Regaal Resources Ltd Management Discussions

Regaal Resources Limited Annual Report 2025-26

Indian Economy

The Frost & Sullivan report projected Indias real GDP growth at 6.2% in FY2026 and 6.3% in FY2027, with growth expected to average approximately 7.0% annually between FY2023 and FY2029. Steady government spending and buoyant domestic demand are expected to remain key growth drivers, supported over the medium term by Indias demographic dividend, rising urban household incomes and technological advancement. This growth environment is expected to support consumption and industrial activity across key starch-consuming sectors, including Processed Foods, Pharmaceuticals, Paper and Textiles.

Agricultural and Maize Supply Environment

Indias maize production increased at a CAGR of 7.3% between FY2020 and FY2025, rising from 28.8 million tonnes to 42.3 million tonnes. In FY2025, the area under maize cultivation reached 12.0 million hectares, while average yield stood at 3.5 tonnes per hectare. Production also increased by 12.2% in FY2025, supported by improved seed availability, expansion of storage and marketing infrastructure, public-private partnerships and agricultural subsidies.

The increase in domestic production provides a broader raw-material base for maize-processing industries.

Manufacturing and End-use Industry Activity

The outlook across principal end-use industries remains supportive. Indias food-processing sector is expected to expand from USD 866 billion in 2022 to USD 1,274 billion by 2027, supported by urbanisation, smaller household structures and rising disposable incomes. Between 2024 and 2029, the report projects growth of 9.89% in Convenience

Foods, 9.10% in Snacks, 8.91% in Confectionery, 8.32% in Animal Nutrition, 6.94% in Pharmaceuticals, 4.50% in Paper and 3.67% in Apparel and Textiles. These industries support demand across Native and Modified Starches, Liquid Glucose, Maltodextrin and Maize-Milling Co-Products.

Similarly, the Pharmaceutical Industry constitutes an important end-use segment for Maize Starch, which is widely used in oral solid dosage forms such as tablets, capsules and granules as a binder, disintegrating agent or diluent. India ranks third globally in pharmaceutical production by volume and has the highest number of US

FDA-compliant pharmaceutical plants.

Risks

Indias maize supply remains exposed to weather variability and competing demand from the animalfeed and ethanol industries. Below-average rainfall reduced maize production in FY2024, while erratic monsoons could continue to affect kharif output. Maize prices also remain volatile: the minimum support price increased to INR 2,400 per quintal for FY2025–26, while wholesale prices peaked at INR 2,333 per quintal in January 2025, with the report attributing the peak to increased procurement and ethanol-production activity. For starch manufacturers, this volatility is significant because increases in maize costs may not always be passed on fully through product prices, particularly in commodity-grade starch.

Indias maize supply remains exposed to weather variability and competing demand from the Animal Feed and Ethanol industries. However, Regaal benefits from its location in Bihar, where maize is also harvested during the Rabi season. While around 17–20% of Indias maize is grown during the Rabi season, the Rabi harvesting window in Bihar and West Bengal does not overlap with maize harvesting in other producing states, providing an ‘exclusive availability window. Kishanganj district, where the Companys manufacturing facility is located, recorded a bumper Rabi harvest, with maize production increasing from 91,680 MT in FY2023 to 4,17,511 MT in FY2024. This supports smoother raw-material availability for the Company during the season.

Outlook

Indias maize-processing environment is supported by rising domestic production, improving yields, expanding agricultural infrastructure and government measures promoting cultivation and food processing. Food-processing schemes such as the Pradhan Mantri Kisan

SAMPADA Yojana, the PM Formalisation of Micro Food

Processing Enterprises Scheme and the Production Linked Incentive Scheme for Food Processing Industry are also expected to support investment and capacity creation across downstream industries. At the same time, demand is expected to strengthen across Processed Foods, Pharmaceuticals, Paper, Textiles and Animal Nutrition. Overall, a growing agricultural base and expanding end-use industries provide a supportive medium-term environment for maize starch and derivative manufacturers.

Global Maize Starch and Derivative Products Market

The global maize-based speciality products and ingredient solutions market comprises Native and Modified Starches,

Starch Derivatives, Co-Products and Value-Added Products. In 2024, the global starch market, comprising native and modified starch, was valued at USD 47,210.2 million, while derivatives and co-products were valued at USD 7,214.7 million and USD 7,903.5 million, respectively. By 2029, these segments are projected to reach USD 58,021.4 million, USD 8,905.1 million and USD 9,512.2 million, respectively.

Native Maize Starch Market

The global Native Maize Starch market was valued at USD 30,818 million in 2024 and is projected to reach USD 36,874 million by 2029, registering a CAGR of 3.65 Demand is driven by applications across Food and Beverages, Textiles, Pharmaceuticals, Paper, Chemicals and Adhesives, supported by rising consumption of processed and convenience foods.

Modified Maize Starch Market

The global Modified Maize Starch market was valued at USD 16,392 million in 2024 and is projected to reach USD 21,147 million by 2029, registering a CAGR of 5.23%.

Growth is supported by demand for processed and ready-to-eat foods and by applications across Pharmaceuticals, Textiles, Paper, Chemicals, Cosmetics and Personal Care.

Paper accounted for 23.7% of consumption in 2024, while Food and Beverages represented 16.1%. The Dextrin segment is projected to grow from USD 1.7 billion in 2024 to USD 2.1 billion by 2029 (CAGR 3.72%).

Starch Derivatives Market

The global starch-derivatives segment, comprising Liquid Glucose, Maltodextrin, Dextrose Monohydrate, Dextrose

Anhydrous and Liquid Sorbitol, was valued at USD 7,214.7 million in 2024 and is projected to reach USD 8,905.1 million by 2029, registering a value CAGR of 4.30%. Demand is supported by applications across Food and Beverages, Pharmaceuticals, Personal Care and Animal Nutrition.

• Liquid Glucose: USD 2.36 billion in 2024 to USD 2.89 billion by 2029 (CAGR 4.12%), driven by confectionery, bakery, beverages and pharmaceuticals.

• Maltodextrin: USD 2.05 billion to USD 2.67 billion

(CAGR 5.48%), with food and beverages accounting for 72% of demand.

• Dextrose Monohydrate: USD 1.37 billion to USD 1.73 billion (CAGR 4.70%), primarily used in pharmaceuticals and food.

• Dextrose Anhydrous: USD 861 million to USD

982 million (CAGR 2.66%), with pharmaceuticals accounting for 70% of consumption.

• Liquid Sorbitol: USD 573 million to USD 635 million

(CAGR 2.07%), supported by food, personal care and pharmaceutical applications.

Maize-milling Co-Products Market

account for 30–35% of total milling output. The global

Co-Products market was valued at USD 7,903.5 million in 2024 and is projected to reach USD 9,512.2 million by 2029, registering a CAGR of 3.77%. Key products include Maize

Germ, Gluten, Fibre, Enriched Fibre and Maize Steep Liquor, with demand driven primarily by the Animal Feed, Poultry, Aquaculture and Maize Oil Industries.

Indian Maize Starch and Derivative Products Industry

In 2024, the Indian starch market, comprising Native and

Modified Starch, was valued at USD 3,292.8 million, while Starch Derivatives and Co-Products were valued at USD 593.0 million and USD 570.4 million, respectively. By 2029, these segments are projected to reach USD 4,210.0 million, USD 758.4 million and USD 719.5 million, respectively.

Native Maize Starch Market

The Indian Native Maize Starch market was valued at USD 1,991.0 million in 2024 and is projected to reach USD 2,478.7 million by 2029, registering a CAGR of 4.48%.

Growth is driven by rising demand from the Food and Beverage, Paper, Textile and Pharmaceutical Industries, supported by capacity additions and increasing domestic and export demand. India accounted for 17.4% of global native maize starch exports in 2023, with major export destinations such as Malaysia, Indonesia, Vietnam and Thailand.

Modified Maize Starch Market

The Indian Modified Maize Starch market was valued at USD 1,301.7 million in 2024 and is projected to reach USD 1,731.3 million by 2029, registering a CAGR of 5.87%. Demand is led by the Paper, Textile and Food Processing Industries, with increasing use in Processed Foods and Pharmaceutical formulations. The Yellow Dextrin market is expected to grow from USD 42.4 million to USD 50.4 million during the same period.

Starch Derivatives Market

The Indian Starch Derivatives market comprising Liquid Glucose, Maltodextrin, Dextrose Monohydrate, Dextrose

Anhydrous and Liquid Sorbitol is projected to grow from USD 593.0 million in 2024 to USD 758.4 million by 2029 (CAGR

5.04%), driven by demand across Food and Beverages, Pharmaceuticals, Nutraceuticals and Personal Care.

• Liquid Glucose: USD 195.2 million to USD 236.4 million (CAGR 3.90%), primarily used in food and pharmaceuticals.

• Maltodextrin: USD 151.5 million to USD 210.8 million

(CAGR 6.84%), supported by food, nutraceutical and pharmaceutical applications.

• Dextrose Monohydrate: USD 103.8 million to USD

137.2 million (CAGR 5.74%), with pharmaceuticals accounting for the majority of demand.

• Dextrose Anhydrous: USD 78.0 million to USD 93.2 million (CAGR 3.64%), driven by pharmaceutical and food applications.

• Liquid Sorbitol: USD 64.6 million to USD 80.7 million

(CAGR 4.55%), used across food, pharmaceuticals and personal care.

Maize-Milling Co-Products Market

The Indian Maize-Milling Co-Products market was valued at USD 570.4 million in 2024 and is projected to reach USD

719.5 million by 2029, registering a CAGR of 4.75%. Key products include Maize Germ, Gluten, Fibre, Enriched Fibre and Maize Steep Liquor, with demand driven by Animal Feed, Maize Oil, Pharmaceuticals and Enzyme Manufacturing. Growth is supported by rising poultry feed consumption and increasing maize oil production. Maize Steep Liquor is used as a feed additive and pelleting agent, while also serving pharmaceutical and enzyme manufacturers. Rising maize-oil demand is supporting the market for Maize Germ, with Indian maize-oil production having doubled over the preceding four to five years.

Internal Control Systems and Their Adequacy

The Company maintains internal financial controls commensurate with the nature, size, and complexity of its operations. These controls, particularly in relation to the Financial Statements, have been assessed as adequate. During the year, they were tested, and no material weaknesses were identified in their design or operation.

To ensure independence and objectivity, the Internal Auditor reports directly to the Audit Committee of the Board. This structure ensures transparent oversight and reinforces the integrity of the audit process.

The Company has undertaken a comprehensive review of its Internal Financial Controls (IFC), taking necessary steps to further strengthen its management frameworks. Robust procedural manuals are in place to safeguard assets, prevent and detect fraud and errors, ensure accurate and complete accounting records, and ensure that all transactions are properly authorised, recorded, and reported. As part of the annual statutory audit, the Statutory Auditors evaluated these controls and issued an affirmative report on their adequacy and operating effectiveness.

The Internal Auditor conducts ongoing assessments of the adequacy and effectiveness of internal controls, as well as their compliance with established operational systems, accounting procedures, and policies. Significant audit observations, together with follow-up actions, are reported directly to the Chairman of the Audit Committee. Both internal and statutory auditors meet with the Audit

Committee on a quarterly basis to review audit findings, with all observations and recommendations discussed in detail and subsequently shared with the Board.

The Internal Auditor attends all Audit Committee meetings as a permanent invitee, ensuring continuity and accountability. The Audit Committee regularly reviews internal and statutory audit reports, along with management submissions, offering suggestions for improvement and monitoring the implementation of corrective measures. It also engages with the statutory auditors to evaluate the adequacy of internal control systems and keeps the Board apprised of significant findings.

Based on the reviews and assessments carried out, the Board confirms that the Companys internal financial controls relating to its Financial Statements are adequate and functioning effectively.

Material Developments in Human Resources / Industrial Relations

At Regaal Resources Limited, employees are considered the Companys most valuable asset and lie at the heart of the business, serving as the driving force behind its success.

A strong, people-first culture underpins the organisation, standing out as its most significant competitive edge in delivering sustainable, long-term growth.

The Company firmly believes that every team member, across all levels, plays an integral role in its growth strategy, and is empowered to take ownership and make decisions that drive business outcomes. Beyond compensation and benefits, Regaal Resources is committed to providing world-class learning opportunities and clear pathways for career advancement. reporting and risk

The Companys core philosophy rests on several key pillars: talent development and care, empowerment through decision-making at every level, a culture of innovation, organisational agility, and a strong focus on digital transformation.

Regaal Resources also recognises the strategic importance of internal selection and succession planning for long-term business sustainability. This approach ensures continuity, preserves the Companys values and culture, and strengthens institutional knowledge, while supporting the aspirations of its people. Internal talent is actively nurtured and prepared to take on greater responsibilities, enhancing both engagement and retention.

As of 31 March 2026, the Company had 591 employees. Following the expansion of its maize-processing capacity to approximately 1,650 tonnes per day in May 2026, the Company expects its on-roll workforce to increase to approximately 950 employees. The expanded operations are also expected to generate significant non-payroll and indirect employment opportunities across contractual labour, logistics, warehousing, transportation, procurement, allied services and the broader agricultural value chain.

Information and Technology

The Company continues to focus on deploying automation and advanced technologies across its operations to drive efficiency and optimise costs.

Cautionary Statement

This statement made in this section describes the

Companys objectives, projections, expectations and estimations which may be ‘forward-looking statements within the meaning of applicable securities laws and regulations. Forward–looking statements are based on certain assumptions and expectations of future events. The Company cannot guarantee that these assumptions and expectations are accurate or will be realised by the Company. Actual results could differ materially from those expressed in the statement or implied due to the influence of external factors which are beyond the control of the Company. The Company assumes no responsibility to publicly amend, modify or revise any forward-looking statements based on any subsequent developments.