Rekvina Labs Ltd Management Discussions

We are pleased to present the Management Discussion and Analysis Report covering the operational and financial performance of Rekvina Laboratories Limited (“the Company”) for the financial year ended 31 March 2026.

(a) Industry Structure and Development

The Indian pharmaceutical industry continues to remain an important and growing sector, supported by increasing healthcare requirements, expanding domestic demand, growth in exports, technological developments and Indias established position as a cost-effective pharmaceutical manufacturing base.

Rekvina Laboratories Limited is engaged in the business of pharmaceutical formulations and related activities. The Company seeks to strengthen its presence in the pharmaceutical value chain by focusing on quality, customer requirements, operational efficiency and cost-effective business practices.

The Company continues to monitor developments in the pharmaceutical industry and regulatory environment and is taking appropriate measures to strengthen its business operations and improve its financial performance.

(b) SWOT Analysis Strengths

Presence in the pharmaceutical formulations business. Ability to cater to customer-specific requirements.

Scope to develop and market pharmaceutical formulations through cost-effective processes. Potential to undertake manufacturing/job-work and contract manufacturing opportunities. Management focus on improving operational efficiency and strengthening the Companys business activities. Weaknesses Negative net worth and accumulated losses. Increase in finance and operating costs. Dependence on working capital and external funding for supporting business operations. Relatively small scale of operations compared with established pharmaceutical companies. Competitive pressure within the pharmaceutical industry. Opportunities The pharmaceutical sector continues to provide opportunities in domestic formulations, contract manufacturing, job work and specialized pharmaceutical products. Increasing healthcare expenditure and demand for cost-effective pharmaceutical products provide opportunities for companies having appropriate manufacturing capabilities and market relationships.

The Company intends to explore suitable business opportunities, improve capacity utilization, strengthen customer relationships and focus on cost optimization to improve its operating performance. Threats The principal risks include intense competition, volatility in prices of raw materials and other inputs, changes in regulatory requirements, increasing compliance costs, working capital constraints and fluctuations in operating costs.

The Company continues to monitor these risks and take appropriate measures to mitigate their potential impact on business operations.

(c) Segment-Wise or Product-Wise Performance

The Company is presently engaged primarily in the business of Pharmaceutical Formulations and accordingly operates in a single business segment.

During FY 2025-26, the Company recorded Revenue from Operations of 126.54 lakhs, as against nil revenue from operations during FY 2024-25.

Accordingly, separate segment-wise reporting is not considered applicable to the Company. (d) Outlook and Future Strategy

During FY 2025-26, the Company commenced generating revenue from operations and recorded revenue of 126.54 lakhs. The management is focused on building upon this operational activity and improving the scale and efficiency of the business.

The Companys future strategy includes:

strengthening its pharmaceutical formulation business; increasing business volumes and customer relationships;

exploring suitable manufacturing, job-work and contract manufacturing opportunities; improving working capital management; controlling operating and administrative expenses; optimizing the use of available resources; and improving overall profitability and financial sustainability.

The management remains committed to developing the Companys business in a prudent and sustainable manner while maintaining appropriate quality and regulatory standards.

(e) Risks and Concerns

The Company operates in an industry subject to various commercial, financial and regulatory risks. Key risks and concerns include fluctuations in raw material and input costs, competition, working capital requirements, regulatory changes, customer concentration, availability of finance and changes in market conditions.

During the year under review, the Company incurred a loss before tax of 25.47 lakhs, compared with a loss before tax of 13.71 lakhs in FY 2024-25. The Company also had borrowings of 147.27 lakhs as at 31 March 2026 as against 24.69 lakhs as at 31 March 2025.

The Company is taking steps to improve operating performance, manage costs, optimize working capital and increase business volumes with a view to improving its financial position.

(f) Internal Control Systems and Adequacy

The Company has appropriate internal control processes commensurate with the nature and scale of its operations. The internal control framework is aimed at safeguarding the Companys assets, ensuring proper authorization and recording of transactions, improving operational efficiency and ensuring compliance with applicable laws and regulations.

The management periodically reviews the effectiveness of internal controls and takes corrective measures wherever considered necessary.

The Company continues to strengthen its internal control systems in line with the expansion of its business activities.

(g) Human Resources

The Company recognizes that its employees are an important contributor to its business performance. The Company seeks to maintain a conducive working environment and encourages employee development, accountability and efficiency.

During the year, management continued to focus on effective utilization of human resources and strengthening the organizational capabilities required for supporting the Companys business operations. Employee benefits expense during FY 2025-26 was 22.99 lakhs, as compared with 4.30 lakhs in FY 2024-25, reflecting increased human resource and operational requirements during the year.

(h) Financial Performance

The financial performance of the Company during FY 2025-26, as compared with the previous financial year, is summarized below:

Particulars	FY 2025-26 ( in lakhs)	FY 2024-25 ( in lakhs)
Revenue from Operations	126.54	Nil
Other Income	Nil	Nil
Total Income	126.54	Nil
Purchases of Stock-in-Trade	118.16	Nil
Employee Benefits Expense	22.99	4.3
Other Expenses	10.86	9.41
Total Expenses	152.01	13.71
Loss Before Tax	-25.47	-13.71
Loss After Tax	-25.47	-13.71
EPS Basic ( )	-0.42	-0.23
EPS Diluted ( )	-0.42	-0.23

During FY 2025-26, the Company recorded revenue from operations of 126.54 lakhs, compared with nil revenue in the previous financial year. Against the revenue generated, the Company incurred total expenses of 152.01 lakhs, resulting in a loss after tax of 25.47 lakhs.

The increase in loss is primarily attributable to the increase in employee benefit expenses, other operating expenses and the overall cost structure associated with the Companys operations.

The Company continues to focus on increasing its revenue base, improving operating efficiency and controlling costs to achieve better financial performance.

(i) Details of Significant Changes in Key Financial Ratios

In accordance with the applicable requirements, the following key financial ratios have been considered:

Particulars	FY25-26	FY24-25	Reason for Change
Debtors Turnover	N.A.	N.A.	The ratio is not considered meaningful for comparison due to absence of corresponding trade receivables/sales in the previous year and commencement of operating revenue during the current year.
Inventory Turnover Interest	N.A.	N.A.	The Company has commenced business operations during the year and the corresponding comparative information is not considered meaningful for ratio comparison.
Coverage Ratio	N.A.	N.A.	The Company incurred a loss during the year and accordingly the ratio is not meaningful.
Current Ratio Debt-Equity	0.49	0.09	The ratio improved primarily due to a substantial increase in current assets, including trade receivables and other current assets, during the year.
Ratio Operating Profit	N.A.	N.A.	The Company had negative net worth as at 31 March 2026 and 31 March 2025; accordingly, the ratio is not meaningful.
Margin	N.A.	N.A.	The Company incurred an operating loss during the year; hence, the ratio is not considered meaningful for presentation.
Net Profit Margin	-20.13%	N.A.	The Company generated operating revenue during FY 2025-26 but incurred a net loss of 25.47 lakhs, resulting in a negative net profit margin.

Note: Ratios which are not meaningful due to negative/insufficient denominator or absence of comparable operating activity have been disclosed as “N.A.” rather than presenting a mathematically distorted percentage.

(j) Details of Change in Return on Net Worth

The Company reported a net loss of 25.47 lakhs during FY 2025-26, as compared with a net loss of 13.71 lakhs during FY 2024-25.

The Companys total equity stood at negative 122.82 lakhs as at 31 March 2026, as against negative 33.22 lakhs as at 31 March 2025. The negative net worth position primarily reflects accumulated losses of the Company.

Accordingly, the Return on Net Worth remains negative and the ratio is not meaningful for comparative analysis due to the negative net worth of the Company.

The management is taking steps to improve the Companys operating performance, increase revenue, control costs, improve working capital management and strengthen the overall financial position of the Company.

(k) Material Developments in Human Resources / Industrial Relations

The Company maintained cordial relations with its employees during the year. The management continues to focus on employee development, productivity and efficient utilization of human resources.

(l) Cautionary Statement

Statements in this Management Discussion and Analysis describing the Companys objectives, projections, estimates, expectations or predictions may constitute “forward-looking statements” within the meaning of applicable laws and regulations.

Actual results may differ materially from those expressed or implied due to various factors including changes in economic conditions, market conditions, regulatory environment, competition, input costs, availability of finance and other factors beyond the Companys control.

The Company assumes no obligation to publicly update or revise any forward-looking statements based on subsequent developments, information or events.