Rite Zone Chemcon India Ltd Management Discussions

The Management of Rite Zone Chemcon India Limited presents the Management Discussion and Analysis (MD&A) of the Company for the year ended on March 31, 2025 and its outlook for the future. This outlook is based on assessment of current business environment. It may vary due to future economic and other developments both in India and Abroad.

It contains financial highlights but does not contain the complete financial statements of the Company. It should be read in conjunction with the Companys Audited Financial Statements for the year ended on March 31, 2025.

GLOBAL ECONOMY:

The global construction chemicals market size was valued at USD 49.29 billion in 2023 and is projected to grow at a CAGR of 3.5% from 2024 to 2030. The rise in demand for construction chemicals is due to rapid urbanization and industrialization in emerging economies.

Key Market Trends & Insights

?€? North America market is projected to significantly over the forecast period.

?€? By product, the admixture segment held the largest market revenue share of 46.0% in 2023.

?€? By application, the non-residential segment held the largest market revenue share in 2023.

?€? By application, the residential segment is projected to grow at the fastest CAGR over the forecast period

Market Size & Forecast

?€? 2023 Market Size: USD 49.29 Billion

?€? 2030 Projected Market Size: USD 62.62 Billion

?€? CAGR (2024-2030): 3.5%

?€? North America: Largest market in 2023

Countries in Asia, Latin America, and Africa are experiencing a rise in construction fueled by population growth and the need for infrastructure development.

Construction chemicals are widely utilized in construction activities. These additives are mixed into building materials, including cement, concrete, coatings, etc., to enhance strength and durability, speed up construction, and offer extra defenses against environmental threats. Construction chemicals play a significant role in improving concrete performance and offer advantages such as reducing the need for water and cement in construction projects.

Furthermore, advancements in construction technologies are also driving the demand for specialized chemicals. Innovations in building techniques, such as prefabrication and modular construction, require specific types of adhesives, coatings, and sealants that provide quick curing times and strong bonding properties. These specialized chemicals ensure that construction processes are efficient, cost-effective, and meet the high standards required for modern buildings. Additionally, the increasing focus on renovation and retrofitting of older buildings to meet new safety standards and energy efficiency norms has boosted the market for repair and protection chemicals, such as epoxy resins and corrosion inhibitors.

Another factor fueling the demand for construction chemicals is the global rise in infrastructure projects. Governments worldwide invest heavily in infrastructure development, including roads, bridges, airports, and public transportation systems, to support economic growth and urbanization. Construction chemicals play a crucial role in these large-scale projects by providing

solutions that increase the durability and longevity of infrastructure. Additionally, the growing awareness and implementation of safety and performance standards in the construction industry drive the demand for construction chemicals. Building codes and regulations are becoming increasingly stringent, requiring certified materials that ensure safety, sustainability, and durability. Construction chemicals help meet these standards by improving the performance characteristics of building materials, such as fire resistance, thermal insulation, and seismic stability.

INDIAN ECONOMY:

Asia Pacific held the largest market revenue share of 52.1% in 2023. Countries such as China and India invest heavily in large-scale construction projects, including residential, commercial, and infrastructure developments such as roads, bridges, and airports. The growing emphasis on sustainable construction practices and the need for high-performance materials to enhance the durability and strength of structures are also driving the demand.

Additionally, the rising middle-class population and increasing disposable income in the region are boosting the demand for better-quality housing and commercial spaces, further propelling the growth of the construction chemicals market.

BUSINESS OVERVIEW

Incorporated in 2015, Rite Zone Chemcon India Lim ited is ISO 9001:2015 certified company and deal in range of construction chemicals and concrete products. We offer complete construction solution by supplying a complete range of various chemical products related to civil construction, infrastructure, building & structure including pre-construction or post construction as well supplying all types of concrete required for construction and infrastructure developments. The construction chemicals are chemical compounds used in construction works. They are used to speed up the process or add more sustainability and strength to the structures. The addition of construction chemicals to various building materials during the construction work improves performance, workability, adds functionality, and protects the basic or customized elements of a structure.

Our range of products includes Concrete Admixture, Water Proofing Systems, Concrete Lubricator, Engineering Grouts, Industrial Flooring, Concrete Repairs, Curing Compound & Mould Release Agent, Surface Treatment, Tiling & Block Products. Our Company also deal in range of concrete products such as slump concrete, flowable concrete, self-compaction concrete (SCC), Light Weight Concrete, Stamp Concrete, Color Concrete, PQC Concrete, Early Strength Concrete, Reinforce Concrete, Shotcrete Concrete, Precast Concrete, Pile Concrete, Air Entrench Concrete, Prestressed Concrete, High Strength Concrete Etc.

SEGMENT WISE PERFORMANCE :

Your company has only one segment that is Supply of Construction Chemicals.

RISKS AND CONCERNS:

Our performance and the growth of our business are necessarily dependent on the health of the overall Indian economy. As a result, any slowdown in the Indian economy could adversely affect our business.

Our results of operations and financial conditions are affected by numerous factors including the following:

?€? Our reliance on third party for our business, including our products exposes us to certain risks.

?€? We typically do not enter into long-term agreements with majority of our customers, and an inability to continue to engage with them would have a material adverse effect on our business, results of operations and financial condition.

?€? The Company is dependent on few numbers of customers and suppliers for sales and purchase and loss of any of these large customer and supplier will significantly affect our revenues and profitability.

?€? We plan to expand into new geographies and may be exposed to significant liability and could lose some or all of our investment in such regions.

?€? We have incurred borrowings from commercial banks and an inability to comply with repayment and other covenants in our financing agreements could adversely affect our business and financial condition.

At Rite Zone Chemcon India Limited, risk management is an ongoing procedure that entails identifying, evaluating, and prioritising risks, as well as applying resources in a coordinated and economical way to lessen, monitor and control the likelihood and/or impact of uncertain events or to maximise the realisation of opportunities. Additionally, risk management seeks to detect and control any potential dangers that could have severe consequences. The Board of Directors oversee the Companys risk management framework.

We have been focusing on the increasing network. With large population, increasing urbanization and disposable income, the industries in which we operate provide sustainable growth on a longer-term basis. Robust growth of emerging economies provides large opportunities to the Company. We are a well-established Company in these economies and will continue to focus on the growth, new launches and increasing network strength. In other mature economies, the market trend is changing favorably. The strategy of the company is to get higher profitability and stable cash flow generations in these markets.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:

The internal control system is intended to increase transparency and accountability in an organizations process of designing and implementing a system of internal control. They have been designed to provide reasonable assurance with regard to recording and providing reliable financial and operational information, complying with applicable statutes, safeguarding assets from unauthorized use, executing transaction with proper authorization and ensuring compliance of corporate policies.

FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE:

During the financial year 2024-25, the Company recorded a Gross Income of ^2,642.19 Lakhs as against ^2,688.06 Lakhs in the previous year, reflecting a marginal decline. Total Expenditure stood at ?2,528.93 Lakhs compared to ^2,543.13 Lakhs in 2023-24, indicating effective cost management. Profit Before Tax (PBT) for the year was ^113.25 Lakhs as against ^144.93 Lakhs in the previous year, primarily due to increased employee and operational expenses. Consequently, Profit After Tax (PAT) decreased to ^89.32 Lakhs from ^ 113.09 Lakhs in 2023-24. The Earnings Per Share (EPS) stood at ?2.11 as compared to ?2.67 in the previous year.

The Company maintained a stable financial performance during the year under review. While Gross Income and Profit After Tax witnessed a marginal decline as compared to the previous

year, the overall results reflect prudent cost management, sustained operational efficiency, and continued focus on business growth.

HUMAN RESOURCES / INDUSTRIAL RELATIONS :

Your Company has team of qualified and dedicated personnel who have contributed to the consolidation of the operations of your Company. Your Companys industrial relations continued to be harmonious during the year under review. Your Company has succeeded in attracting and retaining key professional and intends to continue to seek fresh talents to further enhance and grow our business.

CAUTIONARY STATEMENT:

Statements in the Management Discussion and Analysis describing the Companys objectives, estimates, expectations or projections may constitute "forward looking statements", within the meaning of applicable laws and regulations. The current years outlook is Managements perception at the time of drawing this report. Actual results may differ materially from those either expressed or implied in the statement. Important factors that could influence the Companys operations include economic conditions affecting demand/supply and price conditions in the domestic and international markets, changes in the Government regulations, tax laws economic developments within the country and other factors such as litigation, industrial relations and other statutes and other incidental factors.