Sati Poly Plast Ltd Management Discussions

<dhhead>MANAGEMENT DISCUSSION AND ANALYSIS REPORT </dhhead>

The Management Discussion and Analysis (MDA) should be read in conjunction with the Audited Financial Statements of the Company, and the notes thereto for the year ended 31st March, 2026.

(in Lakhs)

Our Company is an ISO Certified Company engaged in the manufacturing of flexible packaging material which is multi-functional and caters to the packaging requirements of various industries. We provide end-to-end solution for various flexible packaging needs. Till year 2015, our company was engaged in the business of trading of flexible packaging material. From 2017, our Company commenced the manufacturing of flexible packaging material. Our Company has set up two manufacturing units, of which "Plant 1" is situated at C44, Phase II, Gautam Budh Nagar - Noida- 201305 with an installed capacity of 540 tones per month which is now destroyed due to major fire accident that took place on 15.02.2025 and "Plant 2" is situated at Plot No. 85 Udhoyg Kendra, Noida - 201306 with an installed capacity of 540 tones per month.

During the year, Board has approved the setting up of a new manufacturing facility/production unit at SP 1 Industrial Area (RICO), Visnodha, Dholpur, Rajasthan- 328028 on lease basis from M/s Osho Tradeflex Private Limited ("OTPL"), one of the promoter group company. It has been discussed amongst the Board that trial production has been started in the new manufacturing plant w.e.f. 01.02.2026. The Plant has the production capacity of 800 tonnes per month. Board further discussed that such set up will increase the production capacity with optimum utilisation of resources that will cater to the needs of the customers.

Manufacturing is emerging as an integral pillar in the countrys economic growth, thanks to the performance of key sectors like automotive, engineering, chemicals, pharmaceuticals, and consumer durables. The Indian manufacturing industry generated 16-17% of Indias GDP pre-pandemic and is projected to be one of the fastest growing sectors.

The uncertainties and volatility in the market are a continuing threat to the organizational performance. However, the twin features of foresightedness and focused analysis of the market have challenged the threat of adverse performance.

Financial Parameters of the Company are provided in the Board report under the head Financial Result and Operations in details. The Company continues to carry on the business of manufacturing.

There are certain internal & external risk factors like we derive majority of our revenue from State of Uttar Pradesh. Such geographical concentration of our business in this region heightens our exposure to adverse developments related to competition, as well as economic and demographic changes in this region which may adversely affect our business prospects, financial conditions and results of operations. Further, the Company is dependent on few numbers of customers for sales. Loss of any of this large customer may affect our revenues and profitability. The Company is dependent on few suppliers for purchase of product. Loss of any of these large suppliers may affect our business operations. Our business is dependent and will continue to depend on our manufacturing facilities, and we are subject to certain risks in our manufacturing process such as the breakdown or failure of equipment, industrial accidents, severe weather conditions and natural disasters.

Major concern occurred when in one of the plant, fire accident took place on 15.02.2025 due to which business operations of the company got temporarily disrupted However, temporary disruption due to fire has already been restored. The management has taken all measures to ensure continuous supplies to the customer without much impacting profitability of the Company. During the year, the Board coordinated with the insurance company for claim of fire insurance which is still ongoing. It is anticipated that insurance claim will be processed soon.

Your Company fundamentally has been built on the principle of sound risk management practices, it has successfully weathered the market turbulence and continues to remain resilient. The Audit Committee of the Company reviews the probable risk that may affect the financial position of the Company from time to time. Directors have an overall responsibility for ensuring that the Company has implemented a robust system and framework of internal financial controls. After the company got listed, requirement to appoint internal auditor arised but when the company was planning to appoint the auditor, fire accident took place. However, the Company had already developed and implemented a framework for ensuring internal controls over financial reporting. This framework includes entity-level policies and processes such as code of conduct, confidentiality and whistle blower policy and other policies such as organisation structure, insider trading policy, HR policy, etc. During the year, controls were tested and no reportable material weakness in design and effectiveness was observed.

The company is having sufficient industry professionals to carry out its operations and follows good management practices. These are basically its human resources assets and integral to the Companys ongoing success. They have played a significant role and enabled the Company to deliver superior performance year after year. Board of Directors of the Company is also actively involved in the day-to-day functions of the Company.

For and on behalf of the BoardFor Sati Poly Plast Limited

Place: DelhiDate: 05/09/2026

Sd/-Balmukund JhunjhunwalaManaging DirectorDIN: 02589799

Sd/-Aditya JhunjhunwalaDirectorDIN: 02939258