Sheel Biotech Ltd Management Discussions

MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

The following discussion is intended to convey managements perspective on our financial condition and results of operations for the financial year ended March 31, 2025, and for the financial year ended March 31, 2024, and March 31, 2023. One should read the following discussion and analysis of our financial condition and results of operations in conjunction with our section titled "Financial Statements" and the chapter titled "Financial Information " on page 299 of the Red Herring Prospectus. This discussion contains forward-looking statements and reflects our current views with respect to future events and our financial performance and involves numerous risks and uncertainties, including, but not limited to, those described in the section entitled "Risk Factors " on page 28 of this Red Herring Prospectus. Actual results could differ materially from those contained in any forward-looking statements and for further details regarding forward-looking statements, kindly refer the chapter titled "Forward-Looking Statements" on page 18 of this Red Herring Prospectus. Unless otherwise stated, the financial information of our Company used in this section has been derived from the Restated Financial Information. Our financial year ends on March 31 of each year. Accordingly, unless otherwise stated, all references to a particular financial year are to the 12-month period ended March 31 of that year.

In this section, unless the context otherwise requires, any reference to "we", "us" or "our" refers to Sheel Biotech Limited (Formerly Known as Sheel Biotech Private Limited), our Company. Unless otherwise indicated, financial information included herein are based on our Restated Financial Statements for the Financial Years ended March 31, 2025, March 31, 2024, andMarch 31, 2023 included in this Red Herring Prospectus beginning on page 299 of this Red Herring Prospectus.

BUSINESS OVERVIEW

Our Company is engaged in the business of growing, developing, processing, and supplying a wide range of plants for field crops, fruits, vegetables, and ornamental plants through tissue culture and organic farming. We manufacture and maintain greenhouses, offer services to farmers and provide training through Farmer Producer Organizations (FPOs). Additionally, we deliver green landscaping services to both government and private sectors. We are an ISO 9001:2015, ISO 14001:2015 & ISO 45001:2018 certified company who employs industry experts and professionals with knowledge in the field of Biotechnology, Agriculture, Floriculture, Horticulture, Tissue Culture and Green Houses. The company also has a Research and Development lab with a production capacity of 10 (Ten) million planting materials which is duly recognized by the Department of Biotechnology (DBT), Government of India.

SIGNIFICANT DEVELOPMENTS SUBSEQUENT TO THE LAST FINANCIAL YEAR I.E. MARCH 31, 2025

As per mutual discussion between the Board of the Company and BRLM, in the opinion of the Board of the Company there have not arisen any circumstances since the date of the last financial statements as disclosed in the Red Herring Prospectus and which materially and adversely affect or is likely to affect within the next twelve months except as follows:

• The Board of Directors of our Company has approved and passed a resolution on August 25, 2024 to authorize the Board of Directors to raise the funds by way of Initial Public Offering.

• The Shareholders of our Company has approved and passed a resolution on August 28, 2024 to authorize the issue by way of Initial Public Offering.

• The Shareholders of our company appointed Dr. Satya Narayan Chandak as Chairman and Director w.e.f.

August 28, 2024 in the Extra- Ordinary General Meeting held on August 28, 2024.

• The Shareholders of our company appointed Mr. Divye Chandak as Managing Director w.e.f. August 28, 2024 in the Annual General Meeting held on August 28, 2024.

• The shareholders of our Company appointed Mr. Shyamsundar Bang and Mr. Atul Kumar as Independent Directors in the Extra-Ordinary General Meeting held on August 28, 2024

• The board of directors in its meeting held on August 22, 2024, appointed Mr. Anupam Pandey as Company Secretary & Compliance officer of the Company & in its meeting held on June 11, 2025 appointed Ms. Surbhi a as Chief Financial Officer of the Company w.e.f. June 15, 2025, respectively.

SIGNIFICANT FACTORS AFFECTING OUR RESULTS OF OPERATIONS

Our business is subjected to various risks and uncertainties, including those discussed in the section titled "Risk Factor" beginning on page 28 of this Red Herring Prospectus. Our results of operations and financial conditions are affected by numerous factors including the following:

• Changes, if any, in the regulations / regulatory framework / economic policies in India and / or in foreign countries, which affect national & international finance.

• Companys results of operations and financial performance;

• Performance of Companys competitors;

• Significant developments in India‘s economic and fiscal policies;

• Failure to adapt to the changing needs of industry and in particular Sector may adversely affect our business and financial condition;

• Volatility in the Indian and global capital market;

MANAGEMENTS DISCUSSION ON RESULTS OF OPERATION- (RESTATED)

(Amount In Lakhs)

S.N. Particulars	March 31, 2025	% of Total Income	March 31, 2024	% of Total Income	March 31, 2023	% of Total Income
I Revenue from Operations	10,175.25	99.49	9,228.22	99.71	8,011.57	99.90
II Other Income	51.83	0.51	26.42	0.29	7.87	0.10
III Total Income (I + II)	10,227.08	100.00	9,254.64	100.00%	8,019.44	100.00
IV Expenses
(a) Cost of Material Consumed	6,506.76	63.62	5,694.79	61.53	5,305.61	66.16
(b) Employee Benefits Expenses	1,347.98	13.18	1,201.37	12.98	982.17	12.25
(c) Finance Costs	176.64	1.73	147.90	1.60	152.08	1.90
(d) Depreciation and Amortization Expenses	90	0.88	98.65	1.07	101.71	1.27
(e) Other Expenses	823.37	8.05	886.70	9.58	840.88	10.49
Total Expenses (IV)	8,944.76	87.46	8,029.42	86.76	7,382.45	92.06
V Profit before exceptional and extraordinary items and tax (III-IV)	1,282.32	12.54	1,225.22	13.24	636.99	7.94
VI Extraordinary Items	-	-	-	-	-	-
VII Profit before tax	1,282.32	12.54	1,225.22	13.24	636.99	7.94
VIII Tax expense:
(a) Current Tax	212.87	2.08	198.47	2.15	132.36	1.65
(b) Mat Credit Entitlement
(c) Deferred Tax	5.84	0.06	(21.22)	(0.23)	(3.02)	(0.04)
Total Tax Expense	218.71	2.14	177.75	1.92	129.34	1.61
IX Profit/(Loss) From The Period From Continuing Operations (VII -VIII)	1,063.61	10.40	1,047.47	11.32	507.65	6.33
X Profit/ (Loss) from discontinuing operations	0.00	-	0.00	-	0.00	-
XI Tax expense of discounting operations	0.00	-	0.00	-	0.00	-
XII Profit/(Loss) from Discontinuing operations	0.00	-	0.00	-	0.00	-
XIII Profit/ (Loss) for the period (IX + XII)	1,063.61	10.40	1,047.47	11.32	507.65	6.33
XVI Earning per equity share:
(I) Basic & Diluted (Rs.)	7.21	-	7.22	-	3.50	-

Items for Restated Financial Statements Our Significant Accounting Policies

For Significant accounting policies please refer Significant Accounting Policies", under Chapter titled Financial Statements beginning on page 299 of the Red Herring Prospectus.

Overview of Revenue & Expenditure

The following discussion on results of operations should be read in conjunction with the Restated Financial statements for the financial years ending on March 31, 2025, March 31, 2024 & March 31,

2023.

Our revenue and expenses are reported in the following manner:

Revenues

? Revenue of operations

In organic farming, our revenue heavily relies on securing government tenders, which provide essential financial support for our operations.

Our revenue is generated from the following segments:- Tissue Culture

- Organic Farming

- FPO & Skill Development

- Landscaping And Planting

- Green House

Other Income

Other income includes profit arising from exchange rate differences, interest income, discount received, and freight charges (income).

Expenditure

Our total expenditure primarily consists of the cost of consumption, employee benefit expenses, finance costs, depreciation, and other expenses.

? Cost of Consumption

The cost of Consumption includes changes in the stock of raw materials, changes in the stock of work-in- progress, changes in the stock of raw materials, purchases during the year, and direct expenses.

? Employee benefit expense

Our employee benefits expense primarily comprises salaries and wages, bonuses, contributions to PF and ESI, gratuities, staff welfare expenses, and directors/partners remuneration.

? Finance Cost

Our finance cost includes interest expenses on secured loans, unsecured loans from banks and related parties, and bank charges.

? Depreciation and Amortization Expenses

Depreciation and amortization expenses on fixed assets majorly include depreciation on plant & machinery, vehicles, furniture and fixtures, computers, electrical installation, office equipment, buildings, and intangible assets.

Other Expenses

Other Expenses majorly include expenses on repair and maintenance, traveling expenses, rent, legal & professional expenses, training expenses, and other expenses.

FISCAL YEAR ENDED MARCH 31, 2025, COMPARED WITH THE FISCAL YEAR ENDED MARCH 31, 2024 (BASED ON RESTATED FINANCIAL STATEMENTS)

Revenues

? Total Income

Total income for the financial year 2024-25 stood at Rs.10,227.08 lakhs whereas in the financial year 2023-24, it stood at Rs. 9,254.64 lakhs representing an increase of 10.51%.

Reason: The increase in the total income of the company is due to a significant increase in the revenue of the company due to general growth in the business operations of the Company and an increase in other income.

? Revenue of operations

Net revenue from operations for the financial year 2024-25 stood at Rs. 10,175.25 lakhs whereas for the financial year 2023-24, it stood at Rs. 9,228.22 lakhs representing an increase of 10.26%.

	(Amount In lakhs)
Particulars	FY 2024-25	FY 2023-24
Sale of Products	9,332.83	8,532.78
Sales Service	842.42	694.24
Total	10,175.25	9,228.22
Year on Year Increase/(Decrease)		10.26%.

Reason: Theres an increase in "revenue from operation" the reason are enlisted below.

1. The increase in the total revenue from the sale of products is about 9.36% in comparison to the previous year which is due to more tender received by the company during the financial year 2024-25.

2. The increase in the total revenue from the sale of services is about 21.34% in comparison to the previous year. This increase is due to execution of additional service contracts during FY 2024-25.

? Other Income

Other income for the financial year 2024-2025 stood at Rs. 51.83 lakhs whereas for the financial year 202324, it stood at Rs. 26.42 lakhs representing an increase of 96.19%.

Reason: There is an increase in ‘other income majorly because of interest income received, Profit on sale of PPE and Investment, Freight charges earned and miscellaneous income as shown below:

	(Amounts in Lakhs)
Particulars	FY 2024-25	FY 2023-24
Accommodation	4.00	-
Exchange Rate Difference	4.68	-
Interest Received.	7.75	7.63
Profit on Sale of PPE	11.29	-
Profit on Sale of Investment	18.78	-
Freight Charges (Income)	3.78	3.11
Miscellaneous Income	1.55	-

Expenditure

? Total Expenses

Total expenses for the financial year 2024-2025 stood at Rs. 8,944.76 lakhs whereas for the financial year 2023-24, it stood at Rs. 8,029.42 lakhs representing an increase of 11.40%.

Reason: The increase in ‘total expense on account of the increase in the cost of consumption, employee benefit expenses and increase in finance cost.

? Cost of goods consumed

Cost of Consumption for the Financial Year 2024-2025, stood at Rs. 6,506.76 lakhs. whereas in the Financial Year 2023-24 it stood at Rs. 5,694.79 Lakhs representing an increase of 14.26%.

Reason: The increase is a combined effect of slightly higher material consumption costs and a smaller expense reduction from the buildup of inventories (Finished Goods & WIP) compared to the previous year.

	(Amounts in Lakhs)
Particulars	FY 2024-25	FY 2023-24
Opening Stock of Finished Goods	3,277.39	1,929.95
Add- Purchase During the years	6,814.23	6,978.79
Less- Stock Transfer	869.07	1,082.87
Less- Closing Stocks of Finished Goods	3,938.53	3,277.39
Add- Direct Expenses	1,222.74	1,146.32
Total	6,506.76	5,694.79

The Companys Cost of Goods Sold (COGS) increased from ^5,694.79 lakhs in FY 2023-24 to ^6,506.76 lakhs in FY 2024-25, representing a growth of 14.26%. This increase is primarily attributable to a 10.51% rise in revenue from operations, along with higher direct expenses, which collectively contributed to the overall increase in COGS.

? Employee benefit expense

Employee benefit expenses for the financial year 2024-2025 stood at Rs. 1,347.98 lakhs whereas for the financial year 2023-24, it stood at Rs. 1,201.37 Lakhs representing an increase of 12.20%.

Reason: For the financial year ended March 31, 2025, the companys Employee Benefit Expenses totalled Rs. 1,347.98 lakhs, marking a 12.20% increase from the Rs. 1,201.37 lakhs recorded in the previous year. This overall rise of Rs. 146.61 lakhs was driven by several factors, most notably a 7.44% rise in Salaries and Wages, which increased to Rs. 1,154.70 lakhs due to recruitment of additional manpower, annual increments, and promotions. Compounding this were significant hikes in Director Remuneration, which rose by 52.73% to Rs.126.00 lakhs, reflecting higher compensation aligned with business expansion and performance-linked payouts and a 161.05% increase in Gratuity provisions to Rs. 25.87 lakhs. A 30.15% rise in Staff Welfare expenses to Rs. 30.07 lakhs also contributed to the overall increase, on account of enhanced employee engagement and welfare initiatives, while PF and ESI contributions moved in line with the growth in salaries and recruitment. Overall, the rise in employee-related costs highlights the companys focus on expanding and retaining talent to support its operational and business growth objectives during FY 2024-25.

Particulars	FY 2024-25	FY 2023-24
Salary & Wages Exp.	1,154.70	1,074.71
Director Remuneration	126	82.50
Employer Contribution in ESI	0.83	0.69
Employer Contribution in EPF	10.51	10.46
Gratuity	25.87	9.91
Staff Welfare	30.07	23.10
Total	1,347.98	1,201.37

? Finance Cost

Finance costs for the financial year 2024-2025 stood at Rs. 176.64 lakhs whereas for the financial year 202324, it stood at Rs. 147.90 lakhs representing an increase of 19.43%.

Reason: The absolute increase of Rs. 28.74 lakhs in finance costs is primarily indicative of higher interest expenses incurred during the year. This rise can typically be attributed to increased borrowings to fund operations or capital expenditure and higher utilization of working capital requirements.

Particulars	FY 2024-25	FY 2023-24
Bank Charges/Commission	32.09	32.86
Interest	144.55	115.04

? Depreciation and Amortization Expenses

The depreciation and amortization expenses for the financial year 2024-2025 stood at Rs. 90.00 lakhs whereas for the financial year 2023-24, they stood at Rs. 98.65 lakhs representing a decrease of 8.77%.

Reason: For the financial year ended March 31, 2025, the companys Depreciation and Amortisation Expenses were Rs. 90.00 lakhs. This represents a decrease of 8.77% from the Rs. 98.65 lakhs charged in the financial year 2023-24.

	(Amount in Lakhs)
Particulars	FY 2024-25	FY 2023-24
Opening balance	723.69	792.94
Addition	123.84	29.41
Deletion	8.72	-
Less - Depreciation	90.00	98.65
Ending balance of fixed assets	748.81	723.69

? Other Expenses

Other expenses for the year ended March 31, 2025, stood at Rs. 823.37 lakhs, compared with Rs. 886.70 lakhs in FY 2023-24, reflecting a decrease of 7.14%. The decline was primarily driven by lower rent expenses, which reduced by Rs. 39.13 lakhs to Rs. 98.22 lakhs due to the relocation of the Companys Delhi Head Office. The new facility, taken on a nine-year lease, resulted in lower annual rentals. Lease rentals recognised in the Statement of Profit and Loss amounted to Rs. 98.22 lakhs for FY 2024-25 (Rs. 137.36 lakhs in FY 2023-24).

? Further, royalty expenses decreased by Rs. 28.68 lakhs to Rs. 12.88 lakhs due to reduced payments to Dummen Orange. Advertisement and publicity expenses also increased by Rs.3.22 lakhs to Rs. 44.36 lakhs, reflecting intensive marketing and promotional campaigns. However, these savings were partially offset by a 37% rise in training expenses, which increased to Rs. 107.98 lakhs from Rs. 81.89 lakhs in

FY 2023-24, reflecting the Companys enhanced focus on employee development.

(Amounts in Lakhs)
Particulars	FY 2024-25	FY 2023-24	% Change in Other Expenses
Audit on Sites Expenses	6.19	4.64	33.25
Audit Fees	2.00	3.00	(33.33)
Bad Debts	-	3.47	(100.00)
Business Promotion	44.36	41.14	7.83
Repair & Maintenance	64.79	67.40	(3.88)
Conveyance Expenses	14.61	17.14	(14.75)
Consultancy Charges	6.65	2.09	218.93
Electricity Expenses	5.08	14.99	(66.12)
Fee & Subscription	17.30	9.74	77.56
Generator Running Expenses	7.91	17.07	(53.68)
Insurance Expenses	8.80	6.33	39.07
Statutory late fees & Interest	8.26	15.52	(46.80)
ITC Reversed	44.74	49.91	(10.35)
ROC Fees & Filing Charges	5.08	16.57	(69.37)
Legal & Professional	60.16	59.93	0.39
Loading & Unloading Charges	11.82	4.46	165.24
Misc. Exp.	48.65	30.24	60.86
Misc. Cess Exp	9.55	12.32	(22.44)
Office Expenses	15.70	26.49	(40.74)
Printing & Stationery	9.63	10.12	(4.87)
Rent	98.22	137.36	(28.49)
Royalty	12.88	41.56	(69.00)
Security Expenses	17.51	22.71	(22.89)
Travelling Expense	148.38	148.59	(0.14)
Foreign Travel	3.65	10.11	(63.91)
CSR Expense	11.00	6.03	82.49
Training Expenses	107.98	81.89	31.86
Vehicle Running Expenses.	32.49	25.90	25.47
TOTAL	823.38	886.70	(7.14)

? Restated Profit before Tax

The restated profit before tax for the financial year 2024-2025 stood at Rs. 1,282.32 lakhs whereas for the financial year 2023-24, it stood at Rs. 1,225.22 lakhs representing an increase of 4.66%.

Reason: This profit growth was achieved because the companys total income grew by 10.51%, slightly outpacing the 11.40% increase in total expenses. While overall expenses grew, the company showed improved cost efficiency in certain areas.

Notably, Depreciation as a percentage of total income fell to 0.88% from 1.07%, and Other Expenses decreased to 8.05% of total income from 9.58% in the previous year. These efficiencies helped to moderate the overall expense growth, though the total expenses as a percentage of total income still rose slightly from 86.76% to 87.46%, indicating some pressure on profit margins.

? Tax Expense

The Tax Expenses for the financial year 2024-25 stood at ?218.71 lakhs out of which the Current Tax was Rs. 212.87 lakhs and the Deferred Tax being Rs. 5.84 lakhs whereas in the Financial Year 202324 stood at Rs. 177.75 lakhs out of which the Current Tax was Rs. 198.97 lakhs and the Deferred Tax being Rs. (21.22) lakhs representing an overall increase of 23.05%.

Reason: This rise in tax liability is a direct result of the 4.66% growth in Profit Before Tax, which increased from Rs. 1,225.22 lakhs to Rs. 1,282.32 lakhs.

? Restated Profit after Tax

The restated profit after tax for the financial year 2024-2025 stood at Rs. 1,063.61 lakhs whereas for the financial year 2023-24, it stood at Rs. 1,047.47 lakhs representing an increase of 1.54%.

Reason for change in the Revenue from operation and Profit after tax

		(Amount in Lakhs)
Particulars	FY 202425	FY 202324
Revenue from Operation	10,175.25	9,228.22
Change in %	10.26%
Profit after tax	1,063.61	1,047.47
Pat Margin in %	10.40%	11.32%

Increase in PAT Justification:

The companys modest 1.54% increase in Profit After Tax is the net result of a robust 10.51% growth in total income being almost entirely offset by an 11.40% surge in total expenses. This margin compression was primarily driven by a 14.26% increase in the Net Cost of Goods Sold and a 12.20% rise in Employee Benefit Expenses, which collectively outpaced revenue gains. While these core costs escalated, the final profit was positively impacted by strong management of overheads, evidenced by a 7.14% reduction in Other Expenses and an 8.77% decrease in depreciation, which ultimately prevented a decline in overall profitability.

Revenues

? Total Income

Total income for the financial year 2023-24 stood at Rs. 9,254.64 lakhs whereas in the financial year 2022-23, it stood at Rs. 8,019.44 lakhs representing an increase of 15.40%.

? Revenue of operations

Net revenue from operations for the financial year 2023 -24 stood at Rs. 9,228.22 lakhs whereas for the financial year 2022-23, it stood at Rs. 8,011.57 lakhs representing an increase of 15.19%

1. The increase in the total revenue from the sale of products is about 8.18% in comparison to the previous year which is due to more tender received by the company during the financial year 202324

2. Revenue from the sale of services experienced exceptional growth of 463.51%, rising from Rs. 123.20 lakhs to Rs. 694.24 lakhs

	(Amounts in Lakhs)
Sale of Products	8,533.98	7,888.37
Sales Service	694.24	123.20
Total	9,228.22	8,011.57
Year on Year Increase/(Decrease)	15.1	9%

? Other Income

Other Income for the financial year 2023-2024 stood at Rs. 26.42 lakhs whereas for the financial year 2022-2023 stood at Rs. 7.87 lakhs representing an increase of 235.81%.

Reason: There is an increase in ‘other income majorly because of interest income and exchange rate difference in import and Discount received, Freight charges earned on the following

	(Amount in Lakhs)
Particulars	FY 2023-24	FY 2022-23
Interest Received	7.63	5.73
Y-o-Y Increase/(Decrease)	33.16 %
Exchange Rate Difference	10.57	1.68
Y-o-Y Increase/(Decrease)	529.1	17%
Freight Charges (Income)	3.11	0.12
Y-o-Y Increase/(Decrease)	2,491.67%
Discount received	5.10	0.20
Y-o-Y Increase/(Decrease)	2,450.00%

? Expenditure

• Total Expenses

Total expenses for the financial year 2023-2024 stood at Rs. 8,029.42 whereas for the financial year 202223, it stood at Rs. 7,382.45 lakhs representing an increase of 8.76%.

Reason: The increase in ‘total expense account of the increase in the cost of consumption, employee benefit expenses and other expenses due to increases in revenue from the operation of the company and expansion of the business.

? Cost of goods consumed

Cost of Consumption for the Financial Year 2023-2024, stood at Rs. 5,694.79 lakhs whereas in the Financial Year 2022-23 it stood at Rs. 5,305.61 lakhs representing an increase of 7.34%.

Reason: There is an increase in the ‘cost of consumption due to increases in pur chases during the year shown as follows:

Particulars	FY 2023-24	FY 2022-23
Opening Stock of Finished Goods	1,929.95	1,182.78
Add- Purchase During the years	6,978.79	5,601.31
Less- Stock Transfer	1,082.87	(882.48)
Less- Closing Stocks of Finished Goods	3,277.39	1,929.95
Add - Direct Expenses	1,146.32	1,333.95
Total	6,660.78	5,305.61

Under the Direct expenses there was an additional cost with farming training of Rs. 316.62 lakh in FY 22-23 whereas in FY-23-24 there was no such additional farmer training cost due to our company not receiving any tenders wherein they were also required to conduct farmer training. Due to an increase in efficiency of the production in the tissue culture lab which led to the multiplication of plants resulting in more closing stock however our purchase cost decreased.

Also increase in bulk import and domestic purchases in comparison to previous year resulting in more discounts too which led to decrease in cost of goods sold as a percentage of total income in the financial year 2023-24 which was 61.53% of total income comparing to the financial year 2022-23 which was 66.16% of the total income.

? Employee benefit expense

Employee benefit expenses for the financial year 2023-2024 stood at Rs. 1,201.37 Lakhs whereas for the financial year 2022-23, it stood at Rs. 982.17 Lakhs representing an increase of 22.32%.

Reason: There was an increase in ‘Employee benefit expenses because of an increase in Salaries & wages, Directors remunerations, gratuity, and contribution to PF & ESI, as our company hired more employees and promoted their existing employees.

	(Amount in Lakhs)
Particulars	FY 2023-24	FY 2022-23
Salary & Wages Exp.	1,074.71	885.86
Director Remuneration	82.50	60.00
Employer Contribution in ESI	0.69	0.14
Employer Contribution in EPF	10.46	6.61
Gratuity	9.91	4.62
Staff Welfare	23.10	24.94
Total	148.63	134.56

? Finance Cost

Finance costs for the financial year 2023-2024 stood at Rs. 147.90 Lakhs whereas for the financial year 2022- 23, it stood at Rs. 152.08 Lakhs representing a decrease of 2.75%.

Reason: This was majorly because of decrease in the bank charges/ commission expenses paid by our company in the financial year 2023-24 comparing to the bank charges paid in the financial year 202-23 whereas interest paid on secured and unsecured loans reduced in the financial year 2023-24.

		Amount in Lakhs
Particulars	FY 2023-24	FY 2022-23
Bank Charges/Commission	32.86	40.38
Interest	115.04	111.70

? Depreciation and Amortization Expenses

The depreciation and amortization expenses for the financial year 2023-2024 stood at Rs. 98.65 Lakhs whereas for the financial year 2022-23, they stood at Rs. 101.71 Lakhs representing a decrease of 3.01%.

Reason: In the financial year 2023-24, the depreciation charged on the fixed assets had a lower opening

Written Down Value ("WDV") as compared to WDV in the financial year 2022-23 of the assets and the assets purchased in the middle of the year.

	(Amount in Lakhs)
Particulars	FY 2023-24	FY 2022-23
Addition	29.41	129.61
Deletion	-	-
Less - Depreciation	98.65	100.71
Ending balance of fixed assets	723.69	792.94

? Other Expenses

The other expenses for the financial year 2023-2024 stood at Rs. 886.70 whereas for the financial year 2022-23, it stood at Rs. 840.88 Lakhs representing an increase of 5.45%.

Reason: There is an increase in ‘Other expenses because of the increase in training expenses, royalty, rent, traveling expenses, legal & professional fees, and business promotion expenses as shown below:

	(Amount in Lakhs)
Particulars	FY 2023-24	FY 2022-23
Training Expenses	81.89	2.19
Y-o-Y increase/(decrease)	3,636.89%
Royalty	41.56	-
Y-o-Y increase/(decrease)	100.00%
Rent	137.36	66.67
Y-o-Y increase/(decrease)	106.03%
Travelling Expense	148.59	142.19
Y-o-Y increase/(decrease)	4.50%
Legal & Professional Fees	59.93	53.60
Y-o-Y increase/(decrease)	11.80%
Business promotion	41.14	14.88
Y-o-Y increase/(decrease)	176.44%

? Restated Profit before Tax

The restated profit before tax for the financial year 2023-2024 stood at Rs. 1,225.22 Lakhs whereas for the financial year 2022-23, it stood at Rs. 636.99 Lakhs representing an increase of 92.35%

Reason: An increase in the total income of our Company by 15.40% whereas companies total expenses only increased by 8.76% only in comparison to the previous year and furthermore discount received from vendors, reduction of the cost of production and finance cost.

The total expenses represents 86.76% of total income in the financial year 2023-24 comparing 92.06% in the financial year 2022-23. Decrease in COGS, finance cost, depreciation and amortization expenses and other expenses as a percentage of revenue representing 61.53%, 1.60%, 1.07% and 9.58% respectively contributing to this decrease in total expenses in the financial year 2023-24 in comparison to 66.16%, 1.90%, 1.27% and 10.49% in the financial year 2022-23.

? Tax Expense

The Tax Expenses for the financial year 2023-24 stood at Rs. 174.25 Lakhs out of which the Current Tax was Rs. 195.47 Lakhs and the Deferred Tax being Rs. (21.22) Lakhs whereas in the Financial Year 202223 it stood at Rs. 129.34 Lakhs out of which for current tax being Rs. 132.36 Lakhs and deferred tax being Rs. (3.02) Lakhs representing an increase of 34.72%.

Reason: The tax expenses increased over the financial year due to an increase in profit before tax therefor more provision for tax made in the financial year 2023-24 as compared to the financial year 2022-23..

		(Amount in lakhs)
Particulars	FY 2023-24	FY 2022-23
Tax Expenses
Current tax	198.97	129.34
Deferred tax	(21.22)	(3.02)
Total Tax Expense	177.75	129.34

? Restated PAT

The restated profit after tax for the financial year 2023-2024 stood at Rs. 1,047.47 Lakhs whereas for the financial year 2022-23, it stood at Rs. 507.65 Lakhs representing an increase of 106.34%.

Reason for change in the Revenue from operation and Profit after tax

		(Amount in Lakhs)
Particulars	FY 2023-24	FY 2022-23
Revenue from Operation	9.228.22	8,011.57
Change in %	15.19%
Profit after tax	1047.47	507.65
Pat Margin in %	11.32%	6.34%

Increase in PAT Justification:

1. There is an increase in the sales in the Green House & Pack house segment by additional Rs. 1,816.41 Lakhs from Rs. 2,117.54 Lakhs FY-2023 to Rs. 3,933.95 Lakhs in the FY-2024.

2. The Sale of Service in the financial year 2023-24 amounting to Rs. 694.21 Lakhs were significantly higher as compared to financial year 2022-23 amounting to Rs. 123.20 Lakhs. This substantial growth in revenue has directly contributed to an increase in Profit After Tax (PAT) by 106% for FY 2023-24 due to expenses associated with this service are minimal and it is performed by our existing employees.

3. Services Sales in the Financial year 2022-23

	(Amount in Lakhs)
Particular	Order Value
Delhi Cantonment Board	26.79
Delhi Metro Rail Corporation Limited (DMRC)	52.98
Delhi Metro Rail Corporation Limited (Janakpuri)	4.24
Gamlaa Bioscapes Private Limited	2.82
Indore Smart City Development Limited	11.00
Jalandhar Smart City Limited	25.38
Grand Total	123.20

4. Services Sales in the Financial year 23-24

	5. (Amount In Lakhs)
Particular	Order Value
Behjoi Jptagore Farmer Producer Company LIMITED	0.34
Bhoomisut Krishak Producer Company LIMITED	0.34
Bibhutinath Farmer Producer Company Limited	0.34
DAO East Siang	3.45
Delhi Cantonment Board	79.86
Delhi Metro Rail Corporation Limited	20.96
Deputy Director of Agriculture, Meerut	13.35
Deputy Director of Agriculture, Saharanpur	0.55
Director Horticulture & FP Assam	150.70
District Agriculture Officer, Banka,	3.05
District Agriculture Officer, Hardoi,	8.90
District Agriculture Officer, Saharsha,	10.59
District Agriculture Officer, Siwan,	10.59
District Project Coordinator, Badaun	36.02
District Project Coordinator, Bijnor	24.58
District Project Coordinator, Farrukhabad	27.97
Executive Engineer, PW Division No.3, Nagpur	48.53
Gamlaa Bioscapes Private Limited	5.36
Gibiagan Farmer Producer Company Limited	0.34
Jivatma Krishak Producer Company LIMITED	0.34
Kaleenaagro Farmer Producer Company Limited	0.34
KAREH Shivajinagar Farmer Producer Company Limited	0.34
Manoj Trading Company	0.10
Nafed (Bhubaneshwar)	47.50
Parapusta Farmer Producer Co. Limited Sambhal, UP	0.34
Prayagraj Development Aurhority, U.P.	125.51
Samthu Farmers Producer Company Limited	0.34
Shividyapati Farmer Producer Company Limited	0.34
Small Farmers Agribusiness Consortium (SFAC)	16.95
Sudhahimsheel Farmer Producer Company Limited	0.34
Thulungapuri Farmer Producer Company Limited	0.34
Wapcos Limited	55.65
Grand Total	694.24

3. There was a decrease in the cost of goods sold (COGS) in FY 24 compared to FY 23. This reduction can be attributed to an increase in closing stock, which resulted in an improvement in the EBITA margin by 0.53% of revenue from product, amounting to Rs. 45.04 lakhs. This increase also positively impacted the PAT for FY 24. Increase in Closing Stock is due to substantial multiplication of our inventory. Additionally, some orders are on hold due to tender requirements. As shown in the table below:

		(Amount in Lakhs)
Particulars	FY 2023-24	FY 2022-23
Revenue from Operation	9,228.22	8,011.57
Sale of Products	8,533.98	7,888.37
Sale of Service	694.24	123.20
COGS	5,694.79	5,305.61
% of Revenue from product	66.73%	67.26%
Profit after tax	1,047.47	507.65
Pat Margin in %	11.32%	6.34%

INFORMATION REQUIRED AS PER ITEM (II) (C) (IV) OF PART A OF SCHEDULE VI TO THE SEBI REGULATIONS:

1. Unusual or infrequent events or transactions:

Except as described in this Red Herring Prospectus, during the periods under review there have been no transactions or events, which in our best judgment, would be considered unusual or infrequent.

2. Significant economic changes that materially affected or are likely to affect income from continuing operations:

Other than as described in the section titled Risk Factors beginning on page 28 of this Red Herring Prospectus, to our knowledge there are no known significant economic changes that have or had or are expected to have a material adverse impact on revenues or income of our Company from continuing operations.

3. Known trends or uncertainties that have had or are expected to have a material adverse impact on sales, revenue, or income from continuing operations:

Other than as described in this Red Herring Prospectus, particularly in the sections Risk Factors and Managements Discussion and Analysis of Financial Condition and Results of Operations on pages 28 and 300, respectively, to our knowledge, there are no known trends or uncertainties that are expected to have a material adverse impact on our revenues or income from continuing operations.

4. Income and Sales on account of major product/main activities:

Income and sales of our Company on account of major activities derive from the business of sale of Agriculture, Horticulture, and Organic Farming related products to end consumers.

5. Future changes in the relationship between costs and revenues, in case of events such as future increases in marketing or advertisement costs or prices that will cause a material change are known:

Our Companys future costs and revenues can be indirectly impacted by changes in policies of the government for Agriculture and their allied sectors and an increase in marketing and research and development costs as the company is required to continuously research and Develop its segment to promote its products with a view to increasing its sale.

6. Future relationship between Costs and Income

Our Companys future costs and revenues will be determined by competition, demand/supply situation, Indian Government Policies, and interest rates quoted by banks & others.

7. Extent to which material increases in net sales or revenue are due to increased sales volume, introduction of new products or services or increased sales prices.

Increases in our revenues are by and large linked to increases in the volume of business.

8. Total turnover of each major industry segment in which the issuer company operates

The Company operates in the Agriculture, Horticulture and Organic Farming related Industry. Relevant industry data, as available, has been included in the chapter titled "Our Industry" beginning on page 145 of this Red Herring Prospectus.

9. Status of any publicly announced new products or business segments:

Our Company has not announced any new services and product and segment / scheme, other than disclosure in this Red Herring Prospectus.

10. The extent to which the business is seasonal:

Our business does not depend to a certain extent on the seasonal, environmental and climate changes.

11. Competitive Conditions

We face competition from existing and potential competitors, which is common for any business. Over a period of time, we have developed certain competitive strengths which have been discussed in section titled Our Business on page 171 of this Red Herring Prospectus.