Shivchem Agro Ltd Management Discussions

You should read the following discussion of our financial condition and results of operations together with our "Restated Financial Statements which have been included in this Red Herring Prospectus. The following discussion and analysis of our financial condition and results of operations is based on our Restated Financial Statements for the financial year ended on March 31, 2026, 2025 and 2024, including the related notes and reports, included in this Red Herring Prospectus prepared in accordance with requirements of the Companies Act and restated in accordance with the SEBI Regulations, which differ in certain material respects from IFRS, U.S. GAAP and GAAP in other countries.

Our Restated Financial Statements have been derived from our audited financial statements for financial year 2025-26, financial year 2024-25 and financial year 2023-24 and restated in accordance with the SEBI ICDR Regulations and the Guidance Notes issued by the ICAI. Our Restated Financial Statements are prepared in accordance with Indian Generally Accepted Accounting Principles (IGAAP), notified under the Companies (Accounting Standards) Rules, 2006, and read with Section 133 of the Companies Act, 2013.

We have included various operational and financial performance indicators in this Red Herring Prospectus, many of which may not be derived from our Restated Financial Statements or otherwise be subject to an examination, audit or review by our auditors or any other expert. The manner in which such operational and financial performance indicators are calculated and presented and the assumptions and estimates used in such calculations, may vary from that used by other companies in India and other jurisdictions. Investors are accordingly cautioned against placing undue reliance on such information in making an investment decision and should consult their own advisors and evaluate such information in the context of the Restated Financial Statements and other information relating to our business and operations included in this Red Herring Prospectus.

Some of the information contained in this section, including information with respect to our strategies, contain forward-looking statements that involve risks and uncertainties. You should read the section titled "Forward- Looking Statements" beginning on page 33 of this Red Herring Prospectus for a discussion of the risks and uncertainties related to those statements and also the section titled "Risk Factors" and "Business Overview beginning on page 35 and 187, respectively, of this Red Herring Prospectus for a discussion of certain factors that may affect our business, results of operations and financial condition. The actual results of the Company may differ materially from those expressed in or implied by these forward-looking statements.

Unless otherwise stated, references to "the Company", "our Company", "we", "us", and "our" are to Shivchem Agro Limited.

Our Financial Year ends on March 31 of each year. Accordingly, all references to a particular Financial Year are to the 12 months ended March 31 of that year.

OVERVIEW OF OUR BUSINESS

Our Company was incorporated by Rohit Agarwal and Sachin Agarwal under the provisions of the Companies Act, 2013, pursuant to certificate of incorporation dated September 12, 2021 issued by the Registrar of Companies, Central Registration Centre. The registered office of our Company is situated at Unit No. 703, 704, Amba Tower, Plot No.2, Community Centre, D.C Chowk, Sector-9, Rohini Sec-11, North West Delhi, Delhi, India, 110085 and our manufacturing facility is situated at Killa no 102 19 1 4-3, Khewat no. 609, Khata no. 688, Barhana, Village Jhajjar, Haryana-124107, India.

We are ISO 9001:2015, ISO 22000:2018 and ISO 31000:2018 certified agrochemical company operating in India, engaged in the manufacturing, stocking, exhibiting, distribution, and sale of agricultural formulations. Our product portfolio includes insecticides, fungicides, herbicides, plant growth regulators, rodenticides, and fertilizers.

We provide our customers with crop protection solutions designed to support farmers in agricultural output through manufacturing, supply and distribution of formulations. These Formulations may be in the form of solids (e.g. powders) or liquids (e.g. emulsifiable concentrates).

Our Company is required to obtain various licenses and permissions from various authorities for manufacturing and sale of our products. During the financial year 2023-24, our Company had licenses for manufacturing 232 agrochemical products which expanded to 258 licenses in the financial year 2024-25. With an objective to offer a wide product portfolio, we continuously work to expand our range of agrochemical products.

As on the date of this Red Herring Prospectus, we have license under the Insecticides Act, 1968 for manufacturing 176 agrochemical products including 88 insecticides, 40 fungicides, 37 herbicides, 8 plant growth regulators and 3 rodenticides. These registrations are granted by the Central Insecticides Board and Registration Committee (CIBRC), Directorate of Plant Protection, Quarantine & Storage, under the Department of Agriculture & Farmers Welfare, Haryana. In addition, we have Letter of Authorization from the Agriculture and Farmers Welfare Department, Haryana, Panchkula, for the manufacturing of 82 fertilizers under the Fertilizer Control Order, 1985.

We are licensed to sell, stock, exhibit and distribute our products in eight (8) states of India, namely, Andhra Pradesh, Telangana, Odisha, Assam, Bihar, West Bengal, Uttar Pradesh and Madhya Pradesh. As of March 31, 2026, our Company has 685 distributors selling our products across the aforementioned states. For supply and distribution to these distributors, we operate five (5) godowns in the aforementioned states.

Our manufacturing facility is located in Jhajjar, Haryana, and is equipped with machinery and equipment for the manufacturing of agrochemical products. Further, we have installed an Effluent Treatment Plant (ETP) to manage wastewater generated during the manufacturing process and a Wet Scrubber Unit to control air emissions and remove pollutants. Following the installation, we obtained the Consent to Establish and Operate from the Haryana State Pollution Control Board.

Product Offered

KEY FACTORS AFFECTING THE RESULTS OF OPERATION

We believe that the following factors may significantly affect our results of operations and financial condition in the future:

• Political Stability of the Country.

• Global economic conditions like GDP, inflation rate, forex rate, or export-import conditions

• Government policies for the capital markets.

• Investment Flow in the country from the other countries.

• Government policy for agrochemicals, fertilizer and pesticides industry.

• Competition from existing players and new entrants

• Companys ability to successfully implement our growth strategy

• Subsidies announced by the government

• Weather and Natural Calamities affecting the crops in the country

• Inflation, deflation, unanticipated turbulence in interest rates, equity prices or other rates or prices;

• Availability of material used for raw material in manufacturing of our products

• Fail to attract, retain and manage the transition of our management team and other skilled professionals;

• Conflicts of interest with affiliated companies, the promoter group and other related parties;

• Expansion strategy of the company across India

• Scope of increase in number of licensed products in future

• Newly set-up automated plant by the company in Haryana resulting in increase of installed production capacity.

• A large and diverse Distributors and Distribution Network KEY FINANCIAL PERFORMANCE INDICATORS

Key Financial Performance Indicators and Certain Non-Gaap Measures

EBITDA, EBITDA Margin, Return on Assets, Return on Capital Employed and Return on Equity (together, "Non- GAAP Measures"), presented in this Red Herring Prospectus is a supplemental measure of our performance and liquidity that is not required by, or presented in accordance with, Indian GAAP, Ind AS, IFRS, U.S. GAAP or any other GAAP. Further, these Non-GAAP Measures are not a measurement of our financial performance or liquidity under Ind AS, Indian GAAP, IFRS, U.S. GAAP or any other GAAP and should not be considered in isolation or construed as an alternative to cash flows, profit for the years or any other measure of financial performance or as an indicator of our operating performance, liquidity, profitability or cash flows generated by operating, investing or financing activities derived in accordance with Ind AS, Indian GAAP, IFRS, U.S. GAAP or any other GAAP. In addition, these Non-GAAP Measures are not standardized terms, hence a direct comparison of these Non- GAAP Measures between companies may not be possible. Other companies may calculate these Non-GAAP Measures differently from us, limiting its usefulness as a comparative measure. Although such Non-GAAP Measures are not a measure of performance calculated in accordance with applicable accounting standards, our Companys management believes that they are useful to an investor in evaluating us as they are widely used measures to evaluate a companys operating performance.

EBITDA and EBITDA Margin

EBITDA is defined as our profit/loss before tax, finance Costs, depreciation and amortization and other income. Profit/loss before tax margin is defined as profit/loss before tax divided by revenue from operations. EBITDA margin is defined as our EBITDA as a percentage of revenue from operations.

The following table reconciles our profit/loss after tax (an AS financial measure) to EBITDA for the years indicated:

(Amount in Rs. Lakhs)

Particulars	FY 2025-26	FY 2024-25	FY 2023-24
Net Profit as Restated	324.86	260.15	129.35
Add: Depreciation	26.44	11.96	4.76
Add: Interest on Loan	133.91	71.97	16.16
Add: Income Tax/Deferred Tax	115.10	92.19	43.47
Add: Exceptional item	-	-	-
Less: Other income	2.27	3.83	0.71
EBITDA	598.04	432.44	193.03
EBITDA Margin (%)	17.69	15.75	17.64

For more details of Key Performance Indicators of the Company for financial years ending March 31, 2026, March 31, 2025 and March 31, 2024 please refer chapter titled "Basis for Issue Price" beginning on page 127 of this Red Herring Prospectus.

SIGNIFICANT ACCOUNTING POLICIES

The Restated Financial Statements for Financial Year 2025-26 has been prepared considering the audited financial statements of company Shivchem Agro Limited of Financial Year 2025-26 and the figures pertaining to Financial Years 2024-25 and Financial Year 2023-24.

For Significant accounting policies please refer Significant Accounting Policies and Notes to accounts, Annexure- IV and V beginning under chapter titled "Restated Financial Statements beginning on page 285 of this Red Herring Prospectus.

Presentation of Financial Information

These Restated Financial Statements have been compiled by the management from the Audited financial statements of the Company as at and for the years ended, March 31, 2026, March 31, 2025 and March 31, 2024 are prepared in accordance with the accounting standards notified under the Section 133 of the Act ("Indian GAAP") and other accounting principles generally accepted in India which have been restated in accordance with the SEBI (ICDR) Regulations by M/s VMSM & Co., Chartered Accountants, Kolkata i.e. Statutory &Peer Review Auditor of the Company.

The policies have been consistently applied by our Company in preparation of the Restated Financial Statements and are consistent with those adopted in the period pertaining to the restated financial statements

The Restated Financial Statements have been prepared so as to contain information / disclosures and incorporating adjustments set out below in accordance with the SEBI ICDR Regulations:

Adjustments to the profits or losses of the earlier years for the changes in accounting policies if any to reflect what the profits or losses of those periods would have been if a uniform accounting policy was followed in each of these years and of material errors, if any;

Adjustments for reclassification of the corresponding items of income, expenses, assets and liabilities, retrospectively for the years ended March 31, 2026, March 31, 2025 and March 31, 2024, in order to bring them in line with the groupings as per the Restated Financial Statements of for the year ended March 31, 2026 and the requirements of the SEBI ICDR Regulations, if any; and

The resultant impact of tax due to the aforesaid adjustments, if any.

KEY COMPONENTS OF STATEMENT OF PROFIT AND LOSS

Set forth below are the principal components of statement of profit and loss from our continuing operations: Total Income

Our total income comprises of

(i) Revenue from operations and

(ii) other income.

Revenue from Operations

Revenue from operations comprise revenue from the following:

(i) Sale of product

(ii) Scrap Sale;

Other Income

Other income includes

(i) Interest Income,

(ii) Discount Received

(iii) Misc. Income;

Expenses

Cost of Material Consumed

Cost of Materials Consumed includes Purchases during the year and change in opening and closing stock of raw materials;

Change in Inventories

Change in Inventories comprises of difference in opening and closing stock of Finished goods;

Employee benefits expense

Employee benefits expenses primarily include Salaries, Wages & Bonus, Gratuity expenses, Contribution to Provident & Other Funds and Staff Welfare;

Finance Costs

Finance costs include Processing fees, Interest on borrowing, Interest on income tax, Interest on late payment; Depreciation and Amortization expense

Depreciation includes depreciation on Tangible Asset and Deprecation on Intangible Asset;

Other Expenses

Other expense mainly includes Administrative Expense, Postage & Courier Charges, Communication expenses, Audit fees, Advertisement expense, Bank Charges, licence fees, Commission and brokerage, Fire & Safety Equipment, Discount allowed, Donation expenses, Power and fuel, Software expenses, Insurance charges, Legal & professional expenses, Loading & Unloading charges, Office expenses, Printing & stationery, Repair & maintenance, Rent, Rates & Taxes, Travelling Charges , Other expenses, Business Promotion Expenses, Director Sitting fees, Freight and forwarding expenses, Carry and forwarding expenses, Miscellaneous expenses;

Tax Expenses

Tax expenses include

(i) current tax and

(ii) Deferred Tax charges/ (benefit)

RESULTS OF OUR OPERATION

The following table sets forth detailed total income data from our Restated Statement of profit and loss for the period ended on March 31, of the Financial Years 2026, 2025 and 2024, the components of which are also expressed as a percentage of total Income for such period.

(Amount in Rs. Lakhs)

Particulars	FY 2025-26	FY 2024-25	FY 2023-24
	Amount	% of Total Income	Amount	% of Total Income	Amount	% of Total Income
Revenue from Operations	3,381.59	99.93%	2,746.50	99.86	1,094.25	99.94
Other Income	2.27	0.07%	3.83	0.14	0.71	0.06
Total Income	3,383.86	100.00	2,750.33	100.00	1,094.96	100.00
Cost of Material Consumed	1,543.35	45.61%	2,015.24	73.27	1,099.87	100.45
Change in Inventories	323.34	9.56%	(491.46)	(17.87)	(536.11)	(48.96)
Employee Benefit Expenses	392.12	11.59%	331.15	12.04	166.17	15.18
Financial Costs	133.91	3.96%	71.97	2.62	16.16	1.48
Depreciation and amortization expense	26.44	0.78%	11.96	0.43	4.76	0.43
Other Expenses	524.74	15.51%	459.13	16.69	171.28	15.64
Total Expenses	2943.90	87.00%	2,397.99	87.19	922.13	84.22
EBITDA	598.04	17.69%	432.44	15.75	193.03	17.64
Profit before Tax	439.96	13.00%	352.34	12.81	172.83	15.78
Total Tax Expenses	115.10	3.40%	92.19	3.35	43.48	3.97
Profit after Tax as Restated	324.86	9.60%	260.15	9.46	129.35	11.81

DISCUSSION ON RESULTS OF OPERATIONS TOTAL INCOME:

Revenue from operations

The Total Revenue from operations for the period ended on March 31, 2026, was Rs. 3,381.59 Lakhs. Which has increasing trend, as compared to previous years. The increase was attributed to significant increase in the licensed products, growing distributors base and popularity of company products in the market. The growth in the Revenue from Operations is as per the following reasons:

(Amount in Rs. Lakhs)

Particulars	FY 2025-26	FY 2024-25	FY 2023-24
Revenue from Operations	3,381.59	2,746.50	1,094.25
Growth (%)	23.12%	150.99%	379.07%

1. Product Category wise growth

The company has increased its product wise revenue over the FY 2025-26, FY 2024-25 and FY 2023-24. This growth is mainly driven by the growth in Fungicides and Herbicides resulting in diversified revenue base and planning for better market penetration. The details of revenue generated from our products for the indicated period, as a percentage to revenue from operations are mentioned below:

(Amount in Rs. Lakhs)

S Particulars No.	FY 2025-26	FY 2024-25	FY 2023-24
	Amount	% of Revenue from Operations	Amount	% of Revenue from Operations	Amount	% of Revenue from Operations
1 Insecticide	1,025.36	30.32%	1,615.48	58.82%	521.56	47.66%
2 Herbicide	1,472.02	43.53%	781.96	28.47%	373.07	34.09%
3 Fungicides	536.24	15.86%	150.81	5.49%	75.19	6.87%
4 Fertilizer	70.95	2.10%	77.60	2.83%	55.92	5.11%
Plant Growth Regulator	272.77	8.07%	83.35	3.03%	48.77	4.46%
6 Rodenticides	4.25	0.13%	31.58	1.15%	19.73	1.80%
Others (Scrap Sale)	-	0.00%	5.73	0.21%	-	0.00%
TOTAL	3,381.59	100.00%	2,746.50	100.00%	1,094.25	100.00%

2. Growth in Distribution network

The Company has achieved growth in its distributor network over the last three years, which has enhanced its market reach. The increase in the number of distributors has enabled wider availability of products, deeper access into new locations, and increased revenue from operations. This expanded network has supported the overall revenue growth and diversification of the product portfolio. Number of Distribution network is also increase as compared to the last year i.e in the FY 2025-26. The company has 685 Distributors as compared to the 516 and 185 in FY 2024-25 and 2023-24.

Particulars	FY 2025-26	FY 2024-25	FY 2023-24
No. of Distributors	685	516	185

3. Growth in Products

The company has maintained its number of licensed products since FY 2024-25. The increase in licensed products since FY 2023-24 has enhanced the Companys product mix, supported entry into new market segments, and contributed to revenue increase alongside core product categories. The company could cater a greater number of customers now compared to initial years resulting the strengthening of revenue base.

Particulars	UoM	FY 2025-26	FY 2024-25	FY 2023-24
Number of Licensed Products	No.	258	258	232

4. Increase in Production

The company has enhanced its production capacity in FY 2024-25 compared to previous years which then remained constant in FY 2025-26. The company now can produce 65,07,500 litre/kilograms in a year as compared to 56,00,000 litre/kilograms in FY 2023-24.

Growth in the Revenue

The growth of the revenue in the operations has been due to both, new customers and new business products over the years. The details of New and Repeat Customers are as follows:

(Amount in Rs. Lakhs)

Particulars	2023-24	% to Revenue from Operations	2024-25	% to Revenue from Operations	2025-26	% to Revenue from Operations
Revenue from New Customers	956.57	87.42%	1306.19	47.56%	2,219.98	65.65%
Revenue from Repeat Customers	137.68	12.58%	1440.31	52.44%	1,161.60	34.35%
Total Revenue from Operations	1094.25	100.00%	2746.50	100.00%	3,381.59	100.00%

The company has introduced new product line of Fertilizers in FY 2023 -24 and also earned some revenue from sale of scrap in FY 2024-25.

Other Income:

Other income of the company was Rs. 2.27 lakhs constituting negligible portion of Total Income for the FY 2025- 26. Other Income includes Interest Income.

EXPENSES

Cost of Material Consumed

Our Cost of Material Consumed were Rs. 1,543.35 lakhs which include Purchase and stock difference of raw material.

Our Cost of Materials consumed were Rs. 1,543.35 lakhs representing 45.61% of Total Income for the period ended March 31, 2026. Cost of raw materials consumed includes consumption of raw materials such as aggregate, active ingredients, solvents and emulsifiers etc.

The cost of material is directly linked with the operations of the company. The company increased its purchases over the years as mentioned below:

(Amount in Rs. Lakhs)

Particulars	FY 2025-26	FY 2024-25	FY 2023-24
Revenue from Operations (A)	3,381.59	2,746.50	1,094.25
Growth (%)	23.12	150.99	379.07
Purchases (B)	2,059.44	2,448.55	1,371.60
Change (%)	(15.89%)	78.52	387.84

During the FY 2025-26, the Company achieved a 23.12% growth in revenue from operations, which increased to Rs. 3,381.59 lakhs from Rs. 2,746.50 lakhs in FY 2024-25. The growth was due to increase in demand across Companys product categories. Purchases decreased by 15.89% during the FY 2025-26 to Rs. 2,059.44 lakhs compared to Rs. 2,448.55 lakhs in FY 2024-25. There were higher inventory levels in FY 2024-25, which resulted in a decrease in purchases despite increased revenue.

Change in Inventory

Change in inventory consists of difference of closing finished goods of Rs. 704.23 lakhs and opening finished goods of Rs. 1,027.57 lakhs. The company has to keep higher level of finished good stock for various reasons such as marketing of new introduced products, to meet the demands of seasonal crops and making the goods available to all the locations. The company has the manufacturing facility situated in Haryana and has to send the goods to all warehouses. So the company has to keep inventory of finished goods at the warehouses levels to avoid the situation of shortage and saving time of transportation accordingly.

Employee Benefit Expenses

Employee Benefit expenses were Rs. 392.12 lakhs representing 11.59% of Total Income for the period ended March 31, 2026. Employee Benefit Expenses includes Salaries, Wages & Bonus, contribution to provident fund & other funds, Gratuity and staff welfare. The employees of the company increased along with revenue from operations over the years resulting in the increase in employee benefit expenses. The number of the employees were 66, 59 and 40 in FY 2025-26, 2024-25, and 2023-24 respectively.

Finance Costs

Finance costs were Rs. 133.91 lakhs representing 3.96% of Total Income for the period ended March 31, 2026. Finance Costs include Processing fees, Interest of borrowing, Interest on Income tax, Interest on goods & service tax. The finance costs increased during the year primarily on account of higher interest and financing costs incurred by the Company. The company had Rs. 727.52 lakhs borrowings in FY 2025-26 as compared to Rs. 826.15 lakhs in FY 2024-25.

Depreciation and Amortization

The Depreciation and amortization expense were Rs. 26.44 lakh representing 0.78% of Total Income for the period ended March 31, 2026. Depreciation mainly includes depreciation on Intangible Asset and depreciation on Tangible Asset.

Other Expenses

Other Expenses were Rs. 524.74 lakhs representing 15.51% of Total Income for the period ended March 31, 2026. The major expenses which contributed to the increase in the other expenses are Discount given to the customers, commission and brokerage expenses, rent charges, travelling charges, Freight and forwarding expenses and carry and forwarding expense which all together amounted to Rs 431.85 lakhs, Rs. 372.26 lakhs and Rs. 155.23 lakhs which were 82.30%, 81.08% and 90.63% of total other expenses in FY 2025-26, 2024-25 and 2023-24 respectively on account of increase in demand in products of the company.

(Amount in Rs. Lakhs)

S Particulars No.	FY 2025- 26	% of Total Other Expenses	FY 2024- 25	% of Total Other Expenses	FY 2023- 24	% of Total Other Expenses
1 Discount allowed	46.48	8.86	28.37	6.18	8.40	4.90
2 Commission and Brokerage expenses	23.79	4.53	9.61	2.09	40.10	23.41
3 Rent	42.73	8.14	26.61	5.80	11.97	6.99
4 Travelling charges	138.80	26.45	127.00	27.66	41.92	24.47
5 Freight and forwarding expenses	147.45	28.10	154.21	33.59	52.84	30.85
6 Carry & Forwarding expenses	32.59	6.21	26.45	5.76	-	-
Total	431.85	82.30	372.26	81.08	155.23	90.63
Total Other Expenses	524.74		459.13		171.28

Profit before Tax

The Profit before Tax for the period ended March 31, 2026, was 13.00% of the total income. The Profit before Tax was Rs. 439.96 lakhs for the period ended March 31, 2026.

Profit after Tax (PAT)

Our company recorded profit after tax was Rs. 324.86 lakhs for the period ended March 31, 2026. Profit after tax was 9.60% of Total Income after deducting the tax expenses of Rs. 115.10 lakhs for the period ended on March 31, 2026.

COMPARISON OF FINANCIAL YEAR ENDED MARCH 31, 2026 WITH FINANCIAL YEAR ENDED MARCH 31, 2025 BASED ON RESTATED FINANCIAL STATEMENTS

(Amount in Rs. Lakhs)

Particulars	FY 2025-26	FY 2024-25	% of Change
Revenue from Operations	3,381.59	2,746.50	23.12
Other Income	2.27	3.83	(40.73)
Total Income	3,383.86	2,750.33	23.03
Cost of Material Consumed	1,543.35	2,015.24	(23.42)
Change in Inventories	323.34	(491.46)	(165.79)
Employee Benefit Expenses	392.12	331.15	18.41
Financial Costs	133.91	71.97	86.09
Depreciation and amortization expense	26.44	11.96	121.07
Other Expenses	524.74	459.13	14.29
Total Expenses	2,943.90	2,397.99	22.77
Profit before Tax	439.96	352.34	24.87
Total Tax Expenses	115.10	92.19	24.85
Profit after Tax as Restated	324.86	260.15	24.87

TOTAL INCOME

Our Total Income increased to 3,383.86 lakhs in Financial Year 2025-26 from 2,750.33 lakhs in Financial Year 2024-25, primarily due to an increase in our Revenue from Operations as discussed below:

Revenue from operations

In FY 2025-26, our Company recorded revenue from operations of Rs. 3,381.59 lakhs, compared to Rs. 2,746.50 lakhs in FY 2024-25. This represents an increase of approximately 23.12% compared to the FY 2024-25.

Further, in FY 2025-26, our Companys revenue has shown a significant upward trend over the past three financial years, reflecting effective operational strategies and improved market positioning. The increase was primarily attributable to increased sales across certain product categories, expansion of our distributor network and increased market penetration. As a result of the increased operational activities, revenue from operations increased as compared to the previous year.

Other Income

Other income of the company decreased to 2.27 lakhs in Financial Year 2025-26 from 3.83 lakhs in Financial Year 2024-25, representing a decrease of approximately 40.73%. Interest income decreased from Rs. 3.83 lakhs to Rs. 0.17 lakhs, partly offset by discount received and miscellaneous income during FY 2025-26.

(Amount in Rs. Lakhs)

Particulars	FY 2025-26	FY 2024-25
Interest Income	0.17	3.83
Discount Received	0.10	-
Miscellaneous Income	2.00	-
Total	2.27	3.83

EXPENSES

Our total expenditure increased to Rs. 2,943.90 Lakhs for the FY 2025-26 from Rs. 2,397.99 Lakhs for the FY

2024- 25. Our total expense was 87.00% of total income in FY 2025-26 and 87.19% of total income in FY 2024- 25. The reasons for change are mentioned below:

Cost of Material Consumed

Our Cost of Material Consumed Expenses decreased by Rs. 471.90 lakhs amounting to Rs. 1,543.35 Lakhs in FY

2025- 26 from Rs. 2,015.24 Lakhs in FY 2024-25, representing a decrease of 23.42% as compared to FY 2024- 25. The decrease is attributable to lower purchases during the year and the higher closing stock.

Cost of material consumed decreased in FY 2025-26 on account of decrease in purchases during the year to Rs. 2,059.44 lakhs from Rs. 2,448.55 lakhs in FY 2024-25. Purchases decreased by approximately 15.89% as compared to FY 2024-25.

(Amount in Rs. Lakhs)

Particulars	FY 2025-26	FY 2024-25
Opening Stock	836.15	402.84
Purchase during the year	2,059.44	2,448.55
Less: Closing Stock	1,352.24	836.15
Cost of Material Consumed	1,543.35	2,015.24
Change %	(23.42)	-

With the growth in the demand of products, more quantity of Finished goods is required. In the FY 25-26 companys production volume capacity remained constant at 65,07,500Kg/litre as in FY 2024-25 showing the stability in the production Capacity to support this growth and increased production, company purchased raw material amounting to Rs.2,059.44 lakhs, Rs. 2,448.55 lakhs and Rs. 1,371.60 lakhs in FY 2025-26, FY 2024- 25 and FY 2023-24, respectively.

Change in Inventory

The change in inventory for FY 2025-26 was Rs. 323.34 Lakhs as against Rs. (491.46) lakhs for FY 2024-25 showing a change of Rs. 814.81 lakhs, mainly on account of the movement in opening and closing finished goods inventory during FY 2025-26. The Company maintained higher levels of finished goods inventory during the previous financial year.

Employee Benefit Expenses

Employee Benefit expenses increased to Rs. 392.12 lakhs for FY 2025-26 from Rs. 331.15 Lakhs for FY 2024- 25, showing an increase of Rs. 60.97 lakhs and representing an increase of 18.41%. The increase in employee benefit expenses is primarily due to increases in salaries, contribution to provident and other funds and staff welfare expenses.

fAmnnnt in T.nlrhs;)

Particulars	FY 2025-26	FY 2024-25	% change
Salaries, Wages & Bonus	361.19	308.67	17.01
Contribution to Provident and Other Funds	14.11	7.99	76.60
Gratuity	4.55	5.03	(9.54)
Staff Welfare	12.27	9.46	29.70
Total	392.12	331.15	18.41

Financial Costs

Financial costs increased to Rs. 133.91 Lakhs in FY 2025-26 from Rs. 71.97 lakhs in FY 2024-25, representing an increase of 86.08%. The increase was mainly due to higher interest on borrowings and processing fees during FY 2025-26 due to higher interest on loans.

Depreciation and Amortisation expense

The Depreciation and amortization expense for FY 2025-26 was Rs. 26.44 Lakhs as against Rs. 11.96 lakhs for FY 2024-25, showing an increase of Rs. 14.50 Lakhs, mainly on account of higher depreciation on tangible and intangible assets due to addition in plant & machinery previous year.

Other Expenses

Other Expenses increased to Rs. 524.74 Lakhs for FY 2025-26 from Rs. 459.13 Lakhs for FY 2024-25, showing an increase of Rs. 65.61 lakhs as compared to the last year.

(Amount in Rs. Lakhs)

Particulars	FY 2025-26	FY 2024-25	% Change
Administrative expenses	5.14	2.60	97.69
Postage & courier charges	0.58	0.69	(15.94)
Communication expenses	3.07	1.78	72.47
Audit fees	4.00	4.00	-
Advertisement expenses	1.47	1.45	1.38
Bank charges	5.94	4.71	26.11
Licence fees	2.95	0.09	3,177.78
Commission and brokerage expenses	23.79	9.61	147.55
Discount allowed	46.48	28.37	63.84
Donation expenses	0.12	-	-
Power and fuel expenses	0.58	0.43	34.88
Software expenses	1.07	1.26	(15.08)
Insurance charges	5.88	3.09	90.29
Loading & unloading charges	5.57		-
Legal & professional expenses	18.13	29.07	(37.63)
Office expenses	3.26	3.09	5.50
Printing & stationery	2.41	1.22	97.54
Rates and taxes	3.04	-	-
Repair & maintenance	5.72	7.01	(18.40)
Rental expenses	42.73	26.61	60.58
Travelling charges	138.80	127.00	9.29
Other expenses	13.01	8.45	53.60
Business promotion expenses	2.87	17.31	(83.42)
Director sitting fees	7.78	0.63	1,134.92
Freight and forwarding expenses	147.45	154.21	(4.38)
Carry and forwarding expenses	32.59	26.45	23.21
Miscellaneous expenses	0.31	-	-
Total	524.74	459.13	14.29

The increase in the expenses is mainly due to the following factors:

• Travelling expenses increased to Rs. 138.80 lakhs in FY 2025-26 from Rs. 127.00 lakhs in FY 2024-25.

• Discount allowed increased to Rs. 46.48 lakhs in FY 2025-26 from Rs. 28.37 lakhs in FY 2024-25, while commission and brokerage expenses increased to Rs. 23.79 lakhs from Rs. 9.61 lakhs due to the achieve more sales during the year.

• Rent expenditure increased in FY 2025-26 to Rs. 42.73 lakhs from Rs. 26.61 lakhs in FY 2024-25.

• Carry & forwarding expenses increased to Rs. 32.59 lakhs in FY 2025-26from Rs. 26.45 lakhs in FY 2024-25 due to more movement of stocks to the different branches and vendors.

Profit before Tax

As a result, we recorded an increase of Rs. 87.62 lakhs in our profit before tax, which was Rs. 439.96 Lakhs in FY 2025-26, as compared to Rs. 352.34 Lakhs in FY 2024-25. The increase in profit before tax was primarily due to growth in revenue from operations and the decrease in cost of material consumed. It represents 13.00% of total income in FY 2025-26 as compared to 12.81% of total income in FY 2024-25.

Profit after Tax

Our profit for the period increased by Rs. 64.71 lakhs to Rs. 324.86 lakhs in FY 2025-26 from Rs. 260.15 lakhs in Financial Year 2024-25.

In FY 2025-26, our Companys PAT Margin increased to 9.60% of total income compared with 9.46% of total income in FY 2024-25. Key factors contributing to the change in PAT Margin are detailed below:

• The increase in Profit after Tax is primarily attributable to the increase in profit before tax during FY 2025-26.

• The decrease in other income was more than offset by the increase in profit before tax arising from the overall movement in revenue and expenses.

• The percentage of Consumption of material consumed to total income decreased to 45.61% in FY 2025- 26 as compared to 73.27% in FY 2024-25.

COMPARISON OF FINANCIAL YEAR ENDED MARCH 31, 2025 WITH FINANCIAL YEAR ENDED MARCH 31, 2024 BASED ON RESTATED FINANCIAL STATEMENTS

Particulars	FY 2024-25	FY 2023-24	% of Change
Revenue from Operations	2,746.50	1,094.25	150.99
Other Income	3.83	0.71	439.44
Total Income	2,750.33	1,094.96	151.18
Cost of Material Consumed	2,015.24	1,099.87	83.23
Change in Inventories	(491.46)	(536.11)	(8.33)
Employee Benefit Expenses	331.15	166.17	99.28
Financial Costs	71.97	16.16	345.36
Depreciation and amortization expense	11.96	4.76	151.26
Other Expenses	459.13	171.28	168.06
Total Expenses	2,397.99	922.13	160.05
Profit before Tax	352.34	172.83	103.87
Total Tax Expenses	92.19	43.48	112.03
Profit after Tax as Restated	260.15	129.35	101.12

TOTAL INCOME

Our Total Income increased to 2,750.33 lakhs in Financial Year 2024-25 from 1,094.96 lakhs in Financial Year 2023-24, primarily due to an increase in our Revenue from Operations as discussed below:

Revenue from operations

In FY 2024-25, our Company recorded revenue from operations of Rs. 2,746.50 lakhs, compared to Rs. 1,094.25 lakhs in FY 2023-24. This represents an increase of approximately 150.99% compared to the previous financial year.

Further, in FY 2024-25, our Company s revenue has shown a significant upward trend over the past three financial years, reflecting effective operational strategies and improved market positioning. The increase was attributed to Significant increase in number of products & distributors and popularity of company product in the market

In FY 2024-25 Revenue from Operations of Rs. 2,746.50 lakhs as compared to the FY 2023-24 of Rs. 1,094.25 Lakhs. As a result, of the improved geographical presence, revenue from operations reflects better operations, leading to an increased revenue figure.

The Growth in the Revenue in FY 24-25 is the result of increased number of license product, introduction of new segment, better profitability of segment as compared to the FY 23 -24.

Other Income

Other income of the company is increased to 3.83 lakhs in Financial Year 2024-25 from 0.71 lakhs in Financial Year 2023-24. Interest Income is the main constituents of the Other Income for the year Financial Year 2024-25.

This increase is on account of increase in interest income by Rs. 3.48 lakhs in the Financial Year 2024-25 as compared to previous financial year.

(Amount in Rs. Lakhs)

Particulars	FY 2024-25	FY 2023-24
Interest Income	3.83	0.35
Discount Received	-	0.27
Miscellaneous Income	-	0.09
Total	3.83	0.71

EXPENSES

Our total expenditure increased to Rs. 2,397.99 Lakhs for the FY 2024-25 from Rs. 922.13 Lakhs for the FY

2023- 24. Our total expense was 87.19% of total income in FY 2024-25 and 84.22% of total income in FY 2023- 24. The reasons for change are mentioned below:

Cost of Material Consumed

Our Cost of Material Consumed Expenses increased by Rs. 915.37 lakhs amounting to Rs. 2,015.24 Lakhs in FY

2024- 25 from Rs. 1099.87 Lakhs in FY 2023-24 representing an increase of 83.23% as compared to the FY 23- 24. The increase in the cost of material consumed is attributable to the rise in revenue from operations during the year. Additionally, the company had higher levels of operating activities as compared to the operations in the previous year.

Cost of material consumed increased in FY 2024-25 on account of increase in purchases during the year to Rs. 2,448.55 lakhs from Rs. 1,371.60 lakhs FY 2023-24. Purchases increased in the FY 2024-25 by 78.52% as compared to the FY 23-24.

(Amount in Rs. Lakhs)

Particulars	FY 2024-25	FY 2023-24
Opening Stock	402.84	131.11
Purchase during the year	2,448.55	1,371.60
Less: Closing Stock	836.15	402.84
Cost of Material Consumed	2,015.24	1,099.87
Change %	83.23	-

With the growth in the companys geographical presence and product mix, more quantity of Finished goods is required. In the FY 23-24 companys production volume capacity increased from 56,00,000 Kg/ltr in FY 2023- 24 to 65,07,500 Kg/litre of in FY 2024-25 showing the increase in the production Capacity by 16.21%. to support this growth and increased production, company purchased raw material amounting to Rs. 2,448.55 lakhs, and Rs. 1,371.60 lakhs Rs. in FY 2024-25, and 2023-24 respectively.

Change in Inventory

The change in inventory for FY 2024-25 was Rs. (491.46) Lakhs as against Rs. (536.11) lakhs for the FY 2023 - 24 showing a change of Rs. 44.65 lakhs, mainly on account of higher closing Finished goods kept at warehouses to meet the local demands at various locations in FY 2024-25 as compared to previous year.

Employee Benefit Expenses

Employee Benefit expenses increased to Rs. 331.15 lakhs for FY 2024-25 from Rs. 166.17 Lakhs for FY 2023- 24 showing an increase Rs. 164.98 lakhs as compared to FY 2023-24 representing an increase of 99.28%. The increase in employee benefit expenses is primarily due to salary expenses of employees and increase in operations. The total number of employees in the company is 59 in FY 2024-25 which were 40 in FY 2023-24. Changes are as follows:

Particulars	FY 2024-25	FY 2023-24	% change
Salaries, Wages & Bonus	308.67	60.90	91.84
Contribution to Provident and Other Funds	7.99	2.46	224.80
Gratuity	5.03	2.81	79.00
Staff Welfare	9.46	-	NA
Total	331.15	166.17	-

Financial Costs

Financial costs were increased to Rs.71.97 Lakhs in FY 2024-25 from Rs. 16.16 lakhs in FY 2023-24. In FY 2024-25, financial costs increased on account of additional borrowing secured and unsecured has been taken by the company. the company availed the long-term borrowing of Rs. 624.35 lakhs and short-term borrowings of Rs. 22.17 lakhs During the FY 24-25 which resulted in the increase in Processing fees and interest on borrowings.

Depreciation and Amortisation expense

The Depreciation and amortization expense for FY 2024-25 was Rs. 11.96 Lakhs as against Rs. 4.76 lakhs for FY 2023-24 showing an increase of Rs. 7.19 Lakhs, mainly on account of increased in fixed assets owned by the company. The Company has invested Rs. 368.71 lakhs in tangible assets and Rs. 1.58 lakhs in intangible assets which contributed to increase in depreciation expenses.

Other Expenses

Other Expenses increased to Rs. 459.13 Lakhs for FY 2024-25 from Rs. 171.28 Lakhs for FY 2023- 24 showing an increase of Rs. 287.85 lakhs as compared to the last year.

(Amount in Rs. Lakhs)

Particulars	FY 2024-25	FY 2023-24	% Change
Administrative Expense	2.60	0.24	983.33
Postage & Courier Charges	0.69	0.09	666.67
Communication expenses	1.78	0.76	134.21
Audit fees	4.00	0.50	700.00
Advertisement expense	1.45	2.03	-28.57
Bank Charges	4.71	1.08	336.11
licence fees	0.09	-	-
Commission and brokerage expenses	9.61	40.10	(76.03)
Discount allowed	28.37	8.40	237.74
Power and fuel	0.43	-	-
Software expenses	1.26	-	-
Insurance charges	3.09	0.90	243.33
Legal & professional expenses	29.07	1.03	2722.33
Office expenses	3.09	0.34	808.82
Printing & stationery	1.22	1.32	(7.58)
Repair & maintenance	7.01	4.40	59.32
Rent	26.61	11.97	122.31
Travelling charges	127.00	41.92	202.96
Other expenses	8.45	0.56	1408.93
Business Promotion Expenses	17.31	2.80	518.21
Director Sitting fees	0.63	-	-
Freight and forwarding expenses	154.21	52.84	191.84
Carry and forwarding expenses	26.45	-	-
Total	459.13	171.28

The increase in the expenses is mainly due to the following factors:

• Freight and forwarding expenses because of more sales recorded in the FY 2024-25 as compared to the FY 2023-24

• Travelling expenses increased due to enhanced efforts of our marketing personnels to reach the distributors to connect them with the company in the FY 2024-25 as compared FY 2023-24 with the aim of better availability of the products in the various region of India. However, other expenditure increases as a % to total income to 16.69% of total income in FY 2024-25 as compared to 15.64% of total income in FY 2023-24.

• Rent expenditure also increased in FY 2024-25 due to opening of more warehouses and new office in Delhi

Profit before Tax

As a result, we recorded an increase of Rs. 179.51 lakhs in our profit before tax, which was Rs. 352.34 Lakhs in FY 2024-25, as compared to Rs. 172.83 Lakhs in FY 2023-24. The increase in profit before tax was primarily due to growth in revenue from operations. It also represents 12.81% of total income in FY 2024-25 as compared to 15.78% in FY 2023-24. This decrease in % of total income is attributed to increase in Change in Inventories as a percentage of total income, as compared to previous financial year as more finished goods were produced in FY 2024-25.

Profit after Tax

Our profit for the period, increased by 130.81 lakhs to Rs. 260.15 lakhs in FY 2024-25 from Rs. 129.35 lakhs in Financial Year 2023-24.

In FY 2024-25, our Companys PAT Margin decreased to 9.46% compared with 11.81% of total income in FY 2023-24. Key factors contributing to decreased PAT Margin are detailed below:

• Due to the increase in Change in Inventories as a percentage of total income as the company has to maintain the higher level of finished goods inventory at warehouses and for new product launched in the year.

• Increase in the Other Expenses as a percentage of total income

COMPARISON OF NET WORTH OF OUR COMPANY BASED ON RESTATED FINANCIAL STATEMENTS

The details of the net worth of our company for FY 2025-26, 2024-25 and 2023-24 are as follows:

(Amount in Rs. Lakhs)

Particulars	FY 2025-26	FY 2024-25	FY 2023-24
Share Capital	263.64	263.64	5.00
Reserves and Surplus
Statement of Profit & Loss
Opening balance	335.29	145.13	15.77
Add: Profit for the year	324.86	260.15	129.35
Total	660.13	405.29	145.13
Less: Utilized for Bonus Issue	-	(70.00)	-
Balance as at the end of the year	660.13	335.29	145.13
Security Premium	368.25	368.25	-
Total Reserve & Surplus	1,028.39	703.54	145.13
Net Worth	1,292.03	967.18	150.13

FY 2023-24

We recorded growth of 622.82% net worth in FY 2023-24 as compared to FY 2022-23 from Rs. 20.77 lakhs to Rs. 150.13 lakhs in net worth. The major reason of the growth has been growth in profitability of our company during FY 2023-24. Our company increased net profit from Rs. 12.72 lakhs in FY 2022-23 to Rs. 129.35 lakhs in FY 2023-24. FY 2022-23 was the second year of the operations and majority of production was started in FY 2022-23. Our company showed growth in FY 2023 -24 as it increased our customer bases, geographical reach and number of products to offer to the customers. The growth in net worth is directly associated with the increased profits of the company.

FY 2024-25

The major reason for the growth in the net worth in FY 2024-25 as compared to FY 2023-24 has been net profits and security premium received during issuance of shares are mentioned below:

• We earned net profits amounting to Rs. 260.15 lakhs in FY 2024-25.

• On October 7, 2024, we have converted unsecured loan from the directors into equity shares, at Rs.19.16 per equity share and 16,00,000 equity shares were issued to the directors as part of this conversion and security premium of Rs. 9.16 per equity share amounting to Rs. 146.56 lakhs were recorded in this transaction.

• On October 22, 2024, we have completed a private placement of 1,72,800 equity shares at an issue price of Rs. 87 per equity share having face value of Rs. 10 per equity share and our company recorded security premium of Rs. 77 per equity share amounting to Rs. 133.06 lakhs.

• On February 02, 2025, we have completed a private placement of 2,27,273 equity shares at an issue price of Rs. 44 per equity share having face value of Rs. 5 per equity share and our company recorded security premium of Rs. 39 per equity share amounting to Rs. 88.64 lakhs.

FY 2025-26

The major reason for the growth in the net worth in FY 2025-26 as compared to FY 2024-25 has been net profits earned during the year. The company earned net profit of Rs. 324.86 lakhs in FY 2025-26. Security Premium remains unchanged in FY 2025-26 as compared to FY 2024-25.

COMPARISON OF GROWTH IN "BORROWINGS" OF OUR COMPANY FOR FINANCIAL YEAR ENDED MARCH 31, 2025 WITH FINANCIAL YEAR ENDED MARCH 31, 2024 BASED ON RESTATED FINANCIAL STATEMENTS

Particulars	FY 2025-26	FY 2024-25	FY 2023-24
Long term Borrowings	279.91	273.81	179.64
Short Term Borrowings	447.61	552.34	530.18
Total	727.52	826.15	709.82

We increased our operations in the second year of incorporation i.e. FY 2022-23 as previously mentioned in above point. To support the expansion in operations, production and sales, we required additional funds.

In FY 2023-24, with further growth in operations and increased working capital requirements, we availed loans as short term and long-term borrowings. This financial expansion was driven by growth in Revenue from Operations, which increased by 379.07%, from Rs. 228.41 lakhs in FY 2022-23 to Rs. 1,094.25 lakhs in FY 2023-24. This increase in revenue resulted in higher inventory, increased receivables, and increased operational capacity, all of which resulted in increase in borrowings.

In FY 2024-25, the Company continued to expand its operations, which resulted in higher funding requirements. Accordingly, the Companys total borrowings increased from Rs. 709.82 lakhs in FY 2023-24 to Rs. 826.15 lakhs in FY 2024-25, mainly due to an increase in both long-term and short-term borrowings to support working capital and operational requirements.

In FY 2025-26, the Company continued to strengthen its operations while managing its funding requirements efficiently. The total borrowings decreased from Rs. 826.15 lakhs in FY 2024-25 to Rs. 727.52 lakhs in FY 2025- 26, primarily due to a reduction in short-term borrowings from Rs. 552.34 lakhs to Rs. 447.61 lakhs, partly offset by an increase in long-term borrowings from Rs. 273.81 lakhs to Rs. 279.91 lakhs.

LIQUIDITY AND CAPITAL RESOURCES

We fund our operations primarily with cash flow from operating activities and borrowings / credit facilities from banks. Our primary use of funds has been to pay for our working capital requirements and capital expenditure and for the expansion of our manufacturing facilities. We evaluate our funding requirements regularly considering the cash flow from our operating activities and market conditions. In case our cash flows from operating activities do not generate sufficient cash flows, we may rely on other debt, subject to market conditions.

Financial Indebtedness

As on March 31, 2026, our Company has total outstanding of long term secured borrowings from banks aggregating to Rs. 160.38 lakhs and unsecured borrowings of 119.53 lakhs and total outstanding of short term secured borrowings from banks aggregating to Rs. 189.52 lakhs and unsecured borrowings of Rs. 258.09 lakhs in the ordinary course of business.

CASH FLOWS

The following table sets forth selected information from our statement of cash flows for the periods indicated:

(Amount in Rs. lakhs)

Particulars	FY 2025-26	FY 2024-25	FY 2023-24
Net Cash Generated/(Used) From Operating Activities (A)	179.25	(299.85)	(434.34)
Net Cash Generated/(Used) From Investing Activities (B)	42.25	(291.05)	(131.67)
Net Cash Generated/(Used) From Financing Activities (C)	(232.58)	608.30	571.54
Net increase / (decrease) in cash and cash equivalents (A+B+C)	(11.08)	17.40	5.58
Cash and Cash equivalent at the beginning of the year	23.92	6.52	0.95
Cash and Cash equivalent at the end of the year	12.84	23.92	6.52

Operating Activities FY 2025-26

Net cash generated in operating activities during FY 2025-26 was Rs. 179.25 lakhs. While our net profit before tax was Rs. 439.96 lakhs, we had an operating profit before working capital changes of Rs. 604.69 lakhs, primarily due to adjustments for depreciation and amortization expenses of Rs. 26.44 lakhs, interest expenses of Rs. 133.91 lakhs, provision for gratuity of Rs. 4.55 lakhs and interest income of Rs. 0.17 lakhs. The working capital adjustments primarily consisted of increase in inventories of Rs. 192.75 lakhs, increase in trade receivables of Rs. 582.01 lakhs, increase in short-term loans and advances of Rs. 234.19 lakhs, decrease in other assets of Rs. 54.46 lakhs, increase in trade payables of Rs. 403.48 lakhs and increase in other liabilities of Rs. 200.52 lakhs. The net cash generated from operations was Rs. 179.25 lakhs after adjusting tax paid of Rs. 74.95 lakhs.

FY 2024-25

Net cash used in operating activities during the year was 299.85 lakhs. While our net profit before tax was Rs. 352.34 lakhs, we had an operating profit before working capital changes of Rs. 430.44 lakhs, primarily due to adjustments for depreciation and amortization expenses of Rs. 11.96 lakhs and finance Costs of Rs. 64.94 lakhs, provision for Gratuity Rs. 5.03 lakhs and interest income of Rs. 3.83 lakhs.

Our adjustments for working capital changes for the year 2024-25 primarily consists of increase in inventories of Rs. 924.77 lakhs, increase in trade receivables of Rs. 684.24 lakhs, decrease in short term loans and advances of Rs. 12.62 lakhs, increase in other assets of Rs. 90.85 lakhs, increase in trade payables of Rs. 959.54 lakhs, decrease in long term provision Rs. 7.91 increase in other current liabilities of Rs. 42.28 lakhs increase in short term provision Rs. 0.01 lakh. Our net cash used from operations was Rs. (299.85) lakhs after adjusting tax paid of Rs. 36.97 lakhs.

2023-24

Net cash used in operating activities during the year 2023-24 was Rs. 434.34 lakhs. While our net profit before tax was Rs. 172.83 lakhs, we had an operating profit before working capital changes of Rs. 190.34 lakhs, primarily due to adjustments for depreciation and amortization expenses of Rs. 4.76 lakhs and interest expenses of Rs. 10.29 lakhs, Interest Income of Rs. 0.35 lakhs, provision of gratuity of Rs. 2.81 lakhs.

Our adjustments for working capital changes for the year 2023-24 primarily consists of increase in inventories of Rs. 807.81 lakhs, increase in trade receivables of Rs. 330.36 lakhs and increase in short term loans of Rs. 17.53 lakhs and increase in other assets of Rs. 77.53 lakhs, increase in trade payables of Rs. 505.52 lakhs, decrease in long term Provision Rs 0.01 lakhs and increase other current liabilities of Rs. 109.13 lakhs decrease in short term provision Rs 0.01 lakhs. Our net cash generated from operations was Rs. (434.34) lakhs after adjusting tax paid of Rs. 6.09 lakhs.

Investing Activities

FY 2025-26

Net cash generated in investing activities was Rs. 42.25 lakhs in FY 2025-26, primarily on account of sale of Rs. 42.08 lakhs relating to property, plant & equipment and receipt of interest and other income of Rs. 0.17 lakhs.

FY 2024-25

Net cash used in investing activities was Rs. 291.05 lakhs in FY 2024-25, primarily on account of Rs. 294.88 lakhs used for purchase of property, plant & equipment and receipt of interest and other income of Rs. 3.83 lakhs.

2023- 24

Net cash used in investing activities was Rs. 131.67 lakhs in 2023-24, primarily on account of Rs. 132.02 lakhs used for purchase of property, plant & equipment and receipt of interest and other income of Rs. 0.35 lakhs.

Financing Activities

FY 2025-26

Net cash used in financing activities in FY 2025-26 amounted to Rs. 232.58 lakhs, which primarily consists of proceeds from long-term borrowings of Rs. 558.44 lakhs, repayment of long-term borrowings of Rs. 552.34 lakhs, net repayment of short-term borrowings of Rs. 104.76 lakhs and interest & finance costs paid of Rs. 133.92 lakhs.

2024- 25

Net cash generated in financing activities in FY 2024-25 amounted to Rs. 608.30 lakhs, which primarily consists of issue of equity share of Rs. 556.90 lakhs, proceeds from long-term borrowing of Rs. 624.35 lakhs, repayment of long-term borrowings of Rs. 530.18 lakhs, proceed from short term borrowings of Rs. 22.17 lakhs and interest & finance Costs paid of Rs. 64.94 lakhs.

2023-24

Net cash generated in financing activities in 2023-24 amounted to Rs. 571.54 lakhs, which primarily consists of proceeds from long-term borrowings of amount Rs. 179.64 lakhs, proceeds from short-term borrowings amounting to Rs. 402.21 lakhs and interest & finance Costs paid of Rs. 10.29 lakhs.

CAPITAL EXPENDITURE IN LAST THREE YEARS

Our net capital expenditures include expenditures on tangible assets which primarily include Plant & Machinery, furniture and fixtures, office equipment, vehicle, and computers. The following table sets out our capital expenditures for the period ended March 31, 2025, and for the financial year ended 2024 and 2023.

(Amount in Rs. Lakhs)

Particulars	FY 2025-26	FY 2024-25	FY2023-24
Furniture & Fittings	0.26	1.47	1.11
Computers & Other Accessories	1.10	4.46	2.53
Motor Vehicle	-	-	42.53
Plant & Machinery	(47.16)	229.60	10.90
Building	-	125.39	-
Office Equipments	3.47	7.79	3.28
Computer Software	0.23	1.58	5.58
Total	(42.10)	370.29	65.94

CONTINGENT LIABILITIES AND OFF-BALANCE SHEET ARRANGEMENTS

As on the date of this Red Herring Prospectus, our Company has no contingent liability and off-balance sheet arrangements in the name of claims against the company not acknowledged as debt - bank guarantee which we believe reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenue or expenses, operating results, liquidity, capital expenditure or capital resources.

CONTRACTUAL OBLIGATIONS AND COMMITMENTS

As of March 31, 2026, the company does not have any capital Obligations and commitments that will affect our future operating results, revenue or other capital resources.

RELATED PARTY TRANSACTIONS

Related party transactions involving our promoters, directors, their entities, and relatives primarily pertain to share capital, remuneration, unsecured borrowings, and the purchase and sale of goods and services etc. For further details of such related parties under AS-18, refer chapter titled "Restated Financial Statements" beginning on page 285.

(Amount in Rs. Lakhs)

Particulars	FY 2025-26	FY 2024-25	FY2023-24
Related Party-Asset transaction	237.98	-	-
% to Total Assets	5.28	-	-
Related Party- Borrowings availed/ (Repaid) (Net)	(87.66)	(348.06)	163.54
% to Total Borrowings	-12.05%	(42.13)	23.04
Related Party - Revenue Transaction	-	80.31	10.73
% to Total Revenue from Operations		2.92	0.98
Related Party - Expense transaction	60.20	43.84	152.16
% to Total Expenses	2.04	1.83	16.50
Related Party - Issue of Equity	-	-	-
% to Total Equity Share Capital	-	-	-

CUSTOMER CONCENTRATION

The percentage of revenue from operations derived from our top clients is given below:

Particulars	FY 2025-26	FY 2024-25	FY2023-24
Top 1 Customer (%)	7.64	5.49	8.34
Top 3 Customers (%)	13.80	11.43	19.85
Top 5 Customers (%)	18.89	15.75	25.45
Top 10 Customers (%)	28.71	24.00	35.70

SUPPLIER CONCENTRATION

The percentage of purchase material and stock in trade derived from our top suppliers is given below:

Particulars	FY 2025-26	FY 2024-25	FY2023-24
Top 1 Supplier (%)	33.57	44.16	38.75
Top 3 Suppliers (%)	53.75	60.27	53.65
Top 5 Suppliers (%)	60.60	68.37	62.66
Top 10 Suppliers (%)	71.29	83.81	77.35

AUDIT OBSERVATIONS

There has been no adverse observations, reservations, qualification, adverse remarks or matter of emphasis in the audit reports of financial statement since incorporation.

MATERIAL DEVELOPMENTS SUBSEQUENT TO THE LAST FINANCIAL YEAR

In the opinion of the Board of Directors of our Company, since the date of the last financial statements which is March 31, 2026 as disclosed in this Red Herring Prospectus, there have not arisen any circumstance that materially and adversely affect or are likely to affect the business activities or profitability of our Company or the value of its assets or its ability to pay its material liabilities within the next twelve months. except as mentioned below:

1. The Chief Financial Officer, Jatin Bansal, resigned from his position w.e.f March 31, 2026.

2. Pawan Kumar Agrawal was appointed as Chief Financial Officer with effect from May 28, 2026.

3. Our Company executed Agreements to Sell with Rohit Agarwal and Sachin Agarwal. As at March 31, 2026, capital advances of Rs. 102.42 lakhs and Rs. 135.56 lakhs, respectively, were outstanding. Subsequently, the proposed purchase from Rohit Agarwal was cancelled and the advance of Rs. 102.42 lakhs was repaid by him to our Company between April 01, 2026 to September 15, 2026. The proposed purchase from Sachin Agarwal is in the process of being completed and the advance of Rs. 135.56 lakhs remain outstanding. For further details, please see "Risk Factor - Our Company has paid capital advances to our Promoters for proposed property acquisitions. The transaction with Rohit Agarwal has been cancelled and the advance refunded, while the transaction with Sachin Agarwal remains incomplete and may expose us to forfeiture risk" beginning on page 38.

QUALITATIVE DISCLOSURE ABOUT MARKET RISK

In the course of undertaking our business, we are exposed to the following risks arising from financial instruments, which include credit risk, liquidity risk and market risk. Our primary focus is to achieve better predictability of financial markets and seek to minimize potential adverse effects on our financial performance.

Credit Risk

Credit risk is the risk that a customer will fail to perform or fail to pay amounts due causing financial loss. Our exposure to credit risk is influenced mainly by the individual characteristics of each customer and the geography in which it operates. Credit risk is managed through credit approvals, continuous follow-up, and continuously monitoring the creditworthiness of customers to which our Company grants credit terms in the normal course of business.

Liquidity Risk

Liquidity risk is the risk that we will encounter difficulty in meeting the obligations associated with its financial liabilities that are proposed to be settled by delivering cash or another financial asset. Our financial planning has ensured, as far as possible, that there is sufficient liquidity to meet the liabilities whenever due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to our reputation. We have practiced financial diligence and syndicated adequate liquidity in all business scenarios.

Market Risk

Market risk is the risk that results in changes in market prices, such as foreign exchange rates, interest rates and other price like equity prices, which will affect our income or the value of our holdings of financial instruments.

Foreign currency risk is not material as our Companys primary business activities are within India and does not have significant exposure in foreign currency.

Currently, our companys interest rate exposure is mainly related to debt obligations outstanding.

Effect of Inflation

We are affected by inflation as it has an impact on the material cost, wages etc. in line with changing inflation rates, we rework our margins so as to absorb the inflationary impact.

Details of default, if any, including therein the amount involved, duration of default and present status, in repayment of statutory dues or repayment of debentures or repayment of deposits or repayment of loans from any bank or financial institution

Except as disclosed in chapter titled "Restated Financial Statements" beginning on page 285, there have been no defaults in payment of statutory dues or repayment of debentures and interest thereon or repayment of deposits and interest thereon or repayment of loans from any bank or financial institution and interest thereon by the Company.

INFORMATION REQUIRED AS PER ITEM (11) (II) (C) (iv) OF PART A OF SCHEDULE VI TO THE SEBI REGULATIONS, 2018

Unusual or infrequent events or transactions

Except mentioned in this RHP, there have been no transactions or events, which in our best judgment, would be considered unusual or infrequent including unusual trends on account of business activity, unusual items of income, change of accounting policies and discretionary reduction of expenses.

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

Indian rules and regulations as well as the overall growth of Indian economy have a significant bearing on our operations. Major changes in these factors can significantly impact income from continuing operations.

Other than as described in the section titled "Risk Factors" beginning on page 35 to our knowledge there are no significant economic changes that materially affects or are likely to affect income of our Company from continuing operations.

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

Apart from the risks as disclosed under Section titled "Risk Factors" beginning on page 35, in our opinion, there are no other known trends or uncertainties that have had or are expected to have a material adverse impact on revenue or income from continuing operations.

Expected future changes in relationship between costs and revenues, in case of events such as future increase in labour material costs or prices that will cause a material change are known

Apart from the risks as disclosed under Section titled "Risk Factors" beginning on page 3 5, there no known factors that might affect the future relationship between cost and revenue. Our Companys future costs and revenues will be determined by demand/ supply situation, government policies, and cost of our products.

The extent to which increase in products or revenue are due to quality of our products, distribution network and increase in number of products.

Increase in revenue is by and large linked to increases in volume of business activity by the Company.

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

Our company is engaged in the manufacturing of fertilizers, insecticides, fungicides, herbicides, plant growth regulators and rodenticides. Increase in revenues are by and large linked to increase in operations of company and dependent on the price realization of our products.

Total turnover of each major business segment in which the issuer company operated.

Our company is engaged in the manufacturing of fertilizers, insecticides, fungicides, herbicides, plant growth regulators and rodenticides. Relevant Industry data, as available, has been included in the section titled "Industry Overview beginning on page 144 of this Red Herring Prospectus.

Status of any publicly announced new products or business segment.

Otherwise as stated in the Red Herring Prospectus and in the section titled "Business Overview appearing on page 187. Our company has not publicly announced any new business segment till the date of this Red Herring Prospectus.

The extent to which business is seasonal.

Our Company is engaged in the manufacturing of fertilizers, insecticides, fungicides, herbicides, plant growth regulators and rodenticides. Our products are sold throughout the year. In India, there are two major crop seasons, ensuring that our products are always in demand across the year, thereby enabling us to have business visibility and sales throughout the year. Hence, our business is not seasonal in nature.

Any significant dependence on a single or few suppliers or customers.

Our business is primarily end-user driven and is not significantly dependent on any single customer or a limited group of customers. For further details, please refer "Risk factor" on page 35.

Competitive Conditions

We face competition from existing established players and potential new entrants, which is common for any business. We have, over a period, developed certain competitive strengths which have been discussed in section titled "Business Overview beginning on page 187 of this Red Herring Prospectus.

Material Frauds

There are no material frauds, as reported by our Statutory Auditor, committed against our Company, in the last three financial years.