Southern Petrochemicals Industries Corporation Ltd Management Discussions

Share Capital

As of 31st March 2025, your Companys paid-up equity share capital stood at Rs. 2,03,64,03,360. There were no alterations in share capital during the year.

Transfer to Reserves

In accordance with Sections 123 and 134(3)(j) of the Companies Act, 2013, no transfers were made to the General Reserves for the year under review.

Dividend

The Board, in alignment with the Dividend Distribution Policy and financial results, recommended a dividend of Rs. 2 per equity share (20% of face value of Rs. 10) for FY 2024 25 to the Members for their approval at the ensuing 54th Annual General Meeting (AGM) to be held on Tuesday, the 23rd September 2025 and subject to applicable tax deductions. Payment would be made to eligible shareholders as of the Record Date, fixed by the Board of Directors of your Company.

Operational Overview Urea Production

During FY 2024 25, your Company achieved a total production of 721,051 MT of neem-coated urea, surpassing the Reassessed Production Capacity (RAC) of 620,400 MT by 100,651 MT.

Effective May 2024, operations transitioned entirely to natural gas-based processes. There was no scheduled annual shutdown during the year under review. Ammonia output also reached an all-time high of 430,623 MT, reinforcing its critical role in urea manufacturing. Your Company is executing Urea modernisation project which would enhance the capacity of the plant from the present level of 759200 MTPA to 912500 MTPA. The Engineering activities and equipments ordering have been completed, civil and mechanical erection activities are in process. It is expected to commission the modernized Urea Plant on or before July 2026.

Gas Supply Infrastructure

The Reliquefied Natural Gas (RLNG) pipeline from Ennore, Chennai was successfully commissioned in late 2023, following which Indian Oil Corporation Limited (IOCL) authorized gas intake. Effective May 2024, your Company transitioned to 100% sourcing of its feedstock and fuel requirements from natural gas. Supply channels include: Domestic Gas: Procured from the Ramnad Oil & Natural Gas Corporation fields Imported Gas: Sourced from the IOCL LNG Terminal located in Ennore, Chennai

Public Deposits

In compliance with Chapter V of the Companies Act, 2013, the Company did not accept any public deposits during FY 2024 25, and therefore no disclosures are required under this provision.

Debentures

In September 2023, your Company successfully raised Rs. 50 crores through a private placement of 5,000 Unlisted, Rated, Senior, Secured, Redeemable, Non-convertible Debentures of Rs. 1,00,000 each, issued to Vivriti Emerging Corporate Bond Fund and Vivriti Alpha Debt Fund Enhanced. In line with the agreed terms, the Company has complied with the financial obligation and the outstanding amount as on 31st March, 2025 is Rs. 23.59 Crores.

Consolidated Financial Statements

Your Companys Consolidated Financial Statements for the financial year ended 31st March, 2025 have been prepared in compliance with Indian Accounting Standards (Ind AS) and forms part of the Annual Report.

Financial Statements of Associates and Joint Ventures

As per Section 129(3) of the Companies Act, 2013, read with Rule 5 of the Companies (Accounts) Rules, 2014, a statement presenting key financial highlights of the Companys Associate and Joint Venture entities, in Form AOC-1, is appended to the Financial Statements. Your Company does not have any Subsidiary entities.

Tamilnadu Petroproducts Limited (TPL)

The fourth quarter of FY 2024 25 witnessed a notable surge in demand for Linear Alkyl Benzene produced by TPL, aided by supply shortages stemming from plant maintenance at other facilities. This contributed to improved net realizations, although domestic pricing remained under pressure from low-cost imports.

Caustic Soda prices were subdued during the first half of FY 2024-25 due to weak demand across certain end-use sectors. On the contrary, prices rebounded significantly in the second half, largely driven by supply disruptions in the Chinese market.

The domestic Propylene Oxide (PO) market faced significant challenges due to the influx of lower-priced imported downstream Polyols. As a result, PO offtake became a major challenge since Q3 of FY24-25. Nonetheless, a recovery in PO demand is expected to commence from Q2 of FY 2025 26, subject to market conditions.

The Board of TPL has recommended a dividend of Rs. 1.20 per equity share of Rs. 10 each fully paid-up for the year 2024-25, subject to the approval of Members at their ensuing AGM scheduled on 17th September 2025.

Tuticorin Alkali Chemicals and Fertilizers Limited (TFL)

TFL successfully posted profits in all four quarters, breaking a two-decade streak of financial losses. TFL reported strong annual net profits and a noticeable uptick in net worth. Modernization efforts are ongoing, and the carry-forward losses are expected to be fully offset within two years. TFL is advancing its sustainability agenda by operating exclusively with biomass fuel derived from agricultural residue and Juli flora. TFL was honored as Runner-Up in the Renewable Material Transition category at the inaugural Global Symposium and Awards on Resource Efficiency & Circular Economy held by FICCI in March 2025. During the Financial Year 2024-25, TFL undertook refurbishment of malfunctioning equipment and installed modern systems, resulting in its highest production levels in the last 14 years. Key upgrades included replacing the

DCS with the Yokogawa Centum VP system in the ACL and soda ash plants.

Salt requirements were met primarily through local procurement, supplemented by a consignment from Gujarat. At the year-end, falling ammonia prices influenced downward revisions in the prices of soda ash and ammonium chloride.

ISO certifications in quality and environmental management were renewed by DNV. TFL also

commissioned a CO2 storage system to harness carbon

from external sources, supporting stable productivity and its environmental goals.

Greenam Energy Private Limited (“Greenam”)

During the financial year 2024-25, 22.0 MW AC Floating Solar Power Plant was operated seamlessly by Greenam. Your Company fulfilled regulatory Renewable Energy obligations by sourcing renewable power from Greenam and also mitigated evaporation from its water reservoirs. Greenam reported a net profit of Rs. 2.20 Crores and revenues of Rs. 18.32 Crores for the year. EBITDA reached Rs. 17.00 Crores, representing approximately 92.79% of total revenue. Energy output totalled 36.66 million units.

Changes in Joint Ventures, Associates & Subsidiaries

During FY 2024 25, there were no additions to or removals from the Companys list of Joint Ventures or Associate entities. The Company does not have any Subsidiaries.

Safety, Health and Environment (SHE)

DNV successfully completed the Re-certification Audit of the Companys Management Systems, including QMS (ISO 9001:2015), EMS (ISO 14001:2015), and OHS (Occupational Health & Safety) (ISO 45001:2018). All systems were found to be effectively implemented with zero non-conformities. The certifications remain valid until January 2026. Periodic medical examinations for employees were also reviewed and found to meet requisite standards. Your Company maintained its commitment to environmental stewardship through the planting of approximately 721 tree saplings.

Your Company received operational clearance to run on a mixed feedstock of Natural Gas and Naphtha, until 31st March 2026. Additionally, permission to commence modernization of the Urea plant has been granted, targeting a capacity of 912,500 MTPA of neem-coated urea, alongside sustainable technologies such as CO2 capture, utilization and a Zero Liquid Discharge system. As at the end of the reporting period, your Company had achieved an impressive 1,164 consecutive days without any lost-time accidents, representing 4.05 million man-hours of safe operation. The Health, Safety & Environment (HSE) policy has been updated to reflect ongoing modernization efforts.

Human Resources and Industrial Relations

Your Company remains unwavering in its dedication to cultivating a supportive, inclusive, and growth-oriented work environment. A diverse portfolio of training programs, upskilling initiatives and career development opportunities have been deployed to ensure employees are equipped with the skills and capabilities aligned to the Companys strategic vision. This people-first approach fosters individual empowerment and contributes to the long-term sustainability of the organization.

Throughout the year under review, industrial relations have been consistently stable and constructive, underpinned by mutual respect, open communication, and transparent collaboration between management and employees. Your Company continues to champion a culture of engagement, reinforcing a positive and inclusive atmosphere across all levels of the organization.

As of 31st March 2025, the total employees on the rolls of the Company stood at 616 employees. In alignment with its strategic workforce development plan, the ongoing campus recruitment program has remained a cornerstone for sourcing and nurturing emerging talent, positioning them for future leadership roles In support of employee well-being, your Company continues to offer maternity leave benefits to all eligible women employees, fully compliant with the Maternity Benefit Act, 1961.

Annual Return

In compliance with Section 92 of the Companies Act, 2013, the Annual Return in Form MGT-7 for FY 2023 24 has been uploaded on the Companys website. The Annual Return for FY 2024 25 will be duly filed with the Registrar of Companies within the statutory timeline, following the conclusion of the 54th Annual General Meeting, scheduled for 23rd September 2025. Once filed, it will be accessible at: https://www.spic.in/investors/annual-return.

Change in Business Nature

There has been no changes in the nature of the Companys business operations during FY 2024 25.

Directors and Key Managerial Personnel

The Boards composition is in compliance to the provisions of the Companies Act, 2013, and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, including criteria related to Independent Directors, Woman Director and directorship limits across listed entities.

Mr. E. Balu, Wholetime Director is liable to retire by rotation at the forthcoming Annual General Meeting and being eligible has offered himself for re-appointment. All current Independent Directors have submitted the requisite disclosures affirming their eligibility under Section 149(6) of the Companies Act, 2013 and in accordance with the applicable SEBI Regulations.

Effective 7th February 2025, Mr. R. Swaminathan was appointed as Company Secretary and Compliance Officer, in the place of Mr. M. B. Ganesh. The Board places on record its appreciation of the significant contributions by Mr. M. B. Ganesh during his tenure.

Transfer of Unclaimed Shares to IEPF Authority

In line with Section 124(6) of the Companies Act, 2013 and the IEPF Rules, the Company had transferred 1,66,454 equity shares to the Investor Education and Protection Fund (IEPF) covering 1,008 shareholders. At the year-end, 1,64,754 shares remain unclaimed by 1,003 shareholders.

Escrow Account

A separate suspense escrow demat account has been opened for moving the shares, if any, required to be transferred beyond 120 days from issuing of Letter of Confirmation by the Company as stipulated under SEBI Circular dated 30th December, 2022. As at 31st March, 2024, no shares have been transferred to the said account.

Independent Directors Familiarization Programme

Independent Directors are regularly updated through structured familiarization initiatives that cover their roles, responsibilities, business model, market dynamics, strategic direction and risk landscape. These programs include the provision of relevant documentation, policies and informative presentations during Board and Committee meetings.

Details of these familiarization programs can be accessed via: https://www.spic.in/wp-content/uploads/2025/04/ Familiarization-Programmes-2024-25.pdf

Nomination and Remuneration Policy

Pursuant to Section 178(3) of the Companies Act and the Listing Regulations, the Nomination and Remuneration Policy is detailed in Annexure I of this Report.

Remuneration of Directors, KMP & Employees

A comprehensive statement of remuneration for Directors, Key Managerial Personnel (KMP), and other employees has been enclosed in Annexure II, in accordance with Section 197(12) of the Companies Act, 2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

Statutory Auditors

M/s. MSKA & Associates, Chartered Accountants, Chennai (Firm Registration No.: 105047W) were appointed as Statutory Auditors for a five-year term commencing from FY 2022 23, holding office from the 51st to the 56th AGM. Their annual remuneration is Rs. 24 lakhs plus applicable taxes and out-of-pocket expenses, with authority granted to the Board for revisions during the tenure. For FY 2024 25, the Auditors Report on the Standalone and Consolidated Financial Statements contains no qualifications, reservations, adverse remarks, or disclaimers.

Cost Auditors

M/s. B Y & Associates, Cost Accountants (Firm Registration No. 003498), were appointed to conduct the cost audit of the Company for FY 2024 25. The Company has duly maintained its cost records in compliance with Section 148(1) of the Companies Act, 2013, as prescribed by the Central Government. The Cost Audit Report for the previous fiscal year ended 31st March 2024 was filed within the stipulated timeframe as required under the Act. In continuation of regulatory compliance, cost accounts and records for FY 2024 25 have also been maintained. Based on the Audit Committees recommendation, the Board at its meeting held on 8th May 2025 re-appointed M/s. B Y & Associates as Cost Auditors for FY 2025 26, at a remuneration of Rs. 1,75,000/- plus actual out-of-pocket expenses. The payment of remuneration is subject to Members approval/ratification at the forthcoming 54th Annual General Meeting.

Secretarial Auditors

Under Section 204 of the Companies Act, 2013 and Regulation 24A of SEBI Listing Regulations, the Company appointed Ms. B Chandra, Practicing Company Secretary, Chennai, as Secretarial Auditor for FY 2024 25. The Company complied with applicable Secretarial Standards issued by the Institute of Company Secretaries of India and approved by the Central Government.

The Secretarial Audit Report for FY 2024 25 is annexed as Annexure III and contains no qualifications, reservations, adverse remarks or disclaimers.

In accordance with the amended Regulation 24A, effective from FY 2025 26, shareholders may approve the appointment or reappointment of Secretarial Audit firms for a maximum of two five-year terms. M/s. B Chandra & Associates, Chennai, has given their consent and eligibility certificate for appointment and holds a valid Peer Review Certificate (No. 1711 dated 28th February 2022). The Board, at its meeting on 8th May 2025, has recommended their appointment for a term of 5 years covering FY 2025 26 to FY 2029 30, subject to Members approval at the ensuing AGM.

Directors Responsibility Statement

In line with Section 134(3) of the Companies Act, 2013, your Directors affirm that to the best of their knowledge and belief, and based on information provided by Management: a) The annual financial statements for FY ended 31st March 2025 were prepared in accordance with Ind AS, with relevant disclosures on material deviations, if any. b) Accounting policies were applied consistently and judicious estimates made to reflect a true and fair view of the Companys financial position and performance. c) Sufficient measures were taken to maintain proper records, safeguard assets, and prevent fraud and irregularities. d) Financial statements were prepared on a going concern basis. e) Appropriate internal financial controls were established and found to be adequate and effective. f) Systems for legal compliance were implemented and operated effectively.

Reporting of Frauds by Auditors

During FY 2024 25, there were no instances of frauds reported by the Statutory Auditors, Cost Auditors and Secretarial Auditors under Section 143(12) of the Companies Act, 2013.

Loans, Guarantees or Investments

No loans or guarantees under Section 186 of the Act were extended by the Company during the year under review.

During the year, the Board of Directors of the Company at their Meeting held on 16th May 2024, had approved the proposal to invest in the Equity Shares of M/s Green Infra Renewable Energy Generation Private Limited (GIREGPL), M/s Green Infra Renewable Energy Projects Limited (GIREPL) and M/s Green Infra Wind Energy Generation Limited (GIWEGL) (“SEMBCORP Group”), for value not exceeding Rs. 11,25,00,000/- in order to qualify as captive user of power under Electricity Rules, 2005. Pursuant to this arrangement, your Company entered into a Share Subscription cum Shareholders Agreement dated 24th September 2024. As on the date of this report, pursuant to the Agreement, your Company invested 14,98,447 equity shares of Rs.10 each at par in GIREGPL offered on rights basis on 19th February, 2025, 16,85,753 equity shares of Rs. 10 each at par in GIREPL offered on Private Placement basis on 5th May 2025 and 48,03,200 equity shares of Rs. 10 each at par in GIWEGL offered on Private Placement basis on 13th June 2025.

Corporate Social Responsibility (CSR)

A CSR Committee has been constituted, and the Company has a CSR Policy aligned with the Companies Act. Although there is no mandatory spending obligation due to profit criteria under Section 198, the Company has voluntarily undertaken initiatives for societal development. These are detailed in Annexure IV. The policy is available at: https://www.spic.in/wp-content/uploads/2021/02/ Corporate-Social-Responsibility-Policy.pdf

Related Party Transactions

All Related Party Transactions for FY 2024 25 were undertaken in the ordinary course of business and at arms length. There are no contracts or arrangements requiring disclosure under Sections 188(1) and 134(h) of the Companies Act in Form AOC-2, which is attached as Annexure V. Details of transactions with any persons or entities belonging in the Promoter/Promoter Group holding 10% or more equity stake in the Company are disclosed in Note No. 38 of the Notes to Accounts in accordance with Ind AS.

Material Changes and Commitments

No material changes or commitments impacting the Companys financial position occurred between the close of FY 2024 25 (i.e., 31st March 2025) and the date of this

Energy Conservation, Technology Absorption, and Foreign Exchange Earnings/ Outgo Energy Conservation

Your Company has instituted a dedicated internal audit team to drive initiatives focused on reducing energy consumption, enhancing operational reliability, and strengthening process safety. Key accomplishments include: Replacement of the High Temperature Shift Converter catalyst, resulting in lower CO slippage and improved plant efficiency Ongoing steam audits with prompt replacement of faulty steam traps Deployment of real-time energy monitoring across critical process parameters Implementation of preventive maintenance strategies to mitigate risks of major equipment failures Regular inspections to detect and rectify leakages and inefficiencies Periodic tuning of fired heaters and furnaces to maintain optimal air-fuel ratios Gradual rollout of energy-efficient LED lighting systems across operational zones

Technology Absorption

Nil

Foreign Exchange Earnings and Expenditure

During FY 2024-25, your Company recorded foreign exchange transactions as detailed below:

(Rs. in lakhs)

Internal Financial Controls and Risk Management

Your Company has instituted a comprehensive framework of internal financial controls designed to oversee operational workflows, ensure precision in financial reporting and maintain compliance with applicable Regulations. These controls undergo regular evaluations by both Internal and Statutory Auditors, with their findings reviewed by the Audit Committee. Any identified gaps are promptly addressed through structured corrective actions and defined timelines. The Committee also assesses the Internal Auditors reports covering key business processes and accounting practices.

Risk management remains a core component of the Companys governance structure. In alignment with SEBI Listing Regulations, a dedicated Risk Management Committee has been constituted and a detailed Risk Management Policy has been adopted. This policy facilitates systematic identification of business risks and prescribes appropriate mitigation strategies. The Board reviews the Risk Management Report at periodic intervals to monitor emerging risks and the effectiveness of ongoing mitigation efforts.

Significant Legal Orders

No significant or material orders were passed by any regulatory authority, court or tribunal that could adversely impact the Companys going concern status or its future operations.

Insolvency and Bankruptcy Proceedings

As of 31st March 2025 and through the date of this report, there have been no applications filed or proceedings initiated against the Company under the Insolvency and Bankruptcy Code, 2016.

One-Time Settlement and Loan Valuation Disclosure

No one-time settlements or loan valuations differing in amount were undertaken during the year. Hence, no disclosures are required under this clause.

Corporate Governance

The Corporate Governance Report for FY 2024 25, along with a Compliance Certificate issued by M/s. B Chandra & Associates, Practicing Company Secretaries, certifying adherence to SEBIs corporate governance norms, forms an integral part of this Annual Report.

Business Responsibility & Sustainability Report

In accordance with Regulation 34 of the SEBI (LODR) Regulations, 2015, the Business Responsibility & Sustainability Report for the Financial year ended 31st March 2025 forms an integral part of this Annual Report.

Board, Committees & Director Performance Evaluation

The Company follows a structured mechanism for evaluating the effectiveness of its Board, Committees, individual Directors, and the Chairperson.

Independent Directors Meeting (28th March 2025): Evaluation of Non-Independent Directors, the Board as a whole and the Chairperson, including an assessment of the quality and timeliness of information shared with the Board.

Board Meeting (14th August 2025): Comprehensive review of Independent Directors and performance of the entire Board and its Committees. Evaluation criteria included active involvement, strategic input, understanding of business dynamics, and effectiveness in Committee roles.

Meetings of the Board and Audit Committee

Details regarding the number of meetings held, along with composition of the Board and Audit Committee, are provided within the Corporate Governance Report.

Policy Framework Material Subsidiary Policy

The Policy on Material Subsidiary, approved by the Board in accordance with SEBI Listing Regulations, is accessible at: https://www.spic.in/wp-content/uploads/2021/02/ Determining-Material-Subsidiary-Policy.pdf

Related Party Transactions Policy

In compliance with the Companies Act, 2013 and SEBI Listing Regulations, your Company has adopted a Policy on Related Party Transactions. This policy ensures transparency and governance in dealings with related parties. The complete document is accessible at: https:// www.spic.in/wp-content/uploads/2025/04/Policy-on-Related-Party-Transactions-2.pdf.

Insider Trading Policy

Your Company has implemented a Code of Conduct to prevent Insider Trading, governing the trading of securities by Directors and designated employees. This policy is in line with the SEBI (Prohibition of Insider Trading) Regulations, 2015, as amended. Details are available at: https://www.spic.in/wp-content/uploads/2021/02/Code-of-Practices-and-Procedures-for-Fair-Disclosure-of-UPSI1.pdf.

Policy on Prevention of Sexual Harassment (POSH)

Your Company maintains zero tolerance for any form of sexual harassment in the workplace. In line with the POSH Act, 2013, a dedicated Internal Complaints Committee oversees the enforcement of this policy and ensures compliance with relevant rules and procedures.

Status of POSH complaints for FY 2024-25:

Complaints received: Nil Complaints resolved: Nil Cases pending over 90 days: Nil

Vigil Mechanism

As per Section 177 of the Companies Act, 2013 and SEBI Listing Regulations, your Company has instituted a Vigil Mechanism and Whistle Blower Policy. This framework enables Directors and employees to report genuine concerns, including unauthorized disclosures of Unpublished Price Sensitive Information (UPSI). Full details are available at: https://www.spic.in/wp-content/uploads/ 2021/02/Whistle-Blower-Policy-and-Vigil-Mechanism-24.03.2020.pdf

Dividend Distribution Policy

The Company has framed its Dividend Distribution Policy in accordance with the SEBI (LODR) Regulations, 2015 (Second Amendment dated 5th May 2021). It outlines the principles for declaring dividends, maintaining consistency and transparency. The policy is available at: https:// www.spic.in/wp-content/uploads/2021/08/Dividend-Distribution-Policy.pdf

Management Discussion and Analysis Industry Overview

Indias 2024 monsoon season concluded with 108% rainfall as compared to the Long Period Average (LPA), marking the highest occurrence of heavy rainfall events in the last five years. These extreme weather patterns have had a pronounced impact on crop productivity, posing significant challenges to agricultural stability.

Cropped Area Growth (YoY):

Kharif: +14.11% Rabi: +5.92%

Production Trends:

Increase:

Food grains: +4.40% Oilseeds: +8.07%

Decrease:

Sugarcane: 3.99% Cotton: 9.52% Jute: 10.20%

Major contributors to the decline in cash crop production include erratic rainfall and shifting crop preferences by farmers. Despite a 2% reduction in domestic production and a 20% drop in imports, Urea availability remained stable, buoyed by carryover stocks from the previous year. Consequently, total sales increased by 8% from 35.78 million tonnes to 38.79 million tonnes.

Services Extended to Farmers

Your Company continued to actively support farmers by promoting enhanced cultivation methods, soil health management, integrated nutrient and pest management techniques aimed at minimizing residual deposits on soil, crops and harvests.

Key Initiatives Undertaken:

Through 2,473 PMKSK centers across Tamil Nadu, Puducherry, Kerala, Karnataka, Andhra Pradesh, Telangana and Maharashtra, the Company provided: o Soil and irrigation water testing facilities o Training on soil-based nutrient management and integrated pest control o Information on welfare schemes of the Government of India and respective State Governments.

Features relevant articles on sustainable farming, new agricultural technologies and farmer success stories across the state. It serves as a valuable knowledge-sharing platform to improve farm productivity.

Outlook for FY 2025 26 Monsoon & Urea Demand Forecast

India is expected to receive 5% above normal rainfall this year (historical average: 87 cm). The Economic Survey 2025 projects a 3.8% growth in the agriculture sector, driven by favorable climatic conditions and increased foodgrain output.

To meet anticipated higher demand, domestic urea production is expected to reach approximately 33 million tonnes, thereby reducing reliance on imports. This will be supported by ongoing greenfield and brownfield projects, and through substitution of 20 25 lakh tonnes of conventional urea with Nano Liquid Urea during top dressing.

Nano Urea Adoption & Research

Nano Urea, introduced by IFFCO in 2021, is a liquid formulation containing 4 14% nitrogen intended to replace conventional prilled or granular urea. Despite its potential, adoption remains limited due to: Nutrient instability Compatibility issues with agrochemicals Higher application cost Inconsistent crop performance As urea constitutes approximately 82% of nitrogenous fertilizer consumption in India, the Government is encouraging fertilizer producers to transition towards Nano Urea. Accordingly, National Fertilizers Limited (NFL) and Rashtriya Chemicals and Fertilizers Limited (RCF) have entered NDAs and MoUs with IFFCO to adopt Nano Urea manufacturing technologies.

Your Company has partnered with Tamil Nadu Agricultural University to conduct field trials comparing the efficacy and phytotoxicity of Nano Urea versus SPIC Prilled Urea, specifically in paddy cultivation. These studies will also evaluate economic viability and inform strategies for deploying Nano Technology in nutrient delivery systems.

All-India Urea Production, Imports, Supplies and Sales

A comparative analysis of urea production, imports, distribution and sales across India for the current and previous financial year reflects the evolving dynamics in fertilizer demand and supply. The data underscores industry efforts to improve self-reliance through increased domestic production and better inventory management.

Tissue Culture Business

Your Company continues to expand its tissue culture operations in Coimbatore by cultivating and supplying seven premier banana sapling varieties to farmers in Tamil Nadu, Karnataka and Andhra Pradesh using advanced plant tissue culture techniques.

Highlights include:

Modernization of the tissue culture facility to enhance operational efficiency Accreditation from the Department of Biotechnology with NCS TCP certification Ongoing research into cost-effective propagation protocols for high-value crops, including medicinal and ornamental plant species.

Key Financial Ratios Year-on-Year Comparison

Significant changes (25% or more) in key financial ratios for FY 2024 25 as compared to the previous year are outlined below:

* The accounting ratio are given under Note: 51 of the Standalone Financial Statements.

Operational Challenges Sale of Urea Outside ePOS Potential Risks:

Delays in concession bill submissions Possibility of stock diversion for non-agricultural usage Elevated closing balances in ePOS systems that restrict market supply

Mitigation Measures:

Deployment of field-level personnel to monitor product movement up to retail counters Implementation of tech-enabled real-time inventory tracking across all tiers of the distribution network institutions, wholesalers, dealers, and retailers Adoption of the SUBSIDEX software platform to enable stock correction, streamline supply flow, and drive timely liquidation through promotional initiatives Removal of habitual defaulters from the Companys dealership network These measures have significantly optimized the subsidy cycle and ensured more accurate market forecasting.

Acknowledgement

Your Board extends its sincere gratitude to the following stakeholders for their continued guidance and support:

Department of Fertilizers

Ministries of Chemicals and Fertilizers, Petroleum and Natural Gas, Agriculture, Shipping, and Corporate Affairs State Governments including Tamil Nadu Tamil Nadu Industrial Development Corporation Ltd. Tamil Nadu Generation and Distribution Corporation Ltd.

Indian Oil Corporation Limited Oil and Natural Gas Corporation Limited Financial institutions, partner banks and other lending institutions.

The Directors thank the shareholders for their continued support.

The Board also acknowledges and deeply appreciates the dedication and commitment of every employee of the Company.