Tapi Fruit Processing Ltd Management Discussions

INDUSTRY STRUCTURE AND DEVELOPMENTS & OUTLOOK

Global Economy

The global economy recorded moderate growth in Calendar Year (CY) 25, with GDP expanding by approximately 3.4%, supported by resilient consumer demand and public investment. However, growth remained uneven across regions, with advanced economies slowing to around 1.9% due to elevated interest rates and tighter financial conditions, while emerging markets grew at a stronger pace of about 4.4%, driven by domestic demand and manufacturing activity.

During the year under review, global trade conditions remained volatile, influenced by evolving trade policies and geopolitical tensions. Disruptions in key regions, including West Asia, led to significant operational challenges, such as port closures, extended transit time, and heightened volatility in energy prices, freight rates and commodity markets. These developments exerted pressure on global supply chains and contributed to inflationary trends across economies.

Despite the challenging global environment marked by geopolitical uncertainties and supply chain disruptions, your Company responded proactively through calibrated and timely interventions. We continued to strengthen supply chain resilience to ensure uninterrupted product availability across markets. We also actively managed cost pressures through a balanced approach comprising calibrated price increases, disciplined cost control measures and close collaboration with business partners, enabling continuity of operations and sustained business performance.

Outlook

The global economic outlook remains moderate, with growth projected at around 3.1% in CY26 and 3.2% in CY27, reflecting subdued expansion across major economies. Global growth remains exposed to geopolitical tensions, particularly in West Asia, and evolving trade policies, which could disrupt energy and shipping routes. Such developments may increase commodity and freight costs, create supply chain uncertainties and impact global trade flows and investment sentiment. Your Company remains focused on maintaining operational resilience through proactive risk management, diversified sourcing strategies and strong supply chain planning. We continue to closely monitor developments across key markets while pursuing disciplined cost management, productivity improvement initiatives and strategic collaboration with business partners to mitigate potential disruptions and sustain long-term growth.

(https://www. imf. org/en/publications/weo/issues/202 6/04/14/world-economic-outlook-april-202 6)

Indian economic review

India remained one of the fastest-growing major economies in Financial Year (FY) 26, with real GDP growth estimated at 7.7%, driven by strong domestic demand, sustained public capital expenditure and improving industrial activity. Inflation remained broadly moderate during the year under review, with a slight uptick toward the end due to food prices and energy-related risks linked to geopolitical developments.

Macroeconomic fundamentals remained stable, supported by healthy financial sector conditions, robust tax collections and continued policy support. The Reserve Bank of India (RBI) reduced the repo rate by 100 basis points during the year to support liquidity, credit growth and consumption. Policy measures, including income tax relief, GST rationalisation and labour reforms, continued to support consumption, formalisation and ease of doing business. Against this positive macroeconomic backdrop, your Company continued to focus on strengthening its brands, expanding distribution reach, driving innovation and enhancing operational efficiencies.

Outlook

Indias economic outlook remains resilient, supported by strong domestic fundamentals, continued infrastructure investments and sustained policy support. The RBI projects real GDP growth of around 6.6% for FY27, with domestic demand expected to remain the primary growth driver and private consumption staying healthy.

However, near-term risks include potential El Nino-related disruptions to monsoon patterns, which could impact agricultural output, rural demand and food inflation. Global trade uncertainties and geopolitical developments, particularly in West Asia, may impact India through energy and commodity prices, trade flows and financial conditions.

Despite these risks, Indias strong macroeconomic fundamentals, ongoing infrastructure development and policy reforms are expected to support steady growth and economic resilience. We remain confident in the long-term growth prospects of the Indian market. Your Company is focused on leveraging strong consumer demand through continued investment in its brands, innovation and distribution expansion, while maintaining operational agility to navigate evolving market conditions.

Industry Overview

FOOD PROCESSING INDUSTRY

The food processing industry in India has witnessed rapid growth in the recent past, with the sector emerging as one of the most promising industries driving the economic growth of the country. Indian food processing market size reached Rs. US$ 354.5 billion in 2024 and is expected to grow to US$ 535 billion by the end of FY26. In the long term, the sector is projected to expand to US$ 700 billion by 2030 and US$ 1,100 billion by 2035. The food processing industry contributes around 32% of the overall Indian food market, 13% of total exports, and 6% of industrial investment. The Indian food and grocery market is the worlds sixth largest, with retail contributing 70% of sales. The food processing industry alone represents 32% of this market, making it one of the countrys largest industries and positioning it fifth globally in terms of production, consumption, exports, and anticipated growth. A robust food processing sector is critical for addressing Indias food

and nutritional security challenges. Processed food enhances shelf life, improves convenience, enables distribution to remote regions, and ensures better accessibility for consumers. For farmers, it provides higher value realization and wider market opportunities, creating a strong multiplier effect across the economy.

Fruits Pulp

The fruit pulp market size has grown steadily in recent years. It will grow from $1.53 billion in 2025 to $1.59 billion in 2026 at a compound annual growth rate (CAGR) of 4.4%. The growth in the historic period can be attributed to expansion of juice and beverage processing, availability of tropical fruit supply, growth of packaged food consumption, adoption of fruit-based formulations, development of cold-chain infrastructure. It will grow to $1.91 billion in 2030 at a compound annual growth rate (CAGR) of 4.7%. The growth in the forecast period can be attributed to increasing demand for natural ingredients, rising consumption of smoothies and purees, expansion of foodservice applications, growing preference for organic fruit pulp, increasing use in functional beverages. Major trends in the forecast period include increasing demand for shelf-stable fruit ingredients, rising use of fruit pulp in beverages, expansion of exotic fruit varieties, growing adoption of clean-label fruit products, enhanced focus on color and flavor retention.

The fruit pulp market in India is undergoing a significant transformation, marked by an 8.2% year-over-year growth rate as the industry pivots from commodity supply to high-value ingredient manufacturing. This evolution is driven by strong consumer demand for clean- label ingredients and functional health ingredients for nutraceutical applications. In response, processors are upgrading facilities with advanced technology. For instance, a mid-sized processing facility within a regional processing cluster in Maharashtra now uses AI-driven vision systems for optical sorting automation, grading mangoes for brix level consistency to reduce post-harvest losses. This allows the production of premium tropical fruit purees that meet stringent phytosanitary standards for export. Such technological adoption, supported by the governments production linked incentive scheme, enhances traceability systems and ensures the sector can meet the rising demand for aseptic fruit pulp production while controlling for microbial degradation. This focus on quality and innovation is positioning Indian fruit pulp as a key component in the global food and beverage supply chain.

Some of the key factors fuelling the consumption of fruit and vegetable pulp globally includes: a widening application in food products, rising private label offerings, investments in pulp processing technology, and capacity expansions by leading players. Developed regions like North America and Europe are mature markets. The Asia-Pacific region and Latin America offer strong growth potential owing to rapid urbanisation, rising incomes, and an increasing middleclass population. Overall, the fruit and vegetable pulp sector is poised for a prosperous future globally backed by a strong health and wellness trend.

(Source: https://www. thebusinessresearchcompany. com/report/fruit-pulp-global-market-report

https://www.technavio.com/report/fruit-pulp-market-industry-in-india-analysis)

Jellies and Gummies

The global jellies & gummies market size was valued at USD 38.2 billion in 2024 and is projected to grow from USD 41.0 billion in 2026 to USD 47.7 billion by 2030, at a CAGR of 3.8% from 2025 to 2030. The market growth is attributable to the increasing consumer demand for convenience foods. With hectic schedules and busy lifestyles, consumers have increasingly sought quick and easy snack options, including jellies and gummies. These products are convenient and come in a wide range of flavors and forms that appeal to a broader range of consumers. Health consciousness among consumers is another major factor propelling the market. As consumers become more inclined towards healthier eating habits, manufacturers have responded by incorporating vitamins, minerals, and natural ingredients into their products. A McKinsey and Company report suggests that up to 40% of conscious consumers prefer eating fresh produce, while 33% prefer meals without artificial ingredients. This shift towards functional and fortified gummies has attracted health-conscious consumers. Additionally, the rising popularity of vegan and sugar-free options has contributed to market growth. Consumers have progressively continued to adopt vegan lifestyles and become aware of the negative impact of excessive sugar consumption, leading to the ongoing demand for vegan and sugar-free jellies and gummies.

(Source: https://www.grandviewresearch.com/industry-analysis/jellies-gummies-market)

Organic Food and Beverages

The global organic food and beverages market size was valued at USD 371.1 Billion in 2025. The analyst estimates the market to reach USD 1.01 trillion by 2034, exhibiting a CAGR of 11.51% from 2026-2034. The market is driven by the growing health consciousness among consumers, increased demand for natural and sustainable products, and a rising awareness about the environmental impact of conventional farming. Additionally, advancements in organic farming practices, government support, and the expansion of organic product availability are influencing the organic food and beverages market share.

People are becoming more conscious about the health advantages of organic items, like enhanced nutritional content and reduced chemical usage. With a growing emphasis on healthier living, there is an increase in the demand for organic foods and beverages, as consumers look for substitutes of traditional items to minimize their contact with pesticides and additives. Furthermore, governments around the globe are providing incentives and subsidies to encourage organic agriculture. Strict organic certification criteria also contribute to product safety and quality, fostering consumer confidence. These guidelines not only assist farmers but also motivate consumers to select certified organic goods. Besides this, continuous introduction of novel product formulations, packaging, and flavors, are appealing to a wider range of consumers. The launch of organic snacks, drinks, and ready-to-eat (RTE) meals is broadening the markets attractiveness, addressing diverse tastes and dietary needs.

(Source:https://www.researchandmarkets.com/report/organic-food-and-beverages?srsltid=AfmBOoqR3hO3AXF1ov4NJjJ4B6uPmkCnw- tU_54czYN4dph VJZRFXDRu)

Nutraceutical products

The global nutraceuticals market size was valued at USD 636.2 billion in 2025 and is projected to grow from USD 683.8 billion in 2026 to USD 1151.5 billion by 2033, at a CAGR of 7.7% from 2026 to 2033. The market growth is attributed to the increasing consumer awareness of preventative healthcare and the link between diet and well-being. The aging global population, particularly in developed nations, is actively seeking solutions to maintain health and manage age-related conditions, leading to a surge in demand for supplements targeting joint health, cognitive function, and cardiovascular wellness. Simultaneously, rising rates of chronic diseases like obesity and diabetes are prompting individuals to adopt healthier lifestyles, including incorporating nutraceuticals into their daily routines. This proactive approach to health management is a key trend powering the industry forward.

Consumers are increasingly scrutinizing ingredient lists, seeking clean labels, and opting for plant-based options. This aversion to synthetic ingredients and a desire for transparency is driving demand for nutraceuticals derived from natural sources, such as fruits, vegetables, herbs, and botanicals. Innovations in extraction and processing technologies are also playing a crucial role, enabling manufacturers to create more potent and bioavailable formulations from these natural ingredients. This trend extends beyond just ingredient sourcing and encompasses ethical and sustainable production practices, further shaping consumer choices.

The increasing understanding of personalized nutrition and the role of gut health are also significant demand drivers. Consumers are moving away from a one-size-fits-all approach and are exploring nutraceuticals tailored to their individual needs based on factors like genetics, lifestyle, and health goals. The growing body of research highlighting the gut microbiomes influence on overall health has fueled demand for probiotics, prebiotics, and other gut-health-focused supplements.

(Source: https://www.grandviewresearch.com/industry-analysis/nutraceuticals-market)

GOVERNMENT INITIATIVES

• Providing financial assistance and fiscal incentives to develop common supply chain infrastructure including cold storage, packaging, logistics etc. to lower investment costs, increase viability, and ensure regulatory compliance.

• The Union Budget FY26 allocated US$ 226.31 million (Rs. 2,000 crore) to the PM Formalisation of Micro Food Processing Enterprises (PMFME) scheme, strengthening micro food processing units and rural value chains.

• PLI schemes to support the creation of infrastructure to encourage manufacturing champions based out of India.

• The Mega Food Park Scheme would create integrated infrastructure for storing and processing requirements of the food processing industry.

• The government of India has liberalized the FDI norms to allow as high as 100% FDI in food products e-commerce through an automatic route issued by the Department of Industrial Policy and Promotion, Ministry of Commerce and Industry.

• Promoting processing clusters and strong linkages from farm to retail through measures like setting up Mega Food Parks with appropriate incentives.

• Supporting the creation of services for R&D, testing, quality improvement, marketing etc., to enhance innovation, competitiveness, and eco-friendly packaging.

• Assisting new and existing micro food enterprises through capital investment support along with strengthening linkages, common facilities, training etc., through the Pradhan Mantri Formalisation of Micro food Processing Enterprises (PMFME) scheme.

• Supporting the setting up of new micro units and upgrading existing micro food processing units, through the PMFME scheme.

BUSINESS OVERVIEW OF TAPI

Tapi Fruit Processing Limited is thriving in the highly favourable business environment for the Indian food processing industry, capitalising on the increasing demand for processed fruits and vegetables. The company have a successful track record of over two decades in the Indian food industry which has enabled them to develop an effective business model with stringent control over processes, including raw ingredient procurement, manufacturing operations, inventory management across their large range of products and SKUs, management of distribution logistics across India, as well as managing deemed export sales.

Tapi Fruit Processing Limited unwavering commitment to sustainability and ethical manufacturing practices, differentiates it from the commoditised nature of this industry enabling it to become the preferred supplier to top brands globally. The Company actively embraces renewable energy, water conservation measures, and effective waste management initiatives, demonstrating its dedication to minimising its environmental footprint.

The domestic candied fruits and jelly industry also experienced a year of robust growth. Some factors for this growth include the resurgence of out-of-home channels and pent-up demand driven by consumers returning to socialising along with increased outreach in rural electrification and increase of capacities by large brands.

The Indian beverages industry presents significant growth opportunities in the future, driven by deeper penetration into rural markets, an expanding demographic profile, and a growing middle-class population. Furthermore, with the growth in per capita income, consumers are willing to spend more on premium and niche products. Urbanisation is also playing a significant role in the growth of the industry, as more people move to urban areas and have greater disposable income.

The Company has implemented several strategic initiatives to enhance its operational excellence.

PRODUCTS AND SERVICES

Products	Description
Candied, Crystallized and Glazed Fruit and Vegetable Products ("Candied Fruit")	These products are made out of 100% fruits and vegetables cooked in sugar syrup. Our products under this category includes tooty fruity, karonda cherry, amla candy. We sell these products under our brand "Tapi", "MumMum" and "Boleto".
Fruit Bar, Jellies, Fruit Jam & Fruit Leathers ("Fruit Jellies")	A product made out of natural fruit pulps dried and shaped in to roll form or bar forms. Our products under this category includes mango fruit rolls, tamarind bars etc. These are fruit jellies made from sugar, glucose, pectin along with fruit pulps added with flavours and colors. Our products under this category includes jelly balls, fruit bears, fruit jelly pops, Jams, fruit katli and jelly cubes. Fruit Jam made from sugar, glucose, pectin along with fruit pulps added with flavours and colors.
Chutney & Sauces	In this category we sell Ketchup made from tomato paste under our brand "Tapi".
Beverages	Under this category our product includes fruit crush and fruit syrups. Our Company recently reintroduced its fruit syrups under its new packaging, with added fruit content.
Nutraceutical Products	We manufacture herbal base nutraceutical products as gummies, fortified with minerals as a functional food. These products are available as multi vitamin gummies, etc.

RESEARCH AND DEVELOPMENT

Tapi have placed a strong emphasis on developing their in-house R&D abilities, which, has been instrumental in companys growth. Their in-house R&D initiatives have resulted in the expansion of companys product portfolio, maintaining the quality of our products and translating feedback received from customers, dealers and distributors into concrete results.

The research and development activities emphasize designing and developing new products keeping in mind market standards, customer requirements, cost of production and compliance with applicable standardization norms.

OPPORTUNITIES

^ Growing Packaged Food and Beverage Consumption: Large and Expanding Indian Market ^ Rising urbanisation and changing consumption patterns

^ The growing emphasis on health and wellness among consumers has led to an increased demand for organic and plant-based foods.

^ International Market Expansion: Introducing Products to Cater to Indian Diaspora and Ethnic Food Aisles ^ Premium Product Development: Targeting Consumers Seeking High-Quality Offerings ^ Strengthening Supply Chain and Business Practices: Enhancing Operational Efficiency and Cost Reduction

THREATS

^ High Tax Structure

^ Volatility in Commodity and Currency Rates: Led by inflationary pressures and mobility restrictions ^ Broad-Based Cost Pressures: Including commodity prices, input cost inflation, and freight challenges

SEGMENT-WISE OR PRODUCT-WISE PERFORMANCE & DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

The company is primarily engaged in the business of FMCG product, which constitute a single reportable segment in accordance with Ind AS 108 - "Segment Reporting".

Financial Highlights INR In Hundred

Particulars	Standalone		Consolidated
	F.Y. 2025-26	F.Y. 2024-25	F.Y. 2025-26	F.Y. 2024-25
Revenue from Operations	24,27,764.87	17,49,760.90	28,52,709.75	20,18,862.53
Other Income	1,151.77	9,020.98	1,151.77	9,216.14
Total Income	24,28,916.64	17,58,781.88	28,53,861.52	20,28,078.67
Less: Total Expenses before Depreciation, Finance Cost and Tax	22,80,301.50	18,26,843.15	26,81,162.18	20,73,944.57
Profit before Depreciation, Finance Cost and Tax	1,48,615.13	(68,061.28)	172,699.34	(45,865.90)
Less: Depreciation	2,68,286.26	92,815.89	273,559.57	94,949.67
Less: Finance Cost	67,711.19	9,383.15	68,684.70	9,395.10
Profit Before Extraordinary & Exceptional Items and Tax	(1,87,382.32)	(1,70,260.31)	(169,544.93)	(1,50,210.67)
Less: Extraordinary & Exceptional Items	213.77	(14,834.45)	(213.77)	(14,834.45)
Profit before tax	(1,87,596.09)	(1,55,425.86)	(169,758.70)	(1,35,376.22)
Less: Current Tax	-	-	4,781.02	5,339.00
Less: Earlier Years Tax	-	-	-	706.37
Less: Deferred tax Liability (Asset)	6,066.12	1,801.78	6,328.43	1,732.02
Profit after Tax	(1,81,529.97)	(1,57,227.64)	(1,68,211.29)	(1,43,153.61)

Financial Performance On Standalone Basis

During the year under review, the revenue from operation of the Company was stood at INR 24,27,764.87 Hundred as against that of INR 17,49,760.90 Hundred for previous year. Revenue from operation of the Company was increased by 38.75% over previous year.

Loss before Tax for the financial year 2025-26 stood at INR 1,87,596.09 Hundred as against Loss before Tax of INR 1,55,425.86 Hundred making the net loss of 1,81,529.97 Hundred for the financial year 2025-26 as against the net loss of INR 1,57,227.64 Hundred for the financial year 2024-25. Due to increase in raw material prices and other expenses, the Company could not generate the requisite profit.

The Board is making its continuous efforts for re-visiting the purchase policy of the Company and increasing the capacity utilization of manufacturing capacity. The company has expanded production capacity and production area for generating more revenue and profit. The Management is also confident that the addition of new automated production and packing machinery would help in achieving a reduction in fixed costs, and that reduced manual intervention in production would lead the Company to generate profit in the coming years. Company has also added New profitable Products as well as expansion in nutraceutical products which will help in generating more revenue and profits.

On Consolidated Basis

The consolidated revenue from operation of the Company for financial year 2025-26 stood at INR 28,52,709.75 Hundred as against that of INR 20,18,862.53 Hundred for previous year. Loss before Tax for the financial year 2025-26 stood at INR 1,69,758.70 Hundred as compared to INR 1,35,376.22 Hundred for the previous financial year 2024-25. The consolidated net loss of INR 1,68,211.29 Hundred for the financial year 2025-26 as compared to INR 1,43,153.61 Hundred for the previous financial year 2024-25.

The strong consolidated performance reflects the positive contribution from subsidiary operations, improved operational efficiencies, and the Companys strategic initiatives to strengthen its business portfolio. The consolidated financial results demonstrate the Companys continued focus on sustainable growth, business diversification, and long-term value creation for its stakeholders.

RISK AND CONCERNS

The Company is exposed to various risks and uncertainties which may adversely impact its performance. The Companys future growth prospects and cash flow generation could be materially impacted by any of these risks or opportunities. The major risks as identified by the Company are demand-risks due to any resurgence in the COVID 19 pandemic, currency risk associated with imports, unfair competition, etc. The Company follows the Enterprise Risk Management (ERM) framework to manage and mitigate such risks which is primarily based on the integrated framework for enterprise risk management and internal controls developed by the Company.

DETAILS OF SIGNIFICANT CHANGES IN KEY FINANCIAL RATIOS (STANDALONE BASIS)

Particulars	F.Y. 2025-26	F.Y. 2024-25	% Change	Reason
Debtors Turnover	14.76 times	12.74 times	15.86 %	Increase in Net Credit Sales
Inventory Turnover	9.34 times	8.87 times	5.30%	-
Interest Coverage Ratio	2.19 Times	(5.67) Times	(138.64)	increase in EBITD
Current Ratio	0.79 times	0.98 times	19.39%	Increase in Current Liabilities
Debt Equity Ratio	1.11: 1.00	0.59: 1.00	88.14%	Increase in Total Debt
Operating Profit Margin (%)	(7.73%)	(8.88%)	(13.01%)	Increase in operative revenue
Net Profit Margin (%)	(7.48%)	(8.99%)	16.79%	Decrease in Net Profit
Return on Net Worth	(16.89%)	(13.97%)	20.91%	Decrease in Net Profit after Tax

DETAILS OF SIGNIFICANT CHANGES IN KEY FINANCIAL RATIOS (CONSOLIDATED BASIS)

Particulars	F.Y. 2025-26	F.Y. 2024-25	% Change	Reason
Debtors Turnover	17.06 times	14.44 times	18.14%%	Increase in Net Credit Sales
Inventory Turnover	10.17 times	10.88 times	6.98%%	-
Interest Coverage Ratio	2.51 times	(3.30) times	(176.03)%	Decrease in EBITD
Current Ratio	0.82 times	1.03 times	20.39%	Increase in Current Liabilities
Debt Equity Ratio	1.09: 1.00	0.58: 1.00	87.93%	Increase in Total Debt
Operating Profit Margin (%)	(5.95%)	(6.71%)	(11.26)%	Increase in operative revenue
Net Profit Margin (%)	(5.90%)	(7.09%)	765.98%	Increase in Net Sales
Return on Net Worth	(15.25%)	(12.55%)	528.74%	Decrease in Net profit after tax

INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY

Internal Control system and adequacy Internal Control measures and systems are established to ensure the correctness of the transactions and safe guarding of the assets. Thus, internal control is an integral component of risk management. The Internal control checks and internal audit programmes adopted by the Company plays an important role in the risk management feedback loop, in which the information generated in the internal control process is reported back to the Board and Management. The internal control systems are modified continuously to meet the dynamic change. Further the Audit Committee of the Board of Directors reviews the internal audit reports and the adequacy and effectiveness of internal controls.

MATERIAL DEVELOPMENTS IN HUMAN RESOURCES / INDUSTRIAL RELATIONS FRONT, INCLUDING NUMBER OF PEOPLE EMPLOYED

The Company believes in establishing and building a strong performance and competency driven culture amongst its employees with greater sense of accountability and responsibility. The Company has taken various steps for strengthening organizational competency through the involvement and development of employees as well as installing effective systems for improving their productivity and accountability at functional levels. The Company acknowledges that its principal asset is its employees. Ongoing in-house and external training is provided to the employees at all levels to update their knowledge and upgrade their skills and abilities. As on March 31, 2026, the Company had total 61 full time employees. The industrial relations have remained harmonious throughout the year.

CAUTIONARY NOTE

Statements in this Report, describing the Companys objectives, projections, estimates and expectations may constitute forward looking statements within the meaning of applicable laws and regulations. Forward looking statements are based on certain assumptions and expectations of future events. These statements are subject to certain risks and uncertainties. The Company cannot guarantee that these assumptions and expectations are accurate or will be realized. The actual results may be different from those expressed or implied since the Companys operations are affected by many external and internal factors, which are beyond the control of the management. Hence the Company assumes no responsibility in respect of forward-looking statements that may be amended or modified in future on the basis of subsequent developments, information or events.