The Ravalgaon Sugar Farm Ltd Management Discussions

A. INDUSTRY STRUCTURE AND DEVELOPMENTS:

Indias proclivity for sweet foods is well known. A consumer looking for sweet foods can choose between hard-boiled sweets, toffees, chocolates, gums, jellies, mints, cakes, biscuits, traditional from individual homes to small, unorganized establishments to large industrial units. Some of the distinguishing characteristics, regardless of size of the production unit, are the focus on good raw materials, hygiene, nutritional values and branding. In some ways strong branding is a signal that the product is consistently manufactured and distributed with the expected care. Innovation in product and packaging as well as consumer engagement through social and traditional media have allowed the category to grow considerably in the last few years. The products are still largely sold through the general trade channel. However, modern trade remains an exciting and growing avenue for driving volumes and brand engagement at the store level. E-commerce and Quick commerce, especially for impulse categories, is a niche channel that shows promise for even greater contribution in the future. The industry is highly price sensitive and therefore remains dependent on a stable pricing environment for raw materials and other industrial inputs. A growing focus on nutrition among consumers has driven recent innovations on substitution of sweetening agents and the government continues to take steps to ensure responsible consumption of these products. Overall, the industry is mature and growing with predictable demand characteristics and will be an important pillar of the fast-moving consumer goods industry in the future.

Keeping in mind the intense competition and the pressure on margins, the Company decided to enter into a transaction for the sale, transfer and assignment of the trademarks, recipes, all intellectual property rights, including all rights, interests, and protections associated therewith, relating to the Companys sugar boiled confectionery business to Reliance Consumer Products Limited. The transaction was completed on March 22, 2024. ancillary assets for the manufacture of confectionery for third parties or can wait for the non-compete period related to the abovementioned transaction to conclude to consider re-entering the confectionery business. Alternately, the Company may decide to refocus its resources in other endeavours that leverage the Companys assets, know-how and deep relations in the retail and agricultural communities. Any new direction will require human resources that can spearhead these initiatives.

The Company operates in a single segment viz. Manufacturing of Confectionery.

Overall economic activity in India remains robust, despite persistent global headwinds. However, FMCG volumes have shown sluggish growth in recent quarters. Competition in the confectionery segment remains intense with consequent pressures on volumes and margins. The inflationary pressures during the pandemic years have eased to a great extent. However, input costs remain elevated without much expectation of rationalization to pre-pandemic levels. Rising input costs will force an industry-wide reckoning on the path beyond the Rupee One price point. The future of the confectionery industry depends greatly on the rationalization of products available in the market and the consolidation of trade channels.

As the Company evaluates strategic alternatives, future business endeavours may involve a learning curve and the attendant risks of pursuing new ventures. Even if the Company persists in FMCG businesses, inflationary pressures in the cost of raw materials, human resources and transport may put pressure on margins, while lack of timely availability of raw materials or suitable manpower may hamper our ability to meet demand. Unpredictable changes in laws and unexpected enforcement actions by governments or local authorities may make it difficult to operate consumption may dissuade some from consuming sugar-based products like confectionery.

The Company maintains adequate internal control systems and makes need-based suitable changes therein to strengthen the same. The system provides, among other things, reasonable assurance of recording the transactions of its operations in all material respects and of providing protection against significant misuse or loss of Companys assets.

The Revenue from Operations (Net) (excluding Other Income) for the year ended March 31, 2025 was Rs. 115.81 Lakhs as against

Rs. 858.01 Lakhs for the previous year. The Net Loss of Rs. 202.70 Lakhs for the year ended March 31, 2025 as against the Net

Profit of Rs. 1730.80 Lakhs (including exceptional items) for the previous year.

The Company believes that manpower is the most valuable resource for its growth. Industrial relations have been cordial. During the year, the Company provided a Voluntary Retirement Scheme to many of its factory workers as production was suspended following the sale of the trademarks, recipes and intellectual property rights related to its confectionery business in March 2024.

During the year under review, there has been no changes in Accounting Policies and Practices. These Financial Statements are prepared in accordance with Indian Accounting Standards (Ind AS) as per the Companies (Indian Accounting Standards) Rules, 2015 and the Companies (Indian Accounting Standards) (Amendment) Rules, 2016 notified under Section 133 of the Act and other relevant provisions of the Act. The Financial Statements up to and for the year ended March 31, 2025 were prepared to comply in all material aspects with the AccountingStandards specified under Section 133 of the Act read with the Companies (Accounts) Rules, 2014 and the relevant provisions of the Act. The previous year figures have been regrouped/ reclassified restated, so as to make the figures comparable with the figures of current

The information, opinions and views expressed in this section of the Annual Report contain certain forward looking statements which involve risks and uncertainties. The Management has made its best efforts to present this discussion/analysis and believes these to be true to the best of its knowledge at the time of its preparation. The Management is not responsible to publicly update or revise any of these forward looking statements whether on the basis of new information, future events or otherwise. The Management shall not be liable for any loss which may arise as a result of any action taken on the basis of information, opinion or views contained herein. The reproduction, disclosure or use of the information contained herein without express prior written permission of the company is strictly prohibited.