International Conveyors Ltd Management Discussions

Th is Management Discussion and Analysis report presents the key performance highlights of the Financial Year 2024-25 pertaining to your Companys business. Th is review should be read in conjunction with the report presented in the other sections i.e. financial statements, the schedules and notes thereto and other information included elsewhere in this Annual Report. Your Companys financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS), complying with the requirements of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

INDUSTRY STRUCTURE & SCENARIO

Before the advancement of technology, labour was used to transport material and goods from one point to another. People were responsible for carrying these products from one place to another using some kind of mobile transportation devices. This manual handling of goods had many disadvantages such as safety risk, higher cost, lower productivity, miss handling etc.

With the developing technology, new and better ways of transportation of goods were developed. Among these new techniques, Conveyor Belting is the most cost-effective and efficient method of carrying goods and materials from one point to another and it is mostly used for conveying a large volume of materials continuously in a short span of time. The efficiency of Conveyor Belting assists in improving productivity, saves cost and decreases lead time. The high versatility, light weight nature and cost-effectiveness have made Conveyor Belting highly popular across various industries such as manufacturing, mining, agriculture, and logistics etc. Over the time, Conveyor Belting has also improved leveraging technological advancements to offer more energy efficient and longer lasting belts thus reducing the cost per tonne of transportation.

Th e advantages of Conveyor Belting are manifold, such as it enables continuous and consistent material flow, allow for precise control of speed and direction and can handle heavy loads with ease. In comparison to alternative transportation methods, such as manual handling or forklifts, Conveyor Belting is more efficient and require lower operational costs. Conveyor Belting is built in such a manner that it can move loads of materials of all weights, sizes and shapes.

Growing demand from the power, mining, cement, coal, potash and manufacturing industries represent one of the key factors driving the Conveyor Belting market, out of which the mining segment is anticipated to garner the highest share in the market in near future.

INDUSTRY OVERVIEW IN INDIA

Th e Conveyor Belting industry in India is a dynamic and growing sector playing a crucial role in various industrial and material handling operations. Th e Indian Conveyor Belting industry is experiencing substantial growth, driven by expanding manufacturing, increasing e-commerce, and infrastructure development. Th e market is projected to reach USD 856.0 million by 2033, with a compound annual growth rate (CAGR) of 4.64% from 2025-2033. Th is growth is fueled by the adoption of advanced technologies and a focus on sustainable and energy-efficient solutions.

The "Make in India" initiative and government investments in infrastructure are boosting manufacturing and related sectors, increasing the demand for Conveyor Belting. Th e rapid expansion of e-commerce and warehousing industries is driving the need for efficient material handling solutions, including Conveyor Belting. In India, Conveyor Belting is widely used across various industries including mining, cement, manufacturing, aviation, chemicals, oil & gas and e-commerce.

The Indian Governments efforts, such as the construction of 100 smart cities, Pradhan Mantri Awas Yojana (affordable housing) and expansion of road networks under the Bharatmala Project are boosting Cement demand. Metro projects will also drive the demand for cement in future. Th e Cement industry is expected to grow at a CAGR of 7.60% during 2025-2033. As a result, the demand for Conveyor Belting will outgrow in cement industry. Increased activity in mining, manufacturing, food processing and e-commerce is driving the demand for Conveyor Belting in India. Many industries are increasingly embracing automated Conveyors Belting system to improve efficiency and reduce dependence on manual labour.

Th e government has introduced reforms like the National Mineral Policy (2019) and amendments to the Mines and Minerals (Development and Regulation) (MMDR) Act to promote private sector participation and foreign direct investment in the mining sector. Th e Government is also providing incentives for underground mining, specifically for underground coal mining, the government has reduced the floor revenue share and waived upfront payment requirements, coupled with a 50% rebate on performance security, to address challenges like high capital investment and long gestation periods. Additionally, the "Atmanirbhar Bharat" initiative encourages domestic exploration and production of critical minerals, potentially boosting underground mining activity. Th e expanding underground mining sector directly drives the demand for robust and specialized Conveyor Belting solutions to transport materials efficiently and safely. Continuous investments in the mining sector provides the long runway for growth of Conveyor Belting industry going forward.

Th e Indian Conveyor Belting industry is poised for continued growth, fueled by industrial expansion, government support and technological innovation. Th e shift towards automated, intelligent and sustainable conveyor system is expected to reshape the market in coming years.

INDUSTRY OVERVIEW GLOBALLY

Th e global Conveyor Belting industry is expected to continue its upward trajectory driven by technological advancement, the ever growing demand for automation and the expansion of key end use industries like manufacturing, mining and logistics. It is dynamic and growing sector driven by increasing need for efficient material handling solutions across various industries.

Th e global Conveyor Belting market was valued at USD 6.42 billion in 2024 and it is projected to grow at a CAGR of 3.80% between 2025 and 2034, reaching USD 9.32 billion by 2034.

BUSINESS OVERVIEW

Your Company is engaged in the manufacturing and marketing of solid woven fabric reinforced PVC impregnated and PVC covered fire retardant, anti-static Conveyor Belting in India since 1978 having a rich and valuable experience of around 45 years guided by core human values. It has complete integrated in-house manufacturing from yarn preparation, fabric weaving, compound mixing to finishing and it ensures quality control at each step of manufacturing activity. Th e primary product of your Company is PVC Fire Resistant Antistatic Solid Woven Conveyor Belting. Your Company has achieved an annual production of 3,04,359 meters in Financial Year 2024-25. Your Company is one of the largest manufacturers of solid woven belting in the world and has a complete product range with the ability to make Conveyor Belting up to 3150 kN/m (type 18) in strength and belting widths ranging from 600 mm to 1800 mm. Th is is the widest product range of Solid Woven Belting available from any one Company with a manufacturing capacity of 1 million meters per annum of PVC Solid Woven Conveyor Belting. Your Company has plants at Aurangabad, Maharashtra and Falta SEZ, West Bengal. Aurangabad Plant has total annual installed capacity of 7,00,000 meters and Falta SEZ Plant has total annual installed capacity of 4,25,000 meters. Your Company has fully-integrated plants with comprehensive equipped laboratory at both the locations at Aurangabad and Falta SEZ.

Your Companys design team can undertake full in-house design starting from preliminary design of systems from power and tensile strength/tension calculations all the way through to detailed design. It has years of experience in solid woven Conveyor Belting both for underground and above ground applications. Your Company is the first Company to have BIS Certification. It provides products of International quality, superior technology and testing capability.

Your Company has twisting and doubling machines, which is capable of handling upto 20 tons of yarn at a time. It also has one of the widest and heaviest beaming machines in the world with a 2400 mm beam width and carcass making machine capable of handling upto 22 tons of beamed yarn in a single load.

Your Company is also associated with Mato Industries Ltd., UK as their distributor in India for Mato Belt Lacing Machine, Fasteners, Spindle Pins and Belt Cutter etc., for last 3 decades. Your Company has achieved substantial growth rate in sale of Mato Products in India. It expects substantial growth of the ongoing business in coming years.

Your Company has been involved in numerous supply arrangements for Indian Coal Mines and also involved in export contract arrangements with Canadian customers in their potash mining applications. Your Company supports its customers for selecting belting based on Conveyor structure (sidewinder software) and it is pioneer in use of PVC belting in cement industries.

In order to be ahead in the curve when the industry consumption increases globally, your company has undertaken various research and development projects to increase the product range which would increase your companys market share, while contributing to the industry efficiencies. As a result of its research and development activities, your company has developed a superior low abrasive belt with thicker covers to cater to the market which till now has been dominated by PVG. Your company is in the process of various regulatory approvals and is hopeful of penetrating the market from second half of financial year 2025-2026.

STRENGTHS

Experienced Promoters and Management Team

Th e Promoters of your Company have rich and vast experience in Conveyor Belting industry and are well assisted by an experienced and competent team. Your Company is managed by a team of competent professionals with deep knowledge of the core aspects of the business.

High entry barriers

Th ere are barriers for entering in the Conveyor Belting market as dual stage approval is required to be an approved supplier. Product approval by regulatory authorities of importing countries is also required and these approvals are specific to importing entities. As there are very few manufacturers of the product globally, your Company is able to grab a large market share of a niche industry.

Long Term Relationship with the Clients

Your Company believes in maintaining long term relationships with the clients. Your Companys long term contracts ranging between 5-7 years with customers. Your Companys dedicated focus on client coverage and its ability to manufacture as per Countrys and Customers specification has helped to establish long term relationships. It has reputed clients in International and Domestic Market.

Advantageous Policies and Regulations

Th ere are several policies and regulations which gives advantage to the Conveyor Belting industry. For example, National Mineral Policy, 2019 provides for encouragement of merger and acquisition of mining entities, creates dedicated mineral corridors to boost private sector mining, encouraging technology for mineral administration and curb illegal mining, introduction of appropriate incentive for exploration, creation of dedicated mineral corridors to boost private sector mining. Further, Government has relaxed the FDI norms such as FDI of 100% is permitted under the Automatic Route and Government allowed 100% FDI in commercial coal mining to introduce private sector participation.

Talented and Competent Employees

Your Company has skilled and professionally competent employees and technical team who contribute for the success and growth of your Company. It has highly skilled team with an average on-the-job experience exceeding 20 years.

Strong research and Development

With a customer centric ethos, your company has over the years built a strong research and development framework with a focus on reduction of cost of ownership of its customers and is now using that structure to innovate new products so as to increase its offering on its customers.

Connectivity with Sea Ports

Your Companys plant situated at Aurangabad, Maharashtra has the benefit of excellent road infrastructure between Aurangabad and Mumbai. Mumbai sea port is at a distance of 350 KMs from the plant situated at Aurangabad. Kolkata sea port is at a distance of only 50 KMs from the plant situated at Falta SEZ, South 24 Parganas.

Financial Performance

During the year under review, your Company has achieved a turnover of 14,082 lacs as compared to 13,822 lacs in the previous year, signifies a growth of 1.88% than the previous Financial Year. Your Companys profit before taxation for the Financial Year 2024-25 stood at 10,073 lacs as compared to 7,663 lacs in the previous year and has grown by 31.45% over the year.

OPPORTUNITIES & THREATS Conveyor Belting

Your Company deploys wide ranging engineering capabilities to complete manufacturing of products on schedule realizing that our products derive our customers business ahead. Your Company has complete in house manufacturing - from yarn preparation, fabric weaving, compound mixing to finishing - to ensure total process and quality control at each step of manufacturing activity.

Th e product your Company manufactures is an ingenious way to increase productivity in industries and to reduce cost. Th ere are ample of opportunities available with the growing demand of Conveyor Belting in cement and mining industry. Your Company is an ISO 9001:2015 certified Company meeting International quality benchmarks and enjoys several certifications and endorsements from stringent global regulatory bodies, which enables it to grab the international as well as domestic market.

Th e Conveyor industry is surrounded by certain threat which needs to be overcome. Some of the threats that the conveyor industry encounter are inconsistencies in legislations governing the sector, fluctuation in rupee value, volatility in the price of key raw material, depletion of natural resources arising out of the use of coal, transportation hindrances along with high carrying cost of coal and lack of availability of highly skilled manpower.

Th e macro industry in which we operate has high demand and growth potential. We treat every threat as opportunity which helps us to evolve suitably for future.

Treasury

Th e treasury sector in India, a part of larger financial services sector has experienced significant growth and is a crucial contributor to Indias overall economic development. Th is growth is fueled by factors such as increasing financial literacy, rising incomes and a growing demand for various financial products and services.

Indias economy has transitioned from being primarily agriculture dependent to a service oriented economy. Th e tertiary sector, which includes services like banking, finance, IT and healthcare is the largest and fastest growing sector, contributing around 55-60% to the GDP. Equity markets are expected to offer high returns in the long run, supported by improving global and domestic landscapes. Your Companys outlook remains optimistic, grounded in factors such as softened inflation, early adjustments in monetary policy rates, and reduced crude oil prices. Your Company invests after considering both global and domestic macro-economic conditions.

Geopolitical tensions, economic downturns, and other global events can significantly impact exchange rates, interest rates, and overall financial stability, demanding flexible and adaptable treasury strategies. Th e increasing reliance on technology makes treasury operations attractive targets for cybercriminals, requiring robust security measures and continuous vigilance.

Your Company is looking forward for a sustainable growth of its investee Companies in the coming years which would result in your Companys capital appreciation and enhancing income from dividends.

RISK AND CHALLENGES

Conveyor Belting

Foreign Currency Exchange Rate Fluctuations

Your Company imports critical raw material and payment of these purchases is made in foreign currency. International Market is a much bigger market in comparison to Domestic Market resulting in export of your Companys products outside India. Changes in value of currencies with respect to Indian Rupee may cause fluctuations in your Companys operating results expressed in rupees. Th e exchange rate between the rupee and other currencies is variable and may continue to fluctuate in future. Any unforeseen or adverse fluctuations with respect to the unhedged exchange rate of any Foreign Currency for Indian Rupees may affect your Companys Results of operations.

Regulatory Risk

Changes in the Regulatory Environment, while usually beneficial to the progress of the sector in the long term, could sometimes cause short term disruptions. Stringent corporate governance regulations and public disclosure requirements have enhanced the need for compliances. Compliance risk is caused by failure in compliance with various domestic and overseas rules and regulations. Non-compliance may lead to penalties and loss of reputation.

Political Differences

As your Company exports its product outside India, any political differences between India and the Countries in which the product is being exported can lead to disruption in demand of Conveyor Belting. Revision in import/export regulation or political events such as trade wars can be detrimental for exporting your Companys product outside India. Th ese events are largely out of hands and can be fairly unpredictable.

Change in Policies due to Change in Ruling Dispensation

Policy changes about usage of product due to change in ruling dispensation and their mindset for abrupt policy change may cause loss of business to the Company.

However, your Company has various due diligence systems in place to mitigate the impact of the risks mentioned above and to ensure transparency and accountability in the day to day business activities.

Material cost and supply chain disruptions

Due to geopolitical conflicts, global economic development and post-pandemic conflicts, supply networks are very uncertain. Apart from delays in important parts like motors and bearings, Conveyor Belting manufacturers are also dealing with the increasing cost of commodities like copper, steel and rubber. Th ese problems bring in higher project costs, delayed deliveries and strained vendor relationship.

Customized Demand

In the specialized production environment, off-the-shelf Conveyor Belting are no longer adequate. Th e clients demand highly customized solutions that are suited to their layouts, materials, and throughout objectives and environmental circumstances. Even though it is essential, it can bring strain on resources, lengthen lead times and make scaling difficult, especially because consumers also want real time stimulations, quicker design cycles and quick deployment without sacrificing quality or safety.

Treasury

Treasury operations face a complex and dynamic environment, presenting numerous risks and challenges to effectively manage a Companys financial resources. Your Company is exposed to various risk such as market risk, financial risk, political risk, fidelity risk, legal risk, liquidity risk and operational risk. Your Company has quoted investment which are exposed to fluctuations in stock market. Any decline in these quoted investments will have an impact on your Companys financial position. Any slowdown in the growth of the Indian economy or future volatility in the global financial market, could also affect the financial position of your Company.

However, your company puts continuous effort to frequently examine the ups and downs of the market. As your Company has been fundamentally built on the principle of sound risk management practices, it has successfully weathered the market turbulence and continues to remain resilient. Th e Audit Committee of your Company reviews the probable risk that may affect the financial position of your Company from time to time.

SEGMENT-WISE AND PRODUCT-WISE PERFORMANCE

Th e segment-wise and product-wise performance of your Company is given below:

a. Conveyor Belting

Your Company is mainly engaged in the manufacturing of Conveyor Belting. Th e revenue generated from this segment during the Financial Year 2024-25 comprises of 94.22% of the total revenue of your Company. Th e revenue generated from Conveyor Belting segment during the financial year 2024-25 is 13,268 lacs as compared to 12,956 lacs in the previous financial year, which signifies a growth of 2.41% than previous year. Th e Profit before Interest and Tax from Conveyor Belting segment is 2,950 lacs for the year ended March 31, 2025 as compared to 2,869 lacs for the year ended March 31, 2024 and has increased by 2.82%.

b. Wind Energy

Your Company presently has in total 5 Wind Mills. All these Wind Mills are generating green energy in the states of Karnataka, Maharashtra, Gujarat and Andhra Pradesh and the same is supplied to respective state consumers through state grids. Th e revenue generated from Wind Energy during the financial year 2024-25 is 145 lacs as compared to 152 lacs in the previous financial year and reduced by 4.83% over the year. Revenue from this segment has been decreased due to low wind velocity. Th e Profit before Interest and Tax from Wind Energy segment is 35 lacs for the financial year ended March 31, 2025 as compared to

6 lacs for the financial year ended March 31, 2024 and has increased by 483.33%.

c. Trading of Goods

Your Company is engaged in trading of fasteners. During the financial year 2024-25, the revenue generated from trading of goods is 631 lacs as compared to 691 lacs in the previous financial year and has decreased by 8.68% over the year. Th e revenue generated from this segment has been decreased due to lack of export orders. Th e Profit before Interest and Tax for the year ended March 31, 2025 is 121 lacs as compared to 124 lacs and has decreased by 2.42% over the year. Profit before Interest and Tax has decreased due to lower revenue recorded during the year.

d. Treasury

Th e Treasury segment comprises of investment in equity instruments, mutual funds and inter-corporate deposits given by your Company and the total assets under this segment as on March 31, 2025 stood at 44,068 lacs as compared to 35,989 lacs in the previous financial year and has grown by 22.45% over the year. Th e Profit before Tax from the treasury segment is 7,861 lacs for the financial year ended March 31, 2025 as compared to 5,661 lacs in the previous financial year and has grown by 38.86% over the year. Further, profit from the treasury segment contributes to 78.04% of the Profit before Tax of the Company.

INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY

A separate paragraph on internal financial control systems and their adequacy has been provided in the Directors Report.

DETAILS OF SIGNIFICANT CHANGES IN KEY FINANCIAL RATIOS ALONGWITH EXPLANATION

In compliance with the requirement of the Listing Regulations, the key financial ratios of your Company alongwith explanation for significant changes (i.e., for change of 25% or more as compared to the immediately previous financial year) has been provided hereunder:

Sl. No.	Particulars	2024-25	2023-24
01	Debtors Turnover	5.82	6.00
02	Inventory Turnover	8.69	6.78
03	Interest Coverage Ratio	14.32	9.23
04	Current Ratio	3.99	2.18
05	Debt Equity Ratio	0.25	0.45
06	Operating Profit Margin (%)	16.50	15.58
07	Net Profit Margin (%)	31.06	30.36
08	Return on Net-worth (%)	22.04	23.14

Inventory turnover ratio has been increased by 28.17% due to increase in sales and decrease in average inventory.

Interest coverage ratio has been increased by 55.15% as earnings before interest and tax has been increased as compared to last financial year while interest expenses has been reduced.

Current ratio has been increased by 83.03% due to increase in current assets in the form of current investment. Debt equity ratio has been decreased by 44.44% due to decrease in borrowings during the year.

Th ere have been no significant changes in the ratios over previous year except as provided above. For detailed explanation, please refer to Note no. 38 (14) of the Notes to Standalone Financial Statements for the year ended March 31, 2025.

MATERIAL DEVELOPMENTS IN HUMAN RESOURCES

Your Company has been continuously working to enhance human resource skills, competencies and capabilities within the organization, which are critical to achieve desired results in line with the strategic business ambitions. Your Company strongly believes that to achieve continual success, a dedicated and devoted workforce is very much required to get high performance and improved productivity. Your Company has left no stones unturned for enhancing the capabilities of employees across all levels of the Organization through continuous learning and development programs.

Th e total employee strength as on March 31, 2025 stood at 93. Your Company is taking initiatives to maintain safety and welfare of employees such as: a. Celebration of Yoga Day; b. Annual Medical Checkup; c. Celebration of Safety week; d. Conducting Safety Mock Emergency Drill; e. Conducting Monthly Safety Committee Meeting; f. Conducting Safety Induction Training; g. Celebration of Ganpati festival; h. Celebration of Republic Day and Independence Day. i. Conducting POSH Awareness Session

CAUTIONARY STATEMENT

Statements in this "Management Discussion and Analysis Report" describing your Companys objectives, projections, estimates and expectations may be forward looking statements within the meaning of applicable laws and regulations. Th e actual results may differ substantially or materially from those expressed or implied. Th e important factors that would make a difference to your Companys operations include demand-supply conditions, raw material prices, changes in Government Policies, Governing Laws, Tax regimes, Global Economic Developments and other factors such as litigation and labour negotiations.

	For and on behalf of the Board of Directors
	Yogesh Kajaria
Date : August 14, 2025	Chairman & Managing Director
Place: Chhatrapati Sambhajinagar	DIN: 01832931