Astral Ltd

Leading with Discipline and Confidence

Dear Stakeholders,

It is my privilege to connect with you once again at the conclusion of another pivotal year for Astral. FY25 has been a period of consolidation and forward-building, where we have focused not just on navigating the operating environment but also on laying down the next set of building blocks for long-term, sustainable growth. What makes this journey particularly meaningful is that much of what we set out to do, whether through capacity expansion, operational decentralisation, or product diversification, is already beginning to take shape. These steps, though operational in nature, carry deep strategic intent.

FY25 brought with it a distinct shift in the external environment. In the pipes segment, the year was marked by heightened volatility in raw material pricing, particularly PVC and a moderation in demand due to a slowdown in real estate and construction activity. The impact of these factors was felt across the value chain, with manufacturers needing to manage input costs more tightly while responding to regional shifts in demand. Although the broader category continued to grow, the momentum was notably lower than the previous fiscal.

Meanwhile, in our UK adhesives operations, the market environment remained subdued, especially in the silicone segment which forms a major part of our portfolio there. The demand environment was softer, influenced by macroeconomic headwinds in the UK and Europe, which led to pressure on sales volumes. However, the overall business remained stable from a profitability perspective.

Our pipes business continued to serve as the company's operational backbone, with meaningful progress on both capacity expansion and efficiency. The Hyderabad plant is now fully operational, enabling us to meet demand more eyectively across southern and eastern markets. This not only brings us closer to our customers but also enhances logistics and reduces turnaround times. In northern India, our Kanpur facility is nearing completion, with equipment installation finished and commissioning set to begin in September 2025. Once operational, this plant will strengthen our presence in Uttar Pradesh and surrounding high-growth regions.

A major highlight this year was the decentralization of our fittings manufacturing. With new facilities in South India and Rajasthan already producing, and another plant underway in Odisha, we have significantly reduced supply-chain bottlenecks and improved our ability to respond to regional needs, all while unlocking

The acquisition of Al-Aziz, has given us instant access to new application areas such as gas utility piping.

" greater cost efficiencies. On the product side, our portfolio continues to deepen. We expanded capacity in our Silent Pipes range, introduced the country's first UL approved piping systems for fire-safety applications, and commenced the installation of a PEX-AL composite pipe line, which is expected to be commissioned shortly.

Our adhesives business in India made strong headway this year, with the Dahej facility now fully operational and delivering key products such as epoxy and PVA adhesives. Building on this momentum, we are expanding our capabilities with two additional production lines for specialised adhesives and tapes, enabling us to serve a broader set of consumer, construction, and industrial needs. The Kanpur plant has also begun producing Teflon and electrical tapes, and, notably, our Teflon tapes have secured approval from major US buyers, paving the way for our first exports and marking a significant step towards global competitiveness. In the UK, while demand for construction adhesives softened, the operational restructuring we undertook last year has started to stabilise margins. We are confident that ongoing cost recalibrations and a renewed focus on customer engagement will support a gradual recovery in the coming quarters.

Our bathware business, though still in its early stages, demonstrated encouraging progress in FY25. By leveraging our established plumbing distribution network, we have been able to introduce a growing range of faucets, sanitaryware, and accessories to the market. Enhanced product design and robust backend support have increased dealer confidence, and as adoption rises, we are optimistic that margins will improve in tandem with volumes.

FY25 also marked the first full year of strategic rollout and brand transition in our paints business under the Astral Coatings identity. Our initial priority was to stabilise operations without additional capital infusion, and we have made meaningful progress with successful launches in Gujarat and Rajasthan. In South India, we continue to operate under the Gem Paints brand, capitalising on its strong legacy recognition. We are now seeing promising traction in paints as well, and the brand his EBITDA positive on a steady-state run rate.

Beyond day-to-day operations, we continued to fortify Astral's organisation and pipeline of products. We have been decentralising decision-making and empowering our regional teams. By setting up production units closer to demand centres, we aim to respond faster to local market needs. Our strong distribution network supports these initiatives and enables eyective cross-selling. For instance, introducing bathware and adhesives into our existing plumbing channels has expanded each dealer's oyerings and improved Astral's share of wallet in projects.

Innovation and strategic investments remain a priority. We made significant progress in OPVC pipes, using fully Indian technology. Our product has passed the ISI quality standards and we have already started receiving orders for commercial supplies. Furthermore, the acquisition of Al-Aziz, which came with an established product line in PE pipes and specialised fittings, has given us instant access to new application areas such as gas utility piping. This acquisition has not only expanded our portfolio but has also saved years of development eyort and capital investment.

On the people and process side, we intensi_ed employee training and implemented leaner procedures across plants. Our marketing teams have strengthened brand-building and dealer engagement, especially in new growth regions. All these eyorts will take time to fully reflect in financial results, but we are confident that they position Astral for sustained profitability.

We enter FY26 with cautious optimism and clear priorities. Our immediate goal is to stabilise the performance of newly launched facilities and product lines while ensuring consistent service to our customers. We are equally focused on scaling our diversification segments—paints, bathware, and new-generation pipes, in a manner that is both profitable and sustainable. The work done over the past year has positioned Astral to emerge stronger, more agile, and better equipped to deliver long-term shareholder value. We remain grounded in execution, and that focus will continue to guide us.

I would like to thank each member of the Astral team for their eyorts this year. I also express my sincere appreciation to our channel partners, customers, vendors, and you, our shareholders, for your continued trust. It is your confidence that fuels our ambition and strengthens our resolve to build a business that endures.