MANAGEMENT DISCUSSION AND ANALYSIS

AGRICULTURE AS AN ENGINE OF GROWTH:

1. In the past agriculture has played and will continue to play a dominant role in the growth of Indian economy in the foreseeable future. It rebrsents the largest sector producing around 28 percent of the GDP, is the largest employer providing more than 60 percent of the jobs and is the prime arbiter of living standards for seventy percent of India's population living in the rural areas. These factors together with a strong determination to achieve self-sufficiency in food grains production have ensured a high priority for agriculture sector in the successive development plans of the country.

2. An important facet of progress in agriculture is its success in eradication of its critical dependence on imported food grains. Indian agriculture has progressed a long way from an era of frequent droughts and vulnerability to food shortages to becoming a significant exporter of agricultural commodities. This has been possible due to persistent efforts at harnessing the potential of land and water resources for agricultural purposes.

3. India's future for sustainable and inclusive growth lies in her farms. Agriculture has the potential to accelerate economic growth and social development in India. We can never overemphasize the importance of agriculture as provider of food, as a provider of jobs, as

a provider of raw material for industry and also as a provider of purchasing power in the hands of millions of people. The benefits are so obvious, extensive and immediate.

4. The resurgence of agriculture would require large scale investments in developing basic infrastructure, mainly irrigation, rural roads and post harvest technology. The increase in productivity would depend on our ability to embrace newer technologies and more particularly the seed embedded technologies.

5. Our country has the potential to emerge as a major provider of quality seeds in the world. We have abundance of lands, hands, water, sun shine as also agricultural knowhow to produce quality seeds.

YOUR COMPANY'S STRATEGY FOR GROWTH & RISK MITIGATION:

1. Besides cotton, your company's product portfolio includes food crops of national importance namely, Paddy, Wheat, Maize, Bajra and Jowar. Amongst oil crops, we have substantial brsence in Mustard seeds.

2. Since past few years, your company has increased its focus on vegetable seeds and plant nutrition supplements. Amongst Vegetable crops, our concentration is mainly on Okra, Tomatoes, Chillies, Brinjal and various types of Gourds.

3. With increased income levels, the country has to transition from food security to nutrition security. We believe that there shall be exponential growth in demand for vegetables and fruits.

4. It has been your company's strategy to have a balanced portfolio of products comprising cotton, food crops, vegetable crops as also plant nutrition supplements so that company is not overly dependent on a single crop. The diversified product portfolio helps in offering a range of products to our channel partners round the year and also helps us in effective utilization of marketing team.

5. Your company's research program is essentially farmer-centric. The products are launched only after thorough evaluation in multi-location trials in different regions and different seasons. Your company has thus developed a robust pipeline of research products.

6. Your company's strategy is to work intensively in 200 identified territories. Each territory would be treated as a service centre to serve and educate the farming community in agro activities as also to act as a profit centre for sale of company's products.