Credit Rating

Corporate Office & Communication Address: 40I Aza House, 24, Turner Road, Bandra (W), Mumbai 400 050. Website: www.panamapetro.com Phone : 9I-22-42I77777 I Fax : 9I-22-42I77788 I E-mail : ho@panamapetro.com CIN No. L23209GJI982PLC005062 October 12, 2026 BSE Limited National Stock Exchange of India Limited Pjiroze Jeejeebhoy Towers, Exchange Plaza,5th Floor,Plot No. C/1 Dalal Street, Fort,Mumbai 400 001 G Block,BKC, Mumbai-400 051 Scrip Code: 524820 Scrip Symbol: PANAMAPET Sub: Intimation of credit rating on the Bank Facilities Dear Sir/ Madam, Pursuant to Regulation 30(6) of the SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015 (the “Regulations”), this is to inform you that CARE Ratings Limited has revised the Outlook from Stable to Positive for Long-Term Bank Facilities while reaffirming the ratings, as under: Facilities Rating Rating Action Reaffirmed; Outlook Long-Term Bank Facilities CARE A+; Positive revised from ‘Stable’ to Positive’ Short-Term Bank Facilities CARE A1+ Reaffirmed Press Release dated October 12, 2026, issued by the credit rating agency is enclosed herewith. This is for your information and records Thanking You, Yours faithfully, For PANAMA PETROCHEM LIMITED Samir Rayani Managing Director & CEO DIN:00002674 Press Release Panama Petrochem Limited October 12, 2026 Name of the Facilities/Instruments Amount (₹ crore) Rating2 Rating Action Regulator1 Reaffirmed; Long-term bank facilities RBI 64.00 CARE A+; Positive Outlook revised from Stable Short-term bank facilities RBI 585.00 CARE A1+ Reaffirmed Details of instruments/facilities in Annexure-1. Rationale and key rating drivers Reaffirmation of ratings assigned to bank facilities of Panama Petrochem Limited (PPL) continues to derive strengths from its established track record in the petroleum speciality oils business considering four decades of promoters’ experience in the industry and ability to manufacture numerous variants, which cater to diversified industries. Revision in outlook from ‘Stable’ to ‘Positive’ factors in operationalisation of new capacities, which is expected to support its growth in scale of operations in the medium term with improvement in profitability and cash accruals levels. It also factors in the multi- fold growth in total operating income (TOI) in Q1FY27 (Q1 refers to April 01 to June 30) over Q1FY26 given the significant increase in product prices led by uptick in raw material prices, base oil, which is a crude oil derivative. This growth was also backed by increased sales volumes due to surge in demand from end-user industries in anticipation of higher prices and to safeguard the material availability considering scarcity of petroleum products in the market due to global geopolitical headwinds. Hence, sustainability in overall scale of operations in the medium term backed by timely commencement of the additional capacities achieving volume driven revenue growth remains a key credit monitorable. Ratings continue to derive strength from the sustained increase in scale of operations for five years ended FY26 (FY refers to April 01 to March 31), geographically diversified revenue, above-average profit margins within its industry sectors, healthy capital structure, debt coverage indicators and strong liquidity position. These rating strengths are partially tempered by vulnerability in profit margins due to sensitive base oil prices linked to volatile crude, and foreign exchange fluctuations, competitive industry due to low entry barriers and limited product differentiation in the base oil processing industry. Rating sensitivities: Factors likely to lead to rating actions Positive factors • Sustenance of volume driven increase in the TOI with increase in gross cash accruals (GCA) level above ₹250 crore on a sustained basis. • Maintaining profit before interest, lease rentals, depreciation and taxation (PBILDT) margin above 10% on a sustained basis. • Maintaining healthy financial risk profile and liquidity position. Negative factors • Deterioration in the PBILDT margin below 8% on a sustained basis. • Large-sized debt-funded capex or acquisition impacting the capital structure • Elongation of operating cycle above 100 days leading to deterioration of liquidity position. • Net debt/PBILDT increases over 1.00x on a sustained basis. Analytical approach: Consolidated CARE Ratings Limited (CareEdge Ratings) has considered consolidated business and financial profile of PPL and its whole-owned subsidiary Panol Industries, RMC FZE (PIRF) as both entities are involved in the same business. PPL has control over the subsidiary’s management and operations with strong financial synergies among them. Entity consolidated are listed under Annexure-5. 1SEBI: Securities and Exchange Board of India; RBI: Reserve Bank of India; MCA: Ministry of Corporate Affairs; IRDAI: Insurance Regulatory and Development Authority of India; PFRDA: Pension Fund Regulatory and Development Authority. 2Complete definitions of ratings assigned are available at www.careratings.com and in other CARE Ratings Limited’s publications. 1 CARE Ratings Ltd. Press Release Outlook: Positive The revision in outlook from ‘Stable’ to ‘Positive’ reflects CareEdge Ratings expectation of sustained volume backed increase in scale of operations and profitability levels with timely operationalization of additional capacities. The outlook may be revised to ‘Stable’ in case of lower-than-envisaged profitability or decline in sales volumes than envisaged levels. Detailed description of key rating drivers: Key strengths Established track record with experienced management in base oil processing industry PPL is an established player in the petroleum speciality oils processing business with over four decades of existence in the industry. The group manufactures over 80 variants of oil, which provide its applications across multiple industries such as printing ink, resin, cosmetics, rubber products, pharmaceuticals, engineering, textiles, machinery manufacturing, chemical and petrochemical industries among others. The diversified industry applications mitigate industry specific risks in case of downturn. The company benefits from experienced promoters, who are supported by qualified professionals across their respective functions. The company’s promoters are part of Rayani family with Arif A Rayani being the Chairman and Samir A Rayani being Managing Director. Board of directors consists of eight members including four independent directors. Overseas operations are managed by Iqbal Rayani, who is a part of promoter family and looks after day-to-day function of its subsidiary company. Reputed and diversified customer base and wide geographical presence The group’s customer base remained reputed marked by leading companies across industries. Major industries catered by the group include cosmetics, pharmaceuticals, automotive lubricants, petroleum jellies, and transformer oils among others. This remained diversified marked by top 10 customers on a consolidated basis accounted for 43.72% of the TOI in FY26 (FY25: 45.46%). In the last decade, it consistently met customer requirements by delivering customised end-products to their specifications. The lengthy approval process, which can take up to a year for each product grade, serves as a significant barrier to entry for potential competitors, strengthening PPL’s enduring relationships with its customers. The group exports to over 75 countries with exports contributing 50% of the TOI in FY26 against 56% of TOI in FY25 with the Middle East, Africa and South America being key export regions reflecting wide geographical reach. Consistent increase in revenue for five years ended FY26 with significant growth in Q1FY27 In the last five years, the company’s consolidated revenue has consistently grown with TOI stood in the range of ₹2,132.35 crore in FY22 to ₹3,064.26 crore in FY26. In FY26, revenue increased to ₹3,064.26 from ₹2,792.89 crore in FY25, registeri [Showing first 8,000 characters — download PDF for full document]