Mercantile Ports & Logistics Regulatory News (MPL)

Mercantile ports & logistics limited

("MPL", the "Group" or the "Company")

Full Year Results

Mercantile Ports & Logistics (AIM: MPL), which has been operating and developing a port and logistics facility in Navi Mumbai, Maharashtra, is pleased to announce its preliminary results for the year ended 31 December 2025.

Chairman's Statement

Dear Shareholders,

I am pleased to present the Annual Report of Mercantile Ports & Logistics Limited (MPL) for the year ended 31 December 2025.

The past year has been one of the most challenging periods in the history of the Company. It has also been a period that has tested the resilience, determination and conviction of your Board, management team and shareholders.

Since its admission to trading on the London Stock Exchange in 2010, the Company has pursued a singular objective: to develop and operate a strategic port and logistics asset serving the Mumbai metropolitan region and wider Indian economy. Over the past fifteen years, the Company and its investors have committed approximately US$200 million of capital to develop what is today a unique maritime and logistics platform at Karanja, Navi Mumbai.

The asset has been developed through numerous economic cycles, regulatory changes and operational challenges. Throughout this journey, the Company has remained committed to its obligations, invested substantial capital and worked constructively with all stakeholders to create long-term value.

Today, the Karanja asset represents significantly more than the development opportunity that existed at the time of the Company's IPO. The Company has successfully developed approximately 100 acres of waterfront land, secured the rights to expand the development substantially further, established operational infrastructure, obtained key licences and approvals, and positioned the asset within one of India's most strategically important maritime and industrial corridors.

The Board and I remain unanimous in our view that Karanja is a highly valuable strategic infrastructure asset and that the interests of shareholders have not been served by the events that have unfolded over the past year. Having spent considerable time reviewing the asset, its operations, customer relationships, strategic location and long-term potential, I have no doubt that significant value exists within the business. The fact that the asset has attracted such sustained interest from major financial and infrastructure groups only reinforces that conclusion.

The Board and I fully support the strategy being pursued by the Company to protect shareholder interests and secure the return of our asset. We continue to believe that the Company has identified credible funding solutions and financial structures capable of repaying creditors and restoring value to shareholders. While the process has been challenging and at times deeply frustrating, our determination remains undiminished. We will continue to pursue every available avenue to achieve a fair outcome and remain steadfast in our belief that the value created by shareholders over many years deserves to be protected and ultimately returned to its rightful owners.

Mercantile Ports & Logistics Limited

Managing Director's Statement

Dear Shareholders,

When we founded Mercantile Ports & Logistics nearly two decades ago, we believed that India offered one of the most compelling infrastructure investment opportunities in the world. That belief led us to raise substantial capital in London, list the Company on AIM and embark upon the development of what would become the Karanja Port project.

Over the years, shareholders invested approximately $200million into the Company and its subsidiaries. Together, we transformed a vision into a strategic port and logistics asset located in one of India's most important economic corridors. Karanja was not simply a project on paper. It was financed, constructed, operationalized and increasingly attracting significant commercial opportunities, including contracts supporting India's offshore oil and gas sector.

The strategic importance of Karanja has become increasingly apparent over time. Located in Navi Mumbai, one of India's most important industrial and logistics hubs, the port occupies a unique position within a region that continues to experience significant infrastructure investment and economic growth. The asset has secured long-term tenure, developed port infrastructure and direct access to one of the largest concentrations of industrial activity in the country.

In recent years, Karanja has also established itself as an increasingly important offshore oil and gas logistics hub, securing contracts and supporting operations for ONGC and other industry participants. As activity in India's offshore energy sector expanded, the port began attracting growing interest from both domestic and international operators seeking strategically located marine infrastructure.

The Board remains firmly of the view that the quality, location and strategic relevance of Karanja are among the principal reasons why the asset has attracted such sustained attention from some of the largest financial and infrastructure interests in India. The fact that the asset has attracted sustained interest from thesegroups serves only to reinforce the Board's long-held view regarding its strategic value and long-term potential. The events of the past year have only reinforced our belief in the long-term value of what shareholders helped create.The past year has been dominated by the fight to protect that asset and preserve shareholder value.

During 2025, the Company worked extensively with its consortium lenders to agree a One Time Settlement ("OTS") that would allow the debt to be repaid and ownership of the asset to remain with shareholders. Following a lender-led Swiss Challenge process, MPL increased its offer to ₹472.1 crore (approximately £42 million) and was declared the successful bidder. The Company subsequently deposited ₹43 crore (approximately £3.8 million) pursuant to the sanctioned process and was granted until 30 September 2025 to complete payment.

The Company continued to engage with lenders and worked towards completion of the settlement. However, before the expiry of the agreed payment period, the OTS was terminated, the debt was subsequently assigned to Prudent ARC and insolvency proceedings were commenced against Karanja Terminal & Logistics Private Limited, our wholly-owned operating subsidiary.

As has been announced previously, the Company challenged this and subsequent court filings have revealed facts that were not previously known to the Company. Those filings indicate that, while MPL's sanctioned OTS remained active and the Company had already been declared the successful bidder, and after MPL had deposited ₹43 crore (approximately £3.8 million) pursuant to the settlement process, a revised proposal of ₹520 crore (approximately £46 million) was submitted by Prudent ARC and considered by lenders before the OTS was terminated.For much of the period that followed, the narrative surrounding the failure of the OTS focused on the absence of approval from one member of the lending consortium. The later filings reveal a materially different factual picture and raise important questions regarding the sequence of events that ultimately resulted in the termination of the settlement process and the subsequent transfer of the debt. These matters remain the subject of ongoing legal proceedings.

The Board has continued to challenge those events through the courts and tribunals of India. We have pursued redemption proposals, secured funding commitments, proposed full repayment solutions and sought to preserve the asset for shareholders. Those efforts continue today.

The Company repeatedly demonstrated both the willingness and the ability to settle its obligations. We have committed significant deposits, demonstrated proof of funds, secured funding commitments from multiple sources and consistently pursued consensual solutions, including proposals that would have resulted in creditors being repaid in full. We have encountered a process that, in our view, lacked consistency, transparency and predictability.The sanctity of process is fundamental to investor confidence. International investors can tolerate commercial risk; what they cannot tolerate is uncertainty regarding whether established processes will be followed fairly and consistently.

The treatment of Mercantile Ports & Logistics stands in stark contrast to the aspirations promoted through the UK-India Free Trade Agreement. Trade agreements, investment roadshows and policy announcements cannot substitute for due process, transparency and the consistent application of the law. Without those foundations, such agreements risk becoming little more than aspirational documents.

India remains a country of enormous opportunity and immense potential. However, our experience has highlighted how difficult it can be for foreign investors to protect their interests when confronted by powerful commercial and financial interests. At a time when India seeks to attract increasing levels of international investment, these issues matter.

The Board is also deeply concerned by the impact that the insolvency process has had on the underlying business, its customers and the value of the asset itself.

Prior to the commencement of insolvency proceedings, Karanja was an operating business with established customers, growing activity levels and significant momentum, particularly within the offshore oil and gas sector. Years of effort had been invested in developing customer relationships, building operational capabilities and positioning the port as an increasingly important logistics hub. Unfortunately, much of that progress has been placed at risk during the insolvency process. Customers who had committed business to the port have experienced prolonged uncertainty, operational disruption and a lack of clarity regarding the future direction of the asset. The Board has become increasingly concerned by the deterioration of customer relationships that took many years to establish.

Particularly disappointing has been the position taken by ONGC, one of the Company's most important customers, which has issued a termination notice in relation to its contract with the port. The loss of such relationships not only damages current revenues but also undermines the long-term value of the business that shareholders invested substantial capital to create. Whilst the Board is confident that these relationships can be restored once the asset is back under control of the Company, clearly this becomes more difficult, the longer the period of uncertainty.

The Board remains firmly of the view that preserving the operating business, protecting customer relationships and maximising enterprise value should have been a primary objective throughout the process. Instead, the deterioration of the business during this period has had a direct impact on stakeholder value and has reinforced our concerns regarding the manner in which the asset has been managed.Looking Forward

While the battle for Karanja continues, the future of MPL is not defined by a single asset.

The events of recent years have reinforced the importance of operating in jurisdictions where property rights, contractual certainty, regulatory transparency and the rule of law are consistently applied. As a result, the Board has been actively evaluating opportunities in a number of jurisdictions that we believe offer a more stable and predictable environment for long-term infrastructure investment.

Regardless of the outcome of the Karanja proceedings, the Board remains committed to ensuring that MPL emerges as a stronger, more diversified and better protected business for the benefit of shareholders.

Against this backdrop, I remain enormously grateful to our shareholders for their patience, loyalty and support. I am equally grateful to our employees, advisers, customers and partners who have stood by the Company during what has undoubtedly been the most challenging period in the Company's history.I also wish to welcome two exceptional individuals who agreed to join the Board. Stefan Passantino, former Deputy White House Counsel joined the Board early in 2025. In addition, since the year end, Marty Martin, a former senior CIA officer and intelligence leader, has agreed to join the Board and his appointment is expected to be confirmed shortly.

Both bring considerable experience, judgment and international perspective to the Company. Their willingness to join MPL at such a critical time reflects both the quality of the people associated with the Company and the importance of the issues we continue to pursue.Before concluding, I would like to express my sincere gratitude to my fellow Board members and the management team who have stood by the Company throughout the most challenging period in its history.

For an extended period, many of these individuals have continued to devote extraordinary amounts of time, effort and expertise to MPL despite receiving little or no compensation. Their commitment has not been driven by financial reward, but by a genuine belief in the quality of the asset that shareholders helped create and a determination to protect and enhance that value for the benefit of all stakeholders.

I would also like to place on record my personal thanks to Karanpal Singh, who stepped down from the Board during the year. Karanpal has been a valued colleague and supporter of the Company for many years. On behalf of the Board and our shareholders, I would like to thank him for his contribution, commitment and service to MPL and wish him every success in his future endeavours.

Yours sincerely,

Pavandeep (Pavan) Bakhshi

Managing Director

Mercantile Ports & Logistics Limited

Operational Review

INDIAN ECONOMY AND INDUSTRY OVERVIEW

India continued to demonstrate economic resilience during FY 2025-26, maintaining its position amongst the fastest-growing major economies globally despite persistent geopolitical uncertainties, evolving trade dynamics, and fluctuating commodity markets. Supported by strong domestic consumption, sustained public infrastructure investment, and continued growth in manufacturing and services, the Indian economy remained a significant contributor to global economic expansion.

Government initiatives aimed at improving logistics efficiency, strengthening manufacturing competitiveness, and enhancing multimodal connectivity continue to support long-term growth across the transportation and infrastructure sectors. Programmes such as PM Gati Shakti, the National Logistics Policy, and Sagarmala are driving greater integration between ports, railways, road networks, and industrial corridors, improving supply chain efficiency and facilitating trade growth.

India's export sector remained resilient during the year, supported by diversification of export markets, growth in services exports, and increasing participation in global supply chains. Simultaneously, continued expansion of domestic manufacturing capacity and industrial activity has contributed to sustained demand for logistics infrastructure, bulk cargo handling, warehousing, and transportation services.

The Government's ongoing emphasis on port-led development, coastal connectivity, and logistics modernization continues to create long-term opportunities for private sector participation in maritime infrastructure. Investments in industrial corridors, dedicated freight infrastructure, and coastal economic zones are expected to strengthen cargo generation and improve connectivity between production centers and ports.

Inflation remained within manageable levels during the year, supporting macroeconomic stability and providing a relatively predictable operating environment for businesses. India's banking and financial sectors also continued to demonstrate resilience, maintaining adequate capitalization levels and supporting investment activity across key infrastructure sectors.

Key Economic Indicators

• India remained one of the fastest-growing major economies globally.

• Continued government investment in infrastructure and logistics development.

• Sustained growth in manufacturing and industrial activity.

• Ongoing implementation of PM Gati Shakti, Sagarmala and National Logistics Policy initiatives.

• Stable inflationary environment and resilient financial sector.

• Continued focus on trade facilitation, multimodal connectivity and supply chain efficiency.

OUTLOOK

India's long-term economic fundamentals remain favorable, supported by demographic advantages, increasing urbanization, rising industrialization, and continued investment in infrastructure development. The logistics and maritime sectors are expected to play a critical role in supporting this growth trajectory as trade volumes expand and supply chains become increasingly integrated.

The Company believes that continued government focus on logistics efficiency, port infrastructure, manufacturing growth and multimodal connectivity will support long-term opportunities within the broader ports and logistics sector. While global economic conditions and trade patterns may continue to evolve, India remains well-positioned to sustain its role as a key growth market for infrastructure and logistics development.

OPERATIONS UPDATE

During 2025, Karanja Port continued to provide cargo handling and marine services across its established operating segments. The port remained focused on maintaining operational continuity, servicing existing customers, and supporting cargo movements through its marine, yard and logistics infrastructure.

The Company handled approximately 1.2 million MT of cargo during the year, compared to 1.33 million MT in the previous year, reflecting continued utilisation of the port's infrastructure and customer relationships across its core cargo segments. Coal continued to constitute the principal cargo handled through the facility, supported by long-standing customer engagements and established operational capabilities.

Karanja Port maintained its ability to provide round-the-clock operations, enabling the efficient handling of vessels, cargo storage, and landside logistics activities. The operational team remained focused on ensuring safe and efficient execution of port activities while maintaining service standards for customers and stakeholders.

During the year, the port continued to engage with a diverse range of customers and industry participants across multiple cargo categories including bulk, oil & gas sector and project cargo amongst others. In addition to existing business segments, enquiries were received relating to bulk cargoes, liquid cargo opportunities, logistics support services and land utilisation requirements. Management continued to evaluate these opportunities with a view to enhancing the long-term utilisation of the port's infrastructure assets.

The Company also continued to assess opportunities for diversification of cargo streams and expansion of services offered through the port. As part of these efforts, discussions were held with prospective customers regarding potential infrastructure development and long-term commercial arrangements, although no material commitments had been concluded as at the reporting date.

Karanja Port's strategic location within the Mumbai Harbour region, together with its proximity to major industrial and consumption centres, continues to provide a platform for participation in the broader growth of India's maritime and logistics sectors. The Company remains focused on maximising the value of its existing infrastructure while pursuing opportunities that align with its long-term operational and commercial objectives.

During the latter part of 2025, the Company became subject to the Corporate Insolvency Resolution Process ("CIRP") pursuant to an order of the National Company Law Tribunal, Mumbai Bench. Following commencement of the CIRP, management of the Company vested in the Insolvency Resolution Professional in accordance with the provisions of the Insolvency and Bankruptcy Code, 2016. Operational activities at Karanja Port continued during this period, although certain commercial and operational initiatives were affected by the ongoing resolution process. The Company continues to cooperate with all stakeholders and statutory authorities in relation to the CIRP.

The Board wishes to acknowledge the commitment and efforts of the Company's employees, operational personnel and business partners, whose continued support contributed to the maintenance of port operations throughout the year.

Performance Highlights

Operational Performance:

Prior to the commencement of the insolvency proceedings, the operational performance of the business continued to strengthen, supported by increasing customer engagement and the successful execution of a number of strategic commercial initiatives.

Most notably, the Company secured and commenced execution of a significant long-term contract with Oil and Natural Gas Corporation Limited ("ONGC"), one of India's largest public sector enterprises. The contract, which commenced in October 2025 and extended through September 2028 for an aggregate value of approximately ₹100 crore (approximately £8 million) over its three-year term. The award of this contract represented a major commercial milestone for the business and reflected the growing recognition of Karanja Port's capabilities within India's offshore energy sector. Whilst the uncertainty created by the ongoing Court proceedings has put that contract at risk, the Company remains confident of repairing the relationship with this customer post the successful completion of these proceedings.

Management believed that the ONGC contract represented the beginning of a substantially larger opportunity. Karanja Port was increasingly establishing itself as a logistics and support base for offshore oil and gas operations, benefiting from its strategic location, marine infrastructure and operational capabilities. During the year, the Company received enquiries and engaged in discussions with a number of domestic and international participants within the offshore energy sector regarding the provision of marine support, logistics and related services.

In addition, the Company secured a further long-term commercial arrangement relating to container handling activities and continued to pursue opportunities across a range of cargo and logistics segments. Discussions were ongoing with prospective customers regarding project cargo handling, including a major Engineering, Procurement and Construction ("EPC") contractor, as well as opportunities relating to liquid cargo storage and handling infrastructure. Management also continued to evaluate proposals from customers seeking long-term utilisation of the port's land and logistics facilities.

The Board believed that the Company's years of investment in infrastructure development, operational capability, customer relationships and regulatory approvals were beginning to translate into meaningful commercial opportunities. Supported by a growing pipeline of contracted revenues and advanced commercial discussions across multiple business segments, the business was positioned to pursue a broader range of growth opportunities than at any previous point in its operating history.

Financial Highlights:

Impact of the Insolvency Process

The ongoing insolvency process has disrupted that momentum. Customers, suppliers, employees and counterparties have all been affected by uncertainty surrounding ownership and control of the asset.

Relationships that took many years to develop have inevitably been impacted. The Board believes the underlying business, including opportunities within the offshore energy sector, has suffered as a consequence of the uncertainty created by the process.

Board Strengthening and Governance

During the year the Company welcomed Stefan Passantino to the Board and since the year end, we announced the proposed appointment of Marty Martin.

Stefan Passantino is one of the United States' leading legal and regulatory advisers and previously served as Deputy Counsel to President Donald Trump and Senior Ethics Counsel in the White House.

Marty Martin is a distinguished former member of the CIA Senior Intelligence Service and held numerous senior leadership positions during a career spanning more than three decades.

The Board believes the appointment of individuals of this caliber represents a significant endorsement of both the Company's underlying assets and the importance of the issues currently being pursued on behalf of shareholders.

Risk factors and their mitigation measures are as follows:

The Directors believe that the management of the business and the implementation of the Group's plans are potentially exposed to a variety of risks. It is the Board's job to ensure that MPL is managed for the long-term benefit of all shareholders, with effective and efficient decision-making. Corporate governance is an important part of that job, reducing risk and adding value to our business. Good governance and risk management are core to our business and to the achievement of our objectives.

The Board has identified the following principal risks and uncertainties facing by the Company. These are kept under continuous review, and the Board takes appropriate steps to monitor, mitigate and manage each risk in the interests of shareholders and other stakeholders.

Insolvency Resolution Process Risk:

The Group's principal operating subsidiary, Karanja Terminal & Logistics Private Limited ("KTLPL"), was admitted into the Corporate Insolvency Resolution Process ("CIRP") during the year. As a result, management and control of KTLPL vested with the Insolvency Resolution Professional and subsequently the Resolution Professional in accordance with applicable law.

The ultimate outcome of the CIRP remains uncertain and may impact the future ownership, control, capital structure and operations of KTLPL. The process is also subject to legal, regulatory and procedural requirements under the Insolvency and Bankruptcy Code, 2016.

The Group continues to closely monitor developments relating to the CIRP and remains engaged with relevant stakeholders. All material developments are disclosed to shareholders in accordance with applicable AIM Rules and regulatory requirements.

Concentration Risk - Single Strategic Asset

The Company's portfolio is currently focused on Karanja as its principal strategic asset. This concentration means that the Company's financial performance, prospects and value are significantly dependent on the successful development and realisation of this single asset. Any adverse development affecting Karanja - whether operational, technical, legal or commercial - could have a material impact on the Company as a whole. The Board continues to assess opportunities to diversify the asset base where this is consistent with the Company's strategic objectives and the interests of shareholders.

Operations Risk:

The Company is engaged in providing port services and integrated logistics solutions for EXIM and Inland Cargo. The Company is prone to inherent business risks. The Audit Committee monitors risk management activities of each business vertical and key support functions. Fraud Risk Assessment is also part of overall risk assessment. The purpose of risk management is to achieve sustainable business growth, protect the Company's assets, safeguard shareholders' investments, ensure compliance with applicable laws and regulations and avoid major surprises of risks. The Policy is intended to ensure that an effective risk management framework is established and implemented within the Company.

Liquidity Risk:

Liquidity risk is the risk that the Group will be unable to meet its financial obligations as they fall due. As a consequence of the CIRP proceedings, the Group is unable to access cash and other liquid assets held by KTLPL without the approval of the Resolution Professional. The Group's ability to service its own obligations at the parent entity level is therefore dependent on resources available independently of KTLPL. Management monitors the Group's liquidity position and takes into account the restrictions arising from the CIRP framework in assessing the adequacy of available liquid resources.

Foreign Exchange Risk:

The exchange difference arising due to foreign currency exchange rate variances on translating a foreign operation into the presentational currency results in a translation risk. The exposure to FX risk is being closely monitored by the Board on a regular basis only for information to the stakeholders.

Investors are at risk as investments are made in GBP and the assets are in INR, therefore the fluctuation in currency can impact the carrying value of the asset when retranslated.

Macro-Economic and Geopolitical Risk:

The Group's performance may be affected by changes in economic conditions, commodity markets, trade flows, shipping activity and broader geopolitical developments.

Global conflicts, supply chain disruptions, inflationary pressures, changes in trade policy and economic slowdowns may adversely impact cargo volumes, operating costs and customer activity.

The Group seeks to mitigate these risks through prudent cost management, operational flexibility and maintaining relationships across a diverse range of industries and market participants.

Credit risk and losses

Credit risk is the risk that a counterparty will fail to discharge an obligation, resulting in a financial loss to the Group. The Group's maximum exposure to credit risk at the reporting date arises principally from intercompany loan balances and other receivables due from KTLPL.

Future Strategy

The Group's immediate strategic priority remains the preservation of value within its principal operating asset, Karanja Port, while supporting the continuation of operations during the ongoing CIRP involving KTLPL.

The Directors continue to believe that Karanja Port possesses significant long-term strategic value due to its location within the Mumbai Metropolitan Region, proximity to major industrial and logistics corridors, established infrastructure and ability to service a diverse range of cargoes.

Over the near term, the Group's focus will remain on:

* Supporting the continued operation and maintenance of the port infrastructure;

* Preserving customer relationships and maintaining operational readiness;

* Maximising throughput opportunities where commercially viable;

* Protecting the value of the Group's assets and stakeholder interests; and

* Monitoring developments relating to the CIRP process and evaluating their implications for the Group.

The Directors believe that the long-term fundamentals supporting India's logistics and maritime sectors remain favourable. Continued growth in trade, infrastructure development and industrial activity are expected to support demand for efficient port and logistics infrastructure over the long term.

While the timing and outcome of the CIRP remain uncertain, the Board believes that the underlying strategic rationale for Karanja Port remains unchanged and that the asset continues to possess significant potential under an appropriate long-term ownership and capital structure.

Conclusion

The year under review was one of significant challenge and transition for the Group.

The admission of KTLPL into the Corporate Insolvency Resolution Process introduced substantial uncertainty regarding the future of the Group's principal operating asset and altered the operating environment in which the business functions. Despite these challenges, Karanja Port remained operational throughout the period and continued to provide services to customers.

The Directors recognize that the resolution process remains ongoing and that its ultimate outcome will be a significant factor in determining the future direction of the Group. Nevertheless, the Board remains of the view that Karanja Port represents a strategically important infrastructure asset with strong underlying fundamentals and long-term relevance within India's maritime and logistics sector.

The Group remains committed to maintaining the highest standards of governance, transparency and stakeholder engagement throughout this period. The Directors will continue to monitor developments closely and provide updates to shareholders in accordance with applicable regulatory requirements.

On behalf of the Board, we thank our shareholders, employees, customers and other stakeholders for their continued support during a period of considerable change and uncertainty.

Events Subsequent to year end

Subsequent to the year ended 31 December 2025, a number of significant events occurred in relation to the Company's principal operating subsidiary, Karanja Terminal & Logistics Private Limited ("KTLPL").

In November 2025, the National Company Law Tribunal, Mumbai Bench ("NCLT"), admitted an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 ("IBC") against KTLPL and initiated the Corporate Insolvency Resolution Process ("CIRP"). Following the commencement of the CIRP, management and control of KTLPL vested in the Interim Resolution Professional and subsequently the Resolution Professional in accordance with the provisions of the IBC.

During January 2026, the National Company Law Appellate Tribunal ("NCLAT") upheld the admission order of the NCLT. Thereafter, KTLPL and certain stakeholders pursued various legal remedies and settlement proposals with a view to resolving the outstanding indebtedness of KTLPL and seeking withdrawal of the CIRP proceedings.

In February 2026, an application under Section 12A of the IBC was submitted proposing a settlement of the claims forming the basis of the insolvency proceedings. The proposal contemplated repayment of the financial indebtedness owed to the relevant creditor and withdrawal of the CIRP, subject to the approvals required under applicable law. The proposal was considered during the CIRP but was not approved.

The CIRP continued throughout the period subsequent to the reporting date, including the invitation of expressions of interest from prospective resolution applicants and the evaluation of resolution plans in accordance with the provisions of the IBC. The Committee of Creditors subsequently approved a resolution plan, which remains subject to the applicable approval process under the IBC.

In parallel, legal proceedings relating to the CIRP and associated matters continued before various judicial forums, including the Hon'ble Supreme Court of India. As at the date of approval of these financial statements, certain proceedings remain ongoing and their ultimate outcome cannot presently be determined.

The commencement of the CIRP and the subsequent actions taken during the resolution process have had a significant impact on the operations, management and commercial activities of KTLPL. Given that KTLPL represents the Group's principal operating asset, these developments are of material significance to the Group.

The Directors continue to monitor developments closely and will evaluate their impact on the Group's financial position, operations and future strategy as further information becomes available.

Independent Auditor's Report

To the Members of Mercantile Ports & Logistics Limited

Report on the Audit of the Consolidated Financial Statements

Disclaimer of Opinion

We were engaged to audit the consolidated financial statements of Mercantile Ports & Logistics Limited, which comprise the consolidated statement of financial position as at December 31, 2025, and the consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the year then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

The financial reporting framework that has been applied in their preparation is applicable law and UK-adopted International Financial Reporting Standards ("UK-adopted IFRS"). 

We do not express an opinion on the accompanying financial statements of the Company because of the significance of the matters described in the Basis for Disclaimer of Opinion section of our report, we have not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these financial statements.

Basis for Disclaimer of Opinion

The Group's sole operating Cash Generating Unit (CGU) is its Indian subsidiary, Karanja Terminal and Logistics Private Limited ('KTLPL'). During the financial year, KTLPL was admitted to a Corporate Insolvency Resolution Process ("CIRP") under the provisions of the Insolvency and Bankruptcy Code, 2016 of India ("IBC"). As a consequence of the CIRP, the management and administration of KTLPL are conducted by a Resolution Professional appointed in accordance with applicable Indian insolvency legislation, and the Group's ability to direct the operating and financial policies of KTLPL has been materially curtailed.

In preparing the consolidated financial statements, management has utilised the Trial Balance, Statement of Profit and Loss, and Statement of Financial Position of KTLPL, which management was able to obtain directly. Whilst this financial information has been made available for consolidation purposes, access to certain underlying accounting records, primary source documentation, third-party confirmations, and other information ordinarily required for the audit of consolidated financial statements prepared in accordance with IFRS has been subject to procedural limitations arising from the ongoing CIRP proceedings.

As a result, we have been unable to obtain sufficient appropriate audit evidence regarding the existence, completeness, and accuracy of KTLPL's assets, liabilities, income, expenses, and related disclosures, and the consequential effects thereof, if any, on the Group's consolidated financial statements. Because KTLPL constitutes the Group's sole operating CGU, the possible effects of this inability to obtain sufficient appropriate audit evidence are deemed to be both material and pervasive to the consolidated financial statements as a whole. Consequently, we are unable to determine whether any adjustments to the amounts and disclosures in the consolidated financial statements would be necessary in respect of recorded or unrecorded assets, liabilities, income, expenses, and related notes thereto.

As noted above, owing to the procedural limitations arising from the CIRP, we have been unable to obtain sufficient appropriate audit evidence to evaluate management's assessment of going concern in respect of KTLPL. Accordingly, we are unable to conclude on whether a material uncertainty related to going concern exists, and we draw attention to Note 2 in the financial statements, which discloses the circumstances surrounding the CIRP and the Directors' assessment thereof. In forming this position, we have had regard to the following: management has assessed that the Group retains de jure control of KTLPL for IFRS 10 consolidation purposes, notwithstanding the suspension of Board authority under the IBC framework, on the basis of the Group's existing legal ownership interest, the expectation that management authority may be restored upon conclusion of the CIRP, and the terms of applicable Indian insolvency legislation. Management further acknowledges that this conclusion involves significant judgement, and that future developments in the CIRP proceedings - including the pending challenge before the NCLT in relation to the rejection of the promoters' repayment plan, and any change in ownership structure subject to the outcome of those proceedings - could necessitate reassessment of whether control is retained. The Directors have also disclosed, in accordance with IFRS 12.13, that the Group is subject to significant restrictions on access to KTLPL's assets and cash, transfers of funds, participation in operational and financing decisions, and access to financial records, all arising from the CIRP framework. We draw attention to these disclosures without expressing an opinion on the appropriateness of management's going concern assessment.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. In accordance with ISA (UK) 705, we are not required to communicate key audit matters when we disclaim an opinion on the financial statements. Accordingly, we have not determined key audit matters to communicate.

Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with IFRSs, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Group's financial reporting process.In light of the matters described in the Basis for Disclaimer of Opinion section above, management's ability to fully discharge this responsibility in respect of KTLPL's financial information has been constrained by the CIRP proceedings.

Auditor's Responsibilities for the Audit of the Consolidated Financial Statements

Our responsibility is to conduct an audit of the Group's consolidated financial statements in accordance with International Standards on Auditing (UK) and to issue an auditor's report. However, because of the matter described in the Basis for Disclaimer of Opinion section of our report, we were not able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these consolidated financial statements.

We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard as applied to listed entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements.

Extent to which the audit was capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

Non-compliance with laws and regulations

Based on:

· Our understanding of the Group and the industry in which it operates;

· Understanding and reviewing the reporting package submissions made by the component auditors;

· Discussion with management and those charged with governance; and

· Obtaining and understanding of the Group's policies and procedures regarding compliance with laws and regulations.

We considered the significant laws and regulations to be the International Financial Reporting Standards as adopted by the European Union ("IFRS"); Indian tax laws and The Companies (Guernsey) Law,2008.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Report on Other Legal and Regulatory Requirements Report on Other Matters Prescribed by the Companies (Guernsey) Law, 2008

Arising solely from the limitation on the scope of our work relating to the matter described in the Basis for Disclaimer of Opinion section above and pursuant to our duties under section 263 of the Companies (Guernsey) Law, 2008:

· We have not been able to determine whether adequate accounting records have been kept by Mercantile Ports & Logistics Limited.

· We have not been able to determine whether the consolidated financial statements are in agreement with the accounting records and returns.

· We have not obtained all the information and explanations which, to the best of our knowledge and belief, are necessary for the purposes of our audit, as required under section 264 of the Companies (Guernsey) Law, 2008.

Strategic Report and Directors' Report

In our opinion, based on the work undertaken in the course of the audit, except for the possible effects of the matter described in the Basis for Disclaimer of Opinion section above, the information given in the Strategic Report and the Directors' Report for the financial year for which the consolidated financial statements are prepared is consistent with the consolidated financial statements, and the Strategic Report and Directors' Report have been prepared in accordance with applicable legal requirements.

In light of the knowledge and understanding of the Group and its environment obtained in the course of the audit, except for the possible effects of the matter described above, we have not identified any material misstatements in the Strategic Report or the Directors' Report.

Use of our report

This report is made solely to the company's members, as a body, in accordance with our engagement letter dated 22nd May 2026 and section 262 of the Companies (Guernsey) Law, 2008. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Krishna Prasad Dahal (Senior Statutory Auditor)

For and on behalf of

McMillan Woods Audits Limited

42-44 Bishopsgate

London

United Kingdom

EC2N 4AH

Date: June 30, 2026

Please see the below link for the full financial statements.

http://www.rns-pdf.londonstockexchange.com/rns/4566K_1-2026-6-30.pdf