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Item 2. Management’s Discussion and Analysis

2025-08-19 compared with 2025-02-25 · 75 added, 128 removed, 134 unchanged (60% of the section changed)

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Report and the Company’s audited financial statements for the fiscal year ended March 31, 2025, as filed with the SEC in its Annual

Report on Form 10-K/A on August 15, 2024, along with the accompanying notes.

As used in this Quarterly Report, the terms “we,”

“us,” “our” and the “Company” means Groove Botanicals, Inc.

Report on Form 10-K on July 16, 2025, and its Amendment No.

1 on Form 10-K/A on August 14, 2025, along with the accompanying notes.

used in this Quarterly Report, the terms “we,” “us,” “our” and the “Company” means Groove

Botanicals, Inc.

The Company relies primarily on its current sole officer and

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Results of Operations

Three Months Ended December 31, 2024, and December 31,

Three Months Ended June 30, 2025, and June 30, 2024

We have not generated any revenue since our inception and

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We reported a net loss of $38,170 in the three months ended

December 31, 2024 as compared to a gain of $13,796 in the three months ended December 31, 2023 and a net loss attributable to our common

stockholders of $87,649 in the three months ended December 31, 2024 as compared to a net loss attributable to our common stockholders

of $40.821 as of December 31, 2023 which is reflective of a dividend on our Preferred Stock of $54,618 at December 31, 2024 and $54,617

at December 31, 2023, respectively as follows:

June 30, 2025 as compared to a loss of $36,539 in the three months ended June 30, 2024 and a net loss attributable to our common stockholders

of $92,787 and $91,156, respectively, in the three months ended June 30, 2025 and 2024 which includes accrued dividends on our Series

A and B Preferred stock of $54,617 in the three months ended June 30, 2025 and 2024, respectively.

Three Months ended

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Income (loss) from operations

Gain on settlement of debt

Interest Income (expense)

Total other income (expense)

Net income (loss)

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Total operating expenses

for the three months ended December 31, 2024 decreased substantially over the three months ended December 31, 2023, with $33,031 at December

31, 2024 compared to total operating expenses of $55,196 at December 31, 2023.

The decrease in operating expenses during the three months

ended December 31, 2024, is mainly due to a decrease in legal and professional fees from $33,227 (December 31, 2023) to $12,176 (December

All other expenses remained relatively constant.

The decrease in legal and professional expenses was largely due to

a decrease in audit and accounting fees, filing fees and tax services related to increased audit fees in the three months ended December

31, 2023 related to our regulatory filings and a change in auditors in 2023 which increased our audit fees for the period.

Other Income (Expense)

Other income in the three months ended December 31, 2024,

was nil, as compared to other income in the three months ended December 31, 2023, of $69,992, related to a gain on settlement of

debt of $71,242, offset by interest expense of $2,250 with no comparable expenses or gains in the three months ended December 31, 2024.

Dividends on Preferred Stock

Dividends on Preferred Stock for the period ended December

31, 2024, and 2023 remained constant, at $54,618 and $54,617 for each period.

These dividends on preferred stock are required subject

to the designation of the preferred stock and contribute to the net loss attributable to our common stockholders.

Nine Months Ended December 31, 2024, and December 31,

We have not generated any revenue since our inception and

do not expect to generate any revenue from the sale of products in the near future.

We reported a net loss of $99,404 in the nine months ended

December 31, 2024 as compared to a net loss of $206,968 in the nine months ended December 31, 2023 and a net loss attributable to our

common stockholders of $263,258 in the nine months ended December 31, 2024 as compared to a net loss attributable to our common stockholders

of $306,328 as of December 31, 2023 which is reflective of a dividend on our Preferred Stock of $163,854 and $163,852 at December 31,

2024 and December 31, 2023 as follows:

Nine Months ended

Operating expenses:

Selling, General and Administrative Expenses

Legal and Professional Expenses

Consulting Expense

Total operating expenses

Income (loss) from operations

Gain on extinguishment of debt

Interest Income (expense)

Total other income (expense)

Net income (loss)

Dividends on Preferred Stock

Net (loss) attributable to common stockholders

Operating Expenses

Total operating expenses for the nine months

ended December 31, 2024, were $99,404 compared to total operating expenses of $206,968 for the nine months ended December 31, 2023.

decrease in operating expenses during the nine months ended December 31, 2024, is mainly due to reduction in consulting expenses from

$78,300 (December 31, 2023) to $1,250 (December 31, 2024) due to a consulting agreement with an independent third party settled by shares

valued at $78,300 which terminated in the period ended December 31, 2023.

The Company recorded a slight reduction in general and administrative

expenses from $56,141 in the nine months ended December 31, 2023, to $52,187 for the nine months ended December 31, 2024.

Rent remained

relatively constant for the nine months ended December 31, 2024, and 2023 with a slight decrease of $2,097 in the nine months ended December

Professional fees decreased from $58,595 (December 31, 2023) to $34,132 due to a change in auditors for the period ended December

Other Income (Expense)

Other income in the nine months ended December 31, 2024, was nil, as compared

to other income in the nine months ended December 31, 2023, of $64,492, comprised of a gain in settlement of debt by the issuance

of stock in the amount of $71,242, offset by interest expense of $6,750 with no comparable expense in the nine months ended December 31,

2024, due to the repayment of outstanding loans in a prior period, with no outstanding loans for the nine months ended December 31, 2024.

for the three months ended June 30, 2025 increased slightly over the three months ended June 30, 2024, totaling $38,170 at June 30, 2025

compared to total operating expenses of $36,539 at June 30, 2024.

There was a slight increase in professional and accounting fees from

$14,546 (2024) to $15,605 (2025), mainly due to an increase in audit fees offset by a refund of legal fees and a decrease in accounting

The increase in audit fees was mainly due to fees invoiced during the period for our March 31, 2025 financial statements.

decreased from $4,644 (2024) to $3,600 (2025) while general and administrative expenses increased from $16,599 to $18,965.

Dividends on Preferred Stock

Dividends on Preferred Stock for the period ended December

31, 2024, and 2023 remained constant at $163,854 and $163,852 for each of the nine month periods ended December 31, 2024, and 2023.

dividends on preferred stock are required subject to the designation of the preferred stock and contribute to the net loss attributable

to our common stockholders.

Dividends on Preferred Stock for the period ended June 30,

2025, and 2024 remained constant, at $54,617 for each period.

These dividends on preferred stock are required subject to the designation

of the preferred stock and contribute to the net loss attributable to our common stockholders.

Operating Activities

For the Nine Months Ended

For the Three Months Ended

Net Cash Used in Operating Activities

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Net cash used by operating activities was $19,786 for the

nine months ended December 31, 2024, compared to $62,772 for the nine months ended December 31, 2023.

Net cash used in operating activities for the nine months

ended December 31, 2024, was primarily the result of a net loss of $99,404, offset by non-cash items including accrued payroll of $36,000,

an increase in prepaid expenses of $3,028 and a decrease in accounts payable and accrued liabilities of $22,897.

Net cash used in operating activities for the nine months

ended December 31, 2023, was primarily the result of a net loss of $142,476 offset by a gain on settlement of debt of $71,242, and

non-cash items, including stock issued for outside services of $78,300, accrued interest of $6,750 and accrued payroll of $36,000.

in working capital include an increase to accounts payable and accrued liabilities of $30,032 and an increase in prepaid expenses of $136.

three months ended June 30, 2025, compared to $20,744 for the three months ended June 30, 2024.

Net cash used in operating activities for the three months

ended June 30, 2025, was primarily the result of a net loss of $38,170, offset by non-cash items including accrued payroll of $12,000,

and changes in working capital related to a decrease in prepaid expenses of $1,529 and an increase in accounts payable and accrued liabilities

Net cash used in operating activities for the three months

ended June 30, 2024, was primarily the result of a net loss of $36,539 offset by non-cash items, including accrued payroll of $12,000,

and changes in working capital including an increase to accounts payable and accrued liabilities of $3,757 and a decrease in prepaid expenses

Investing Activities

There was no investing activity during the nine months ended

December 31, 2024 and 2023.

There was no investing activity during each of the three months

ended June 30, 2025 and 2024.

Financing Activities

Net cash provided by financing activities was $20,481 for

the nine months ended December 31, 2024, compared to $59,978 for the nine months ended December 31, 2023.

During the nine months

ended December 31, 2024, the Company received $88,892 in proceeds from a related party in the form of unsecured advances.

During the nine

months ended December 31, 2023, the Company received net proceeds of $79,978 from a related party in the form of unsecured advances.

activities for the nine months ended December 31, 2023 also included funds of $20,000 by way of a private placement and the repayment

of outstanding convertible debt of $40,000.

the three months ended June 30, 2025, compared to $21,694 for the three months ended June 30, 2024.

During the three months

ended June 30, 2025, the Company received $22,677 in proceeds from a related party in the form of unsecured advances and repaid $2,196

to a related party to reduce unsecured advances payable.

During the three months ended June 30, 2024, the Company received net proceeds

of $21,694 from a related party in the form of unsecured advances.

Liquidity and Capital Resources

We are in need of additional cash resources to maintain our

As of December 31, 2024, we had cash of $1,251 and prepaid expenses of $3,482.

We are in the early stage of development and

have experienced net losses to date and have not generated revenue from operations which raises substantial doubt about our ability to

continue as a going concern.

There are a number of conditions that we must satisfy before we will be able to acquire, license and acquire

products and intellectual property, not the least of which is negotiating and financing any acquisitions.

As of June 30, 2025, we had cash of $2,737 and prepaid expenses of $949.

We are in the early stage of development and have

experienced net losses to date and have not generated revenue from operations, which raises substantial doubt about our ability to continue

as a going concern.

There are a number of conditions that we must satisfy before we will be able to acquire, license and acquire products

and intellectual property, not the least of which is negotiating and financing any acquisitions.

We are in the process of identifying

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and has raised limited capital.

The Company had a net loss of $99,404 and $142,476 for the nine-month periods ended December 31, 2024,

and 2023, respectively.

The Company’s accumulated deficit was $35,110,533 and $34,847,277 as of December 31, 2024, and March 31,

The Company had a net loss of $38,170 and $36,539 for the three-month periods ended June 30, 2025, and

2024, respectively.

The Company’s accumulated deficit was $35,289,368 and $35,196,581 as of June 30, 2025, and March 31, 2025, respectively.

These factors raise substantial doubt regarding the Company’s ability to continue as a going concern.

The consolidated

financial statements do not include any adjustment relating to the recoverability and classification of liabilities that might be necessary

should the Company be unable to continue as a going concern.

The consolidated financial

statements do not include any adjustment relating to the recoverability and classification of liabilities that might be necessary should

the Company be unable to continue as a going concern.

The Company is taking certain steps to provide the necessary capital to continue

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condensed financial statements contained herein.

Use of Estimates

The preparation of consolidated financial statements in conformity

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In November 2023, the FASB issued Accounting Standards Update

2023-07, Segment Reporting—Improvements to Reportable Segment Disclosures (“ASU 2023-07”), which requires

incremental disclosures related to a public entity’s reportable segments.

Required disclosures include, on an annual and interim

basis, significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included

within each reported measure of segment profit or loss, an amount for other segment items (which is the difference between segment revenue

less segment expenses and less segment profit or loss) and a description of its composition, the title and position of the CODM, and an

explanation of how the CODM uses the reported measure(s) of segment profit or loss in assessing segment performance and deciding how to

allocate resources.

The standard also permits disclosure of more than one measure of segment profit.

ASU 2023-07 is effective for fiscal

years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

The Company does not

believe the adoption of ASU 2023-07 will have any impact on our financial statements.

In December 2023, the FASB issued Accounting Standards Update

2023-09, Improvements to Income Tax Disclosures (“ASU 2023-09”), which requires public entities on an annual

basis to (1) disclose specific categories in the rate reconciliation and (2) provide additional information for reconciling items that

meet a quantitative threshold (if the effect of those reconciling items is equal to or greater than 5 percent of the amount computed by

multiplying pretax income or loss by the applicable statutory income tax rate).

ASU 2023-09 is effective for fiscal years beginning after

December 15, 2025.

We are evaluating the impact of adopting ASU 2023-09 on our financial statements.

In March 2024, the SEC adopted the final rule under SEC Release

33-11275, The Enhancement and Standardization of Climate Related Disclosures for Investors , which requires registrants

to disclose climate-related information in registration statements and annual reports.

The new rules would be effective for annual reporting

periods beginning in fiscal year 2025.

However, in April 2024, the SEC exercised its discretion to stay these rules pending the completion

of judicial review of certain consolidated petitions with the United States Court of Appeals for the Eighth Circuit in connection with

We are evaluating the impact the adoption of this rule, if any, may have on our financial statements.

(“ASU”) 2023-07 – Improvements to Reportable Segment Disclosures, which enhances the disclosures required for reportable

segments in annual and interim financial statements, including additional, more detailed information about a reportable segment’s

The standard is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning

after December 15, 2024.

The Company adopted ASU 2023-07 for the year ended March 31, 2025 retrospectively to all periods presented in

the financial statements.

The adoption of this ASU had no impact on reportable segments identified and had no effect on the Company’s

financial position, results of operations, or cash flows.

Recent Accounting Standard Not Yet Adopted:

In December 2023, the Financial Accounting Standards Board

issued Accounting Standards Update (“ASU”) 2023-09 – Improvements to Income Tax Disclosures, which enhances the transparency

and decision usefulness of income tax disclosures.

The standard is effective for public companies for annual periods beginning after December

Early adoption is available.

The Company is still evaluating the full extent of the potential impact of the adoption of ASU

2023-09, but believes it will not have a material impact on its financial statements and disclosures.

In November 2024, the FASB issued ASU 2024-03, – Income

Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement

Expenses (“ASU 2024-03”).

This ASU requires disclosures about specific types of expenses included in the expense captions

presented on the face of the statement of operations as well as disclosures about selling expenses.

The standard is effective for annual

reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027.

The requirements

will be applied prospectively with the option for retrospective application.

Early adoption is permitted.

The Company will evaluate the

full extent of the adoption of ASU 2024-03, but believes it will not have a material impact on its consolidated financial statements and

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis