Aartech Solonics Ltd Management Discussions

In terms of the provisions of Regulation 34 (2)(e) read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, your Company presents the detailed Management Discussion and Analysis Report for the financial year 2024-25

A) Industry Structure and Developments

The global power and energy industry is currently undergoing a profound transformation, propelled by increasing demands for sustainability, enhanced grid reliability, and improved energy efficiency. This shift is especially pronounced in India, where ambitious national targets and government initiatives are driving rapid modernization of the energy landscape.

Key Structural Shifts in the Industry:

1. Energy Transition

Globally, there is a marked shift away from conventional fossil fuel-based energy generation towards renewable energy sources such as solar, wind, and hybrid systems. In India, this transition is accelerated by the governments aggressive push to achieve 500 GW of renewable energy capacity by 2030. This transition is creating significant opportunities for companies engaged in the development and deployment of advanced energy storage solutions, smart grid technologies, and products that enhance grid stability and reliability.

2. Grid Modernization

Indias power infrastructure is undergoing a fundamental change from a fragmented, state-wise system to a unified, interconnected national grid under the visionary initiative: "One Nation - One Grid - One Frequency." This integrated grid necessitates deployment of sophisticated systems, including:

?€? Bus Transfer Systems (BTS) for seamless power switching

?€? Control and Relay Panels (CRPs) to safeguard grid stability

?€? Real-time grid monitoring tools to enable prompt and efficient grid management

The transformation is fostering the demand for high-technology solutions to ensure uninterrupted and quality power supply across the country.

3. Technological Integration

The evolving power ecosystem increasingly demands advanced, digitally-enabled technologies to optimize energy management and consumption. The key technology trends shaping the industry include:

Advanced Metering Infrastructure (AMI): Smart meters enabling real-time data capture and dynamic pricing models.

S 0 L 0 N I C S

?€? Demand Response (DR) Systems: Tools to manage consumer electricity demand actively, improving grid efficiency.

?€? Energy Storage Systems: Critical for balancing intermittent renewable generation and ensuring grid stability.

?€? SCADA-Compatible Panels: Supervisory Control and Data Acquisition systems for comprehensive grid automation and monitoring.

?€? Hybrid Renewable Energy Integration Tools: Enabling consistent power output by combining solar, wind, and other renewable sources.

These technologies are central to Indias goal of creating a smarter, more resilient power grid.

4. Defense Innovation Ecosystem

Under the government-backed iDEX (Innovation for Defence Excellence) initiative, domestic companies are increasingly focused on developing indigenous, application-specific technologies tailored to defense requirements. Aartech has emerged as a key player in this ecosystem, contributing innovative solutions such as adaptive power modules and customized control panels, enhancing the self-reliance of Indias defense capabilities.

5. Increased Government Spending and Infrastructure Investment

The government and its entities ?€” including national players like NTPC, PowerGrid, and various State Electricity Boards (SEBs) ?€” are making substantial investments in transmission and distribution (T&D) modernization. This includes upgrading substations, deploying digital relays, and installing hybrid panels to boost efficiency, reduce losses, and support renewable integration. These investments have catalyzed demand for technologically advanced products and services, directly benefiting companies operating in the power infrastructure space.

This evolving industry structure presents significant opportunities and challenges, requiring agility, innovation, and deep domain expertise. Aartech is strategically positioned to capitalize on these trends through its diversified product portfolio, strong R&D capabilities, and growing global footprint.

B) Opportunities and Threats

O pportunities:

1. Export Market Expansion

Aartechs successful project executions in the Middle East and the United Kingdom, including work for the Global Centre for Rail Excellence (GCRE), demonstrate the companys operational maturity and technical readiness to compete in international markets. With growing global demand for smart and sustainable power solutions, Aartech is well-positioned to scale its export portfolio across regions.

2. Defense Contracts and Indigenous Innovation

The development of the Adaptive Alternate Power Module (AAPM), in collaboration with IIT Powai and the Indian Army, opens new avenues within Indias expanding defense technology sector. The solutions application in mobile

S 0 L 0 N I C S

power for tanks and artillery has the potential to generate recurring demand from defense forces including the Indian Army, Navy, and allied defense research organizations.

3. Growth in Smart Grid Projects

Indias utility sector is rapidly modernizing, with a strong push for Substation Automation System (SAS) compliance and smart grid technologies. This is driving increased demand for smart-compatible Control & Relay Panels (CRPs) and Bus Transfer Systems (BTS). Aartechs SAS-compliant offerings give it a competitive edge in this evolving landscape.

4. Emergence of Energy Storage Technologies

With renewable energy integration rising, energy storage systems?€”especially ultracapacitors, hybrid storage, and fast-discharge modules?€”are expected to see exponential growth. Aartechs wholly owned subsidiary, Faradigm® Ultracapacitors Private Limited (FUPL), is strategically positioned to address this market opportunity through indigenous design and scalable manufacturing capabilities.

5. Digital Infrastructure and Government Schemes

Government-backed initiatives such as the Revamped Distribution Sector Scheme (RDSS) and Green Energy Corridor are enabling digital upgrades across Indias transmission and distribution infrastructure. This fosters demand for digitally enabled panels, real-time monitoring systems, and custom control solutions, areas where Aartech has deep expertise.

Threats

1. Volatility in Raw Material Costs

Fluctuations in the prices of essential inputs such as copper, aluminium, electronic components, and engineering plastics can have a significant impact on production costs and overall margin stability. In markets where pricing flexibility is limited due to high sensitivity to cost increases, the ability to offset these rising input costs may be constrained, potentially leading to pressure on profitability.

2. Project Execution Delays

Factors such as delayed government approvals, logistical disruptions, extreme weather conditions, or shifting political priorities can affect the timely execution of projects. This, in turn, can defer revenue recognition and impact quarterly performance metrics.

3. Pricing Pressure and Competitive Intensity

Aartech faces significant pricing pressure in areas such as CRP manufacturing and standard panels, where competition from low-cost domestic manufacturers and imported alternatives is particularly strong. Competing primarily on price while ensuring quality standards and regulatory compliance presents challenges, especially in high-volume contracts where margins are typically thin.

4. Shortage of Skilled Manpower

Specialized talent in areas like embedded systems, high-voltage electrical design, automation, and power electronics remains scarce and increasingly expensive. This talent gap may impact new product development timelines and operational efficiency, particularly as the company scales up. S 0 L 0 N I C S

By proactively leveraging emerging opportunities and strategically mitigating potential threats, Aartech aims to sustain its growth trajectory and reinforce its position as a trusted technology-driven partner in Indias and the worlds energy transition journey.

C) Product-wise / Business Line Performance

In FY 2024-25, Aartech Solonics Limited continued to demonstrate strong, broad-based performance across its core and emerging areas of operation. Each product line contributed meaningfully to the companys revenue, strategic positioning, and long-term growth potential. A detailed analysis of the performance by business line is provided below:

1. Bus Transfer System (BTS)

The BTS product division remained one of Aartechs high-margin contributors, recording an impressive 20% year- on-year (YoY) growth. Demand was driven by:

?€? Power generation facilities (thermal, hydro, and renewables)

?€? Process industries with critical uptime needs

?€? International Engineering, Procurement, and Construction (EPC) contractors

Competitive Advantage: Aartechs proprietary four-breaker scheme continues to offer superior efficiency and reliability, particularly in grid-sensitive applications . This technical edge, combined with deep application expertise, has helped expand market share both domestically and globally.

2. Control and Relay Panels (CRP)

The CRP division achieved a significant milestone by surpassing ^ 20 Crores in revenue during the year.

Key highlights include:

?€? Geographic Expansion: Successful entry into two new Indian states, reinforcing our pan-India presence

?€? Technology Differentiation: Introduction of SCADA-compatible, BCU-integrated panels, enhancing automation and digital control capabilities for modern substations

?€? International Breakthrough: Secured the first export order in this product division- a notable step in Aartechs global growth journey.

The CRP business continues to be a robust, scalable business unit, aligned with Indias substation modernization and smart grid initiatives.

S 0 L 0 N I C S

3. Ultracapacitors (Faradigm®)

Under the wholly owned subsidiary Faradigm® Ultracapacitors Private Limited (FUPL), this business area is gaining strong momentum, driven by the growing need for high-speed energy discharge systems across critical sectors.

Performance and Strategic Developments:

?€? Active sales pipeline of over ^100 Crores, encompassing opportunities in defense, railways, and e-mobility

?€? Collaborative innovation with IIT-Powai and the Indian Army, resulting in the Adaptive Alternate Power Module (AAPM) for deployment in armored vehicles such as the K9 Vajra tank.

Faradigm is now poised to become a leading domestic player in next-generation energy storage solutions, with a strong foundation in IP, engineering, and application-specific design.

4. BestCase - Customized Enclosures

The BestCase product line continues to be the preferred solution for highly customized enclosure systems , especially for use in defense , research institutions , and high-end industrial applications .

Highlights:

?€? Delivered to over 500 customers in FY 2024-25

?€? Sustained 10%+ annual growth in customer acquisition, demonstrating consistent demand for bespoke design and ruggedization

?€? Continued focus on expanding configurability and modularity to serve niche R&D and tactical needs BestCase is building on its reputation for precision, durability, and innovation in enclosure technology.

5. Fault Current Limiter (FCL)

Aartechs Fault Current Limiter is a high-tech, niche offering designed for grid fault protection and voltage stability. Though still in an emerging stage, it has proven successful in:

?€? Addressing specialized grid protection applications

?€? Supporting export-led growth via execution in Qatar, facilitated through our technical collaboration with G&W Electric (USA)

This business area holds significant long-term potential in smart grids, microgrids, and global fault management applications.

6. Trading Business

Launched in FY 2024-25, the Trading business was introduced to enhance the companys position as a one-stop sourcing and solutions provider for the power sector.

S 0 L 0 N I C S

Initial traction:

?€? Secured orders from major Public Sector Undertakings (PSUs)

?€? Established relationships with overseas clients, enabling a strong entry into high-volume, low-lead-time supply chains

?€? Focused on supplying essential components, accessories, and engineered products to utilities and EPC players

This business area is expected to grow rapidly in the coming years by complementing Aartechs core offerings and improving overall client retention.

Together, these activities reflect Aartechs strategic focus on diversification, innovation, and global expansion, while remaining aligned with emerging industry needs and national infrastructure goals.

D) Outlook

As Aartech Solonics enters FY 2025-26, the company is strategically poised to build upon its recent successes and capitalize on both domestic and global opportunities. With a strong focus on innovation, scalability, and customercentric execution, Aartech aims to enhance its market presence, revenue diversification, and stakeholder value.

Growth Areas for FY 2025-26

1. Domestic Generation Expansion

Indias growing energy demand is catalyzing investments in new generation capacity. Major government bodies, including NTPC and other state utilities, are expected to float tenders for over 15 GW of new thermal capacity by 2027.

?€? This surge will fuel demand for Aartechs Bus Transfer Systems (BTS), Control and Relay Panels (CRPs), and

SCADA-compliant panels, especially in high-capacity, mission-critical installations.

?€? Aartechs proven expertise in grid-sensitive systems positions it well to secure significant orders from both central and state-level power generation projects.

2. Energy Storage and Defense Applications

With the rising need for reliable, high-speed energy discharge systems, Faradigm® Ultracapacitors Private Limited (FUPL) is expected to scale operations in FY 2025-26.

?€? Focus will be on large-scale deployments in defense, railways, and industrial automation.

?€? The Adaptive Alternate Power Module (AAPM), jointly developed with IIT-Powai and the Indian Army, is anticipated to see adoption across defense platforms, including tracked vehicles, mobile artillery systems, and potentially naval applications.

S 0 L 0 N I C S

?€? FUPL will also explore integration into hybrid power solutions for microgrids and off-grid defense installations.

3. Export Market Development

Following successful project deliveries in the United Kingdom and the Middle East, Aartech will focus on expanding its international footprint through:

?€? Strategic partnerships with global EPCs and OEMs

?€? Export-ready product lines in CRPs, BTS, and fault management systems

?€? Participation in international trade exhibitions and technology forums to promote indigenous engineering capabilities

The company views exports as a major pillar for long-term revenue growth and brand visibility.

4. New Business Expansion - Trading

The newly launched Trading business is set to grow significantly in FY 2025-26, targeting:

?€? Public Sector Undertakings (PSUs) requiring quick-turnaround procurement for electrical and utility components

?€? Academic and R&D institutions needing precision equipment and control panels

?€? Overseas clients looking for bundled engineering and procurement solutions

With a focus on being a one-stop sourcing partner, Aartech aims to build scalable revenue streams in this space.

5. Innovation-Led Product Development

Leveraging its DSIR-recognized in-house R&D center, Aartech will continue to focus on high-impact innovation,

including:

?€? Smart grid components tailored for SAS-compliant substations

?€? Defense-grade embedded electronics for harsh environment operations

?€? Solar-integrated public infrastructure solutions, including the Saur Stambh solar street lighting system

This innovation roadmap is closely aligned with national missions like Atmanirbhar Bharat, Make in India, and the Green Energy Corridor.

Strategic Guidance for FY 2025-26:

To sustain growth and improve financial resilience, Aartech will pursue the following strategic priorities:

?€? Maintain top-line momentum through continued expansion in high-value, high-margin product categories

?€? Increase export contribution to overall revenue by entering new geographies and deepening global partnerships

Optimize margins via improved operational efficiencies, value-based pricing, and cost control across the supply chain

S 0 L 0 N I C S

?€? Accelerate IPR-backed innovations and invest in scaling up manufacturing capacity to meet growing demand across business lines.

With a fUture-ready mindset and a culture of responsible innovation, Aartech is confident in its ability to navigate market complexities, seize emerging opportunities, and deliver sustained stakeholder value in FY 2025-26 and beyond.

E) Risks and Concerns

While Aartech Solonics remains firmly positioned for sustainable growth, the company operates in a dynamic and evolving ecosystem that presents several external and internal risks. A proactive approach to risk identification, assessment, and mitigation remains central to our governance and decision-making processes.

Key Risks:

1. Macroeconomic Volatility

Global economic uncertainties?€”including potential slowdowns, inflationary pressures, and regional geopolitical tensions?€”pose risks across several fronts:

?€? Commodity price volatility, especially for copper, aluminum, and electronic components

?€? Foreign exchange fluctuations, which can impact the cost of imported inputs or overseas project profitability

?€? Delays in global project execution due to economic or political disruptions in target export geographies.

Such volatility can challenge cost structures, project planning, and margin visibility across business areas.

2. Supply Chain Disruptions

Aartech, like many industrial players, remains exposed to potential delays in the procurement of critical components, especially:

?€? Semiconductors, sensors, and embedded system chips

?€? Specialty electronics required for defense and automation products

?€? Logistics-related delays, including import clearance and cross-border shipment uncertainties

Global semiconductor shortages and fragmented logistics networks remain key watchpoints for production continuity.

3. Technological Obsolescence

In fast-evolving sectors such as defense electronics, smart grids, and energy storage, technology cycles are shortening significantly.

?€? Failure to adapt or pre-empt these shifts may lead to product irrelevance, delayed go-to-market timelines, or missed opportunities.

S 0 L 0 N I C S

?€? Continuous investment in innovation, application engineering, and IP development is critical to remain relevant and competitive.

4. Regulatory Uncertainty

The company operates in regulated industries such as energy, infrastructure, and defense, making it sensitive to policy shifts, including:

?€? Defense procurement norms, including offset clauses or vendor qualification requirements

?€? Power sector regulations, such as Renewable Energy Purchase Obligations (RPOs) or grid code revisions

?€? Import/export compliance norms, which can impact delivery schedules or pricing in cross-border projects

Any sudden change in these areas could affect order pipelines or require realignment of strategic plans.

5. Human Capital Constraints

As demand for highly skilled technical talent continues to outpace supply, Aartech faces challenges in:

?€? Hiring and retaining professionals in embedded systems, high-voltage design, automation, and AI-enabled control systems

?€? Scaling up knowledge-intensive teams rapidly while maintaining domain expertise

?€? Addressing wage inflation in niche engineering roles, especially for R&D and project execution.

The war for talent, if not effectively managed, can constrain innovation timelines and operational agility.

Mitigation Measures

T o counteract these risks, Aartech has implemented a robust risk mitigation framework, including:

?€? Strategic Procurement & Alternate Sourcing

Entered into long-term contracts with critical suppliers and diversified vendor bases to mitigate raw material price fluctuations and ensure supply continuity.

?€? Investment in Innovation & Technology Scouting

Continues to invest in DSIR-approved R&D, including cross-sector collaborations with institutions like IIT Powai, to stay ahead of the technology curve.

?€? Regulatory Compliance Management

Active tracking of policy changes and regulatory updates, especially in defense procurement, energy reforms, and power grid standards, allows for agile business adaptation.

?€? Talent Development and Institutional Partnerships

Structured training programs, leadership succession planning, and tie-ups with premier engineering institutes are in place to build future-ready talent pipelines. F) Internal Control Systems and their adequacy

Aartech has established a robust internal control framework that ensures:

?€? Operational discipline

?€? Regulatory compliance

?€? Asset protection

?€? Accuracy of financial reporting

Key Features of the System:

1. Risk-Based Internal Audits:

Conducted periodically by both internal and external audit teams.

Focused on key operational areas: procurement, inventory, delivery timelines, cash flows.

2. Automation and Digitization:

Several manual control checkpoints have been automated in:

Vendor due diligence

Inventory reconciliation

Invoice and approval systems

3. Board Oversight:

The Audit Committee of the Board closely monitors:

Audit findings

Risk mitigation plans

Corrective action closures

4. Department-Level Reviews:

Regular self-assessments by departments against SOPs.

Identifies process gaps and implements improvements proactively.

5. No Material Weakness Found:

During the financial year, audits found no material weaknesses in the internal control systems. Enhancements Made in FY25:

?€? Improved tracking of receivables through automated alerts.

?€? Vendor contracts revised to include penalty clauses for late deliveries.

System upgrades in ERP for cost control and real-time tracking. S 0 L 0 N I C S

The company considers its internal control systems to be adequate, evolving, and aligned with global best practices.

G) Financial Performance Vs. Operational Performance

Aartech Solonics Limiteds financial results for FY 2024-25 reflected the companys successful execution of its operational strategy. The year marked a period of solid performance across revenue growth, margin expansion, and strategic capacity utilization?€”despite navigating external headwinds and one-time accounting impacts.

Operational Achievements

The companys operational milestones during the year were pivotal in driving financial results. Key contributors included:

?€? Record Revenue Achievement:

Total revenue rose to ^35.70 Cr, reflecting a 9% year-on-year (YoY) growth, supported by:

Strong order execution in Bus Transfer Systems (BTS), Control and Relay Panels (CRPs), and BestCase® customized enclosures

Geographic expansion into Uttar Pradesh, Himachal Pradesh, and the Middle East, unlocking new demand centers.

2020-21

2021-22

2022-23

2023-24 2024-25

?€? Capacity Utilization:

Significant improvement in CRP production capacity utilization helped drive operating efficiency and support margin resilience.

?€? Strategic Cost Control Initiatives:

The company actively implemented:

Vendor renegotiations for raw materials and components

Optimized logistics and warehousing practices

T argeted procurement strategies, reducing procurement cycle time and costs

These operational gains helped offset input cost pressures and maintained stability in service delivery.

S 0 L 0 N I C S

Financial Outcomes

Operational success directly translated into improved financial performance across several key metrics:

?€? Profit After Tax (PAT):

PAT stood at ^2.04 Cr, representing a 41% YoY growth.

Notably, the adjusted PAT (excluding one-time impairment) was ^5.97 Cr, highlighting underlying business strength.

PROFIT AFTER TAX

___ 3.00 cc 2.00 cc 1.00 H - <		1 A?	1 3Q	1.44	2.04
	0.84	1.42	1.38
		1	1	1
	2020-21	2021-22	2022-23	2023-24	2024-25
			YEAR

2020-21

2021-22

2022-23

2023-24

2024-25

?€? Operating Margin Expansion:

Key product lines experienced a 10-15% YoY improvement in operating margins, driven by:

Volume growth

Better fixed-cost absorption

Margin-focused execution

?€? Resilience to Cost Inflation:

Despite raw material price volatility (particularly in copper and electronics), the company preserved and, in some cases, enhanced margins through pricing discipline and cost controls.

Divergences and One-time Impacts

While core performance remained strong, a few financial divergences were recorded:

?€? Earnings Per Share (EPS) Decline:

EPS was impacted due to a one-time impairment loss of ^3.93 Cr on a non-core onshore investment, leading to a temporary dip in reported profitability.

?€? Trading Business Contribution:

Launched in FY 2024-25, the trading business contributed modestly in its first year, as it was still in the setup and early execution phase. However, it holds strong potential for scale and diversification in FY 2025-26 and beyond.

S 0 L 0 N I C S

Conclusion

Overall, Aartechs financial performance was consistent with and strongly supported by its operational execution. Strategic expansion into new geographies, disciplined cost management, product innovation, and improved manufacturing efficiency were instrumental in:

?€? Sustaining revenue momentum

?€? Enhancing profitability

?€? Building a foundation for long-term growth

With a solid operational base and focused execution, the company is well-positioned to continue delivering improved shareholder value in the coming financial years.

H) Human Resource/ Industrial Relations

Aartech Solonics Limited firmly believes that its people are its most valuable asset. The companys HR strategy in FY 2024-25 was built around talent retention, capability development, workplace inclusivity, and cultural alignment with long-term strategic goals.

Workforce Overview

?€? Total Employees (Regular) (as of March 31, 2025): 69

?€? Annual Attrition Rate: 20.27%

?€? While this is above the global industry benchmark of 10-12%, it reflects a phase of strategic restructuring. Aartech continues to operate with a focused, cross-functional team that enables innovation, agility, and scalable growth.

Aartechs compact yet capable workforce is structured to support scalability, rapid innovation, and cross-functional responsiveness. The company remains committed to employee engagement and retention while aligning workforce capabilities with long-term business goals.

Key HR Initiatives and Developments

1. Leadership Pipeline Development

To ensure future readiness and long-term organizational sustainability, Aartech has:

?€? Established structured Senior Executive and Middle Executive management teams, enabling succession planning and role clarity

?€? Continued aligning talent architecture with the strategic vision laid down by the companys founding leadership.

This structure enhances decision-making autonomy and prepares high-potential employees for leadership roles.

2. Campus Engagement & Talent Acquisition

As part of efforts to attract emerging talent and strengthen employer branding: S 0 L 0 N I C S

?€? MoUs were signed with reputed engineering colleges and universities

?€? Multiple campus hiring drives were conducted, leading to the onboarding of bright, entry-level engineers

?€? Aartech is increasingly seen as an employer of choice among early-career professionals, particularly those seeking exposure to core engineering, R&D, and applied technology domains.

3. Learning & Development (L&D)

Aartechs L&D approach is anchored in on-the-job, hands-on learning, with senior executives actively mentoring junior staff.

?€? T raining was focused on core technical areas, including:

Embedded systems and firmware design

Power automation and panel integration

Project management and site execution

?€? The emphasis remains on experiential learning, with real-time application of concepts in live projects.

This approach nurtures problem-solving, innovation, and practical competence among young engineers.

4. Policy Enhancements for Employee Welfare

A number of HR policy updates were rolled out to ensure a more inclusive, safe, and supportive workplace, including:

?€? POSH Policy Implementation:

Adopted the Prevention of Sexual Harassment (POSH) framework to foster a safe, respectful, and inclusive work environment.

?€? Welfare-Oriented Policy Amendments:

Increased employer contributions to employee health and life insurance

Flexible work hours introduced to support work-life balance

Relaxation in late mark rules to accommodate genuine personal or travel delays

These policy changes reflect Aartechs commitment to employee-centric governance.

5. Digitization of HR Operations

?€? Shifted major HR applications?€”such as leave, attendance, expense claims, and document requests?€”onto digital platforms

?€? Continued push toward paperless HR operations and better employee self-service tools.

These transitions have improved response time, transparency, and record-keeping accuracy.

6. Employee Engagement & Cultural Initiatives

?€? The company maintained a culture of recognition and connectivity, with regular celebration of:

Employee birthdays

Festivals and national days

Project milestones and internal achievements

S 0 L 0 N I C S

?€? The open-door policy continues to be a cultural hallmark, with leadership remaining accessible and involved in day-to-day interactions, fostering mutual trust and alignment.

Aartechs human resources strategy is future-focused, responsive, and grounded in its Ratiostructured capability development, and a culture of openness, the company has built a strong human capital foundation to support its growth and innovation agenda in FY 2025-26 and beyond.

I) Significant changes in key financial ratios:

As part of statutory reporting and financial transparency, the Company is required to disclose any changes in key financial ratios that exceed a 25% variation on a year-over-year (YoY) basis. Below is a summary of such significant changes for FY 2024-25, along with the business context behind them:

Ratio	FY 2025	FY 2024	% Change	Explanation
Debtors Turnover Ratio	T		T 35%	Improved receivables management, faster collections, and stricter credit control policies across clients, including EPC and PSU contracts.
Inventory Turnover Ratio	T		T27%	Accelerated project execution cycles and tighter inventory control led to a lower average inventory holding period.
Interest Coverage Ratio	T		T42%	Improvement in operating profits and EBITDA, combined with relatively stable finance costs, led to enhanced debt-servicing capacity.
Current Ratio	1		130%	Increased reliance on short-term working capital borrowings to support larger execution pipeline and inventory mobilization in Q4.
Debt to Equity Ratio	0.17x	0.13x	T 31%	The rise reflects higher working capital loans, but remains well within conservative and low-risk threshold levels. The company continues to maintain a healthy balance sheet.
Operating Profit Margin	T		T 15-18%	Driven by cost optimization, higher capacity utilization, and an improved product mix favoring high-margin areas like BTS and CRPs.
Net Profit Margin	1	--	1 27%	The decline is attributed to a one-time impairment loss of ^3.93 Cr. Adjusted

S 0 L 0 N I C S					NPM (excluding impairment) would show YoY improvement.
Sector-Specific Ratios	--	--	No change	major	No significant variation in other industry-specific metrics for the year.

While the Company recorded healthy operational and margin improvements across most metrics, the drop in Net Profit Margin and Current Ratio were primarily non-structural and temporary in nature. Core ratios related to profitability, efficiency, and leverage remained strong and aligned with the Companys growth strategy.

The management continues to monitor all key ratios as part of its financial governance and aims to further strengthen balance sheet resilience in FY 2025-26.

J) Change in Return on Net Worth (RoNW) Metric	FY 2024-25	FY 2023-24	% Change
Return on Net Worth (RoNW)	0.17x	0.09x	T 88.9%

The significant increase in RoNW in FY 2024-25 reflects the Companys enhanced ability to generate profits from its equity base. Key drivers include:

?€? Stronger Profitability:

Even after accounting for the one-time impairment of ^3.93 Cr, the Company posted a 41% growth in PAT, showcasing robust core profitability.

?€? Operational Excellence:

Record topline growth, improved margin profile, and strategic cost optimization strengthened returns on invested capital.

?€? Capital Efficiency:

The RoNW improvement underscores disciplined capital deployment, with enhanced contribution from high-value areas such as:

Ultracapacitors (Faradigm®)

Adaptive Alternate Power Module (AAPM)

Export-oriented BTS and CRPs

This metric validates the Companys profit-first growth strategy, prudent financial governance, and sharp focus on high-ROI business verticals.

Conclusion

FY 2024-25 has been a landmark year in Aartech Solonics Limiteds strategic evolution. Guided by a steadfast commitment to the principles of Make in India, technological innovation, and value creation for all stakeholders, the Company has laid a resilient and future-ready foundation.

As we enter FY 2025 26, Aartech moves forward with strong fundamentals , strategic clarity , and a sharpened focus on scaling impact both in India and across global markets.

We remain committed to our vision of becoming a globally respected Indian technology company delivering cutting-edge power solutions , enabling self-reliance in critical infrastructure , and pursuing responsible, sustainable growth .

Together with our stakeholders, we look forward to building the next chapter of innovation, excellence, and impact.

	For and on behalf of the Board
	Aartech Solonics Limited
	Sd/-	Sd/-
	Amit Anil Raje	Arati Nath
Place: Bhopal	Chairman & Managing Director	CEO & Director
Dated: 05/09/2025	(DIN: 00282385)	(DIN: 08741034)
	R/o 15, Silver Oak, Green Heights	Bunglow No.3, Samarth Parisar,
	Gulmohar Colony	Bawadia Kalan, E-8 Extension,
	Bhopal 462038 (M.P.)	Near Orion School, Trilanga,
		Bhopal, 462039 (M.P.)