ABB India Ltd Management Discussions

1. EXECUTIVE SUMMARY

ABB India is one of Indias leading global technology and automation companies, with operations spanning more than seven decades. In this report, the terms "ABB India Limited," "ABB India," "your Company," or "it" refer to ABB India Limited. Your Companys registered and corporate office is located in Peenya, Bengaluru, and it operates manufacturing facilities in Bengaluru (Karnataka), Faridabad (Haryana), Nashik (Maharashtra) and Vadodara (Gujarat). The ABB Group holds a 75 percent stake in ABB India through its subsidiary, ABB Asea Brown Boveri Ltd., Zurich.

Since its inception in 1949, ABB India has played a pivotal role in supporting the nations automation, digitalisation and electrification journey. With over 100 years of presence in India through the ABB Group, your Company recently celebrated 75 years of manufacturing and innovation, while also contributing to global research and development and business services. Today, your Company continues to nurture a broad portfolio of offerings, serving customers across 23 market segments.

Under its ‘Local for Local strategy, over 90 percent of ABB Indias products manufactured in India are consumed domestically. There are over 5,000 people working across multiple locations, businesses and functions, relentlessly serving our customers. Your Company operates 5 manufacturing locations with 25 plants and 28 sales offices, exporting to over 30 countries. It also works with over 750 channel partners, reinforcing its commitment to local ecosystems and global reach.

2. BUSINESS LANDSCAPE

2.1 Macroeconomic review

2.1.1 Global economic environment

In CY 2025, the global economy expanded by 3.3 percent, marking a phase of relative stability after several years of heightened volatility driven by geopolitical tensions and synchronized monetary tightening.1 Economic activity remained resilient, supported by easing inflation, gradual normalization of monetary policy, steady domestic demand across several large economies, and sustained investment in technology, particularly in Artificial Intelligence (AI) and digital infrastructure. These structural factors helped offset persistent challenges arising from trade fragmentation, elevated tariffs, and ongoing geopolitical uncertainty.

Trade performance

Global trade policy has increasingly been influenced by security and geopolitical considerations rather than efficiency or multilateral frameworks, resulting in faster regionalization and greater supply chain diversification. For the year through September 2025, merchandise trade volume increased by 4.5 percent compared to the same period in 2024, exceeding the headline forecast of 2.5 percent for 2025.2

Regional performance

Advanced Economies along side Emerging Market and Developing Economies (EMDEs) recorded growth of 1.7 percent and 4.4 percent, respectively, during the same period. Advanced Economies maintained investment momentum, particularly in automation, efficiency-enhancing technologies, and industrial upgrading, although growth remained moderate. Within this, growth in the United States remained strong, driven largely by investments in AI.

Business activity also expanded across major emerging and developing economies during the period, with notable growth observed in India and China. EMDEs continued to anchor global growth throughout the year, supported by rising infrastructure investment, shifts in manufacturing, increasing urbanization, and the rapid adoption of clean energy solutions.

Outlook

Global growth is expected to remain stable, with GDP projected to expand by 3.3 percent in CY 2026. Advanced economies are forecast to grow by 1.8 percent during the year, while EMDEs are expected to record growth of 4.2 percent over the same period. Global inflation is projected to continue its downward trend, with headline inflation declining to 3.8 percent in 2026 and further easing to 3.4 percent in 2027.

2.1.2 INDIAN ECONOMIC ENVIRONMENT

In India, macroeconomic conditions remained resilient through 2025, with the economy transitioning toward a more balanced and structurally driven growth trajectory. FY 2026 was a challenging year due to heightened global trade uncertainty and the imposition of high, penal tariffs; however, the Indian Government responded by shifting the focus to advance key measures such as GST rationalization, accelerated deregulation, and further simplification of compliance requirements across sectors. During the reporting year, India surpassed Japan to become the worlds fourth-largest economy by nominal GDP.

Strong fundamentals

Supported by timely policy interventions and strong macroeconomic fundamentals, India is relatively better positioned compared to other economies. This positioning is underpinned by an economy that relies less on financial markets, strong foreign exchange reserves, and a credible degree of strategic autonomy, which together provide resilience amid financial volatility and geopolitical uncertainty. As per the New Series with base year 2022–23 (earlier base 2011–12), in FY 2026 the Indian economy is estimate to grow by 7.6 percent compared to 7.1 percent in FY 2025. The Manufacturing sector has been the major driver in contributing to the resilient performance, attaining double-digit growth in FY 2026. Private Consumption and Fixed Capital Formation are also expected to record a healthy growth of over 7.0 percent each.3

Production in India

Government capital expenditure remained elevated, supported by sustained investments in transport, logistics, power transmission, renewable energy, and urban development. Infrastructure development continued to be a defining feature of Indias economic landscape throughout 2025. The second half of the year saw further improvement in project execution across highways, rail corridors, airports, and renewable energy initiatives, reinforcing Indias long-term growth trajectory. These continued investments, along with manufacturing incentives, supply chain localization, and digital transformation across industries, strengthened the medium-term outlook for domestic demand and industrial activity.

Manufacturing expanded during the year, supported by infrastructure spending, rising demand for capital goods, energy and electrification projects, and improved momentum in export-linked sectors.

Revenue collection

Gross tax revenue collection remained resilient during the year, with direct tax receipts reaching nearly 53 percent of the budgeted annual target.4 Indirect tax collections also stayed robust despite lower inflation and volatility in imports, with gross GST collections in absolute terms recording multiple all-time highs during the year. GST continued to play a stabilizing role by strengthening government revenues, advancing formalization, and reinforcing the governments reform agenda. Monetary policy remained measured through 2025, with the Reserve Bank of India (RBI) maintaining a balanced approach to support growth while keeping inflation within the target range. Amid benign inflationary conditions, the RBI cut policy rates by a cumulative 125 basis points during the year. By the second half of 2025, monetary conditions eased marginally as liquidity improved, even as the central bank retained a cautious stance amid global uncertainties

External Front

Despite heightened tariffs imposed by the United States, merchandise exports increased by 2.4 percent, while services exports grew by 6.5 percent.5 Cumulative exports of goods and services expanded compared with the previous year, supported by electronics, engineering goods, pharmaceuticals, and professional services. Imports remained elevated due to sustained demand for capital goods and intermittent spikes in gold inflows.

Capital flows into India remained strong, reinforcing Indias position as a key global investment destination. Foreign direct investment strengthened across technology, services, manufacturing, and infrastructure-linked sectors, while portfolio flows experienced periodic volatility in response to global financial conditions. Despite these fluctuations, domestic financial markets continued to deepen, supported by strong participation from retail and institutional investors.

Outlook

Further, FY 2027 is expected to be a year of adjustment, during which domestic demand and investment are likely to strengthen as households and firms adapt to ongoing changes in the economy. Economic policies are expected to focus on supply stability and the creation of buffer resources. Domestic inflation is anticipated to moderate, while the recent rationalization of GST rates is expected to support demand by lowering the tax burden and improving price competitiveness. The world suddenly looks different as long-standing landmarks—alliances, conventions, and terms of trade—are being reshaped. This structural breadth of uncertainty, marked by geopolitical fragmentation and volatile commodity cycles, leaves currency markets reflecting deep hedging behavior.

2.2 Industry dynamics

The domestic manufacturing landscape is undergoing a significant transformation. In FY 2026, the Index of Industrial Production (IIP) recorded growth in capital goods, with momentum in the latter half of the year. Indicators such as PMI Manufacturing, IIP Manufacturing and e-way bill generation reflected resilience in the manufacturing environment, supported by healthy economic demand.

In line with these trends, ABB Indias business landscape continued to evolve, reinforcing long-term demand for electrification, automation, digitalization and sustainable industrial solutions. Structural drivers, including the energy transition, advanced manufacturing, infrastructure development and digital expansion, remain closely aligned with ABBs global technology portfolio and strategic priorities. The increased focus on electronics, semiconductor fabrication, advanced manufacturing, supply chain localization and sustainability is accelerating the adoption of energy-efficient products, automation, intelligent motion systems and digitally connected production environments. As industries move toward higher levels of productivity, precision and safety, ABBs portfolio, including electrification, motion and automation, is well positioned to support the factories of the future.

Growth in Industrial Activity in India

Sector	Indicators	Q1 FY26	Q2 FY26	Q3 FY26	Monthly Avg YoY Growth (FY16-FY20)
	E-way bill generation	20.5	23.1	19.4	16.6$
	IIP*	2.0	4.3	3.6	3.1
Industry
	8-core industries	1.5	4.5	1.9	3.5
	PMI manufacturing**	58.1	58.7	56.9	51.9
	Steel consumption	7.8	8.5	3.9	5.7
Construction	Cement production	8.0	7.3	11.1	4.7
	IIP: Infra/ construction goods*	6.0	11.6	9.5	3.3

https://www.indiabudget.gov.in/economicsurvey/ doc/echapter.pdf

2.2.1Digitalisation and digital infrastructure

Across core, infrastructure and transport-related industrial segments, including metals, cement, chemicals, automotive, rail, construction, pharmaceuticals and food processing, a sustained shift toward automation, digitalization, and lifecycle optimization is underway. Key industrial players are investing in industrial IoT solutions, edge- and cloud-connected drives, predictive maintenance, and advanced analytics to enhance asset reliability, minimize unplanned downtime and reduce the total cost of ownership. ABBs digital ecosystem, including the ABB Ability™ platform and an expanding suite of remote and connected services, supports these requirements by delivering actionable insights, improving efficiency and strengthening operational resilience.

In India, data centre capacity has doubled, positioning India as the worlds fastest-growing markets for digital infrastructure. Capacity is projected to grow from ~1.5 GW in 2025 to 14 GW by 2035, representing a ~20–24 percent CAGR, driven by AI and cloud adoption. Total investments are expected to reach $ 70 billion over the same period.6 This rapid expansion is emerging as a critical pillar of Indias technology ecosystem. Driven by growth in cloud services, artificial intelligence workloads, cybersecurity, requirements and rising digital consumption, operators are prioritizing energy-efficient, resilient infrastructure designed for continuous operation. This environment creates opportunities for ABBs high-efficiency electrical systems, power distribution solutions, digital monitoring tools, and automation platforms that support uptime, optimize energy usage and enable scalable growth.

2.2.2Energy Transition and Electrification

Energy demand in India continues to rise and is expected to grow further, with the country projected to account for more than 23 percent of global incremental energy demand by 2050.7 To support this increase, India is strengthening its energy systems through policy reforms, infrastructure expansion and the adoption of cleaner energy pathways. Reinforcing the governance and regulatory framework remains essential alongside these efforts. The ongoing energy transition and electrification continue to drive market activity. Investments by industry participants and infrastructure operators are increasing to enhance grid reliability, integrate higher shares of renewable energy, modernize distribution networks, and improve energy efficiency.

These priorities are driving demand for next-generation switchgear, control systems, protection technologies, high-efficiency motors and digitally enabled energy management platforms. As power grids become more decentralized and renewable-intensive, customers increasingly require interoperable solutions that enhance stability, flexibility and operational visibility, areas where ABBs integrated electrification and automation offerings continue to gain traction.

2.2.3 Sustainability trends

As India advances its economic, infrastructure and sustainability priorities through 2025 and 2026, these developments are expected to create growth opportunities for ABB India. The company is well positioned to address evolving customer requirements with technologies that are safe, smart and sustainable.

Sustainable product offerings remain integral as sustainability strengthen as a key operational and compliance priority across industries. Customers increasingly seek solutions that enhance energy efficiency, safety, circularity and environmental performance. High-efficiency motors and drives, low-emission electrification systems, building automation technologies and lifecycle-optimized service models are being systematically incorporated into capital planning and asset strategies. This transition aligns with ABBs sustainability value proposition and reinforces growth opportunities in energy-efficient technologies and green manufacturing solutions.

3. BUSINESS AREA PERFORMANCE REVIEW

ABB India operates within ABBs globally established decentralized operating model, designed to promote accountability, agility and sustainable value creation. Your Companys 18 divisions are organized into four global business areas: Electrification, Motion, Automation and, Robotics and Discrete Automation. Each business area has a defined portfolio focus and market orientation, while enabling collaboration across divisions to strengthen customer offerings.

Consistent with ABBs global structure, divisions represent the highest level of operational responsibility. This framework ensures that decision-making remains aligned with customer and market requirements, supporting timely execution, competitiveness, and effective solution delivery. Through this model, ABB India is well positioned to address evolving customer needs while contributing to the broader performance objectives of the ABB Group.

3.1 Electrification

The Electrification business offers a wide-ranging portfolio of products, digital solutions and services, from substations to sockets, enabling safe, smart, and sustainable electrification.

3.1.1 Performance snapshot

The business delivered a resilient performance in 2025. While revenue recorded year-on-year growth, profitability moderated compared to the previous year. Performance trends should be viewed in conjunction with order inflow and backlog movement, which indicate evolving demand conditions across key segments. Margins by an improved product mix, localization initiatives and supply chain efficiencies. Despite moderation in certain core industrial segments, performance remained stable, sustained by as diversified demand and expanded market coverage.

These segments continue to demand reliable, energy-efficient and digitally enabled electrification solutions, aligning well with ABBs portfolio strengths.

3.1.2 Major orders and projects

During the year, the Electrification business secured and executed a diverse portfolio of projects across infrastructure, industry, digital economy, and energy sectors, both in India and international markets.

Orders booked during the year Data centers and digital infrastructure

• Leading data center operators in Mumbai – Low-voltage (LV) panels

• Major colocation players in Mumbai and Pune – LV panels and remote power panels

• Digital Infrastructure provider in Mumbai – LV panels and components

• Significant breakthrough orders for MV and LV colocation data centers in western and southern India

• Global Data Centre operators – Unloading, installation, testing and commissioning

• Global Cloud Service provider – Unloading, installation, testing and commissioning

• Leading Data Center provider – Unloading, installation, testing and commissioning, and annual maintenance contract

Industrial and manufacturing

• Global industrial major in Thailand – LV panels

• Electronics manufacturing major – LV panels and components

• Global tyre manufacturer in Mexico – LV panels

• Pharma major in Madhya Pradesh – LV panels

• Large Indian conglomerate entering EV manufacturing – LV panels

• Breakthrough order in semiconductor segment – State-of-the-art gas insulated switchgear

• Major rate contract with one of Indias largest steel plants – MV and LV systems

Infrastructure, transport and utilities

• National high-speed rail project (multi-region) – LV panels and components

• Renowned metro rail project in eastern India – LV panels

• Regional airport in Karnataka – LV panels and electrical components

• MV switchgear supply for Badrinath and Kedarnath infrastructure

• State power distribution utilities – Extension of GIS panels

• State power distribution utilities – Supply and ETC of AIS switchgear

• Central power generation utility Retrofitting SF

CBs with vacuum CBs

• Buildings and real estate

• Premium real estate developers in Karnataka and Andhra Pradesh – LV panels and components

• Real estate developer in Telangana – LV panels and components

Services, retrofits and lifecycle support

• Supply of spare parts and retrofit of MOCBs with vacuum CBs in major refineries (West & South India)

International

• International telecom operator in West Africa – LV panels

Technology milestones

• First-ever E-house order with 11kV SF -free

GIS, demonstrating progress in sustainable switchgear solutions

Major orders commissioned during the year Data Centers and digital economy

• Large data center operator in Pune – LV panels commissioned

• Global data center operator in Mumbai – LV panels supplied

• Data center operators – Electrification solutions

IT and technology sector

• Global technology company in Haryana – LV panels commissioned

• Global IT services provider in Telangana – LV panels commissioned

• IT services company in West Bengal – LV panels commissioned

Industrial

• Automotive manufacturer in Haryana – LV panels commissioned

• MV AIS panels commissioned in Assam

Infrastructure and public projects

• ‘Shree Ram Mandir, Ayodhya – MV and LV panels commissioned

• Renowned metro rail project in eastern India – LV panels commissioned

• Key national airports including Navi Mumbai Airport, Leh–Ladakh and Noida International Airport (Jewar) – MV and LV electrification products supplied

3.1.3 Market expansion

Strategic expansion into new geographies and deeper penetration across Tier II and Tier III markets enhanced domestic reach. Export growth continued strengthened the international footprint, supported by an expanded partner network and resilient supply chain. Optimized inventory planning and localized sourcing further enhanced responsiveness to customers.

SEGMENT OUTLOOK

Indias strong macroeconomic fundamentals, continued infrastructure investments and the acceleration of energy transition initiatives are expected to sustain demand for electrification solutions. Structurally robust segments such as Data Centers, Buildings and Rail remain key growth drivers, while emerging sectors including Semiconductors, Green Hydrogen and Battery Energy Storage Systems present new opportunities.

Commodity price volatility and forex fluctuations remain key watchpoints. The business continues to invest in manufacturing capacity, supply chain resilience, technology innovation and partner development. These efforts position the Company to support customers in building safe, reliable and sustainable operations over the long term.

3.2 Motion

The Motion business is a leading supplier of energy-efficient motors, generators, drives, traction solutions and lifecycle services. The portfolio supports productivity, reliability and energy transition across industrial, infrastructure and utility segments.

3.2.1 Performance snapshot

The Motion business delivered steady performance in 2025, supported by robust order bookings and diversified demand across industrial and infrastructure segments. The cement sector recorded stable growth, while oil and gas benefited from domestic demand. The rubber and tyre segment registered strong growth, while metals normalized following two years of robust performance. The sugar segment remained subdued; however, sub-segments such as compressed biogas and agro-processing within the food and beverage sector performed well.

PLC automation continued to perform strongly in the solar segment and expanded into new OEM applications and industries. Margin benefited from portfolio expansion, localization initiatives and improved manufacturing output. Export momentum and modernization-led services further supported performance stability.

Orders booked during the year Renewables and energy transition

• Major wind power project

• Green hydrogen project executed through an EPC contractor

Water and infrastructure

• Supply of over 200 HT motors for Government of Indias Water Mission

• Flagship export order in the water and desalination segment in the Middle East

Industrial

• Breakthrough orders for ultra-premium efficiency motors across metals, cement and textile industries

• Expansion of the NEMA portfolio for North America

• Strong OEM orders for automation-centric machine building solutions

Services and modernization

• A 9 percent growth in Motion Services orders, supported by modernization, motors and generators services along with service agreements

Solar and automation

• Automation solutions delivered for solar plants in India surpassed 18 GW

3.2.3 Operational and technology highlights

• Highest-ever induction motor manufacturing output

• Introduction of IE5 large and mid-range motors in India, free of rare-earth metal

• Portfolio expansion in flameproof and ultra-premium efficiency motors

• Expansion of local drive production capabilities through a new automated line

• Strengthening traction manufacturing and engineering capabilities

• Advancement of HVAC-focused modernization opportunities under NEMA Motors

• Continued export growth in lifecycle services across Middle East, Africa and the Americas

3.2.4 Market expansion

The business expanded its export footprint across North America, the Middle East and Africa. Deeper engagement with OEMs and automation-centric machine-building solutions, strengthened domestic presence. Expansion into Tier II and Tier III markets further diversification. Motion Services scaled globally, reinforcing lifecycle and modernization offerings.

3.2.5 Rewards and recognitions

• ISO 50001 energy management certification at the Maneja and Nelamangala facilities

• Silver award at the National Awards for Manufacturing Competitiveness (Drive Products Peenya)

• Best Supplier Partnership Award from KSB India (Induction Motors)

SEGMENT OUTLOOK

Looking ahead to 2026, the Motion business remains cautiously optimistic amid evolving market dynamics and geopolitical uncertainties. The metals, cement and mining sectors are expected to remain stable, with sustained opportunities in water-related applications. Renewables will continue as a key focus area, supported by integration of Siemens Gamesas power electronics business. Growth is anticipated across heavy industries, infrastructure, renewables and emerging sectors, driven by capacity expansions and greenfield projects.

The business will continue to advance energy-efficiency, digitalization, service-led offerings and portfolio competitiveness, alongside sustained investments in people and organizational culture. Infrastructure investments in metros, high-speed rail, airports, tunneling and pumped storage projects are expected to create additional opportunities. Backed by innovation, footprint and a sustainability-led portfolio, the Motion business is well positioned to deliver sustained growth.

3.3 Automation

The automation business provides a comprehensive portfolio of solutions for process and hybrid industries. These include industry-specific integrated automation, electrification and digital solutions, control technologies, software and advanced services, as well as measurement and analytics and marine solutions.

3.3.1 Performance snapshot

The business delivered stable performance in 2025, supported by sustained momentum across energy infrastructure, process industries and digital solutions.

• Energy Industries performance was driven by expansion of City Gas Distribution networks, pipeline automation and centralized monitoring systems. Demand remained robust across agrochemical, specialty chemical and pharmaceutical sectors, particularly in greenfield and modernization projects.

• Process Industries recorded steady momentum, driven by activity in metals, cement and industrial modernization programs. Investments in electrification upgrades, advanced drives and digital performance management platforms supported order inflows.

• Marine and Ports strengthened its market position through defence-related orders, marine digitalization initiatives and lifecycle service engagements, including remote diagnostics and maintenance contracts.

• Measurement and Analytics delivered value through digital instrumentation and asset performance solutions. During the year, a remote automated health check digital solution was developed for an upstream oil and gas customer, resulting in a strategic order for Coriolis meters and deployment of remote health monitoring across the customers fleet. This engagement also established recurring annual digital service revenues.

3.3.2 Major orders and projects Energy industries

• Digitalization of 300 CNG stations across six cities

• Multiple pipeline automation orders in a major multi-product pipeline corridor

• Centralized monitoring modernization for a leading private energy company

• Deployment of automation and safety systems for agrochemical facilities in southern India

• Execution of a greenfield pharmaceutical automation project

• Expansion with in the paints and coatings sector

Process industries

• Supply of two 110 kA Thyristor Rectifier Systems for a zinc manufacturer

• Steel plant modernization replacing DC motors with MV synchronous motors and drives

• Cement sector Knowledge Manager upgrades covering legacy and new systems

Marine and ports

• Defence spare parts order from DRDO

• Digital remote diagnostic system for LNG vessels

• International service order supporting a cross-border power generation project between Bangladesh and India

• Commissioning of a large-scale port system along with a long-term operations and maintenance contract

Measurement and analytics

• Digital remote health check solution for oil and gas upstream operations

• Strategic Coriolis meter order linked to digital asset monitoring deployment

• Establishment of a recurring digital service revenue through instrumentation analytics

3.3.3 Major projects commissioned Process industries

• Commissioned electrical systems, drives and automation system for aluminium manufacturers 4-Hi Cold Rolling Mill • Commissioned Continuous Galvanizing Line #3 for a steel manufacturer

3.3.4 Market expansion

The segment expanded across pipeline infrastructure, marine digitalization, measurement-driven digital solutions and international service engagements. Participation in greenfield and brownfield projects improved long-term revenue visibility. Customers accelerated the adoption of centralized control platforms, remote diagnostics, digital instrumentation and lifecycle service models to enhance operational efficiency and compliance.

SEGMENT OUTLOOK

Energy Industries - Expansion of CGD networks and pipeline infrastructure remains a key growth driver. Policy focus on energy security, cleaner fuels and digitalization is expected to sustain investments. Opportunities in green hydrogen, carbon capture and clean energy technologies are emerging.

Process Industries - Investments in metals, cement and mining are expected to continue, supported by electrification, decarbonization and digital transformation initiatives. Infrastructure growth and manufacturing expansion are likely to sustain activity in the steel and aluminium sectors.

Measurement and Analytics - Adoption of centralized monitoring, analytics platforms, digital twins and instrumentation-based asset health solutions is expected to drive demand for performance management and recurring digital services.

Marine and Ports - Defence, marine digitalization and lifecycle service opportunities are expected to remain stable, supported by modernization of port and vessel operations.

Overall, customers across industries are expected to prioritize reliability, digital performance management, safety and lifecycle support, sustaining demand for integrated electrification, automation, measurement and digital services.

3.4 Robotics and Discrete Automation

The Robotics and Discrete Automation business delivers robotics, machine automation and digital solutions that enhance productivity, precision and flexibility across discrete manufacturing industries. The portfolio supports applications ranging from automotive manufacturing and electronics assembly to food & beverage, logistics and advanced machine building.

3.4.1 Performance snapshot

The business delivered a strong performance in 2025, supported by demand for flexible and digitally enabled automation solutions across key end-user industries. Orders momentum remained healthy, particularly in automotive, electronics along with food and beverage segments. Service revenues benefited from customers continued focus on productivity enhancement and production uptime. Backlog visibility, reflected ongoing investments in automation-led capacity expansion.

3.4.2 Major applications and market adoption

Robotics applications expanded across multiple industries during the year-

Automotive and EV manufacturing

• Automation of Body-in-White production lines for a new market entrant

• Robotic automation of painting processes for a major automotive OEM

Electronics manufacturing

• Investment in robotic assembly and automation solutions by an electronics customer

Services and lifecycle support

• Order growth supported through indirect channels, including system integrators

3.4.3 Market expansion

Demand for robotics solutions broadened beyond traditional automotive applications. The electronics, food and beverage, metals and logistics sectors showed increased adoption, reflecting wider penetration of robotics into discrete manufacturing environments.

SEGMENT OUTLOOK

Demand from the automotive segment is expected to remain strong, supported by the ongoing transition toward electric vehicle manufacturing, which provides an additional avenue for automation-led investments. The food and beverage, consumer goods and electronics segments are also witnessing increasing automation adoption, reflecting improved manufacturing activity and capacity expansion.

Manufacturing activity in metals, logistics and warehousing, chemicals and plastics is expected to remain stable. In addition, growing interest from educational institutions and universities in establishing robotics laboratories and training centers is supporting demand for advanced robotics technologies and skill development infrastructure.

4. OPERATIONAL EXCELLENCE

Your Company entered 2025 with a strong operational foundation, supported by 75 years of local manufacturing and engineering presence. The ‘local for local strategy remained central, with 25 facilities across four states, three major R&D centers and a well-established supplier ecosystem. This localized operating model enhanced resilience against global supply chain volatility and currency fluctuations, while strengthening Indias role within ABBs global footprint.

Indias strategic importance within the Group increased further during the year, supported by continued localization, product adaptation for Indian operating conditions and closer collaboration with domestic industry and government stakeholders.

4.1 Capacity expansion and manufacturing modernization

During the year, your Company undertook targeted capacity enhancement initiatives. The Low Voltage Motors facility was expanded and a new production line for energy-efficient variable speed drives was commissioned at the Peenya campus. This increased local production capacity by approximately one-quarter, enabled shorter delivery cycles, supported higher customization and reduced import dependence for high-power drive solutions.

Manufacturing capability building was supported by productivity enhancement programs, modernization of production systems and improvements in process efficiency across key facilities.

4.2 Operational capability and quality focus

Your Company strengthened operational capabilities through expanded digitalization of factory operations, while maintaining focus on product quality, reliability and delivery performance. Improvements were implemented across manufacturing and service locations to enhance operational consistency and responsiveness to customer requirements.

4.3 Market reach and customer engagement

Operational outreach expanded across Tier II and Tier III industrial clusters, which are emerging as important growth regions. These areas saw increased adoption of electrification, automation, motion and robotics solutions, driven by manufacturing expansion, logistics infrastructure, renewable energy projects, metals and cement capacity additions and commercial infrastructure growth.

Customer engagement was strengthened through ABB Technology Days, industry-specific workshops and partner-driven outreach initiatives. These activities enhanced your Companys presence in sectors such as food & beverage, textiles, specialty chemicals, intralogistics, advanced electronics and renewable-integrated manufacturing.

4.4 Operational support to advanced and emerging sectors

Across advanced manufacturing sectors—including semiconductors, electronics, pharmaceuticals, precision engineering, and data centres—as well as gas distribution networks, your Company delivered integrated electrification and automation architectures. It also deployed robotics and machine automation systems, along with digitally connected control systems and real-time analytics platforms.

With rapid Data Centre expansion in India, your

Company supported customers through high-reliability electrical distribution, power conditioning, cooling optimization and digitally enabled lifecycle services, strengthening operational reliability and scalability.

4.5 Infrastructure and strategic national projects

Your Company continued to play an active role in national infrastructure development. Solutions were delivered across rail transportation, smart cities, metro networks, airports, water management systems, industrial corridors and renewable energy parks.

A notable implementation included the integrated automation and centralized monitoring system for IndianOils 20,000 km pipeline network, one of the countrys largest infrastructure systems. Your Company also entered into a strategic partnership with THINK Gas Pvt. Ltd., deploying ABB Ability™ SCADAvantage to digitalize and centrally control City Gas Distribution networks across multiple states, enhancing operational visibility and efficiency.

4.6 Sectoral portfolio deployment

Across traditional and emerging sectors such as metals, mining, renewables, water, transportation, automotive, buildings and manufacturing, your Companys operational portfolio supported customer objectives related to productivity, reliability and energy efficiency. High-efficiency motors and drives, decentralized energy management systems and integrated automation solutions enabled customers improve operational performance and asset optimization.

Your Companys operational performance in 2025 reflected continued reinforcement of its manufacturing footprint, improved operational agility and a strong pipeline of engagements across high-growth industries and infrastructure programs. These developments support operational readiness for sustained growth in 2026 and beyond.

5. FINANCIAL PERFORMANCE AND ANALYSIS

Your Company closed 2025 with record high orders, consistent uptrend in revenue and strong cash generation, while profitability was impacted by fluctuations in foreign exchange and commodity prices. Orders for 2025 stood at 14,115 Crores, while revenue was 13,203 Crores. Profit after tax was at 1,669 Crores in 2025 and earnings per share for 2025 stood at 78.78, compared to 88.46 in 2024.

Liquidity conditions improved, sustained by a stable and growing market environment. Your Companys reputation, customer relationships and long-standing associations with leading banks enabled access to competitive financing arrangements.

Throughout the year, your Company maintained a positive cash position to fund operations as well as meet the capex requirements. In view of the healthy cash position, surplus funds were invested in fixed deposits with Indian and multinational banks. As of December 31, 2025, your Company had a net cash balance (including all fixed deposits) of 5,694 Crores.

In terms of foreign currency exposure for imports, and exports, – the Company adopted a conservative hedging approach at the point of commitment or at balance sheet level to protect contract margins.

Ratios	Numerator	Denominator	December 31, 2025	December 31, 2024	% Variance
(i) Current Ratio (in times )	Total current assets	Total current liabilities	2.05	2.04	0.42
(ii) Debt-Equity ratio (in times)*	Debt consists of borrowings and lease liabilities	Total equity	0.01	0.01	47.62
(iii) Debt service coverage ratio (in times)*	Earning for Debt Service = Net Profit after taxes + Non-cash operating expenses + Interest + Other non-cash adjustments	Debt service = Interest and lease payments + Principal repayments	33.77	47.14	-28.36
(iv) Return on equity ratio (in %)	Profit for the year less Preference dividend (if any)	Average total equity	22.38%	28.75%	-22.17
(v) Trade receivables turnover ratio (in times)	Revenue from operations	Average trade receivables	4.29	4.41	-2.79
(vi) Trade payables turnover ratio (in times)	Consumption+ Sub contracting charges + Other expenses	Average trade payables	3.06	2.87	6.55
(vii) Inventory turnover ratio	Consumption+ Sub contracting charges	Average Inventory	4.20	4.25	-1.00
(viii) Net capital turnover ratio (in times)	Revenue from operations	Average working capital (i.e. Total current assets less Total current liabilities)	4.81	2.43	97.79
(ix) Net profit ratio (in %)	Profit for the year	Revenue from operations	12.64%	15.36%	-17.71
(x) Return on capital employed (in %)	Profit before tax and finance costs	Capital employed = Net worth + Lease liabilities - Deferred tax assets	28.59%	35.93%	-20.44
(xi) Return on investment (in %)	Income generated from invested funds	Average invested funds in treasury investments	5.83%	6.86%	-15.03

Note

* Variance in case of debt equity ratio and debt service coverage ratio is more than 25% as compared to the previous year. This is mainly due to decrease in profits primarily on account of higher costs.

5.1 Return on capital employed (ROCE)

With a ROCE of 21 percent in 2025, your Company continues to generate solid value in an environment marked by cyclical demand and varying capital intensity.

5.2 Dividend

The Board recommends a final dividend of 29.59 per share. The total dividend for 2025 is 39.36 per equity share, which includes an interim dividend of 9.77 per share.

6. TECHNOLOGY, INNOVATION AND DIGITALISATION

6.1 Product innovation and efficiency technologies

Your Company continued to advance product innovation with a strong focus on energy efficiency and sustainability. During the year, new offerings such as flameproof motors, AI-powered drive technologies, and modular switch solutions were introduced, addressing evolving industrial and infrastructure requirements while enhancing safety, reliability, and performance.

High-efficiency motors, advanced drives, integrated automation systems, and digital platforms continued to play a critical role in supporting customer decarbonization efforts, enabling process optimization, and delivering measurable improvements in energy efficiency across applications.

6.2 Digital manufacturing and solutions

Digitalization of factory operations was expanded across locations. Technologies including remote monitoring, analytics platforms, automation systems, industrial digital twins and cloud-enabled lifecycle services enhanced asset performance, visibility and operational control for customers.

In Electrification, two new Industry 5.0 product lines for contactors and switch products were introduced, combining advanced automation and AI to enhance productivity. An MoU was also signed with the Steel Authority of India for deployment of digital twin solutions for blast furnaces and melt shops.

6.3 Technology platforms and industry showcase

Your Company showcased its portfolio at major national platforms during the year. Participation in India Energy Week 2025 enabled presentation of solutions in distributed energy, grid automation, hydrogen ecosystems and digital energy management.

• At ELECRAMA 2025, your Company demonstrated its commitment to sustainable electrification and launched the Made-in-India "LIORA" modular switch portfolio, designed for residential, commercial and hospitality applications. Motion solutions, including energy-efficient motors, drives and traction systems, were also showcased to highlight energy optimization across industries.

• At SEMICON India 2025, your Company engaged with stakeholders in semiconductor and electronics manufacturing, presenting electrification, automation and power solutions tailored for high-precision industrial environments.

6.4 Advanced manufacturing and national programs

ABB India contributed to national programs, including energy efficiency movement, and year of infrastructure to ISROs 100th rocket launch through electrification and digital control solutions. Technology contributions extended to electronics, space and high-tech manufacturing sectors.

Strategic collaborations were strengthened through an MoU with SAIL for digital twin-based optimization at Rourkela Steel Plant and a strategic alliance with Deloitte India to support enterprise digital transformation.

7. SUSTAINABLE OPERATIONS

ABB India continued to implement energy-efficiency retrofits, water-positive initiatives, and waste reduction programs across manufacturing locations. The Nelamangala facility received Alliance for Water Stewardship ‘Gold Certification, becoming the ‘fourth company in India and the first in the automotive, electrical equipment and machinery production sector, to achieve this stakeholder-focused certification.

7.1 Supply chain and ESG integration

Sustainability integration across the value chain strengthened, with over 51 percent of suppliers (by spend) engaged in ESG initiatives.

7.2 ESG recognition

ABB India received recognition from GRIHA Council, CRISIL (No. 1 ESG ranking in Heavy Electrical Equipment), and NSE ESG Leader designation. At the Group level, ABBs CDP Water rating improved to A.

7.3 Health, safety and environmental governance

HSE governance was strengthened through structured oversight forums and compliance verification mechanisms. All sites operated under ISO 14001, ISO 45001 and ISO 50001, with zero major non-conformities.

Digital permit-to-Work systems were deployed, and ergonomic improvement programs were implemented. Hazard closure exceeded 97 percent, and Safety Observation Tours averaged more than four per manager annually. Injury frequency rates improved year-on-year. Employee awareness programs were conducted.

7.4 Sustainability across the portfolio

ABB Indias portfolio supports renewable integration, electrified transportation, energy-efficient buildings, water infrastructure and circularity solutions. These solutions enable customers to reduce emissions, energy consumption and lifecycle costs while improving productivity and safety.

8. HUMAN CAPITAL DEVELOPMENT

Your Company recognizes that sustained business performance is closely linked to the strength, engagement and capability of its workforce. During the year, emphasis was placed on strengthening people practices and promoting a stable, high-performing workplace culture. A range of structured employee engagement initiatives was implemented to enhance the overall employee experience across wellness, learning and development and collaborative team-building interventions. These initiatives contributed to improved employee satisfaction and supported retention across functions.

8.1 Learning and leadership development

Aligned with the ‘Learn–Connect–Grow philosophy, your Company strengthened its learning and leadership ecosystem through flagship programs such as LEAD, RISE, Learn O Holic 4.0, Classroom in the Air 4.0, Signature Leadership Programs and LCG Day. These initiatives led to a significant increase in total learning hours during the year. The rollout of the ‘GLocal Harvard Business Publishing platform positioned India among the top-performing countries within the ABB Group for platform utilization and certifications. Structured talent assessments supported identification and retention of high-potential employees, while a majority of managers completed formal leadership development programs.

Your Company also strengthened its internal coaching culture. More than 650 managers underwent coaching training, with HR Business Partners and People Development teams certified in ICF fundamentals. Internal coaching capabilities were further strengthened through the development of certified coaching practitioners and a substantial number of internal coaching hours were delivered during the year. Your Company was nominated by the International Coaching Federation as an Emerging Organization for Coaching, reflecting the growing maturity of its coaching ecosystem.

Internal mobility remained a key focus area. The Open Job Market (OJM) platform enabled a significant proportion of roles to be filled through internal movements, reinforcing a culture of career progression and talent development within the organization.

8.2 Employee wellbeing

Your Company continued to promote holistic employee wellbeing through structured initiatives addressing mental, financial and physical health.

Mental wellbeing

Programs such as ‘R U OK?, Stress Less – Thrive More and Spiritual Engineering, along with access to the Employee Assistance Program and the meQuilibrium platform, supporting resilience and mental health.

Physical wellbeing

Continued focus on healthy ergonomic practices, recreational infrastructure, a new gym facility and ongoing engagement on personal fitness.

Financial wellbeing

Initiatives including Womentra, taxation awareness sessions and financial literacy programs across employee segments.

Employees were also provided avenues to participate in voluntary CSR initiatives, supporting a positive and purpose-driven workplace culture.

Your Company continues to focus on building a resilient workforce and strengthening leadership capabilities in alignment with its long-term business objectives. Compliance with the provisions of the ‘New Labour Codes remains a priority, alongside ongoing strengthening of governance and human resource compliance frameworks. Actions based on employee engagement survey insights are being implemented to address improvement areas. These measures are expected to support sustained workforce engagement and organizational readiness.

Read more in the Human Capital Development section on page 70 of the Integrated Annual Report 2025.

9. RISKS AND CONCERNS

ABB India operates in a dynamic business environment characterized by technological evolution, infrastructure investments, and global supply chain interdependencies. Your Company maintains a structured and comprehensive risk management framework to identify, assess and mitigate risks that could impact its strategic objectives, financial performance and operational continuity.

9.1 Risk Management Framework

Your Company has adopted a robust Risk Management Charter and Policy establishing an enterprise-wide framework for risk governance. The framework outlines systematic processes for identifying, evaluating, prioritizing, mitigating and monitoring risks. Key risk domains include-

• Strategic risks: Market dynamics, competition, portfolio alignment and business model evolution

• Technology risks: Rapid technological change, digitalization and cybersecurity

• Financial risks: Currency fluctuations, commodity price volatility and liquidity management

• Operational risks: Supply chain disruptions, manufacturing continuity and project execution

• Legal and regulatory risks: Compliance with evolving regulatory requirements and standards

• Human Capital risks: Talent availability, retention and workforce capability Risk reviews are conducted at multiple organizational levels in line with ABBs global operating structure. Divisional risk assessments are consolidated at the country level and supplemented by macroeconomic and industry-wide risk evaluations.

9.2 Enterprise Risk Management (ERM)

Your Company undertakes an annual Enterprise Risk Management (ERM) exercise. The process begins with the identification of strategic business objectives, followed by the assessment of risks that could hinder the achievement of these objectives or result in material financial impact over a five-year horizon.

Risks are evaluated based on:

• Potential impact

• Likelihood of occurrence

• Speed of onset

Mitigation plans are developed for key risks and are subject to continuous monitoring. The effectiveness of controls and mitigation measures is reviewed through assurance mechanisms including management reviews, internal audits and performance monitoring processes.

9.3 Risk governance

The Risk Management Committee oversees the implementation and monitoring of the ERM framework. The Committee reviews consolidated risk assessments and provides guidance on mitigation strategies as necessary. Your Companys risk management processes are integrated with ABBs global governance systems, ensuring alignment with international standards while addressing local market conditions.

ABBS ENTERPRISE RISK MANAGEMENT PROCESS

9.4 Ongoing risk monitoring

Periodic reassessments are conducted to evaluate the evolving risk landscape, particularly concerning business growth, profitability, talent engagement, and market position. Operational risks are regularly reviewed based on inputs from internal assessments, audit findings and external developments.

Through this structured approach, ABB India aims to proactively manage uncertainties while supporting sustainable growth, and long-term value creation. Read more in the Risk Management section on page 56 of the Integrated Annual Report 2025.

10.OUTLOOK

Your Company expects the near-to medium-term operating environment to continue to being influenced by structural growth drivers in the Indian economy. Ongoing investments in infrastructure development, energy transition, urbanization, digitalization and advanced manufacturing are expected to support demand across electrification, motion, automation and related technologies. Increasing emphasis on energy efficiency, renewable integration and industrial modernization is likely to provide opportunities aligned with your Companys portfolio.

The business environment, however, remains subject to uncertainties. Geopolitical developments, changes in trade and tariff regimes, commodity price volatility, climate-related risks and evolving cybersecurity threats may affect supply chains, project timelines and cost structures. Global economic conditions may influence export demand, while domestic factors such as variability in private capital expenditure and execution challenges in large infrastructure projects could impact order flows.

Your Companys diversified presence across industries, strong local manufacturing footprint, service capabilities, and broad technology portfolio provide operational resilience. Continued focus on localization, productivity, digitalization, innovation and sustainability is expected to support competitiveness and customer value delivery. Your Company will continue to monitor macroeconomic conditions, policy developments and sector trends while maintaining disciplined operational execution.

11. INTERNAL CONTROL SYSTEMS AND INTEGRITY

Internal Controls has been a key focus area of your Company during the year. Internal Controls at ABB India has been designed to further the interest of all stakeholders by providing an environment which is conducive to conduct its operations and at the same time putting in the appropriate checks and balances. In doing so, your companys Internal Control environment has evolved over a decade to take care of, inter alia, financial and operational risks. Your company has a holistic Internal Control framework comprising elements like Country Management Committee, Corporate, Business and Local authorization tables, Local Management Instructions, Process and Entity-Level Controls, Enterprise Risk Management, Local Direct Management Testing Programs and a strong emphasis on integrity and ethics as a part of work culture. Aligning with the global reporting structure, your company has implemented a related Assurance process for every business which establishes the ownership and accountability of the financial statements at every business level. An independent service provider with expertise in the field conducted the current years Internal Financial Control effectiveness testing. ABB India has an effective statutory and legal compliance system in place.

A well-organized Group level tool (GRCM) is available to handle testing, internal audit issues, deficiency tracking, etc. Further, the in-house independent Internal Audit team acts as a pillar to support its control objectives. ABB India also has a well-functioning Whistle Blower Policy in place to report any misdoing. Internal Control framework of ABB India is aligned with one of the most matured IC frameworks – COSO 1992 and then transitioned to COSO 2013. The current framework is also in line with the Internal Finance Control (IFC) requirement of the Companies Act, 2013.