Advance Technoforge Ltd Management Discussions

OF OPERATIONS

You should read the following discussion of our financial condition and results of operations together with our restated financial information as of and for the financial years ended March 31, 2026, 2025, and 2024, all prepared in accordance with the Companies Act and Indian GAAP and restated in accordance with the SEBI ICDR Regulations, including the schedules, annexures and notes thereto and the reports thereon, included in the section titled Financial Information on page 174. Unless otherwise stated, the financial information used in this section is derived from the restated financial statements of our Company.

This discussion contains forward-looking statements and reflects our current views with respect to future events and financial performance. Actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors such as those set forth in the sections titled Risk Factors and Forward-Looking Statements on pages 24 and 22. respectively.

These financial statements have been prepared in accordance with Indian GAAP and the Companies Act. Indian GAAP differs in certain significant respects from U.S. GAAP, IFRS and Ind AS. We have neither attempted to quantify the impact of IFRS or U.S. GAAP on the financial data included in this Prospectus nor do we provide a reconciliation of our financial statements to those under U.S. GAAP or IFRS or Ind AS. Accordingly, the degree to which the Indian GAAP financial statements included in this Prospectus will provide meaningful information is entirely dependent on the readers level of familiarity with the Companies Act, Indian GAAP and the SEBI

ICDR Regulations. Any reliance on the financial disclosure in this Prospectus, by persons not familiar with Indian Accounting Practices, should accordingly be limited.

References to the Company, we, us and our in this chapter refer to Advance Technoforge Limited, as applicable in the relevant fiscal period, unless otherwise stated.

Note: some of the statements in the Chapter describing our objectives, outlook, estimates, expectations or prediction may be the Forward Looking Statements within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to our operations include, among others, economic conditions that may be affecting demand/supply and price conditions in domestic and overseas market in which we operate, changes in Government Regulations, Tax Laws and other Statutes, geo political limitations, conditions & sanctions which may affect international business and incidental factors.

OVERVIEW OF OUR BUSINESS

Our Company was incorporated as a private company in 2013. We are primarily engaged in manufacturing of forged steel machined components of Carbon Steel, Alloy Steel and Stainless Steel, specializing in Closed Die Forging, Upset Forging and Ring Rolling Forging in both rough and precision machined conditions. We are supplying these products to automotive, General engineering, oil & gas, Earth Moving and heavy machinery industries.

DISCUSSION OF RESULT OF OPERATION

As a result of the various factors discussed above that affect our income and expenditure, our results of operations may vary from period to period. The following table sets forth certain information with respect to our results of operations for the Fiscal Years 2026, 2025 and 2024 as derived from our restated financial statements:

Brief Key Financials of our Company:

Particular	As of and for the FY
	2026	2025	2024
Revenue from Operations (Rs. in lakh)	5,004.82	5,070.38	4,796.41
Other Income (Rs. in lakh)	67.85	45.34	27.19
Total Income (Rs. in lakh)	5,072.67	5,115.72	4,823.59
EBITDA (Rs. in lakh)	835.35	551.72	385.79
EBITDA Margin (%)	16.69%	10.88%	8.04%
Profit After Tax (PAT) (Rs. in lakh)	405.86	269.67	170.49
PAT Margin (%)	8.11%	5.32%	3.55%
Net worth (Rs. in lakh)	1,338.15	956.29	692.59
Total Debt (Rs. in lakh)	1,729.11	1,750.62	1,118.65
Return on Equity (ROE) (%)	30.33%	28.20%	24.62%
Return on Capital Employed (ROCE) (%)	22.52%	17.63%	17.77%
EPS (Rs.)	6.24	4.15	2.62
Book Value per Share (Rs.)	20.59	14.71	10.66
Debt To Equity Ratio	1.29	1.83	1.62

Note: As certified by M/s R V D & Co., Chartered Accountants, by way of their certificate dated 15 June 2026.

a) Revenue from Operations means the Revenue from Operations as appearing in the Restated Financial Statements. b) Other Income means the business income other than Revenue from Operations as appearing in the Restated Financial Statements. c) Total Income refers to Revenue from Operations + Other Income. d) EBITDA refers to earnings before interest, taxes, depreciation, amortization, gain or loss from discontinued operations and exceptional items. EBITDA is calculated as Profit before tax + Depreciation + Interest Cost e) EBITDA Margin refers to EBITDA during a given period as a percentage of revenue from operations during that period. f) PAT Margin i.e. Net Profit Ratio/Margin quantifies our efficiency in generating profits from our revenue and is calculated by dividing our net profit after taxes by our revenue from operations. g) Net worth means the aggregate value of the paid-up share capital and reserves & surplus minus deferred expenses. h) Return on equity (ROE) is profit after tax for the year divided by the net worth during that period and is expressed as a percentage. i) RoCE (Return on Capital Employed) is calculated as Earnings Before Interest and Tax (EBIT) (i.e., Profit before tax + Interest) divided by capital employed, which is defined as (Tangible net worth + total debt + Deferred tax liability). j) EPS (Earning per Share) is calculated as PAT divided by weighted average no. of Equity Shares. k) Book Value per Share is calculated as net worth divided by no. of Equity Shares l) Debt to equity ratio is calculated by dividing the total debt by net worth.

Our Strengths:

Experienced Promoters and Senior Management

Diversified clientele

Strong knowledge and expertise of senior management team

Long-Standing Relationship with Customers

Integrated Manufacturing Facility with diversified product portfolio

Large-scale Manufacturing Capabilities

SIGNIFICANT FACTORS AFFECTING OUR RESULTS OF OPERATIONS

Our financial condition and results of operations are affected by numerous factors and uncertainties, including those discussed in the section entitled Risk Factors on Page 24. The following are certain factors that have had, and we expect will continue to have, a significant effect on our financial condition and results of operations:

General geopolitical and other global risks;

General economic and business conditions in the markets in which we operate and in the local, regional, national and international;

Changes in laws and regulations that apply to the industry;

Increasing competition in the industry;

Our Companys inability to successfully implement its future growth plans;

Our ability to retain our key clients;

Our ability to retain our key managerial persons and other employees.

SIGNIFICANT ACCOUNTING POLICIES

The accounting policies have been applied consistently to the periods presented in the Restated Financial Statements. For details of our significant accounting policies, please refer section titled Restated Financial Statements starting on page 178.

RESULTS OF OUR OPERATIONS

As a result of the various factors discussed above that affect our income and expenditure, our results of operations may vary from period to period. The following discussion on results of operations should be read in conjunction with the Restated Financial Statements of Company for the Fiscal 2026, Fiscal 2025, and Fiscal 2024:

(Amount in lakhs)

	Financial Year 2026		Financial Year 2025		Financial Year 2024
Particulars	Amount	% of Total Income	Amount	% of Total Income	Amount	% of Total Income
Revenue from
	5004.82	98.66%	5,070.38	99.11%	4,796.41	99.44%
Operations
Other Income	67.85	1.34%	45.34	0.89%	27.19	0.56%
Total Income	5072.67	100%	5,115.72	100%	4,823.60	100%
Expenditure
Operating expenses	3518.44	69.36%	3,960.42	77.42%	4,084.68	84.68%
Employee Benefits
	614.74	12.12%	496.28	9.70%	282.23	5.85%
expenses
Finance costs	153.63	3.03%	129.18	2.53%	100.29	2.08%
Depreciation and
Amortization	129.12	2.55%	69.98	1.37%	58.52	1.21%
expenses
Other Expenses	104.15	2.05%	107.30	2.10%	70.89	1.47%
Total Expenses	4520.07	89.11%	4,763.16	93.12%	4,596.62	95.29%
Profit /(Loss)
	552.60	10.89%	352.56	6.89%	226.98	4.71%
before tax
Tax expense:
- Current Tax	103.11	2.03%	86.53	1.69%	58.42	1.21%
- Deferred Tax	43.22	0.85%	(4.84)	(0.09)%	(2.12)	(0.04)%
-Previous year Tax	0.41	0.01%	1.2	0.02%	0.19	0.00%
Net Tax expenses	146.74	2.89%	82.89	1.62%	56.49	1.17%
Profit/(Loss) after
	405.86	8.11%	269.67	5.27%	170.49	3.55%
tax

PRINCIPAL COMPONENTS OF OUR STATEMENT OF PROFIT AND LOSS ACCOUNT

Total Income

Our Total Income Fiscal 2026, Fiscal 2025, and Fiscal 2024 were amounting to 5072.67 Lakh, 5,115.72 Lakh and 4,823.59 Lakh, respectively. Following is the break-up of our total revenue forFiscal 2026, Fiscal 2025, and Fiscal 2024.

Our revenue comprises of:

Revenue from Operations

Our revenue from operations consists of revenue from closed die forgings, upset forging, ring Rolling, precision Machining etc. Our revenue from operations as a percentage of total income was 98.66%, 99.11%, and 99.44% for Fiscal 2026, Fiscal 2025, and Fiscal 2024 respectively.

Other Income

Our other income comprises of Foreign Exchange Fluctuation Gain, Discount, Interest income, Duty draw back and other non operating income. Other income, as a percentage of total income was 1.34%, 0.89%, and 0.56% for the Fiscal 2026, Fiscal 2025, and Fiscal 2024 respectively.

Total Expenses

Our total expenses for the Fiscal 2026, Fiscal 2025, and Fiscal 2024 respectively, primarily consist of the following:

Operating Expense

Operating expenses comprises of Freight, Job work, Power & fuel, Repair & Maintenance, Laboratory Expenses, Fumigation Expenses, Tools Expense, Weighing expense etc. Operating expenses, as a percentage of total income was 69.36%, 77.42%, and 84.68% for the Fiscal 2026, Fiscal 2025, and Fiscal 2024 respectively.

Employee Benefit Expenses

Expenses in relation to employees benefit expenses include Salary & Wages, Directors remuneration, Staff welfare expense, Provident fund expenses, Leave encashment, Provision for Gratuity Expenses and other employee benefits. Employee benefit expenses, as a percentage of total income was 12.12%, 9.70%, and 5.85% for the Fiscal 2026, Fiscal 2025, and Fiscal 2024 respectively.

Finance Costs

Finance cost primarily consists of interest on short term and long term loans availed by Company from bank & other borrowing cost. Finance cost, as a percentage of total income was 3.03%, 2.75%, 2.53%, and 2.08% for the Fiscal 2026, Fiscal 2025, and Fiscal 2024 respectively.

Depreciation & Amortisation Expenses

Depreciation & amortisation expenses consist of depreciation on the tangible and amortisation on the intangible assets of our Company which includes Computer, Software, Furniture and Fixtures, Building, Plant & Machinery, Printer, Solar Plant and Motor Vehicle. Depreciation & amortisation expenses, as a percentage of total income was 2.55%, 1.37%, and 1.21% for the Fiscal 2026, Fiscal 2025, and Fiscal 2024 respectively.

Other Expenses

Other expenses include professional fees, business promotion, ROC fees, audit Fees, rent, repair, travelling expenses, Consultancy charges, office expenses, printing & stationery, commission, Insurance, Solar plant registration, Security, Stamp duty, Loss on sale of assets, Board sitting fees etc. Other expenses, as a percentage of total income was 2.05%, 2.10%, and 1.47% for the Fiscal 2026, Fiscal 2025, and Fiscal 2024 respectively.

Provision for Tax

Income tax has been provided on the basis of current income tax rate on taxable income. Advance tax and TDS deducted has been set off against provisions for taxation at the time of finalization of Income tax assessment proceedings. The deferred tax assets are recognized and carried forward only to the extent that there is virtual certainty that the asset will be realized in future. Provision for tax, as a percentage of total income was 2.89%, 1.62%, and 1.17% for the Fiscal 2026, Fiscal 2025, and Fiscal 2024 respectively.

Financial Year 2026 compared to Financial Year 2025:

(Amount in lakhs)

Sr. No. Particulars	For Fiscal 2026	For Fiscal 2025	% Change
1 Revenue from Operation	5,004.82	5,070.38	-1.29%
2 Other Income	67.85	45.34	49.65%
Total Income (1+2)	5,072.67	5,115.72	-0.84%
3 Expenditure
(a) Operating Expenses	3,518.44	3,960.42	-11.16%
(b) Employee Benefit Expenses	614.74	496.28	23.87%
(c ) Finance Cost	153.63	129.18	18.93%
(d) Depreciation & Amortization	129.12	69.98	84.51%
(e) Other Expense	104.15	107.30	-2.94%
4 Total Expenditure 3(a) to 3(e)	4,520.07	4,763.16	-5.10%
5 Profit/(Loss) Before Tax (1+2-4)	552.60	352.56	56.74%
6 Tax Expense:
(a) Current Tax	103.11	86.53	19.16%
(b) Deferred Tax	43.22	(4.84)	NA
(c) Previous year Tax	0.41	1.20	-65.83%
Net Current Tax Expenses	146.74	82.89	77.03%
7 Profit/(Loss) for the Period/Year (5-6)	405.86	269.67	50.50%

Revenue from Operation

Revenue from operations has decreased by 1.29%, from 5,070.38 lakh in Fiscal 2025 to 5,004.82 lakh in Fiscal 2026, on account of marginal decline in sales volume and lower realization from certain products/services during the year.

Other Income

Other income had increased by 49.65%, from 45.34 lakh in Fiscal 2025 to 67.85 lakh in Fiscal 2026. The growth was primarily attributable to higher interest income, duty drawback income, discounts income, exchange differences gain, and other non-operating income earned during the year.

Operating Expenses

Operating expenses had been decreased by 11.16%, from 3,960.42 lakh in Fiscal 2025 to 3518.44 lakh in Fiscal 2026, mainly on account of improved operational efficiencies, better cost management measures, and reduction in raw material and other direct operating costs.

Employee Benefit Expenses

Employee benefit expenses had been increased by 23.87%, from 496.28 lakhs in Fiscal 2025 to 614.74 lakhs in Fiscal 2026 on account of annual salary increments, recruitment of additional personnel, and increased employee welfare and statutory benefit costs.

Finance Cost

Finance Cost had increased by 18.93% from 129.18 lakhs in Fiscal 2025 to 153.63 lakhs in Fiscal 2026. This is primarily due to increased utilization of working capital facilities and borrow fund from the Bank during the year.

Depreciation and Amortization Expenses

Depreciation had increased by 84.51%, from 69.98 lakhs in Fiscal 2025 to 129.12 lakhs in Fiscal 2026 as primarily due to capitalization of new plant and machinery, equipment, and other fixed assets during the year.

Other Expenses

Other expenses have decreased by 2.94% from 107.30 lakh in Fiscal 2025 to 104.15 lakh in Fiscal 2026. This is primarily due to effective control over administrative and general operating expenses during the year.

Tax Expenses

The Companys tax expenses had increased by 77.03% from 82.89 lakh in the Fiscal 2025 to 146.74 lakh in Fiscal 2026. This is primarily due to higher taxable profits generated during the year.

Profit after Tax

The Companys profit after tax had increased by 50.50% from 269.67 lakhs in the Fiscal 2025 to 405.86 lakhs in Fiscal 2026. This increase in Profit After Tax attributable to improved operational efficiency, reduction in operating expenses, higher other income, and better overall profitability despite a marginal decline in revenue from operations.

Financial Year 2025 compared to Financial Year 2024:

(Amount in lakhs)

Sr. No. Particulars	For Fiscal 2025	For Fiscal 2024	% Change
1 Revenue from Operation	5,070.38	4,796.41	5.70%
2 Other Income	45.34	27.19	66.75%
Total Income (1+2)	5,115.72	4,823.59	6.05%
3 Expenditure
(a) Operating Expenses	3,960.42	4,084.68	-3.04%
(b) Employee Benefit Expenses	496.28	282.23	75.84%
(c ) Finance Cost	129.18	100.29	28.81%
(d) Depreciation & Amortization	69.98	58.52	19.58%
(e) Other Expense	107.30	70.89	51.36%
4 Total Expenditure 3(a) to 3(e)	4,763.16	4,596.62	3.62%
5 Profit/(Loss) Before Tax (1+2-4)	352.56	226.98	55.32%
6 Tax Expense:
(a) Current Tax	86.53	58.42	48.12%
(b) Deferred Tax	(4.84)	(2.12)	NA
(c) Previous year Tax	1.2	0.19	531.58%
Net Current Tax Expenses	82.89	56.49	46.73%
7 Profit/(Loss) for the Period/Year (5-6)	269.67	170.49	58.16%

Revenue from Operation

Revenue from operations had increased by 5.70%, from 4,796.41 lakhs in Fiscal 2024 to 5,070.38 lakhs in Fiscal 2025. This increase in Revenue was on account of normal business growth and improved demand across key product lines.

Other Income

Other income had increased by 66.75%, from 27.19 lakh in Fiscal 2024 to 45.34 lakh in Fiscal 2025 mainly on account of an increase in discount received to 23.74 lakh in Fiscal 2025 compared to 13.11 lakh in Fiscal 2024. and increase in interest income to 8.16 lakh in Fiscal 2025 compared to 3.57 lakh in Fiscal 2024.

Operating Expenses

Operating expenses had been decreased by 3.04%, from 4,084.68 lakh in Fiscal 2024 to 3,960.42 lakh in Fiscal 2025, mainly on account reduction in consumable costs and shifting of certain outsourced manufacturing processes to in-house operations, resulting in better cost efficiency.

Employee Benefit Expenses

Employee benefit expenses had been increased by 75.84%, from 282.23 lakhs in Fiscal 2024 to 496.28 lakhs in Fiscal 2025 on account of increase in-house processing activities leading to higher wages, along with provisioning for gratuity and statutory benefits.

Finance Cost

Finance Cost had increased by 28.81% from 100.29 lakhs in Fiscal 2024 to 129.18 lakhs in Fiscal 2025. This is primarily due to increase in interest on short term borrowing by 27.98 lakhs in financial year 2025.

Depreciation and Amortization Expenses

Depreciation and amortization expenses had increased by 19.58%, from 58.52 lakhs in Fiscal 2024 to 69.98 lakhs in Fiscal 2025 as net fixed assets addition of 705.14 lakh at the end of the Fiscal 2025.

Other Expenses

Other expenses had increased by 51.36% from 70.89 lakh in Fiscal 2024 to 107.30 lakh in Fiscal 2025. This is primarily due to 17.98 lakhs expense incurred for PGVCL electric connection in Fiscal 2025.

Tax Expenses

The Companys tax expenses had increased by 46.73% from 56.49 lakh in the Fiscal 2024 to 82.89 lakh in Fiscal 2025. This is primarily due to higher profitability during the year.

Profit after Tax

The Companys profit after tax had increased by 58.16% from 170.50 lakhs in the Fiscal 2024 to 269.67 lakhs in Fiscal 2025. This increase in Profit After Tax was on account of reduction in raw material costs and decreased job work expenses, enhancing overall margins.

Cash flows

The following table sets forth our cash flows with respect to operating activities, investing activities and financing activities for the period indicated:

( in lakh)

Particulars	Fiscal 2026	Fiscal 2025	Fiscal 2024
Net cash flow from/ (used in) operating activities	445.14	378.60	18.88
Net cash flow from/ (used in) investing activities	(270.75)	(880.49)	(182.26)
Net cash flow from/ (used in) financing activities	(175.13)	502.79	166.97
Net increase/(decrease) in cash and cash equivalents	(0.75)	0.90	3.59
Cash and cash equivalents at the beginning of the year	4.54	3.64	0.05
Cash and cash equivalents at the end of the year	3.79	4.54	3.64

Cash Flows from Operating Activities

Financial Year 2025-26

Our net cash flow from operating activities was 445.14 lakh for the Fiscal 2026 as compared to the Restated Profit Before Tax of 552.60 lakh for the same period. Our operating profit before changes in working capital changes was 846.06 lakh which was primarily adjusted against increase in trade receivables, increase in inventory, increase in other current assets, increase in short term loans and advances, decrease in other non-current assets, increase in trade payables and increase in other current liabilities.

Financial Year 2024-25

Our net cash flow from operating activities was 378.60 lakh for the Fiscal 2024 as compared to the Restated Profit Before Tax of 352.56 lakh for the same period. Our operating profit before changes in working capital changes was 564.84 lakh which was primarily adjusted against increase in trade receivables, increase in other current assets, decrease in inventory, increase in short term loans and advances, increase in other non-current assets, increase in trade payables and decrease in other current liabilities.

Financial Year 2023-24

Our net cash flow from operating activities was 18.88 lakh for the Fiscal 2024 as compared to the Restated Profit Before Tax of 226.98 lakh for the same period. Our operating profit before changes in working capital changes was 385.44 lakh which was primarily adjusted against increase in trade receivables, decrease in other current assets, increase in inventory, increase in short term loans and advances, increase in trade payables and increase in other current liabilities.

Cash Flows from Investing Activities

Our net cash flow changes due to investing activities are significant compared to our cash flow from operating activities for the Fiscal 2026, Fiscal 2025, and Fiscal 2024 on account of investment in fixed assets amounting 372.23 lakh, 888.49 lakh, and 195.69 respectively.

Cash Flows from Financing Activities

Financial Year 2025-26

Net cash used in financing activities for the Fiscal 2026 was (175.13) lakh which was mainly on account of net increase in repayment of Long-term borrowing by 23.00 lakhs and finance charges paid 153.63 lakhs.

Financial Year 2024-25

Net cash used in financing activities for the Fiscal 2025 was 502.79 lakhs which was mainly on account of net increase in Short-term borrowing by 161.39 lakhs, net increase in Long-term borrowing by 470.58 lakhs and finance charges paid 129.18 lakhs.

Financial Year 2023-24

Net cash used in financing activities for the Fiscal 2024 was 166.97 lakhs which was mainly on account of net increase in Short-term borrowing by 284.75 lakhs, net decrease in Long-term borrowing by 17.49 lakhs and finance charges paid 100.29 lakhs.

PRINCIPAL COMPONENTS OF BALANCE SHEET

Financial Year 2026 compared to Financial Year 2025:

Sr. No. Particulars	For Fiscal 2026 ( in Lakhs)	For Fiscal 2025 ( in Lakhs)	% Change
1. Long Term borrowing	622.76	796.71	-21.83%
2. Short Term borrowing	1,106.35	953.91	15.98%
3. Trade Payable	1,345.38	1,112.53	20.93%
4. Trade Receivable	1,316.29	1,213.97	8.43%
5. Inventories	1,252.55	807.94	55.03%
6. Short Loans and Advances	115.78	63.27	82.99%

Long Term borrowing

Long Term borrowing outstanding had decreased by 21.83%, from 796.71 lakh in Fiscal 2025 to 622.76 lakh in Fiscal 2026 was mainly on account of scheduled repayment of term loans and reduction in outstanding debt obligations during the year.

Short Term borrowing

Short Term borrowing outstanding had increased by 15.98%, from 953.91 lakh in Fiscal 2025 to 1106.35 lakh in Fiscal 2026 was primarily due to increased utilization of working capital facilities to support business operations and inventory requirements.

Trade Payable

Trade Payable had increased by 20.93%, from 1,112.53 lakh in Fiscal 2025 to 1345.38 lakh in Fiscal 2026 largely due to higher procurement of raw materials and extended credit availed from suppliers in line with business requirements.

Trade Receivable

Trade Receivable had increased by 8.43%, from 1,213.97 lakh in Fiscal 2025 to 1316.29 lakh in Fiscal 2026 was mainly on changes in the credit period offered to customers and timing of collections.

Inventories

Inventories had increased by 55.03%, from 807.94 lakh in Fiscal 2025 to 1252.55 lakh in Fiscal 2026 was mainly on account of higher procurement of raw materials to support the expanded scale of operations and alignment with the companys active order book.

Short Loans and Advances

Short Loans and Advances had increased by 82.99%, from 63.27 lakh in Fiscal 2025 to 115.78 lakh in Fiscal 2026. The significant increase was primarily due to increase in balance with revenue authorities, IPO related expenses and Prepaid expenses.

Financial Year 2025 compared to Financial Year 2024:

Sr. No. Particulars	For Fiscal 2025 ( in Lakhs)	For Fiscal 2024 ( in Lakhs)	% Change
1. Long Term borrowing	796.71	357.51	122.85%
2. Short Term borrowing	953.91	761.14	25.33%
3. Trade Payable	1,112.53	913.97	21.73%
4. Trade Receivable	1,213.97	1,169.19	3.83%
5. Inventories	807.94	848.32	-4.76%
6. Short Loans and Advances	63.27	25.17	151.37%

Long Term borrowing

Long Term borrowing outstanding had increased by 122.85%, from 357.51 lakh in Fiscal 2024 to 796.71 lakh in Fiscal 2025 was mainly on account of capital expenditure incurred for installation of the ground-mounted solar system and related credit facilities availed by the company.

Short Term borrowing

Short Term borrowing outstanding had increased by 25.33%, from 761.14 lakh in Fiscal 2024 to 953.91 lakh in Fiscal 2025 was primarily due to higher turnover and inventory levels. The company availed additional working capital finance from the bank, resulting in an increase in short-term borrowings compared to Fiscal 2024.

Trade Payable

Trade Payable had increased by 21.73%, from 913.97 lakh in Fiscal 2024 to 1,112.53 lakh in Fiscal 2025 largely due to creditors related to recent CAPEX of approximately 107 lakh and normal operational expansion.

Trade Receivable

Trade Receivable had increased by 3.83%, from 1,169.19 lakh in Fiscal 2024 to 1,213.97 lakh in Fiscal 2025 was mainly on account of normal business growth and timing differences in collections consistent with the increased turnover.

Inventories

Inventories had decreased by 4.76%, from 848.32 lakh in Fiscal 2024 to 807.94 lakh in Fiscal 2025 was mainly on account of reduction in material cost and improved inventory management practices.

Short Loans and Advances

Short Loans and Advances had decreased by 151.37%, from 25.17 lakh in Fiscal 2024 to 63.27 lakh in Fiscal 2025. The significant increase was primarily due to advances made to suppliers towards procurement of capital goods related to ongoing expansion and modernization projects, including machinery and equipment purchases under the companys capital expenditure program. These advances are expected to be adjusted upon receipt and capitalization of the respective assets.

Revenue generated from Related Parties

( In Lakhs unless otherwise stated)

Sr. Particulars No.	For the period ended on 31 March 2026	For the period ended on 31 March 2025	For the period ended on 31 March 2024
A Revenue from Operations	5,004.82	5,070.38	4,796.41
B Revenue from Operations on transactions with related parties	7.24	-	1.94
C % of Revenue Operations generated from related parties	0.14%	-	0.04%
[(B/A)*100]

Trade Receivable and Inventories in comparison to Revenue from operation

	(	in Lakhs unless otherwise stated)
Sr. Particulars No.	For the period ended on 31 March 2026	For the period ended on 31 March 2025	For the period ended on 31 March 2024
A Revenue from Operations	5,004.82	5,070.38	4,796.41
B Trade Receivable	1,316.29	1,213.97	1,169.19
C % of Revenue from Operations [(B/A)*100]	26.30%	23.94%	24.38%
D Inventories	1,252.55	807.94	848.32
E % of Revenue from Operations [(D/A)*100]	25.03%	15.93%	17.69%

Trade receivable was consistently raising from the Fiscal 2024 to Fiscal 2026 in proportion to revenue from operation. It was mainly on account of higher revenue from operation in the last quarter of every financial year.

Total debt in comparison to free cash flow from business operation

( . in Lakhs unless otherwise stated)

Sr. Particulars	March 31, 2026	March 31, 2025	March 31, 2024
No.
A Total Debt	1,729.11	1,750.60	1,118.65
B free cash flow from business operation	445.14	378.60	18.88

Free cash flow from business operation are positive in all reporting periods stated under restated financial statement.

OTHER INFORMATION

Quantitative and Qualitative Disclosures about Market Risk

Market risk is the risk of loss related to adverse changes in market prices, including interest rates. In the normal course of business, we are exposed to certain market risks including interest risk.

Interest rate risk

Interest rate risk results from changes in prevailing market interest rates, which can cause a change in the fair value of fixed-rate instruments and changes in the interest payments of the variable-rate instruments. Our operations are funded to a certain extent by borrowings. Our current loan facilities carry interest at variable rates. We mitigate risk by structuring our borrowings to achieve a reasonable, competitive cost of funding. There can be no assurance that we will be able to do so on commercially reasonable terms, that our counterparties will perform their obligations, or that these agreements, if entered into, will protect us adequately against interest rate risks. Further, we also keep fixed deposits and any change in interest rate results change in our interest income.

Liquidity risk

Adequate and timely cash availability for our operations is the liquidity risk associated with our operations. Our

Companys objective is to all time maintain optimum levels of liquidity to meet its cash requirements. We employ prudent liquidity risk management practices which inter-alia means maintaining sufficient cash and the availability of funding through an adequate amount of committed credit facilities.

Credit Risk

We are exposed to the risk that our counterparties may not comply with their obligations under a financial instrument or customer contract, leading to a financial loss. We are exposed to credit risk from our operating activities, primarily from trade receivables. Though, we believe that our customers to be creditworthy counterparties, which limits the credit risk, however, there can be no assurance that our counterparties may not default on their obligations, which may adversely affect our business and financial condition.

Material Frauds

There is no material frauds committed against our Company in the last three financial years.

Related Party Transactions

We enter into various transactions with related parties in the ordinary course of business. For information relating to our related party transactions, please see Annexure 31 titled as Related Party Disclosures under chapter titled

Restated Financial Statement beginning on page 178.

An analysis of reasons for the changes in significant items of income and expenditure is given hereunder:

1. Unusual or infrequent events or transactions

There have been no events or transactions to our knowledge which may be described as unusual or infrequent.

2. Significant economic changes that materially affected or are likely to affect income from continuing operations

Domestic and international government policies governing the sector in which we operate as well as the overall growth of the Indian and global economies has a significant bearing on our operations. Major changes in these factors can significantly impact income from continuing operations. There are no significant economic changes that materially affected our Companys operations or are likely to affect income except as mentioned in the section titled Risk Factors starting on Page 24.

3. Known trends or uncertainties that have had or are expected to have a material adverse impact on sales, revenue or income from continuing operations.

Other than as described in the section titled Risk Factors starting on Page 24 and this Chapter, to our best of knowledge there are no known trends or uncertainties that have or are expected to have a material adverse impact on our income from continuing operations.

4. Future changes in relationship between costs and revenues

Our Companys future costs and revenues will be determined by demand/supply situation, government policies, domestic and international rate and other domestic and international factors. Other than as described in the sections Risk Factors , Our Business starting on page 24 and 116, respectively and this Chapter, to our best of knowledge, no future relationship between expenditure and income is expected to have a material adverse impact on our operations and finances.

5. Segment Reporting

Our Company operates only in single business segment i.e. producing forged and precision machined parts with various additional processes, hence, we have only one reportable segment in context of Accounting Standard 17 on Segment Reporting issued by ICAI.

6. Status of any publicly announced New Products or Business Segment

Our Company has not introduced any new product or services or business segment and does not expect to announce in the near future any new products/ services or business segment.

7. Seasonality of business

Our business is not subject to seasonality. For further information, see Industry Overview and Our Business starting on pages 112 and 116, respectively.

8. Dependence on single or few customers

For Fiscal 2026, Fiscal 2025, and Fiscal 2024 our top five customers accounted for about 46.78, 48.16%, and 57.27%respectively and our largest customer accounted for 12.34%, 19.87%, and 25.39% respectively of our Revenue from Operations.

Further, we do not have long-term contractual arrangements with our significant customers and conduct business with them on the basis of orders that are received from time to time.

For the Fiscal 2026, Fiscal 2025, andFiscal 2024 our top five (5) creditors accounted for about 16.44%, 11.89%, and 10.38% respectively and our largest creditor accounted for 11.39%, 8.72%, and 4.39% respectively of our Revenue from Operations.

We do not enter into any long- term contracts with our creditors and rates of their services are normally based on the quotes we receive from them. For further information, see Risk Factors on starting page 24.

9. Competitive conditions

We expect competition in our business from existing and potential competitors to intensify. We face competition from both organized and unorganized players in the market. We believe our expertise and quality service offerings with experience of our management, will be key to overcome competition posed by such players. We believe that the principal factors affecting competition in our business include client relationships, reputation, timely providing services, fulfilling client specific requirements, the quality and pricing of our services. Further, competitive conditions are as described under the Chapters Industry Overview and Our Business starting on pages 112 and 116, respectively.

Material Developments subsequent to the period ended 31 March 2026

In our opinion there are no circumstances have arisen past period ended 31 March 2026 being the date of the latest financial statements as disclosed in this Prospectus until the date of filing this Prospectus, which materially or adversely affect or are likely to affect, our operations or profitability, or the value of our assets or our ability to pay our material liabilities within the next twelve months.