ANB Metal Cast Ltd Management Discussions

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, 2025, 2024 and 2023, 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" starting on page on page 233. 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" starting on pages 25 and 18 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 Red Herring 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 Red Herring 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 Red Herring 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 ANB Metal Cast 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 shipping routings, freight rates & business and incidental factors.

OVERVIEW OF OUR BUSINESS

We specialize in manufacturing a wide range of aluminum extrusion products, including motor bodies, various profiles, round bars, solar profiles, railings and sliding windows etc. Our products cater to electronics, automotive, mechanical, solar and architectural etc. industries in India. Our owned manufacturing unit is located in Rajkot, Gujarat, spanning about 50,000 sq. ft. and is dedicated to the production of aluminum extrusions and non-ferrous metal alloys. The large variety of dies used in manufacturing are custom-made and owned by our Company. Our primary raw material is aluminium-based metal scrap, which we source from both domestic and international markets.

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 period March 31, 2025 and Fiscal Years 2024, 2023 and 2022 as derived from our restated financial statements:

Brief Key Financials of our Company:

(Rs. in lakh except percentages and ratios)

Particular	As of and for the period
	FY 2025	FY 2024	FY 2023
Revenue from Operations	16,256.86	11,212.05	8,427.46
Other Income	6.71	3.36	0.10
Total Income	16,263.57	11,215.41	8,427.56
EBITDA	1,747.44	1,070.76	314.76
EBITDA Margin (%)	10.74%	9.55%	3.73%
Profit After Tax (PAT)	1,024.71	533.63	184.63
PAT Margin (%)	6.30%	4.76%	2.19%
Net worth	3,396.97	1,067.27	537.27
Total Debt	3,432.96	3412.90	1,592.25
Return on Equity (ROE) (%)	45.91%	66.52%	61.81%
Return on Capital Employed (ROCE) (%)	24.13%	22.47%	13.86%
EPS (Rs.)	12.66	7.12	4.06
Book Value per Share (Rs.)	41.97	14.23	7.16
Debt To Equity Ratio	1.01	3.20	2.95

*After giving retrospective effect of Bonus issue

Note: 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 during a given period as a percentage of revenue from operations during that period. This margin quantifies our efficiency in generating profits from our revenue. g) Net worth means the aggregate value of the paid-up share capital and reserves and surplus. 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 profit before tax plus finance costs divided by {Net Worth + Total Debt + Deferred Tax Liability Intangible Asset}. j) EPS (Earning per Share) is calculated as PAT divided by no. of Equity Shares k) Book Value per Share is calculated as net worth divided by no. of Equity Shares l) Debt to Equity or Leverage ratio is calculated by dividing the debt by net worth.

Our Strengths:

Some of the qualitative factors and our strengths which form the basis of Issue Price are:

Diverse Product Portfolio

Ability to provide customized solutions tailored to client specifications Stringent quality control mechanism ensuring standardized product quality Strong knowledge and expertise of Senior management team Strong existing client relationship

Prepared to grow and reap benefit of available huge potentials available in aluminum product end-users sectors

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" starting on page 25. The following are certain factors that have been, and we expect will continue to have, a significant effect on our financial condition and results of operations:

General economic and business conditions in the markets in which we operate and in the local, regional, national and international; Economies changes in laws and regulations that apply to the industry; Increasing competition in the industry; Companys inability to successfully implement its future growth plans; Our ability to retain our key clients; Fluctuation in raw material price and our ability to pass it to the customers; 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 "Financial information" starting on page 203.

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 2025, Fiscal 2024 and Fiscal 2023:

(Amount in lakhs)

	Financial Year 2025		Financial Year 2024		Financial Year 2023
Particulars	Amount	% of Total Income	Amount	% of Total Income	Amount	% of Total Income
Revenue from Operations	16256.86	99.96%	11,212.05	99.97%	8,427.46	100.00%
Other Income	6.71	0.04%	3.36	0.03%	0.10	0.00%
Total Income	16263.57	100.00%	11,215.41	100.00%	8,427.56	100.00%
Expenditure
Operating expenses	14,128.65	86.87%	9,832.66	87.67%	7,892.56	93.65%
Employee Benefits expenses	122.34	0.75%	168.26	1.50%	129.83	1.54%
Finance costs	261.83	1.61%	200.53	1.79%	42.47	0.50%
Depreciation and Amortization expenses	85.21	0.52%	55.93	0.50%	17.61	0.21%
Other Expenses	265.14	1.63%	143.72	1.28%	90.41	1.07%
Total Expenses	14,863.14	91.39%	10,401.10	92.74%	8,172.89	96.98%
Profit /(Loss) before tax	1400.40	8.61%	814.30	7.26%	254.67	3.02%
Tax expense:
- Current Tax	352.45	2.17%	237.98	2.12%	51.45	0.61%
- Deferred Tax	23.24	0.14%	20.20	0.18%	13.04	0.15%
-Short/Excess Provision of last year	-	-	22.49	0.20	5.56	0.07%
Net Tax expenses	375.69	2.31%	280.67	2.50%	70.05	0.83%
Profit/(Loss) after tax	1024.71	6.30%	533.64	4.76%	184.63	2.19%

PRINCIPAL COMPONENTS OF OUR STATEMENT OF PROFIT AND LOSS ACCOUNT

Total Income

Our Total Income for the financial years ended March 31, 2025, March 31, 2024 and March 31, 2023, were amounting to 16,263.57 Lakh, 11,215.41 lakh and 8,427.56 lakh respectively. Following is the break-up of our total revenue from operations for the Fiscal 2025, Fiscal 2024 and Fiscal 2023.

Our revenue comprises of:

Revenue from Operations

Our revenue from operations consists of revenue from aluminium extrusion products, including motor bodies, various profiles, round bars, solar profiles, railings, and sliding windows. etc. Our revenue from operations as a percentage of total income was 99.96%, 99.97% and 100.00% for Fiscal 2025, Fiscal 2024 and Fiscal 2023 respectively.

Other Income

Our other income mainly comprises of Interest income, as a percentage of total income was 0.04%, 0.03% and 0.00% for Fiscal 2025, Fiscal 2024 and Fiscal 2023 respectively.

Total Expenses

Our total expenses comprise mainly Cost of Material Consumed, Employee Benefits Expenses, Finance Costs and Depreciation &

Amortization Expense and Other Expenses. Our total expenses are 91.39%, 92.74% and 96.98% of the total income for Fiscal 2025, Fiscal 2024 and Fiscal 2023, respectively. Our total expenses primarily consist of the following:

Operating Expense

Operating expenses comprises of Direct Material Consumed i.e. mainly cost of raw material purchases, Direct expenses and changes in inventory. Operating expenses, as a percentage of total income was 86.87%, 87.67% and 93.65% for Fiscal 2025, Fiscal 2024 and Fiscal 2023 respectively.

Employee Benefit Expenses

Expenses in relation to employees benefit expenses include Salary & Wages, Directors remuneration and Gratuity Expenses.

Employee benefit expenses, as a percentage of total income was 0.75%, 1.50% and 1.54% for Fiscal 2025, Fiscal 2024 and Fiscal 2023 respectively.

Finance costs

Finance cost primarily consists of interest payable on loans availed by our Company from lenders & other finance charges, if any. Finance cost, as a percentage of total income was 1.61%, 1.79% and 0.50% for Fiscal 2025, Fiscal 2024 and Fiscal 2023 respectively.

Depreciation Expenses

Depreciation expenses consist of depreciation on mainly the tangible and intangible assets, if any, of our Company which includes office and factory building, Plant and Machinery, Computer, Furniture and Fixtures, Office Equipment etc. Depreciation expenses, as a percentage of total income was 0.52%, 0.50% and 0.21% for Fiscal 2025, Fiscal 2024 and Fiscal 2023 respectively.

Other Expenses

Other expenses include Office and General Expenses, Legal, Professional & Consultancy Charges, conveyance, repair and maintenance, travelling expenses, printing & stationery and Insurance etc. Other expenses, as a percentage of total income was 1.63%, 1.28% and 1.07% for Fiscal 2025, Fiscal 2024 and Fiscal 2023 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 2.31%, 2.50% and 0.83% Fiscal 2025, Fiscal 2024 and Fiscal 2023 respectively.

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	16256.86	11,212.05	44.99%
2 Other Income	6.71	3.60	99.92%
Total Income (1+2)	16263.57	11,215.41	45.01%
3 Expenditure
(a) Operating Expenses	14,128.65	9,832.66	43.69%
(b) Employee Benefit Expenses	122.34	168.26	-27.29%
(c ) Finance Cost	261.83	200.53	30.57%
(d) Depreciation & Amortization	85.21	55.93	52.34%
(e) Other Expense	265.14	143.72	84.48%
4 Total Expenditure 3(a) to 3(e)	14,863.14	10,401.10	42.90%
5 Profit/(Loss) Before Tax (1+2-4)	1400.40	814.30	71.98%
6 Tax Expense:

 

(a) Current Tax	352.45	237.98	48.10%
(b) Deferred Tax	23.24	20.20	15.08%
(c) Short/Excess Provision of last year		22.49	-100.00%
Net Current Tax Expenses	375.69	280.67	33.86%
7 Profit/(Loss) for the Period/Year (5-6)	1024.71	533.63	92.02%

Revenue from Operation

Revenue from operations had increased by 44.99%, from Rs. 11212.05 lakh in Fiscal 2024 to Rs. 16256.86 lakh in Fiscal 2025. This increase in Revenue was on account of rise in demand in previous year, which boosted our revenue from operations.

The reason for increase in Revenue from Operation in FY 2025 is as under:

Particulars	FY 2025	FY 2024	FY 2023
Installed Capacity (in MT)	7800	7800	5400
Actual Production (in MT)	6100	5400	3360

The Company has installed capacity 7800 MT in FY 2025. The Company is fast growing company and has demand for its products. Hence, the Company could increase its productions from 5400 MT in FY 2024 to 6100 MT in FY 2025, which has resulted in higher Sale of Products and therefore, the Revenue from Operations increased in FY 2025. This also has contribution of better pricing policies, better credit terms and brand recognition.

Other Income

Other income had increased by 99.92%, from Rs. 3.36 lakh in Fiscal 2024 to Rs. 6.71 lakh in Fiscal 2025 on account of mainly interest income rise of Rs. 4.57 lakh in Fiscal 2025 compared to Rs. 2.44 lakh in Fiscal 2024. This high increase is due to low base of interest income of Rs. 2.44 lakh in Fiscal 2024

Operating Expenses

Operating expenses had been increased by 43.69%, from Rs. 9,832.66 lakh in Fiscal 2024 to Rs. 14,128.65 lakh in Fiscal 2025, as revenue from operation had been increased by 44.99%. This increase was in line with increase in revenue from operation.

Employee Benefit Expenses

Employee benefit expenses had been decreased by 27.29%, from Rs. 168.26 lakhs in Fiscal 2024 to Rs. 122.34 lakhs in Fiscal 2025 on account of increase in salaries of employees and new recruitment which has resulted into increase in the cost of the Employee benefit expenses.

Finance Cost

Finance Cost had increased by 30.57% from Rs. 200.53 lakhs in Fiscal 2024 to Rs. 261.83 lakhs in Fiscal 2025. This is primarily due to increase in interest cost as our short term debt increased due to higher working capital loans availed from the lender in FY 2025.

Depreciation and Amortization Expenses

Depreciation had increased by 52.34 %, from Rs. 55.93 lakhs in Fiscal 2024 to Rs. 85.21 lakhs in Fiscal 2025 as fixed assets addition of Rs. 229.82 lakh during Fiscal 2025 mainly due to investment in plant & machinery.

Other Expenses

Other expenses had increased by 84.48% from Rs. 143.72 lakh in Fiscal 2024 to Rs. 265.14 lakh in Fiscal 2025. This is primarily due to increase in office & general expense, legal & Professional expenses, Miscellaneous expenses etc. in Fiscal 2025.

Tax Expenses

The Companys tax expenses had increased by 33.86% from Rs. 280.67 lakh in the Fiscal 2024 to Rs. 375.69 lakh in Fiscal 2025. This was primarily due to increase in profit before tax from Rs. 814.30 Lakh in Fiscal 2024 to Rs. 1400.40 Lakh in Fiscal 2025.

Profit after Tax

The Companys profit after tax had increased by 92.02% from Rs. 533.63 lakhs in the Fiscal 2024 to Rs. 1024.71 lakhs in Fiscal 2025. This increase in Profit After Tax was on account of increased in the revenue from operation and less increase in total expenses compared to an increase in revenue from operations.

Further, the Company has been a fast growing company. The increase in Revenue from Operations in FY 2024 and FY 2025 is 33.04% and 44.99% respectively, as under:

Particular	FY 2025	FY 2024	FY 2023
Revenue from Operations (Rs. in Lakh)	16256.86	11,212.05	8,427.46
YOY Growth	44.99%	33.04%	-
EBITDA (Rs. in Lakh)	1747.44	1,070.76	314.76
YOY Growth	63.20%	240.18%	-

Please note that except Employee benefit cost all other cost like raw material, the other fixed cost and semi variable cost of the Company did increase with same rate of growth. Therefore, the EBITDA of the Company has increased by 63.20% and 240.18% respectively in FY 2025 when compared to FY 2024. Post adjusting cost of Deprecation and Interest, therefore PAT has grown at 92.02% in the same period.

Financial Year 2024 compared to Financial Year 2023:

(Amount in lakhs)

Sr. No. Particulars	For Fiscal 2024	For Fiscal 2023	% Change
1 Revenue from Operation	11,212.05	8,427.46	33.04%
2 Other Income	3.60	0.10	3,286.75%
Total Income (1+2)	11,215.41	8,427.56	33.08%
3 Expenditure
(a) Operating Expenses	9,832.66	7,892.56	24.58%
(b) Employee Benefit Expenses	168.26	129.83	29.60%
(c ) Finance Cost	200.53	42.47	372.15%
(d) Depreciation & Amortization	55.93	17.61	217.58%
(e) Other Expense	143.72	90.41	58.96%
4 Total Expenditure 3(a) to 3(e)	10,401.10	8,172.88	27.26%
5 Profit/(Loss) Before Tax (1+2-4)	814.30	254.68	219.74%
6 Tax Expense:
(a) Current Tax	237.98	51.45	362.53%
(b) Deferred Tax	20.20	13.04	54.83%
(c) Short/Excess Provision of last year	22.49	5.56	304.71%
Net Current Tax Expenses	280.67	70.05	300.65%
7 Profit/(Loss) for the Period/Year (5-6)	533.63	184.63	189.04%

Revenue from Operation

Revenue from operations had increased by 33.04%, from Rs. 8,427.46 lakh in Fiscal 2023 to Rs. 11,212.05 lakh in Fiscal 2024. This increase in Revenue was on account of rise in demand in previous year, which boosted our revenue from operations.

The reason for increase in Revenue from Operation in FY 2024 is as under:

Particulars	FY 2024	FY 2023	FY 2022
Installed Capacity (in MT) per month	650	450	450
Actual Production (in MT) per month	450	280	150

The Company has completed its expansion and increased its installed capacity from 450 MT in FY 2023 to 650 MT in FY 2024. The Company is fast growing company and has demand for its products. Hence, the Company could increase its productions from 280 MT in FY 2023 to 450 MT in FY 2024, which has resulted in higher Sale of Products and therefore, the Revenue from Operations increased in FY 2024. This also has contribution of better pricing policies, better credit terms and brand recognition.

Other Income

Other income had increased by 3,286.75%, from Rs. 0.10 lakh in Fiscal 2023 to Rs. 3.36 lakh in Fiscal 2024 on account of mainly interest income rise of Rs. 2.44 lakh in Fiscal 2024 compared to Rs. 0.10 lakh in Fiscal 2023. This high increase is due to low base of other income of Rs. 0.10 lakh in Fiscal 2023

Operating Expenses

Operating expenses had been increased by 24.58%, from Rs. 7,892.56 lakh in Fiscal 2023 to Rs. 9,832.66 lakh in Fiscal 2024, as revenue from operation had been increased by 33.04%. This increase was in line with increase in revenue from operation and on account of mainly higher Cost of Material Consumed due to rise in products sales.

Employee Benefit Expenses

Employee benefit expenses had been increased by 29.60%, from Rs. 129.83 lakhs in Fiscal 2023 to Rs. 168.26 lakhs in Fiscal 2024 on account of increase in salaries of employees and new recruitment which has resulted into increase in the cost of the Employee benefit expenses.

Finance Cost

Finance Cost had increased by 372.15% from Rs. 42.47 lakhs in Fiscal 2023 to Rs. 200.53 lakhs in Fiscal 2024. This is primarily due to increase in interest cost as our long-term and short term debt increased due to investment in plant & machinery in FY 2024 and higher working capital loans availed from the lender.

Depreciation and Amortization Expenses

Depreciation had increased by 217.58%, from Rs. 17.61 lakhs in Fiscal 2023 to Rs. 55.93 lakhs in Fiscal 2024 as fixed assets addition of Rs. 742.05 lakh in during Fiscal 2024 due to investment in fixed assets i.e. mainly in plant & machinery.

Other Expenses

Other expenses had increased by 58.96% from Rs. 90.41 lakh in Fiscal 2023 to Rs. 143.72 lakh in Fiscal 2024. This is primarily due to increase in office and general expense in Fiscal 2024.

Tax Expenses

The Companys tax expenses had increased by 300.65% from Rs. 70.05 lakh in the Fiscal 2023 to Rs. 280.67 lakh in Fiscal 2024. This is primarily due to increase in profit before tax from Rs. 254.67 Lakh in Fiscal 2023 to Rs. 814.30 Lakh in Fiscal 2024.

Profit after Tax

The Companys profit after tax had increased by 189.04% from Rs. 184.63 lakhs in the Fiscal 2023 to Rs. 533.63 lakhs in Fiscal 2024. This increase in Profit After Tax was on account of increased in the revenue from operation and less increase in total expenses compared to an increase in revenue from operations.

Further, the Company has been a fast growing company. The increase in Revenue from Operations in FY 2023 and FY 2024 is 64.15% and 33.04% respectively, as under:

Particular	FY 2024	FY 2023	FY 2022
Revenue from Operations (Rs. in Lakh)	11,212.05	8,427.46	5,133.99
YOY Growth	33.04%	64.15%
EBITDA (Rs. in Lakh)	1,070.76	314.76	66.07
YOY Growth	240.18%	376.40%

Please note that except the increase in variable cost like raw material, the other fixed cost and semi variable cost of the Company did not increase with same rate of growth. Therefore, the EBITDA of the Company has increased by 376.40% and 240.18% respectively in FY 2024 when compared to FY 2023.

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 2025	Fiscal 2024	Fiscal 2023
Net cash flow from/ (used in) operating activities	399.62	(730.29)	(639.90)
Net cash flow from/ (used in) investing activities	(168.21)	(742.05)	(618.48)
Net cash flow from/ (used in) financing activities	1049.50	1,501.74	1,260.07
Net increase/(decrease) in cash and cash equivalents	1,280.92	29.40	1.70
Cash and cash equivalents at the beginning of the year	35.30	5.90	4.21
Cash and cash equivalents at the end of the year	1,316.22	35.30	5.90

Cash Flows from Operating Activities

The following is the Cash Flows from Operating Activities for the following periods

Financial Year 2025

Our net cash flow from operating activities was 399.62 lakh for the Fiscal 2025 as compared to the Restated Profit Before Tax of 1400.40 lakh for the same period. Our operating profit before changes in working capital was 1,747.44 lakh which was primarily adjusted against increase in trade receivables, increase in inventory, decrease in other current assets, increase in trade payables, increase in short term provision and increase in other current liabilities.

Financial Year 2024

Our net cash flow from operating activities was (730.29) lakh for the Fiscal 2024 as compared to the Restated Profit Before Tax of 814.30 lakh for the same period. Our operating profit before changes in working capital was 1,071.76 lakh which was primarily adjusted against decrease in trade receivables, increase in inventory, increase in other current assets, decrease in trade payables, increase in short term provision and increase in other current liabilities.

Financial Year 2023

Our net cash from operating activities was (639.90) lakh for the Fiscal 2023 as compared to the Restated Profit Before Tax of 254.68 lakh for the same period. Our operating profit before changes in working capital was 314.76 lakh which was primarily adjusted against increase in trade receivables, increase in inventory, increase in other assets, increase in short term provision, increase in trade payables and increase in other 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 Fiscal 2024 and the Fiscal 2023 on account of investment in fixed assets amounting 742.74 lakh and 618.48 lakh respectively. For

Fiscal 2025 our net cash flow changes due to investing activities are insignificant compared to our cash flow from operating activities for respective period.

Cash Flows from Financing Activities

Financial Year 2025

Net cash used in financing activities for the Fiscal 2025 was 1,049.50 lakhs which was mainly on account of equity fund of 1,305.00 lakh in Fiscal 2025.

Financial Year 2024

Net cash used in financing activities for the Fiscal 2024 was 1,501.74 lakhs which was on account of mainly increase in Short-term loans amounting to 1,041.01 lakh and Long-term loans amounting to 6,62.76 lakh less finance cost.

Financial Year 2023

Net cash used in financing activities for the Fiscal 2023 was 1,260.07 lakh which was on account of mainly increase in Short-term loans amounting to 842.96 lakh, change in equity capital amounting to 295.00 lakh and Long-term loans amounting to 164.59 lakh.

PRINCIPAL COMPONENTS OF BALANCE SHEET

Financial Year 2025 compared to Financial Year 2024:

(Amount in lakhs unless other wise stated)

Sr. No. Particulars	For Fiscal 2025	For Fiscal 2024	% Change
1. Long Term borrowing	731.24	1,412.05	-48.21
2. Short Term borrowing	2,569.61	1,883.97	36.93
3. Trade Payable	2,381.33	1,545.34	98.42
4. Trade Receivable	3,596.71	2,485.61	72.89
5. Inventories	3,263.41	1,819.77	46.20
6. Short Loans and Advances	2.13	3.63	-41.32

Long Term Borrowing

Long Term borrowing outstanding had decreased by 48.21%, from Rs. 1,412.05. lakh in Fiscal 2024 to Rs. 731.24 lakh in Fiscal 2025 was mainly on account of reduce dependency on long term debt and increase equity funding. Hence, we had repaid loan amount to Rs. 1,873.45 lakh in Fiscal 2025 compared to borrowing of Rs. 1,192.64 lakh for the same period.

Short Term Borrowing

Short Term borrowing outstanding had increased by 36.93%, from Rs. 1,883.97 Lakh in Fiscal 2024 to Rs. 2,569.61 lakh in Fiscal 2025 was mainly on account of additional working capital loan to fulfil sales orders. Hence, we had repaid loan amount to Rs. 18,649.81 Lakh only in Fiscal 2025 compared to borrowing of Rs. 19,335.45 Lakh for the same period.

Trade Payable

Trade Payable had increased by 98.42%, from Rs. 1,545.34 lakh in Fiscal 2024 to Rs. 2,381.33 lakh in Fiscal 2025 was mainly on account of excessive increase in purchase from Rs. 10,953.71 lakh in Fiscal 2024 to Rs. 15,455.34 lakh in Fiscal 2025.

Trade Receivable

Trade Receivable had increased by 72.89%, from Rs. 2,485.61 lakh in Fiscal 2024 to Rs. 3,596.71 lakh in Fiscal 2025 was mainly on account of increase in revenue from operation from Rs. 11,212.05 lakh in Fiscal 2024 to Rs. 16,256.86 lakh in Fiscal 2025.

Inventories

Inventories had increased by 46.20%, from Rs. 1,819.77 lakh in Fiscal 2024 to Rs. 3,263.41 lakh in Fiscal 2025 which was in line with increase in Revenue from Operations.

Short Loans and Advances

Short Loans and Advances had decreased by 41.32%, from Rs. 3.63 lakh in Fiscal 2024 to Rs. 2.13 lakh in Fiscal 2025 was mainly on account of excessive reduction of advance to supplier.

Financial Year 2024 compared to Financial Year 2023:

(Amount in lakhs unless other wise stated)

Sr. No. Particulars	For Fiscal 2024	For Fiscal 2023	% Change
1. Long Term borrowing	1,412.05	749.29	88.45
2. Short Term borrowing	1,883.97	842.96	123.49
3. Trade Payable	1,545.34	2,181.36	-29.16
4. Trade Receivable	2,485.61	2,936.89	-15.37
5. Inventories	1,819.77	636.71	185.81
6. Short Loans and Advances	3.63	2.31	70.42

Long Term Borrowing

Long-term borrowing outstanding had increased by 88.45%, from Rs. 749.29 lakh in Fiscal 2023 to Rs. 1,412.05 lakh in Fiscal 2024 was mainly on account of borrowed additional long term loan to purchase additional fixed assets of 742 lakh in fiscal

2024. Hence, we had repaid loan amount to Rs. 734.65 lakh only in Fiscal 2024 compared to borrowing of Rs. 1,397.41 lakh for the same period.

Short Term Borrowing

Short-term borrowing outstanding had increased by 123.49%, from Rs. 842.96 lakh in Fiscal 2023 to Rs. 1,883.97 lakh in Fiscal 2024 was mainly on account of increase in working capital requirements which was funded by the short term loans.

Trade Payable

Trade Payable had decreased by 29.16%, from Rs. 2,181.36. lakh in Fiscal 2023 to Rs. 1,545.34 lakh in Fiscal 2024, was mainly on account of reduction in trade payable holding periods from 94 days in Fiscal 2023 to 50 days in fiscal 2024.

Trade Receivable

Trade Receivable had decreased by 15.37%, from Rs. 2,936.89 lakh in Fiscal 2023 to Rs. 2,485.61 lakh in Fiscal 2024 was mainly on account of increasing efforts in recovery of payments due from the customers which has resulted in reduction in trade receivables holding periods from 127 days in Fiscal 2023 to 81 days in fiscal 2024.

Inventories

Inventories had increased by 185.81%, from Rs. 636.71 lakh in Fiscal 2023 to Rs. 1,819.77 lakh in Fiscal 2024 was mainly on account of excessive inventory maintained by the Company to timely fullfil sales orders of upcoming periods. The Company revenue from operation had also increased by 5,044.81 lakh in Fiscal 2025 over Fiscal 2024.

Short Loans and Advances

Short Loans and Advances had decreased by 70.42%, from Rs. 2.31 lakh in Fiscal 2023 to Rs. 3.63 lakh in Fiscal 2024 was mainly on account of reduction of advance to supplier.

Revenue generated from Related Parties

(Rs. In Lakhs unless other wise stated)

Sr. No. Particulars	March 31, 2025	March 31, 2024	March 31, 2023
A Revenue from Operations	16,256.86	11,212.05	8,427.46
B Revenue from Operations on transactions with related
parties	536.68	245.53	2,678.43
C % of Revenue Operations generated from related parties
[(B/A)*100]	3.30%	2.19%	31.78%

Trade Receivable and Inventories in comparison to Revenue from operation

(Rs. In Lakhs unless other wise stated)

Sr. No. Particulars	March 31, 2025	March 31, 2024	March 31, 2023
A Revenue from Operations	16,256.86	11,212.05	8,427.46
B Trade Receivable	3,596.71	2,485.61	2,936.89
C % of Revenue from Operations [ (B/A)*100]	22.12%	22.17%	34.85%
D Inventories	3,263.41	1,819.77	636.71
E % of Revenue from Operations	20.07%	16.23%	7.56%
[(C/A)*100]

a) Trade receivable was consistent in the fiscal 2024 to fiscal 2025 but it was slightly higher in fiscal 2023 because of higher credit days in that year.

b) Inventory book value was consistently rising from the fiscal 2023 to fiscal 2025 and it was in line with growth of revenue from operation for respective periods.

Total debt in comparison to free cash flow from business operation

(Rs. In Lakhs unless otherwise stated)

Sr. No. Particulars	March 31, 2025	March 31, 2024	March 31, 2023
A Total Debt	3432.96	3412.90	1592.25
B free cash flow from business operation	399.62	(730.29)	(639.90)

In fiscal 2025 cash flow from operation was positive.

Net cash flow from operation was Rs. (730.29) lakhs in fiscal 2024. It was mainly on account of increase in inventory by Rs. 1,183.06 lakhs and increase in advance to vendor by Rs. 497.91 lakhs in FY 2024 as compared to FY 2023.

Net cash flow from operation was Rs. (639.90) lakhs in FY 2023. It was mainly on account of increase in inventory by Rs. 2,014.98 lakhs in fiscal 2023 as compared to FY 2022.

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 and changes in raw material and products prices.

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.

The Company has witnessed a significant increase in debt during the reviewed period. The reason for the same is as under:

The Company is a fast growing company and has grown at high growth rate in the past three years. With increase in Revenue, there is normally a corresponding increase in Debtors and Inventory. These increase in Debtors and Inventory resulted in increase in working capital requirements, and the same is funded through the short-term borrowings, as explained under:

(Rs. in Lakh)

Particulars	As on March 31, 2025 (Actual)	As on March 31, 2024 (Actual)	As on March 31, 2023 (Actual)
Core Current Assets
Inventories	3,263.4	1,819.8	636.7
Trade Receivables	3,596.7	2,485.6	2,936.9
Core Current Liabilities
Trade Payables	2,381.3	1,545.3	2,181.4
Other Current Liabilities and Provisions	667.4	413.8	76.3
Total working capital requirement	3,969.2	2,975.40	1,436.90
Short term borrowings from banks	2,569.6	1,884.0	843.0

The Company has also done capex and increased its installed capacity. The Company has availed the long-term loan for its capex, which has increased its long-term borrowings during the reviewed period, as under:

(Rs. in Lakh)

Particular	As at March, 2025	As at March, 2024	As at March, 2023
Long Term Borrowings	731.24	1,412.05	749.29
Property, Plant and Equipment and Intangible Assets	1,470.95	1,387.96	701.84

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 employee 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.

We consider 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 are no material frauds committed against our Company in the last three financials year.

Related Party Transactions

We enter into various transactions with related parties in the ordinary course of business. For further information relating to our related party transactions, please see heading titled "Related Party Transactions" under Chapter titled "Financial Information" beginning on page 207.

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

1. Unusual or infrequent events or transactions

Except impact of Covid -19 pandemic in past on our industry, 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 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" beginning on page 25.

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" beginning on page 25 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, raw material prices and government policies. Other than as described in the sections "Risk Factors" and "Business Overview" starting on pages 25 and 140, 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. aluminum extrusion products, 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

The 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 "Business Overview" starting on pages 127 and 140, respectively.

8. Dependence on single or few customers

For Fiscal 2025, Fiscal 2024 and Fiscal 2023, our top five customers accounted for about 72.93%, 70.93% and 56.44%, respectively and our largest customer accounted for 19.88%, 18.14% and 15.54%, respectively of our Revenue from Operations.

For Fiscal 2025, Fiscal 2024 and Fiscal 2023, our top five suppliers accounted for about 91.02%, 78.02% and 59.64%, respectively and our largest supplier accounted for 37.13%, 20.58% and 13.92%, respectively of our Revenue from Operations.

For further information, see "Risk Factors" on starting page 25.

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 products 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, quality of products, fulfilling client specific requirements, the quality and competitive pricing of our products.

Further, competitive conditions are as described under the Chapters "Industry Overview" and "Business Overview" starting on pages 127 and 140, respectively.

Material Developments subsequent to period ended March 31, 2025

There are no circumstances have arisen since the period ended March 31, 2025 being the date of the last financial statements as disclosed in this Red Herring Prospectus until the date of filing this Red Herring 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.