B.C. Power Controls Ltd Management Discussions

This Management Discussion and Analysis Report for the financial year ended 31^st March 2026.

Industry Structure and Developments

The metal industry is one of the core and most flourishing industries of India, contributing more than 2% to the countrys total GDP. It serves a wide range of user industries, including engineering, electrical and electronics, infrastructure, automobiles and automobile components, and packaging. The industry comprises two major groups ferrous metals and non-ferrous metals. Non-ferrous metals, including aluminium, copper, zinc, lead, nickel and tin, are used to make alloys, castings, forgings, extrusions, wires, cables and pipes, and find application across agriculture, power infrastructure, automobiles, railways, telecommunications, construction and engineering. Ferrous metals, primarily iron and steel, have shown strong performance in production, capacity utilisation, exports and consumption, positioning India as a major global competitor among steel producers. Indias key advantages include a liberalised policy regime, reduced customs duty on primary and secondary metals, growing market demand, favourable production conditions, and government support through initiatives such as Make in India and Smart Cities, which are expected to further boost demand for non-ferrous metals. India remains the second-largest producer of aluminium after China.

Opportunities and Threats Opportunities:

Strong underlying demand, availability of raw materials, a high entrepreneurial base, growth of ancillary industries and improving technology together provide sustainable growth potential for the non-ferrous metals industry in India. Per-capita consumption of non-ferrous metals in India remains low relative to both developed and developing economies, indicating significant headroom for growth, further supported by the Make in India campaign and 100% FDI permitted in key infrastructure segments (railways, roadways, ports, inland waterways, aviation and power). Transport (automotive), electricals and construction remain the principal demand drivers for non-ferrous metals, with the steel sector consuming the bulk of zinc produced for galvanisation. The industry is also witnessing a shift toward emerging applications in defence and aerospace, hybrid and electric vehicles, and railways.

Threats:

? Environmental compliance issues

? Inverted / improper duty structures

? Dumping of goods under free trade agreements

? Inadequate infrastructure

? Inconsistent quality consciousness across the value chain

? Rapid capacity expansion in input minerals

? Limited availability of indigenous technological expertise and the resulting need for cost reduction

Risks and Concerns, and Internal Control Systems and Their Adequacy

a. Fluctuation in non-ferrous metal prices: Prices of non-ferrous metals such as copper, nickel and gold are determined with reference to London Metal Exchange (LME) benchmarks and other international markets, which are in turn influenced by global supply-demand balances, currency movements, geopolitical and economic conditions, speculative trading and competition from substitute materials. The Company uses commodity futures to hedge against fluctuations in non-ferrous metal prices.

b. Fluctuation in exchange rates: Import prices of raw materials and domestic prices of non-ferrous metal ingots are both linked to US-dollar-denominated LME reference prices, exposing the Company to currency risk. The Company manages this exposure through forward foreign exchange contracts and the use of foreign currency accounts.

c. Changes in laws and regulations: Business activities remain exposed to changes in environmental, labour, taxation, currency-control and trade regulations. The Company evaluates each decision with due regard to the risks associated with applicable laws and regulations. The Company maintains a proper and adequate internal control system designed to safeguard assets against unauthorised use or disposition, and to ensure transactions are authorised, recorded and reported correctly. This is supplemented by an internal audit programme conducted by the Internal Auditor appointed under applicable law, with observations and corrective action reviewed periodically by the Audit Committee to ensure the internal control system remains effective for preparing reliable financial statements and maintaining accountability.

Market Review Global Economy:

Global economic activity is expected to maintain modest but uneven momentum, with global real GDP growth projected to decelerate to around 3.0% in 2025 and 2.9% in 2026, following 3.2% growth in 2024, as trade frictions, geopolitical uncertainty, market volatility and inflation divergence reshape the outlook. In developed markets, growth is expected to moderate to around 1.3% in both 2025 and 2026 (from 1.8% in 2024), with the US decelerating from 2.8% in 2024 to about 1.5% and 1.3% in 2025 and 2026 respectively, reflecting the impact of higher tariffs on sentiment, inflation, labour markets and business investment. The Euro area is projected to grow around 1.0% in 2025 and 1.3% in 2026, while Japans recovery remains modest at about 0.7% in 2025.

Outlook:

The IMF projects global growth of around 3.0% for 2025, with India expected to lead growth among major economies and potentially become the worlds fourth-largest economy. Key risks include possible tariff increases, geopolitical tensions and continued policy uncertainty.

Indian Economy Overview:

The IMF has revised Indias growth forecast upward to 6.4% for both 2025 and 2026 (from 6.2% and 6.3% respectively in its April 2025 outlook), reaffirming Indias position as the worlds fastest-growing major economy. On a financial-year basis, IMF projections indicate growth of 6.7% for 2025 and 6.4% for 2026. Globally, the IMF projects growth of 3.0% in 2025 and 3.1% in 2026, with China expected to grow 4.8% in 2025 and 4.2% in 2026, and the US 1.9% in 2025 and 2.0% in 2026.

India Metal Industry:

Indias metal economy in 2025 is characterised by robust domestic demand particularly for steel, driven by infrastructure development and urbanisation, with steel demand projected to grow 8 10% alongside a broader multi-metal price rally across both industrial metals (copper, aluminium) and precious metals (gold, silver). Supportive government policy, rising investment and technological upgrades continue to strengthen the sectors role as a driver of economic growth.

Overall Review of Operations of the Company

The Company is engaged in the manufacturing and trading of ferrous and non-ferrous metals. Key financial highlights for the year, as per the audited standalone financial statements, are set out below:

Turnover increased by approximately 1.3% year-on-year, while profit for the year declined from 79.04 Lakh to 73.32 Lakh, primarily on account of a lower net profit margin (0.75% in FY 2025-26 as against 0.82% in FY 2024-25) see Significant Changes in Key Financial Ratios below.

Outlook

The Company continues to focus on improving product quality, ensuring timely delivery and securing orders at competitive rates. Bulk-order volumes and bargaining strength allow the Company to quote competitive rates while maintaining high quality and productivity across traded products. Barring unforeseen circumstances, the Company is confident of achieving improved results in the current year, with continued emphasis in the trading segment on product quality, timely delivery and after-sales service.

Financial and Operational Performance

The financial statements have been prepared in compliance with the requirements of the Companies Act, 2013 and Generally Accepted Accounting Principles in India. Members are requested to refer to the Directors Report and the audited financial statements for further details.

Human Resources / Industrial Relations

The Companys HR philosophy is to build a high-performing organisation in which every individual is motivated to perform to the fullest of their capacity, contributing to individual and departmental excellence and continuously improving performance to realise the full potential of the Companys personnel.

Significant Changes in Key Financial Ratios

Details of significant changes (i.e. change of 25% or more) in key financial ratios during the year, as compared to the previous year, are set out below. These figures are as per Note titled "Analytical Ratios" forming part of the audited standalone financial statements for the year ended 31st March 2026.

Cautionary Statement

Statements made in this Management Discussion and Analysis Report describing the Companys expectations or predictions are "forward-looking statements". Actual results may differ materially from those expressed or implied. Important factors that could influence the Companys operations include market conditions, input costs, government regulations, and economic developments within and outside the country.