Cryogenic OGS Ltd Management Discussions

Part I: Global macroeconomic overview 1.1 Global growth and trade outlook

The global economy grew 3.4% in calendar 2025 and, following the outbreak of conflict in the Middle East in early 2026, the IMF projects growth moderating to 3.1% in 2026 and 3.2% in 2027, below the long-term average. Asia is expected to remain the fastest-growing import market, a supportive backdrop for the capital-goods and industrial-equipment exporters that serve the region.

Source: IMF World Economic Outlook, April 2026; WTO Global Trade Outlook and Statistics, March 2026.

1.2 Energy prices and the Strait of Hormuz

The conflicts economic transmission runs through the Strait of Hormuz, through which roughly a fifth of the worlds oil and LNG trade passes. The disruption tightened energy markets, and the 2026 crude assumption now stands at about US$ 82.22 a barrel, roughly 21% above the 2025 average of US$ 67.74. For the equipment sector the shock is dual-edged: it pressures energy-exposed budgets, but it reinforces the imperative to diversify supply, build LNG regasification and expand pipeline and gas-distribution networks, each a source of sustained demand for precision metering, filtration, pressure regulation and skid-based solutions. This energy-price, freight and currency channel is the same exposure reflected in the Companys risk disclosures in Part III.

Source: IEA, the Middle East and global energy markets; IMF World Economic Outlook, April 2026.

1.3 Global oil, gas and LNG infrastructure

Natural gas remains central to the energy transition. The 2026 to 2028 period is expected to bring some of the largest additions to global LNG export capacity on record as projects in the United States, Qatar and Canada come online, alongside expanding regasification, storage and pipeline investment in importing countries. Every new liquefaction train and import terminal in this cycle requires custody-transfer metering, additive dosing, filtration, terminal automation and cryogenic fluid-handling equipment.

1.4 Global wind energy

Wind delivered a record 165 GW of new capacity globally in 2025. The Middle East and Africa, led by Saudi Arabia, are among the fastest-growing regions, with significant onshore additions planned through 2030 and new turbine manufacturing announced in Saudi Arabia and Oman. Each gigawatt of new onshore capacity requires nacelle lifting jigs, tower erection tooling and precision handling equipment for site assembly.

Source: Global Wind Energy Council, Global Wind Report 2026.

Part II: Indian sector analysis

2.1 Oil, gas and PSU capital investment

India is the worlds third-largest crude consumer and fourth-largest refiner, operating 23 refineries with installed capacity of 258.1 MMTPA, officially targeted to reach 309.5 MMTPA by 2030. Upstream reform under the Oilfield (Regulation and Development) Amendment Act, 2025 and 100% FDI in upstream and private refining are drawing fresh capital. The capital programmes of the public-sector oil companies, including the BPCL Bina expansion, the Saudi Aramco discussions with BPCL and ONGC and a new greenfield refinery in Rajasthan, anchor domestic order flow for measurement, filtration and dosing systems, where Engineers India Limited pre-qualification remains a formidable barrier to entry.

India refining capacity, installed 2025 and official 2030 target (left), and expected exploration and production and petrochemical capital programmes (right). Data: Ministry of Petroleum and Natural Gas, Rajya Sabha reply, December 2025; IBEF; Invest India.

2.2 Natural gas and city gas distribution

Natural gas is Indias most compelling long-cycle structural growth story. The government targets raising the share of gas in the primary energy mix from about 6.7% to 15% by 2030, an investment opportunity of about US$ 67 billion, with demand projected to grow nearly 60% to 297 mmscmd by 2030. All 307 geographical areas are authorised for city gas distribution (100% mainland coverage), about 25,000 km of pipeline is operational, and compressed-biogas blending rising from 1% in FY26 to 5% from FY29 makes gas composition more variable, raising the flow-measurement and metering content of every installation.

Source: PNGRB, natural gas demand projections; Invest India, oil and gas sector overview.

energy mix, current versus 2030 target (right). Data: PNGRB, natural gas demand projections, 2030 base case; Invest India.

Part III: Opportunities and threats Opportunities

- Indias gas infrastructure build-out: raising gas in the energy mix from about 6.7% to 15% by 2030 frames a US$ 67 billion opportunity, with demand growing nearly 60% to 297 mmscmd and 10,805 km of pipeline expansion. Every geographical area, pipeline kilometre and CNG station requires metering, filtration and pressure regulation.

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The LNG cycle, domestic and global: eight terminals with 52.7 MMTPA of regasification capacity are being supplemented by new land-based and floating units, with imports up 15.4% in FY26, while 2026 to 2028 brings record additions to global export capacity. Each terminal requires custody transfer metering, prover tanks, filtration, dosing and pressure reduction skids over a multi-year cycle.

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Refining and petrochemical expansion: capacity growth from 258.1 to 309.5 MMTPA by 2030, Rs2,18,475 crore of expected exploration and production investment and the Rs3,28,227 crore petrochemical capital plan sustain demand for metering skids, additive dosing and calibration infrastructure.

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Wind energy at home and in export markets: Indias record 6.34 GW of additions in 2025, within a 500 GW non-fossil target, expands the market for installation tooling, while more than 18 GW of onshore wind expected in the Middle East to 2030 opens an export corridor.

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Green hydrogen readiness: the National Green Hydrogen Missions 5 MMTPA target by 2030, with Rs19,744 crore of outlay, establishes long-cycle demand for ultra-precise flow measurement, pressure regulation and gas purity management.

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Rising instrumentation content per site: biogas blending rising from 1% in FY26 to 5% from FY29 makes gas composition more variable, favouring density instrumentation and intelligent measurement over commodity hardware.

Threats

- Renewed energy supply disruption: the reference forecast places 2026 crude about 21% above the 2025 average, and adverse scenarios with oil 80% to 100% above baseline would compress global growth to between 2% and 2.5% and delay discretionary capital expenditure.

- Domestic inflation and rural demand: the FY27 CPI projection of 5.1% has paused the easing cycle at a repo rate of 5.25%, while a deficient southwest monsoon would dent rural incomes, weakening a demand engine that supported FY26 growth.

- Higher financing costs: rising long-term financing costs disproportionately affect capital-intensive energy projects in emerging economies and could slow final investment decisions on terminals and pipelines.

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Fiscal strain from fuel under-recoveries: state-owned refiners incurred losses of Rs74,781 crore in the April to June 2026 quarter as retail prices were held, a burden that could defer discretionary PSU capital expenditure.

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Slower global trade and costlier logistics: merchandise trade volume growth of just 1.9% in 2026, with elevated freight and insurance costs, weighs on export competitiveness.

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Currency depreciation: rupee weakness raises the landed cost of imported components and instruments, pressuring margins where input costs cannot be fully passed through.

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Project timing and concentration risk: order flow tied to large public sector and terminal projects is lumpy, and deferrals or tender cycle changes can shift revenue between periods even when the structural demand trend is intact.

Source: IMF WEO April 2026, Chapter 1 (PDF, scenario definitions) Reserve Bank of India, Monetary Policy Statement 2026-27, resolution of the MPC, 3 to 5 June 2026 World Oil, India to expand strategic oil reserves, July 2026 WTO, Global Trade Outlook and Statistics, March 2026 Business Standard, state refiner losses per the petroleum ministry, 2 July 2026

Part IV: Company overview 4.1 Business structure

The Company closed FY26 with one subsidiary, a wholly owned Dubai entity incorporated in March 2026 that carries the international contracting agenda; it was joined in early FY27 by a majority-owned Indian entity, Infravolt Engineering Private Limited, that carries the diversification into solar and railway power electronics components. The rationale for Infravolt is deliberate.

It applies the Companys established precision fabrication and quality system disciplines to an adjacent components market, creates the first revenue stream outside hydrocarbons and reduces single-sector dependence and positions the group behind two policy-anchored capital expenditure programmes, railway electrification and the solar build-out, whose procurement cycles run independently of oil and gas. The entry is order-backed rather than speculative, with the subsidiarys first two orders, worth Rs17.85 crore, were secured within weeks of incorporation. As these entities begin operations, the Company expects to move to consolidated reporting from FY27 and its segment disclosure to expand beyond the present single oil-and-gas equipment segment to reflect the new power-electronics activity.

Corporate structure. Infravolt Engineering Private Limited was incorporated after the close of FY26 and falls within early FY27.

4.2 Product portfolio and applications

The portfolio covers the full measurement and conditioning layer of hydrocarbon logistics and each product line maps to a specific job in that chain:

Product	What it does	Applications
Custody transfer metering skids LNG metering and truck loading skids Truck and wagon loading skids	Integrated flow measurement packages that establish the commercially billed quantity transferred between counterparties Cryogenic-service measurement and road tanker loading of liquefied natural gas Controlled, metered despatch of petroleum products to road and rail	Fuel terminals, depots, pipelines LNG terminals, city gas distribution, small-scale LNG Oil marketing terminals (Petrol , Diesel , kerosene , LPG )and depots
Product	What it does	Applications
Additive dosing systems aDENS density probes	Automated injection of additives, markers and dyes at precise blend ratios. Making premium Products like X-tramile , Xtra Premium ,XP 95, Speed 97 ,Power 95 Proprietary resonant vibration probes, developed with a European partner, for real-time in-line liquid density measurement	Refineries, terminals, biofuel blending Custody transfer accuracy, blend control
Air eliminators and basket strainers Prover tanks and calibration equipment	Remove entrained air and particulates ahead of metering, protecting accuracy and downstream equipment. Filter the product. On-site meter proving and metrological integrity, from 50 to 5,000 litres, including master-meter trolleys. It is required at most of terminal for calibration and comparing the accuracy of flow meter online.	Every metered installation Terminals, pipelines, depots
Pressure reduction and natural gas metering skids Aviation turbine fuel metering and filtration	Regulate and measure natural gas streams for distribution and industrial use Measurement and fuel cleanliness systems for aviation fuelling	City gas networks, industrial consumers Airports and aviation fuel infrastructure
ASME-code pressure vessels and piping spools	Code-certified fabrication under the ASME U-Stamp and EIL-approved piping spools	Refineries, petrochemicals, export projects
Nacelle lifting jigs	Precision-engineered jigs for safe on-site lifting and installation of wind turbine components	Wind energy, greenfield sites
Meter runs and custom fabrication	Meter-run manufacturing for ultrasonic flowmeter OEMs and turnkey design, assembly and calibration	Instrumentation OEMs, multiple industries

Product portfolio: what each line does and where it is applied.

4.3 Industries served

The same measurement competence serves a widening set of industries and the way it serves each differs with the industrys needs:

Industry	How the Company serves it
Oil and gas marketing and storage	Custody transfer metering, truck and wagon loading skids, filtration and proving equipment across the terminal and depot networks of the oil marketing companies; installed at more than 300 terminals
LNG and city gas distribution	Cryogenic LNG metering and truck loading skids (delivering to Konkan LNG and Petronet LNG through Yokogawa and Emerson), pressure reduction and natural gas metering for expanding CGD networks.
Refining, petrochemicals and chemicals	Additive dosing systems, ASME-code pressure vessels, EIL-approved piping spools, strainers and air eliminators for process and blending duty
Aviation	Aviation turbine fuel metering and filtration systems where measurement accuracy and fuel cleanliness are both safety-critical
Industry	How the Company serves it
Industrial gases	Measurement and fluid handling equipment for gas processing and distribution service
Power and renewables	Nacelle lifting jigs for wind turbine installation; precision components for solar power electronics through Infravolt
Railways	Precision-engineered components for railway power electronics applications through Infravolt
Hydrogen and energy transition	hydrogen service as the segment approaches commercial scale Measurement, pressure regulation and handling capability being developed for Build-to-specification skids and meter runs for ABB, Honeywell and Emerson,
Global instrumentation OEMs	Endress + Hausser meeting the documentation and quality frameworks of global technology companies

4.4 Key business strategies

- Move up the value chain to turnkey delivery: complete the transition from component supply to integrated packages in which the Company procures and integrates valves, flowmeters, instruments and pumps and delivers the tested whole. Each turnkey order captures more value per project and builds the references, like Honeywell Nigeria, that win the next one.

- Deepen the LNG and cryogenic franchise: convert Indias LNG terminal, CGD and small-scale LNG build-out into recurring cryogenic skid orders, using the Konkan LNG and Petronet LNG deliveries and the Honeywell LNG order in the United States as reference proof for the next tier of tenders.

- Enter the renewable energy and energy transition markets: ride the wind installation cycle, record additions of 165 GW globally and 6.34 GW in India in 2025, with nacelle lifting jigs and installation tooling; supply precision components to solar power electronics and railways through Infravolt; and build measurement and handling capability for green hydrogen ahead of its commercial scale-up.

- Expand exports through the Dubai contracting vehicle: use Cryogenic OGS Middle East F.Z.E as the approved-vendor and contracting entity for the GCC, Africa and the Americas, building on the order for 143 truck loading skids for an Egypt-based end user, contracted through an EPC contractor, one of its largest to date, the Libya and Nigeria project references and the ADNOC enlistment.

Part V: Financial Overview

5.1 Financial Performance with respect to Operational Performance

During FY 2025-26, Cryogenic OGS Limited focused on improving operational efficiency through effective production planning, quality control, inventory management, and timely execution of customerorders.Bettercoordinationamongproduction,procurement,logistics,quality,andfinance functions supported operational performance and customer satisfaction. The Company remains committed to sustainable growth through operational excellence and efficient resource utilization. These are the audited standalone results for FY 2025-26, approved by the Board on 30 April 2026 with an unmodified opinion from Maloo Bhatt and Co., Chartered Accountants. The

Company has one reportable segment, so this discussion also constitutes the segment disclosure required under Schedule V. Revenue from operations grew 24.1% to Rs4,082.24 lakh, and total revenue, including other income of Rs161.24 lakh, was Rs4,243.48 lakh. Procurement and production discipline showed in the margin. Operating EBITDA rose 42.3% to Rs1,132.90 lakh, a margin of 27.8% against 24.2%, as the materials charge fell from 57.3% to 51.6% of revenue from operations. Employee benefit expense rose 31.1% to Rs262.73 lakh under the four Labour Codes notified on 21 November 2025, and other expenses rose 43.0% to Rs581.96 lakh. Profit before tax of Rs1,349.18 lakh includes a one-time exceptional gain of Rs123.95 lakh on the sale of a plot. Excluding it, profit before exceptional items and tax grew 48.2% to Rs1,225.23 lakh. Profit after tax grew 67.2% to Rs1,018.27 lakh, while earnings per share grew 32.6% to Rs7.69 as the July 2025 issue enlarged the share count. Order execution and working capital management carried through. Trade receivables fell 27.6% to Rs479.52 lakh despite the growth, inventories rose 38.0% to Rs798.19 lakh ahead of execution, and net cash from operating activities was Rs798.59 lakh against Rs193.55 lakh. Shareholders funds rose 88.5% to Rs5,465.18 lakh and cash and cash equivalents closed at Rs3,278.24 lakh against Rs1,106.67 lakh, with no commercial debt.

5.2 Key financial ratios

The table below sets out the key financial ratios per Schedule V of the SEBI (LODR) Regulations, computed from the audited results on the bases stated in the note. Explanations are provided for movements of 25% or more and for return on net worth as required.

Ratio	FY26	FY25	Explanation where required
			+152.9%: IPO proceeds held in bank deposits enlarged current assets while current liabilities declined.
Current ratio (times)	13.30	5.26	Not applicable; there is no long-term debt in the Company. The lease liability of Rs8.25 crore recognised under borrowings is not borrowed money.
Debt-equity ratio (times)	NA	NA
Debt service coverage ratio (times)	NA	NA	Not applicable; there is no long-term debt in the Company.
Interest coverage ratio (times)	110.4	139.3	Change below 25%; finance cost is predominantly lease interest.
Inventory turnover ratio (times)	3.06	3.89	Higher average inventory held for order execution into FY27 lowered the turnover ratio and raised inventory days.
Inventory turnover (days)	119.37	93.95	+27.1%: as above.
Trade receivables turnover ratio (times)	7.15	5.50	+30.0%: revenue grew 24.1% while receivables declined on collections during the year.
Trade receivables turnover (days)	51.05	66.37	Change below 25%.
Trade payables turnover ratio (times)	8.49	5.73	+48.2%: higher purchases during the year and lower trade payables as at 31 March 2026. -32.5%: as above.
Trade payables turnover (days)	43.00	63.73
Net capital turnover ratio (times)	0.95	1.68	-43.4%: working capital enlarged by IPO proceeds held in cash and bank deposits, higher inventories and lower trade payables.

Ratio	FY26	FY25	Explanation where required
Operating profit margin (%)	27.8%	24.2%	Change below 25%; driven by lower materials intensity.
Net profit ratio (%) Return on capital employed (%)	24.00% 24.54%	18.02% 28.65%	+33.2%: operating margin expansion and the exceptional gain lifted profit faster than income. Change below 25%; capital employed enlarged by the July 2025 issue.
Return on equity / return on net worth (%)	18.63%	21.01%	See explanation below.
Return on investment (%)	18.36%	24.42%	Change below 25%; total assets enlarged by IPO proceeds and bank deposits.

materials consumed adjusted for the change in inventories of finished, semi-finished and work-in-progress goods; average balances are the mean of opening and closing audited balances; working capital is current assets less current liabilities; capital employed is net worth plus deferred tax liability less deferred tax asset; total income includes other income; shareholders equity is share capital plus reserves and surplus. Interest coverage and operating profit margin are presented per Schedule V of the SEBI (LODR) Regulations on the bases stated against each.

Three observations complete the ratio picture. Return on net worth declined to 18.63% 21.01% even as profit after tax grew 67.2%, because the denominator grew faster: net worth 88.5% on the July 2025 issue and retained earnings, so the decline reflects an enlarged, recently raised capital base rather than any deterioration in profitability and the return should rebuild new capacity and credentials convert capital into revenue. The current ratio of 13.30 and near-absence of finance cost describe a balance sheet with unusual slack for a company of size, which is a deliberate posture in a project business where customer inspection and approval cycles can stretch working capital without warning. And the debtors turnover improvement is notable positive: collecting faster while growing 24.1% is the opposite of the receivables stretch that often accompanies SME growth and it supports the quality of the reported revenue.

Part VI: Material developments in human resources and industrial relations

Human resources remain a key strength of Cryogenic OGS Limited, whose competitive position rests on engineering judgment that accumulates in people. As on 31 March 2026, the Company had 42 employees. Industrial relations remained cordial throughout the year, with no disputes affecting operations.

The Company continued to strengthen its engineering and fabrication base during the investing in capability rather than headcount alone. It assessed and accounted for restructured compensation following the four Labour Codes notified on 21 November 2025 and continues to monitor the final rules. Training remains focused on the technical disciplines the business depends on, including fabrication qualification, instrumentation practice and the documentation standards that code-governed work demands, with safety managed within the Companys certified management systems.

Part VII: Business outlook

The Company enters FY27 with the market environment described in Parts I and II pulling in favour and a balance sheet built to withstand what could pull against it. Domestically, the demand drivers are structural and policy-anchored: gas grid expansion of 10,805 km, city gas distribution coverage of all 307 geographical areas, refining capacity moving toward 309.5 MMTPA by LNG imports growing 15.4% and the biogas blending mandate raising the measurement content of every installation. Internationally, the 2026 to 2028 global LNG capacity wave and Gulf capacity programmes widen the export opportunity that the UAE subsidiary is positioned to serve. Order conversion from these drivers, rather than the drivers themselves, is the controllable variable and the approvals register, delivered references and certification depth are the instruments of that conversion.

The near-term watchpoints are equally clear. Elevated energy prices and conflict-related uncertainty can slow customer investment decisions even as they strengthen the medium-term case for energy infrastructure; state refiner finances are absorbing fuel under-recoveries that could affect the phasing of discretionary capital expenditure; and the monsoon and inflation trajectory will shape domestic demand conditions and the timing of monetary easing. The response is unchanged from what produced FY26: engineering discipline, institutional qualification, cost control and a debt-free balance sheet with Rs32.78 crore of cash and near-cash that allows it to hold its course through project timing swings. The year begins with an order book of Rs31 crore as at 1 April 2026, covering about three quarters of FY26 revenue before a single new order is booked.

The platform entering FY27

The developments secured during FY26 and in the months immediately after its close each convert into a specific FY27 strength:

- Infravolt Engineering Private Limited (51%, incorporated early FY27): opens the solar power electronics and railway components market, the first revenue stream outside hydrocarbons, riding public capital expenditure in railways and the renewable build-out described in Part I; the subsidiarys first order, Rs12.59 crore from Fimer India for busbar kits received in June 2026 and executable within 18 to 21 weeks, converts the diversification from intent to order book.

- EIL approved-vendor status for piping spools: unlocks piping packages within PSU refinery and petrochemical projects, precisely the project pipeline that the 309.5 MMTPA refining expansion and the Rs3,28,227 crore petrochemical capex plan will tender through the decade.

- ASME U-Stamp: qualifies the Company to fabricate code-stamped pressure vessels for international tenders, a distinctly higher-specification and higher-value market than non-code fabrication and pairs naturally with the turnkey delivery model.

- ADNOC enlistment for metering skids: gives the Dubai subsidiary direct access to Abu Dhabi tenders in one of the worlds largest capital programmes, converting the Middle East presence from a vehicle into a qualified bidder.

- The Egypt truck loading skid order: 143 skids for an Egypt-based end user, contracted through an EPC contractor, one of the largest orders in its history, received during FY26 and included in the order book of Rs31 crore as at 1 April 2026, provides an execution anchor into FY27 and a reference that compounds across Africa, where the Nigeria delivery already stands and the Libya order is in execution.

- Land for a four-fold capacity expansion: the approximately 3,52,776 square feet acquired for phased development means the Company can accept larger and concurrent orders without the lead time of searching for capacity after demand arrives.

Part VIII: Internal Control Systems and Their Adequacy

The company has adequate internal control systems commensurate with the size and nature of its business. Well-defined policies, processes, and periodic internal audits ensure operational efficiency, reliable financial reporting, regulatory compliance, and effective risk management.