Divyashakti Ltd Management Discussions

The Management of Divyashakti Limited is pleased to present the Management Discussion and Analysis Report for the financial year. This report provides a clear and comprehensive overview of the Companys business operations, industry structure, key opportunities and challenges, and overall performance. It also highlights significant developments, strategic initiatives, associated risks, and the future outlook, offering stakeholders valuable insights into the Companys direction and market positioning.

The global economy continues to navigate a complex and uncertain environment, marked by elevated macroeconomic volatility, evolving trade frameworks and persistent fiscal challenges. Despite ongoing geopolitical tensions and financial headwinds, global economic growth remained steady at 3.3% in 2025.

Growth in advanced economies moderated to 1.7% in 2025, with investments in high-technology sectors providing a partial offset to weaker economic activity. The United States economy faced challenges arising from evolving trade policies and tariff-related uncertainties; however, growth remained supported by expansionary fiscal measures, resilient consumer spending, and a robust labour market.

The European Union recorded steady growth of 1.4% in 2025, underpinned by stable household consumption and resilient labour markets. Nevertheless, higher trade tariffs and ongoing geopolitical tensions continued to weigh on export performance and business sentiment.

Among major emerging economies, China maintained strong economic momentum, registering 5.0% growth in 2025. Government policy support, stronger domestic demand, and robust exports to markets outside the United States helped sustain growth, partially offsetting the impact of tariff-related pressures and a subdued property sector.

The global economy is expected to remain resilient despite continued geopolitical uncertainties, evolving trade policies, and persistent fiscal challenges. Global GDP growth is projected to remain broadly stable at 3.3% in both 2026 and 2027, supported by resilient economic activity in the United States and sustained growth across emerging market and developing economies.

Advanced economies, particularly those in Europe, are expected to witness moderate growth as easing inflation, gradual monetary policy normalization, and improving investment sentiment support economicactivity. Emerging economies are projected to continue driving global growth through stronger domestic demand, infrastructure investment, and expanding industrial and services sectors.

As governments and businesses adapt to shifting trade dynamics, technological advancements, and changing policy frameworks, companies will increasingly focus on innovation, supply chain resilience, operational efficiency, and market diversification. Thesedevelopments are expected to shape a more dynamic global business environment, requiring organizations to adopt agile strategies and strengthen long-term competitiveness.

India continues to demonstrate strong economic momentum and it is expected to remain the fastest-growing major economy over the next two years, supported by resilient consumption, improving rural demand, expanding services and a growing share of high-value manufacturing in exports, with GDP growth reaching 6.2% in FY 2025-26, following 6.5% in FY 2024-25.

Inflationary pressures moderated during FY 2025-26, supported by favourable food-price trends, stable commodity prices and improved supply conditions. The easing inflation environment provided greater policy flexibility and supported domestic consumption.

Amid easing inflationary pressures, the Reserve Bank of India reduced the policy repo rate during 2025, with successive rate cuts bringing the rate down to 5.50% by June 2025. These measures supported liquidity conditions and were aimed at sustaining economic growth while maintaining price stability.

The Indian economy is expected to maintain its growth momentum in FY2027, with real GDP projected to expand in the range of 7.0% to 7.4%, supported by resilient domestic demand, robust private consumption, sustained public infrastructure investment, and agradual recovery in private capital expenditure.

Although global challenges, including slower economic growth, geopolitical uncertainties, and rising protectionist trade measures, may pose risks to the external sector, Indias strong macroeconomic fundamentals and ongoing trade initiatives are expected to support overall economic resilience. Proposed and ongoing trade agreements with key partners such as the United Kingdom, the United States, and the European Union are expected to enhance bilateral trade by improving market access for goods and services, reducing trade barriers, and strengthening investment flows.

The global granite market was valued at approximately USD 4.20 billion in CY2025 and is projected to reach USD 7.73 billion by CY2036, registering CAGR of 5.7% during the forecast period. The market is expected to be driven by sustained growth in residential and commercial construction, increasing urbanisation, infrastructure development, and rising demand for premium natural stone products. The growing demand for natural stone in the construction and interior design sectors is a key driver of the granite market. Granites durability, aesthetic appeal, and versatility in applications such as countertops, flooring, and facades drive its popularity, thus aiding the market growth to attain a valuation of USD 7.73 Billion by 2036.

The engineered stone market was valued at approximately USD 7.20 billion in 2025 and is anticipated to grow at a CAGR of around 4.72%, reaching approximately USD 12.7 billion by 2034.

The primary reason behind the growth of the engineered stone market is the increasing demand for engineered stone across the world.

DIVYASHAKTI LIMITED

As we look ahead, we anticipate subdued granite sales inFY 2026-27, driven by ongoing challenges in the U.S. housing and export markets. Nevertheless, we remain optimistic about the performance of our engineered stone segment, with encouraging prospects for both revenue growth and improved profitability.

Key financial indicators are summarised below: