DMR Engineering Ltd Management Discussions

Report Renewable Energy in India

India continues to strengthen its position as one of the fastest-growing renewable energy markets in the world. During FY 2025-26, the country is expected to witness accelerated growth in renewable energy capacity additions, supported by favorable government policies, increasing private sector participation, and substantial investments in grid modernization and energy storage infrastructure.

The Government of India remains committed to its target of achieving 500 GW of non-fossil fuel-based energy capacity by 2030, India is emerging as a global leader in clean energy. As on 20th Jan 2025, Indias total non-fossil fuel-based energy capacity has reached 217.62 GW. Building upon the significant progress achieved in recent years, renewable energy is expected to play an increasingly important role in meeting the countrys growing electricity demand while supporting its climate commitments and energy security objectives.

Solar and wind energy installations are anticipated to continue their strong growth trajectory during FY 2025-26, supported by enhanced transmission infrastructure, improved project execution capabilities, and increasing adoption of energy storage solutions. The renewable energy sector is expected to remain a key driver of investment, employment generation, and technological innovation in the country.

Hydroelectric Power and Pumped Storage Projects

Hydroelectric power continues to be an important component of Indias clean energy portfolio. Several hydroelectric projects currently under construction are expected to progress significantly during FY 2025-26, contributing towards the long-term objective of enhancing the countrys renewable energy capacity and grid stability.

Pumped Storage Projects (PSPs) have emerged as a critical element of Indias energy transition strategy. Often referred to as "Water Batteries," PSPs provide large-scale energy storage capabilities that enable effective integration of intermittent renewable energy sources such as solar and wind power. These projects play a crucial role in balancing grid demand, enhancing system flexibility, and ensuring reliable power supply.

Following the successful concurrence of multiple PSP Detailed Project Reports (DPRs) in recent years, the Central Electricity Authority (CEA) continues to facilitate the accelerated development of additional PSP capacity across the country. Several projects are expected to advance through various stages of approval, construction, and implementation during FY 2025-26, with a significant portion targeted for commissioning before 2030.

The continued focus on hydroelectric and pumped storage development is expected to substantially strengthen Indias energy storage ecosystem, improve grid reliability, and support the countrys ambitious renewable energy expansion plans.

Engineering Consulting Services in India

The rapid expansion of renewable energy generation, transmission infrastructure, hydroelectric projects, and energy storage systems has created significant demand for specialized engineering consulting services across the power sector.

As project developers, utilities, and government agencies undertake increasingly complex infrastructure projects, there is a growing need for high-quality consulting services that combine technical excellence, practical execution experience, and cost-effective solutions. While several international engineering consulting firms operate globally, successful implementation in India requires a deep understanding of local regulatory frameworks, project conditions, stakeholder requirements, and economic considerations.

DMR is well positioned to capitalize on these opportunities through its strong domain expertise, innovative problem-solving capabilities, and ability to leverage both experienced professionals and emerging talent. The Companys comprehensive engineering consulting services, coupled with its commitment to quality, technological advancement, and clientcentric solutions, enable it to effectively address the evolving requirements of Indias energy sector.

The increasing focus on renewable energy, pumped storage projects, transmission infrastructure, and sustainable power development is expected to create substantial opportunities for DMR during FY 2025-26. The Company remains committed to strengthening its market position, expanding its service offerings, and delivering innovative engineering solutions that contribute to Indias transition towards a sustainable and resilient energy future.

Engineering Consulting Services Outside India

The global energy sector continues to undergo a significant transformation driven by the increasing adoption of renewable energy, modernization of power infrastructure, grid expansion, and growing investments in energy storage solutions. Countries across Asia, Africa, the Middle East, and other emerging markets are undertaking large-scale power generation, transmission, and water infrastructure projects to meet rising energy demand and sustainability objectives. These developments are creating substantial opportunities for engineering consulting firms that can deliver technically sound, cost-effective, and innovative solutions. DMRs extensive experience in the planning, design, engineering, and project management of hydroelectric, pumped storage, transmission, renewable energy, and water resources projects positions the Company favorably to participate in international assignments. Leveraging its proven technical expertise, competitive delivery model, and understanding of complex infrastructure projects, DMR aims to expand its presence in select overseas markets and strengthen relationships with international clients, development agencies, utilities, and project developers. The Company believes that growing global investments in sustainable infrastructure and clean energy will continue to create attractive opportunities for engineering consulting services beyond India, supporting its long-term growth strategy and geographical diversification objectives.

Company Overview

Our Company deals in Business to Business (B2B) category and caters to both domestic and international markets. Domestically, we have strong presence across many 15+ states in India with multiple projects in J&K, Uttaranchal, Himachal Pradesh, Rajasthan, Arunachal Pradesh, Maharashtra, Odisha, Jharkhand, Madhya Pradesh, Chhattisgarh etc. Internationally, DMR has done projects in Bhutan, Nepal, Lao PDR, Vietnam, Cambodia, Nigeria, Tanzania, Uganda and several other countries.

Opportunities

i) Increase presence in small and large hydro, dams, irrigation, water resources, renewable energy, pump storage projects, road and railway tunnels;

ii) Focus on global assignments with JV/collaboration with international partners;

iii) Governments focus on building renewable energy and sustainable infrastructure in the Country;

Threats

i) Retention of existing resources / knowledge personnel;

ii) Change of government policy or economic downturn or other factors adversely affecting investments on infrastructure in India;

iii) Increased competition from new and existing players in the business;

Outlook

The outlook for the Company remains positive, supported by a robust order pipeline, increasing demand for engineering consulting services, and significant opportunities arising from investments in renewable energy, hydropower, pumped storage, transmission infrastructure, and other critical sectors. The Company continues to witness steady growth in both domestic and international markets, reflecting the strength of its technical capabilities, client relationships, and project execution expertise.

As part of its long-term growth strategy, DMR is actively exploring opportunities in new geographies and expanding its presence in select international markets while maintaining a balanced portfolio of domestic and overseas assignments. The Company remains focused on strengthening its market position by leveraging its domain expertise, delivering innovative engineering solutions, and enhancing client value.

To support its growing business operations, DMR continues to invest in expanding its infrastructure, technology capabilities, and human resources. The Company is augmenting its workforce with skilled professionals and strengthening its talent pool through continuous learning and development initiatives, ensuring that organizational capabilities grow in line with business requirements.

Following its transition to a publicly listed company, DMR has further reinforced its commitment to strong corporate governance, transparency, accountability, and ethical business practices. The Company remains dedicated to maintaining the highest standards of integrity and compliance while creating long-term value for its clients, employees, shareholders, and other stakeholders.

With a strong order book, expanding market opportunities, a highly skilled workforce, and a commitment to operational excellence, the Company is well positioned to capitalize on emerging opportunities and deliver sustainable growth in the years ahead.

Risk Management

In DMR listed below are some of the key risks identification, anticipated impact on the company and mitigation strategies.

Internal Control Systems

The Companys internal control systems are adequate and provide, among other things, reasonable assurance regarding the recording of operational transactions in all material respects and the safeguarding of Company assets against significant misuse or loss.

Internal audits are conducted periodically to assess the adequacy and effectiveness of internal control procedures and processes. The audit reports are reviewed by the Audit Committee of the Board of Directors, and appropriate policy and process improvements are implemented based on the recommendations and observations of the internal auditor.

Discussion on Financial Performance with respect to Operational Performance

As of March 31, 2026, the Company recorded a decline of 2.01% in its revenue from operations, from Rs. 1,046.85 lakhs in the previous financial year 2024-25 to Rs. 1,025.80 lakhs during the financial year 2025-26. The net profit of the Company also declined by 43.94%, from Rs. 170.59 lakhs in the previous financial year 2024-25 to Rs. 95.63 lakhs in the financial year 2025-26.

Human Resources

At DMR, we firmly believe that our people are the cornerstone of our success and a key driver of sustainable growth. In a dynamic and evolving business environment, human capital plays a critical role in developing organizational capabilities, driving innovation, strengthening operational systems, and fostering a performance-oriented culture. Our ability to attract, develop, retain, and effectively deploy a highly skilled workforce of engineering and management professionals significantly influences our operational efficiency, service quality, and long-term profitability.

As of 31 March 2026, the Company had a workforce of 60 permanent employees. DMR is committed to nurturing a diverse and balanced team that combines the experience and expertise of seasoned professionals with the energy, creativity, and adaptability of young talent. This blend enables the Company to adopt a holistic approach to problem-solving and effectively respond to the evolving needs of clients and projects.

The Company places significant emphasis on continuous learning and professional development. Structured training and capacity-building initiatives are undertaken to enhance technical competencies, leadership capabilities, and domain expertise across all levels of the organization. We view investment in employee training and development as a strategic imperative that not only strengthens project execution capabilities but also enhances employee engagement, career growth, and retention.

DMRs talented and dedicated workforce continues to contribute significantly towards improving business efficiency, driving innovation, developing robust systems and processes, and supporting the Companys growth objectives. The Companys proactive approach to talent management enables it to effectively deploy resources across projects while maintaining high standards of quality and client service.

The Company has established a comprehensive Whistleblower Policy that encourages directors and employees to report instances of unethical conduct, actual or suspected fraud, violations of the Code of Conduct, or any other concerns relating to business integrity. The

policy provides a secure mechanism for reporting concerns and ensures protection against victimization or retaliation, thereby promoting a culture of transparency, accountability, and ethical behavior across the organization.

DMR remains committed to creating a safe, inclusive, and empowering work environment where employees can realize their full potential. The Company believes that effective management and development of its human resources will continue to be instrumental in sustaining its competitive advantage and achieving long-term business success.

Talent Acquisition

DMR recognizes that attracting and retaining skilled professionals is fundamental to sustaining its growth and delivering high-quality services to its clients. The Company has established robust talent acquisition processes to identify, attract, and onboard qualified professionals with the requisite technical expertise, experience, and potential aligned with its business objectives. Through a combination of structured recruitment practices, industry benchmarking, and competitive compensation frameworks, DMR has been successful in meeting its workforce requirements in a timely manner.

The Company follows a rigorous selection process to assess candidates technical competence, professional experience, cultural fit, and long-term growth potential before induction into the organization. This approach has enabled DMR to build a strong talent pool capable of supporting its current operations as well as future expansion plans. The average tenure of employees at the executive level continues to reflect the Companys ability to provide meaningful career opportunities and a supportive work environment.

Talent Management

DMRs talent management philosophy is centered on attracting, developing, motivating, and retaining high-performing professionals who contribute to the Companys long-term success and competitive advantage. The Company strives to create an inclusive, purpose-driven, and performance-oriented workplace that fosters employee engagement, professional growth, and organizational excellence.

The talent management strategy focuses on maximizing the potential of every employee by providing opportunities for learning, career advancement, and meaningful contributions to business objectives. DMR encourages its employees to pursue excellence through a culture built on four key principles: pursuing passion, embracing continuous improvement, committing to lifelong learning, and achieving success through collaboration. By nurturing these values, the Company seeks to enhance employee satisfaction while driving sustainable business growth.

Talent Development

The Company considers its human capital to be its most valuable asset and is committed to fostering an environment that supports continuous learning and professional development. DMR believes that every employee should have access to relevant learning opportunities that enhance their capabilities and prepare them for future responsibilities.

To achieve this objective, the Company has adopted a structured and need-based approach to talent development, combining mentorship, experiential learning, technical training, and on- the-job development initiatives. These programs are designed to strengthen functional expertise, improve project execution capabilities, and support career progression across all levels of the organization. Through continuous investment in learning and development, DMR aims to build a highly skilled workforce capable of meeting evolving industry demands and delivering exceptional value to clients.

Culture and Diversity

DMR is committed to fostering a workplace culture founded on integrity, mutual respect, inclusivity, and equal opportunity. The Company values diversity and believes that a workforce comprising individuals from varied backgrounds, experiences, and perspectives enhances innovation, collaboration, and organizational effectiveness.

The Company does not discriminate on the basis of age, gender, disability, race, ethnicity, religion, or any other protected characteristic. DMR actively promotes a culture of fairness, respect, and dignity where every employee is encouraged to contribute ideas, participate in decision-making, and collaborate across teams. Employees from diverse geographical regions and socio-economic backgrounds work together to create a dynamic and inclusive environment that supports creativity and innovation.

The Company maintains a zero-tolerance approach towards harassment, discrimination, or any form of inappropriate conduct in the workplace. Through its commitment to diversity, equity, inclusion, and employee well-being, DMR continues to build a positive work culture that enables individuals and teams to thrive while contributing to the Companys long-term success.

Cautionary statement

This statement made in this section describes the Companys objectives, projections, expectation and estimations which may be ‘forward-looking statements within the meaning of applicable securities laws and regulations.