EMS Ltd Management Discussions

Indian Economic Overview

Indias economy continued to demonstrate resilience amid a challenging global environment, maintaining its position among the fastest-growing major economies in the world. As per the Second Advance Estimates released by the National Statistical Office (NSO) under the revised GDP series with base year 2022-23, Indias real GDP is estimated to grow by 7.6% in FY 2025-26, compared with 7.1% in FY 2024-25. The sustained growth momentum was supported by strong domestic demand, robust services sector performance, continued infrastructure development, and improving manufacturing activity.

India remains the worlds fifth-largest economy by nominal GDP and the third-largest by Purchasing Power Parity (PPP). The Government continues to pursue its long-term vision of transforming India into a developed economy by 2047, supported by structural reforms, digital transformation, infrastructure development, and enhanced ease of doing business. The revised GDP framework, incorporating improved data sources such as GST, ASUSE, PLFS, and PFMS, further strengthens the measurement of economic activity and reflects the evolving structure of the Indian economy.

The Union Budget 2025-26 reinforced the Governments commitment to investment-led growth through a capital expenditure outlay of Rs11.21 lakh crore, equivalent to approximately 3.1% of GDP. The Budget focused on four key growth engines—Agriculture, MSMEs, Investment, and Exports—while continuing fiscal consolidation efforts with a targeted fiscal deficit of 4.4% of GDP. The sustained emphasis on public infrastructure creation is expected to crowd in private investment, enhance productivity, and strengthen Indias long-term growth potential.

During FY 2025-26, economic activity was driven by resilient private consumption, continued public investment, increasing formalisation of the economy, and rapid adoption of digital technologies. The services sector remained a key contributor to growth, while manufacturing and construction benefited from ongoing infrastructure investments and policy support. Moderating inflation and stable macroeconomic conditions further supported consumer spending and business confidence.

Looking ahead, Indias medium-term growth outlook remains favourable, supported by strong domestic fundamentals, demographic advantages, increasing urbanisation, expanding digital penetration, and sustained public and private investments. Continued policy reforms, infrastructure development, and technological innovation are expected to strengthen competitiveness, drive productivity gains, and support sustainable economic growth over the long term.

Company Overview

EMS Infracon Private Limited was incorporated on December 21, 2010 with Registrar of Companies (ROC), Delhi and Haryana under the provisions of Companies Act 1956. Thereafter, the name of the Company was changed from ‘EMS Infracon Private Limited to ‘EMS Private Limited on October 26, 2022 and thereafter Company was converted from private Limited to public Limited, pursuant to the special resolution passed by the shareholders of the Company in its Extra-Ordinary General Meeting held on October 27, 2022 and a fresh certificate of incorporation was generated after the aforesaid conversion from EMS Private Limited to EMS Limited ("The Company") and was issued by the ROC on November 25, 2022. The Companys Corporate Identity Number was U45205DL2010PLC211609. The Registered office of company is situated at 701, DLF Tower A, Jasola, New Delhi-110025 and corporate office of the Company situated at C-88, 2nd Floor, RDC, Ghaziabad-201002, Uttar Pradesh.

During the financial year 2023-24, Company has come with public issue with the size of Rs 32,124.59 Lakhs by offering 69,30,807 equity shares of face value of Rs. 10 each at premium of Rs. 201 per equity shares aggregating up to Rs. 14,624.00 Lakhs through fresh issue and 82,94,118 Equity Shares of face value of Rs. 10 each at premium of Rs. 201 per equity shares aggregating up to Rs. 17,500.59 Lakhs through offer of sale.

In view of the above, 5,55,30,807 equity shares of the Company got listed on BSE Limited and National Stock Exchange of India Limited on September 21, 2023 and CIN number of the Company was changed from U45205DL2010PLC211609 to L45205DL2010PLC211609.

The Company is engaged in the business of Sewerage solution provider, Water Supply System, Water and Waste Treatment Plants, Electrical Transmission and Distribution, Road and Allied works, operation and maintenance of Water and Wastewater Treatment Plants (WWTPs) and Water Supply Scheme Projects (WSSPs) for government authorities/bodies. WWTPs include Sewage Treatment Plants (STPs) alongwith Sewage Network Schemes and Common Effluent Treatment Plants (CETPs) and WSSPs include Water Treatment Plants (WTPs) along with pumping stations and laying of pipelines for supply of water (collectively, "Projects") and manufacturing of own items used for construction purpose. The treatment process installed at most of the STPs and CETPs is Zero Liquid Discharge (ZLD) compliant and the treated water can be used for horticulture, washing, refrigeration and other process industries.

In addition to the execution of projects independently, Company also enters into joint ventures with other infrastructure and construction companies to jointly bid and execute projects. Joint ventures or partnerships enable the Company to achieve pre-qualification, both technical and financial, with our joint venture partner at the time of the bid and where the bid is successful, Company also execute the project with joint venture partner considering the technical skill and qualification of the joint venture partner required to execute a particular project.

Outlook

Construction Sector Outlook

Indias infrastructure output, as measured by the Index of Eight Core Industries (ICI), recorded a cumulative growth of 2.7% during FY 2025-26 (April–December, provisional), compared with the corresponding period of the previous year. The performance was supported by strong growth in cement, steel, electricity, and coal, while output in certain energy-related segments such as crude oil and natural gas remained subdued during the year.

Urban infrastructure development continued to remain a key policy priority, with sustained investments under flagship initiatives such as the Smart Cities Mission, expansion of metro rail networks, and large-scale urban mobility projects across major cities.

India is increasingly emerging as one of the worlds largest infrastructure and construction markets, with the sector projected to become the third-largest globally, supported by rapid urbanisation and a construction market size exceeding USD 1 trillion. Structural initiatives such as the National Infrastructure Pipeline (NIP) and the PM Gati Shakti National Master Plan continue to play a central role in integrated infrastructure planning, multimodal connectivity, and efficient project execution.

In line with this strategic focus, the Union Budget 2025-26 has allocated Rs11.21 lakh crore towards capital expenditure, equivalent to approximately 3.1% of GDP, reflecting the Governments continued emphasis on infrastructure-led growth and long-term economic capacity building. This sustained investment is expected to enhance connectivity, improve logistics efficiency, and crowd-in private investment across core sectors.

Water and Wastewater Supply Outlook

Most of the Indian population lives in urban centres and the number is expected to go up rapidly leading to increased demand of fresh water. The generation of waste water is double in cities as compared to rural India because of availability of more water in urban cities due to increased living standards and the urbanization pace.

The Water & Wastewater business vertical delivers comprehensive water solutions for the municipal and rural water sectors. In the potable water domain, it manages projects end-to-end covering sourcing, treatment, transmission, storage and distribution. In the municipal wastewater segment, project bids cover collection and conveyance of sewage, construction of pumping stations and advanced wastewater treatment plants, including high standard sludge treatment and power generation.

The business predominantly operates as a B2G vertical with dependency on Central and State policies, with ongoing initiatives playing a pivotal role in shaping business opportunities. Indias water and wastewater sector is poised to grow at a CAGR of 11.60%, targeting USD 17.9 billion by FY 2028-29, primarily driven by the need for improved wastewater treatment and water security. Government-led initiatives, of establishing over 500 wastewater treatment plants by 2027 and the extension of the Jal Jeevan Mission programme until 2028, present significant growth prospects in both potable as well as treated water infrastructure.

Government has allocated major projects of waste water treatment plants under schemes like Namami Gange Programme and Swatch Bharat Mission (Urban). These initiatives are focused on reducing the contamination in the water bodies and reuse of treated water for purposes like industrial use, irrigation etc.

Indias water supply and irrigation industry is a critical sector, supporting agricultural productivity, public health and economic growth. To address rising demand, both public and private entities are investing in large-scale water treatment and distribution infrastructure. Several national initiatives are driving sectoral growth. The Jal Jeevan Mission aims to provide safe and adequate drinking water to all rural households through tap connections by 2024. Programmes such as the Atal Mission for Rejuvenation and Urban Transformation (AMRUT), the National Mission for Clean Ganga (NMCG) and various Community Drinking Water Schemes are further strengthening Indias water and wastewater treatment infrastructure.

* https://www.indiabudget.gov.in/doc/budget_speech.pdf

** https://www.eawater.com/announcements/union-budget-2025-26-advancing-water-security-in-india/

Power Sector Outlook

Indias electricity sector is one of the most diversified in the world. Indias power generation sources range from conventional sources such as coal, lignite, natural gas, oil, nuclear and hydro power to viable unconventional sources such as wind, solar, agricultural and household waste.

India ranks as the third-largest producer and consumer of electricity globally, with an installed capacity of 520.51 GW as on Jan 31, 2026. The power sector plays a vital role in shaping the nations infrastructure, fuelling economic progress, and improving the standard of living. The Indian power industry has witnessed a significant transformation, transitioning from a power-deficit scenario to achieving surplus capacity through the integration of a unified national grid, enhanced distribution networks, and universal household electrification. With a diverse energy mix spanning conventional sources such as coal, natural gas, and hydro, as well as renewable options like solar, wind, and biomass, India is steadily building a sustainable energy future.

As of Jan 31, 2025 Indias Installed thermal energy capacity reached 247 GW and renewable energy capacity (including hydro) reached 267 GW.

Driven by population growth, increasing electrification, and rising per capita electricity consumption, the nations energy demand is on a continuous upward trajectory. By 2031-32, India is committed to surpassing 500 GW of non-fossil fuel-based installed capacity, underscoring its focus on creating a resilient and sustainable power ecosystem. (Source: IBEF.org)

India is projected to grow at 6.9% in FY 2026-27. India is on track to become the worlds third-largest economy by 2030, driven by infrastructure investment, private capital expenditure, and financial services expansion. Ongoing reforms support long-term growth.

Indias positive outlook is underpinned by its demographic dividend, increased capital investment, proactive policies, and strong consumer demand. Improved rural consumption, driven by moderating inflation, further strengthens this trajectory. Government focuses on capital expenditure, fiscal discipline, and rising business/consumer confidence support investment and consumption.

Initiatives like Make in India 2.0, Ease of Doing Business reforms, and the PLI scheme aims to strengthen infrastructure, manufacturing, and exports, positioning India as a global manufacturing hub.

Long-term economic development of a nation, which leads to improved prosperity and well-being of its citizens, necessitates abundant availability of reliable and affordable power supply, which is a critical enabling resource for all economic activities. India is focusing on strengthening the power sector through various policies, targets, and reforms to ensure that both generation capacity and the transmission & distribution infrastructure are augmented in a timely manner, to be able to support the nations growth aspirations while meeting long-term sustainability goals.

Opportunities

a) Increasing Government expenditure: The Government continues to prioritise infrastructure-led growth through a significant increase in capital expenditure, thereby creating substantial opportunities for the Company across water, wastewater, and urban infrastructure segments.

- The Union Budget 2026–27 has proposed capital expenditure of Rs12.2 lakh crore*, reinforcing sustained public investment in infrastructure development.

- Continued focus on infrastructure creation under the Governments long-term vision of Viksit Bharat 2047, with emphasis on logistics, urban infrastructure, and sustainable development.

- Establishment of mechanisms such as the Infrastructure Risk Guarantee Fund to improve private sector participation and project bankability.

*Source:https://www.reuters.com/world/india/india-budget-india-raises-infrastructure-spending-record-122-trillion-rupees-2026-02-01/

b) Development in rural infrastructure:

Rural infrastructure development continues to be a key policy priority, improving access to drinking water, sanitation, irrigation, and basic civic amenities. Government programmes continue to support integrated rural development and water security.

- Rural transformation supported through convergence of infrastructure and service delivery mechanisms under Budget 2026·27 priorities.

c) Strict awareness on pollution control and waste water management

Conducting different activities and programmes through various platforms to generate awareness and information for public at large.

d) Governmental initiatives in the water and wastewater sector:

Continued investments in flagship programmes across the world focused on water security, including Namami Gange, One City One Operator.

e) Resource Recovery & Sustainability:

There is increasing interest in recovering resources from wastewater, such as energy from biogas (produced during anaerobic digestion), nutrients like phosphorus and nitrogen for agricultural use, and water for non-potable purposes. These opportunities align with the principles of a circular economy and sustainable resource management. Growing emphasis on sustainability and circular economy is creating opportunities in wastewater reuse, energy recovery, and resource-efficient infrastructure systems.

Threats

a) Rising competition.

Competition within the water and wastewater segment is intensifying, with both public and private entities. This heightened competition may lead to pricing pressures, impacting margins and overall profitability.

b) Funding & financing constraints

Despite higher Government capex, infrastructure financing continues to face challenges related to cost of capital, project structuring, and delayed payments in PPP frameworks.

c) Rapid advancement of technology

With rapid advancements in technologies, new and more innovative methods are coming. This evolving technology has reduced the lifecycle of current solutions, posing threat to current market players.

d) Delay in completion of projects due to change in government.

Any change in Government may result in the priority of the Government. The new Government may change the terms and conditions retrospectively and may shift its focus to different areas which may affect us negatively.

e) Climate Change:

Climate change can lead to more frequent and severe weather events, such as storms and floods, which can overwhelm sewerage systems and treatment plants. This can result in the discharge of untreated or partially treated wastewater into water bodies, posing environmental and public health risks.

Risk and concern

Environmental Risk

Climate change is affecting the environment in a major way. It is impacting rainfall patterns, causing floods and may also lead to long term decline in naturally available sources like groundwater storage. Groundwater availability is closely linked to food security as it has played a vital role in increasing agricultural production over the years. Groundwater contributes nearly 62% in irrigation, 85% in rural water supply and 50% in urban water supply. Even though Groundwater is replenishable but its availability is non-uniform as it is dependent on rainfall. The over exploited groundwater sources are a major challenge as it is a key water supply source for agriculture.

To mitigate the impact of such risks, the Company proactively assesses the likelihood and impact of such risks. For EPC projects, this assessment is done both at the bidding stage and during the execution stage. Manufacturing facilities also undertake such assessments on a periodic basis. Monsoon preparedness plans, cover plans for the protection of equipment (covering, tying down, or other suitable arrangements), backup for power/fuel, human safety, and plans for restoring normal operations are also in place.

Financial Risk

In the course of business, amongst others, the Company is exposed to several financial risks such as Credit Risk, Liquidity Risk, Interest Rate Risk, Exchange Risk and Commodity Price Risk. These risks may be caused by the internal and external factors resulting into impairment of the assets of the Company causing adverse influence on the achievement of Companys strategies, operational and financial objectives, earning capacity and financial position.

The Company has formulated an appropriate policy and established a risk management framework which encompass the following process.

- Identify the major financial risks which may cause financial losses to the company

- Assess the probability of occurrence and severity of financial losses

- Mitigate and control them by formulation of appropriate policies, strategies, structures, systems and procedures

- Monitor and review periodically the adherence, adequacy and efficacy of the financial risk management system.

Credit Risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including investments, deposits with banks and financial institutions and other financial instruments.

The Companys customer profile includes public sector enterprises. Accordingly, the Companys customer credit risk is very low. The Companys average project execution cycle is around 18 to 36 months. General payment terms include mobilisation advance, monthly progress payments with a credit period ranging from 45 to 90 days and certain retention money to be released at the end of the project. In some cases, retentions are substituted with bank guarantees. The Company has a detailed review mechanism of overdue customer receivables at various levels within the organisation to ensure proper attention and focus for realisation. Customer credit risk is managed by the Companys established policies, procedures and controls relating to customer credit risk management. Credit quality of a customer is assessed based on an individual credit limits and are defined in accordance with managements assessment of the customer. Outstanding customer receivables are regularly monitored. The concentration of credit risk is limited due to the fact that the customer base is large. An impairment analysis is performed at each reporting date using a provision matrix to measure expected credit losses. The Company uses ageing buckets and provision matrix for the purpose of computation of expected credit loss. The provision rates are based on past trend of recoverability.

Liquidity Risk:

Liquidity risk is the risk that the Company may encounter difficulty in meeting its present and future obligations associated with financial liabilities that are required to be settled by delivering cash or another financial asset.

The Companys objective is to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts, bank loans and finance leases. The Company closely monitors its liquidity position and deploys a robust cash management system. It aims to minimise these risks by generating sufficient cash flows from its current operations, which in addition to the available cash and cash equivalents and sufficient committed fund facilities, will provide liquidity. The liquidity risk is managed on the basis of expected maturity dates of the financial liabilities.

Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Companys exposure to the risk of changes in market interest rates relates primarily to the Companys long-term debt obligations with floating interest rates. The Company has fixed deposits as margin money for a period between 3 months to exceeding 12 months. All the fixed deposits are with banks, accordingly there is no significant interest rate risks pertaining to these deposits.

Business Performance

Financial & Operating Performance on standalone basis

(Rs in Lakhs)

Particulars	FY 2025-26	FY 2024-25
Operating Revenue	60,810.21	94,244.58
EBITDA	14,062.24	25,855.89
PBT	12,554.87	24,653.44
PAT	8,846.93	18,227.44
Net Worth	1,03,872.53	96,105.85
Return on Net Worth (%)	8.52%	18.97%
Debt to Equity Ratio	0.074	0.014
Earnings per share (Rs)	15.93	32.82

Company derives revenues from three types of activities:

a) Construction contract- Customer contracts towards delivering a sewerage water treatment facility that it fit for purpose as per the contract.

b) Operation and Maintenance contracts- Customer contracts towards operation and maintenance of sewerage water treatment facilities.

c) Manufacturing- The Company is engaged in manufacturing of own items which are used for construction purpose.

The Company generated a total revenue from its operations of Rs 60,810.21 Lakhs in FY 2025-26 as compared to Rs94,244.58 Lakhs in FY 2024-25.

Construction contract- Total revenue from this activity stood at Rs60,377.91 Lakhs in the Financial year 2025-26 as compared to Rs93,209.14 Lakhs in the previous fiscal 2024-25.

Operation and Maintenance contracts- Total revenue from this activity stood at Rs 387.19 Lakhs in the Financial year 2025-26 as compared to Rs950.09 Lakhs in the previous fiscal year 2024-25.

Manufacturing- Total revenue from this activity stood at Rs 2.92 Lakhs in the Financial year 2025-26 as compared to Rs5.72 Lakhs in the previous fiscal year 2024-25.

Other Income: The Companys other income increases by 31.84% from Rs 887.66 Lakhs in FY 2024-25 to Rs 1,170.29 Lakhs in the FY 2025-26.

Operating Expenses

The Companys operational expenses fell by 29.86% from Rs 70,478.80 Lakhs in FY 2024-25 to Rs 49,425.63 Lakhs in FY 2025-26.

Operating Profits

The EBITDA for FY 2025-26 is decreased to Rs 14,062.24 Lakhs, as compared to previous year of Rs 25,855.89 Lakhs. In FY 2025-26, the Profit after Tax amounted to Rs 8846.93 lakhs as compared to previous Year of Rs 18227.44 Lakhs.

Earnings per Share

In FY 2025-26, the Companys earnings per share was 15.93 as compared to 32.82 in FY 2024-25.

Share Capital & Other Equity

The Board of directors of the company, at its meeting held on February 27, 2026 has approved a proposal to increase authorised share capital of the company to Rs 70,00,00,000/- (Seventy Crore Only) divided into 7,00,00,000 (Seven Crore only) Equity Shares of Rs 10/- each from Rs 60,00,00,000 (Sixty Crore only), divided into 6,00,00,000 (Six Crore only) Equity Shares of Rs 10/- each. Further, the increase in Authorised Share Capital has been approved by the Shareholders of the company at the Extraordinary General Meeting held on March 23, 2026 by way of Ordinary Resolution.

Apart from the above, there is no change in Share Capital of the company. Details of the share capital are given in the Directors Report, forming part of this annual report.

The Companys other equity increased to Rs98,319.45 Lakhs as on March 31, 2026, from Rs90,552.77 Lakhs as on March 31, 2025. Accordingly, the Net Worth of the Company has increased to Rs1,03,872.53 Lakhs as on March 31, 2026 from Rs96,105.85 Lakhs as on March 31, 2025.

Other Bank Balances and Cash and Cash Equivalents

As of March 31, 2026, cash and cash equivalents totalled Rs 1,388.85 Lakhs and Bank Balances totalled Rs 4,165.05 Lakhs.

Trade Receivables

As of March 31, 2026, trade receivables totalled Rs37,100.84 Lakhs, down from Rs 37,699.09 Lakhs as of March 31, 2025. During the course of the year, Debtor Turnover slide from 3.06 times to 1.63 times due to decrease in Revenue from operations.

Current Liabilities

Current liabilities include borrowings, Lease Liability, Trade payables, other financial liabilities, short-term provisions, and other current liabilities. Current liabilities as of March 31, 2026, were Rs 14,011.43 Lakhs as compared to Rs 7,833.17 Lakhs as of March 31, 2025.

Cash Flow

For FY 2025-26, Cash flow/used in operating activities stands at (Rs 8,391.77 Lakhs) from Rs 3,579.40 Lakhs in FY 2024-25.

Financial & Operating Performance on consolidated basis

(Rs in Lakhs)

Particulars	FY 2025-26	FY 2024-25
Operating Revenue	73,274.72	97,249.19
EBITDA	15,267.65	26,703.40
PBT	12,921.73	24,898.07
PAT	9,119.43	18,378.35
Net Worth	1,05,540.74	97,567.94
Return on Net Worth (%)	8.64%	18.84%
Debt to Equity Ratio	0.146	0.088
Earnings per share (Rs)	16.30	33.05

Operating Consolidated Revenue

The Company generated a total revenue on consolidated basis from its business operation of Rs 73,274.72 lakhs in FY 2025-26 as compared to Rs 97,249.19 lakhs in FY 2024-25.

Other Income: During the financial year, Company registered the other Income of Rs 1,225.41 lakhs in FY 2025-26 as compared to Rs 920.65 lakhs in FY 2024-25.

Operating Expenses

The Companys operational expenses fell by 15.96% from Rs 73,271.77 Lakhs in FY 2024-25 to Rs 61,578.39 Lakhs in FY 2025-26.

Operating Profits

The EBITDA for FY 2025-26 was Rs 15,267.65 Lakhs, a 42.82% decrease over the previous years Rs 26,703.40 Lakhs due to decrease in Revenue from Operations.

In FY 2025-26, the Profit after Tax amounted to Rs 9,119.43 Lakhs as compared to Rs 18,378.35 Lakhs during the FY 2024-25.

Earnings per Share

In FY 2025-26, the Companys earnings per share was 16.30 in comparison to 33.05 in FY 2024-25.

Share Capital & Other Equity

The Board of directors of the company, at its meeting held on February 27, 2026 has approved a proposal to increase authorised share capital of the company to Rs. 70,00,00,000/- (Seventy Crore Only) divided into 7,00,00,000 (Seven Crore only) Equity Shares of Rs. 10/- each from Rs. 60,00,00,000 (Sixty Crore only), divided into 6,00,00,000 (Six Crore only) Equity Shares of Rs. 10/- each. Further, the increase in Authorised Share Capital has been approved by the Shareholders of the company at the Extraordinary General Meeting held on March 23, 2026 by way of Ordinary Resolution.

Apart from the above, there is no change in Share Capital of the company. Details of the share capital are given in the Directors Report, forming part of this annual report.

The Companys other equity increased to Rs 99,987.66 Lakhs as on March 31, 2026, from Rs 92,014.86 Lakhs as on March 31, 2025. Accordingly, the Net Worth of the Company has increased to Rs1,05,540.74 Lakhs as on March 31, 2026 from Rs 97,567.94 Lakhs as on March 31, 2025.

Other Bank Balances and Cash and Cash Equivalents

As of March 31, 2026, cash and cash equivalents totalled Rs 1,724.30 Lakhs and Other Bank Balances totalled Rs 4,170.78 Lakhs.

Trade Receivables

As of March 31, 2026, trade receivables totalled Rs 38,741.49 Lakhs, up from Rs 37,679.00 Lakhs as of March 31, 2025. During the course of the year, Debtor Turnover reduced from 2.40 times to 1.55 times due to decrease in Revenue from Operations.

Current Liabilities

Current liabilities include borrowings, accounts payable, other financial liabilities, short-term provisions, and other current liabilities. Current liabilities as of March 31, 2026, were Rs15,801.99 Lakhs as compared to Rs 9,194.07 Lakhs as of March 31, 2025.

Cash Flow

For FY 2025-26, Cash flow/Used from operating activities was (Rs 1,490.40 Lakhs) from Rs 3,624.08 Lakhs) in FY 2024-25.

Factors affecting results of operations

Our results of operations and financial conditions are affected by numerous factors including the following:

- General economic and business conditions in the markets in which we operate and in the local, regional, national and international economies;

- Any change in government policies resulting in increases in taxes payable by us;

- Our ability to retain our key managements persons and other employees;

- Changes in laws and regulations that apply to the industries in which we operate.

- Our ability to make interest and principal payments on our existing debt obligations and satisfy the other covenants contained in our existing debt agreements;

- General economic, political and other risks that are out of our control;

- Inflation, deflation, unanticipated turbulence in interest rates, or other rates or prices;

- Companys ability to successfully implement its growth strategy and expansion plans;

- Occurrence of Environmental Problems & Uninsured Losses;

- Any adverse outcome in the legal proceedings in which we are involved;

- Concentration of ownership among our Promoter;

- The performance of the financial markets in India;

- Global distress due to pandemic, war or by any other reason.

- Other factors beyond our control

Internal control systems and their adequacy

The Company has adequate system of internal controls to safeguard and protect from loss, unauthorized use or disposition of its assets. All the transactions are properly authorized, recorded and reported to the Management. The Company is following all the applicable Accounting Standards for properly maintaining the books of accounts and reporting financial statements. The internal auditors of the company checks and verifies the internal control and monitors them in accordance with policy adopted by the company.

The Company has an Audit Committee consisting majoritywith Independent Directors, details of which has been mentioned in the Corporate Governance Report. The Internal Auditors of the Company are responsible for reviewing the effectiveness of EMS internal control mechanism at regular intervals.

The periodic audit reports submitted by the Internal Auditors, along with suggestions for improvement, are reviewed by the Audit Committee. Relevant suggestions are then considered, in discussion with the Management, and implemented by initiating corrective actions and improvements in business processes. The Audit Committee also meets the Companys Statutory Auditors, from time to time, to ascertain, inter alia, their views on the adequacy of EMS internal control systems. It also keeps the Board of Directors informed about the major observations on a regular basis.

Health and Safety Standards

The Companys operations conform to the Health & Safety Standards. The Company ensures improving employee safety, reducing workplace risks and creating better, safer working conditions in Companys operations.

OCCUPATIONAL HEALTH AND SAFETY

Commitment

EMS Limited is committed to carrying out its operations free from accidents and occupational illnesses. It strives to implement world-class safety practices for all stakeholders, including employees and contractors. Further, Company also provides the necessary training to all its employees at the project site. The Company firmly believes that providing a safe working environment is not only a statutory requirement but also its moral responsibility.

Management Engagement

The Company always believes that its growth is closely linked with the growth and overall development of its employees. The Company is committed to upgrading the skill of its employees and to create an environment where excellence is recognised and rewarded. The target is to place the right people at the right position and to enhance the efficiency, working speed, competency and time management skill of its employees. The Companys endeavour is to create an environment where people can use their entire capabilities in promoting the business of the Company.

Resources

A team of highly qualified, experienced and skilled professionals is deputed to provide management with the required support on occupational health, safety and fire-related matters. The Company deploys latest in-built safety technologies and systems across all new projects and business expansions to safeguard its employees against any operational hazards. State-of-the-art fire prevention and mitigation technologies further ensures utmost safety at work. The Company complies with the highest industry standards to safeguard the interest of employees. These standards address General Safety, Occupational Health, Process Safety and Emergency Preparedness.

Human Resource

Our people are our best assets. The Company is in the business of water management and infrastructure, that demand the skilled and experienced human resource. The expertise and dedication of the Companys skilled workforce, create a high-performance work culture and contribute to long-term value creation for customers, shareholders and investors.

The Company is committed to fostering an inclusive and diverse workplace that does not discriminate people on the grounds of caste, creed, colour, sex, religion or nationality. It is also working to develop a conducive workspace that supports and fosters the growth and development of its personnel.

The Company have strong HR department, as on March 31, 2026, Company had 624 permanent employees, in addition to the contract labour engaged by the Company at project sites. We undertake selective and need-based recruitment every year to maintain the size of our workforce, which may otherwise decline as a result of attrition and retirement of employees. Each of projects has different manpower requirements. The Company also appoint project manager for each of our projects for timely execution of the project. Most of the other workers are supervised by the project manager except for certain staff which is monitored by separate departments viz. quality control department and safety department.

Key Financial Ratio on standalone basis:

S. No	Ratio	As at March 31, 2026	As at March 31, 2025	Change	Explanation for Change in the ratio by more than 25% as compared to the previous year
1.	Current Ratio (Current Assets/ Current Liabilities)	6.15	9.40	-34.60%	Due to Increase in Current Liabilities
2.	Debt-Equity Ratio (Total Borrowing/ Shareholders equity	0.074	0.014	431.63%	Due to increase in total debts
3.	Debt service Coverage Ratio (EBITDA over debt service (Interest & Lease Payment+ Principal Repayment)	12.15	48.84	-75.11%	Due to increase in debt service
4.	Return on Equity Ratio (net profit after Tax/ Average Shareholders equity	0.09	0.21	-57.63%	Due to Decrease in PAT
5.	Inventory turnover ratio (Cost of Goods Sold /Average inventory)	3.41	9.53	-64.25%	Due in increase in Average Inventories
6.	Trade receivable turnover ratio (Revenue from operation/ Average trade receivables)	1.63	3.06	-46.91%	Due to Decrease in Revenue from Operations
7.	Trade payables turnover ratio (cost of revenue operations (excluding stock transfer)/ Average trade payables)	30.97	64.86	-52.25%	Due to increase in Average Trade Payables
8.	Net capital turnover ratio [Revenue from operations/ Average Working capital)	0.88	1.60	-44.87%	Due to Decrease in Revenue from Operations
9.	Net profit ratio (Net profit/ Revenue from operations)	0.15	0.19	-24.78%	-
10.	Return on capital employed Ratio/ Return on Investment (PBIT/ Average Capital Employed)	0.13	0.28	-54.22%	Due to Decrease in EBIT
11.	Operating Profit Margin (Profit Before Tax over Revenue from operation)	20.00	26.00	-23.07%	-

Key Financial Ratio on Consolidated basis:

S. No	Ratio	As at March 31, 2026	As at March 31, 2025	Change	Explanation for Change in the ratio by more than 25% as compared to the previous year
1.	Current Ratio (Current Assets/ Current Liabilities)	5.14	8.14	-36.88%	Due to Increase in Current Liabilities
2.	Debt-Equity Ratio (Total Borrowing/ Shareholders equity)	0.146	0.088	65.88%	Due to Increase in Total Debts
3.	Debt service Coverage Ratio (EBITDA over debt service (Interest & Lease Payment+ Principal Repayment)	8.78	26.68	-67.10%	Due to increase in Debt Service
4.	Return on Equity Ratio (net profit after Tax/ Average Shareholders equity)	0.09	0.21	-56.66%	Due to Decrease in PAT
5.	Inventory turnover ratio (Cost of Goods Sold /Average inventory)	3.70	9.69	-61.84%	Due to Increase in Average Inventories
6.	Trade receivable turnover ratio (Revenue from operation/ Average trade receivables)	1.55	2.40	-35.40%	Due to Decrease in Revenue from Operations
7.	Trade payables turnover ratio (Cost of Revenue Operations (excluding stock transfer)/ Average trade payables)	28.39	54.74	-48.13%	Due to Increase in Average Trade Payables
8.	Net capital turnover ratio (Revenue from operations/ Average Working capital)	1.12	1.68	-33.36%	Due to Decrease in Revenue from Operations
9.	Net profit ratio (Net profit/ Revenue from operations)	0.12	0.19	-34.14%	Due to Decrease in PAT
10.	Return on capital employed Ratio/ Return on Investment (PBIT/ Average Capital Employed)	0.13	0.26	-51.84%	Due to Decrease in EBIT
11.	Operating Profit Margin (Profit Before Tax over Revenue from operation)	17.63	26.00	-32.19%	Due to Decrease in Revenue from Operations

Cautionary statement

Statements in this document or discussion relating to future status, events, or circumstances, including but not limited to statements describing the Companys objectives, projections, estimates and expectations, may be forward looking statements within the meaning of applicable laws and regulations. Such statements are subject to numerous risks and uncertainties and are not necessarily predictive of future results. Actual results may differ materially from those expressed or implied in the statements. Crucial factors that could make a difference to the Companys operations include economic conditions affecting demand and supply and price conditions in the market in which the Company operates, changes in government regulations, tax laws and other statutes and other incidental factors.