Gabion Technologies India Ltd Management Discussions

OPERATIONS

You should read the following discussion and analysis of financial condition and results of operations together with our financial statements included in this Draft Red Herring Prospectus. The following discussion relates to our Company and is based on our restated financial statements. Our financial statements have been prepared in accordance with Indian GAAP, the accounting standards and other applicable provisions of the Companies Act.

Note: Statement in the Management Discussion and Analysis Report describing our objectives, outlook, estimates, expectations or prediction may be "Forward looking statement" within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to our operations include, among others, economic conditions affecting demand/supply and price conditions in domestic and overseas market in which we operate, changes in Government Regulations, Tax Laws and other Statutes and incidental factors.

BUSINESS OVERVIEW

Our Company was incorporated on February 18, 2008, by our Promoter, Mr. Madhusudan Sarda and are engaged in the manufacturing, designing, trading and installation of services of Gabions, Rockfall Protection Nettings, and Geosynthetic Materials, tailored to meet the diverse requirements of civil engineering, infrastructure development, and environmental protection projects. There are three verticals to our business as follows:

Manufacturing and supply of mechanically woven Double Twisted Hexagonal Steel Wire Mesh Gabions, Defence Gabions, PP Rope Gabions, Hi-tensile Rockfall Protection Nettings, Rockfall Fence/Barrier Reinforced Geomat, and High Strength Flexible Geogrid Service of Design and Constructing Gabion Structures, Slope Stabilization by Anchor-Mesh system and other types of structures in the fields of Geosynthetics, Geotechnical Engineering, and Ground Improvement Techniques.

Trading of auxiliary products not manufactured by us but required by our target customers, the product portfolio is listed in detail later in the chapter.

Our company is working with the vision to provide products, services and technology to Government entities, contractors, private customers, consultants, and authorities in the fields of Geosynthetics, Geotechnical Engineering, and Ground Improvement Techniques. To this end, we are manufacturing several products of which the primary product is Steel Gabions. We are trading various other products so that our target customers can avail a wide range of products from us. Apart from the supply of products, we are also a works contractor ourselves. So, we construct the structures that our customers require. We have the capability to engineer and design structures in our field. So, we are a technology provider in our field and have the capability of turnkey execution of projects. We undertake construction projects for both government and private sector clients.

Our products, services and technologies are extensively utilized across a wide range of sectors including infrastructure projects such as roads, railways, airports, irrigation and water resources sector, energy, mining, defence, real estate developments of resorts, commercial building complexes, IIT’s for applications such as road and railway embankments formation, protection of roads and railway tracks from landslides, airport runway developments, protection of hydro power projects, river channelization and river front developments, mining and thermal power plant waste disposal, energy pipelines protection, beach protection etc. The solutions we provide are retaining walls, reinforced soil walls and slopes, slope erosion control, vegetation growth, rockfall protection, slope stabilization, flood protection wall, river training, scour protection, land reclamation, ground improvement, and ash pond formation.

We are continuously developing new capabilities exemplified by our knowledge in the design and turnkey execution of Ash Pond Geomembrane lining and leachate and storm water drainage systems in the mining sector. We have been associated with one of our customers, since 2019 when we were awarded the ‘Service order for Development of Gabion wall of 700 mtr length, average height 20-25 mtr on east side of East Cell redmud pond (RMP) including design, vetting and SPCB approval., and the work was successfully completed in 2021. Such Client has another plant in Jharsuguda, Odisha. Here, they generate Ash waste which needs to be disposed-off in large pond like formations. The Ash contains chemicals which need to be prevented from leaching into the ground as they can be hazardous in nature. They awarded us the work of ‘Upgrading Ash Pond 3 Kurebaga’ in 2024. We are currently executing this work which entails profiling and lining of ash ponds with an impervious Geosynthetic membrane,

constructing drainage systems for leachate and storm water, strengthening the dykes of the pond by anchor mesh system and auxiliary works.

We are accredited with IS 16014:2018 (From Bureau of Indian Standards), ISO 14001:2015 (From International Certification & Inspection UK Ltd), ISO 45001:2018 (From International Certification & Inspection UK Ltd) and ISO 9001:2015 (From DNV Business Assurance) and OHSAS 18001:2007 (From RBS Quality Certification Pvt Ltd) for Quality Management System, and IS 16014:2012 Bhutan Standard Bureau.

Since incorporation, our company has executed many projects which include provision of Services and/or supply of goods manufactured by us. Our company has independently completed 76 (Seventy Six) work contracts having an aggregate contract value of Rs.12760.59 lakhs which includes 36 (Thirty Six) projects in road sector, 12 (Twelve) projects in Railway sector, 8 projects (Eight) in Private Commercial sector, 9 (Nine) projects in Energy sector, 3 (Three) projects in Mining sector, 3 (Three) Projects in Airport sector, 3 (Three) projects in Defence sector and 2 (Two) projects in Water Resources sector. As on the date of DRHP, our work order book consists 12843.06 lakhs. For information in respect of our ongoing projects, please refer "Our Works Order Book" in "Business Chapter" on page 108.

We are pre-qualified to bid independently on projects, tendered by departments of Government Authorities and other entities funded by GOI, we have tendered till now is for contract value up to Rs. 2558.79 lakhs. We have gradually increased our execution capabilities in terms of size of projects that we are now bidding for and executing. For instance, we were awarded a Government Project by one of the Public Sector Undertaking (PSU) under the ownership of the Ministry of Power and the Government of India in the month of July 2019 for Slope Protection with the project cost of Rs. 182.18 lakhs. The other projects awarded to us was by one of the division of South Western Railway (SWR), in the month of February, 2023 for Protection of vulnerable cutting between Kadur-Sakharayapatna stations, Kadur-Chikamangalur stations with project cost of Rs. 544.75 lakhs, & the recently in month of March, 2025 by South Western Railway (SWR), for ADEN/SKLR Sub Division:- Rebuilding of side slope and side drain construction at Land slip at Km.40/300-400 and slope protection works on vulnerable cutting at Km 39/835 - 40/450 between BLLT and SKLR stations (Phase II) with project cost of Rs. 947.09 lakhs and recently we have bid in the month of February, 2025 a tender of East Coast Railway (CONST HQ) for Koraput-Jagdalpur Doubling Project for Execution of Slope Protection works with project cost Rs. 2558.76 lakhs.

We are currently operating a manufacturing unit situated at Khasra No. 402/114/6 and 402/114/4, Kite 2, admeasuring 11 bighas, located in village of Puruwala, Paonta Sahib, District Sirmaur, Himachal Pradesh. The manufacturing unit covers an area of 9273 square meters. In addition to our manufacturing facility, we have our registered office situated at 38, S/F, Near MCD Park, Mohammadpur, New Delhi, Delhi, India, 110066 and corporate office situated at Ground Floor W-121-A Greater Kailash 1, Greater Kailash, South Delhi, New Delhi, Delhi, India, 110048 and we have marketing offices across Guwahati, Mumbai and Bangalore. Further, apart from this currently we have 7 project office. These offices contribute significantly to extending our geographical market reach and provide essential customer service, ensuring sale and delivery of our products all-round the year.

We have an in-house team for Geo-technical design and engineering which makes us self-reliant in all aspects of our business including design inputs required by our customers or for the design of our own projects. We have a team of six (6) design engineers who works closely with customers, Authority’s Engineers, Government clients, and industry personnel for vetting to finalize designs of projects and also design innovative products to meet the project specifications.

We have a project team comprising of over Thirty-Two (32) Civil Engineers in our pay-roll to execute our projects to ensure compliance of quality standards laid down by the industry and government agencies & departments and meeting the project time lines. We are an end to end service provider with minimal dependency on third parties. The scope of our service typically includes design, engineering, procurement and construction.

FACTORS CONTRIBUTING TO THE GROWTH OF OUR REVENUE

1. Key products Market Growth - Gabion and Rockfall Nettings have increasingly become mainstream products for the applications of retaining walls and slope protection. More and more projects are now designed with these technological products rather than conventional concrete structures. We have increased our production and improved our marketing to increase our sale of manufactured products.

2. Specialized Construction Growth - Being specialized in design and execution of Gabion structures and Slope Stabilization, we are awarded works in infrastructure projects for these jobs. And Government has also started tendering these specialized execution works on their own. Our eligibility to bid is increasing in terms of size of tenders we are able to qualify in, so our government contract sizes are increasing.

3. Growth in Trading - The market for Geosynthetics is increasing rapidly owing to acceptance as mainstream products. We are able to supply auxiliary products to the customers of our manufactured products. We have the technical capability to identify the technological products properly and help customers and so gain their trust for supply orders.

FINANCIAL KPIs OF THE COMPANY:

(Amount In Lakhs)

Key Performance Indicator	For the year ended March 31, 2025	For the year ended March 31, 2024	For the year ended March 31, 2023
Revenue from Operations (1)	10,036.38	10,476.44	7,875.79
Growth in revenue from operations (%)	-4.20%	33.02%	30.19%
Total Income (2)	10,117.14	10,497.08	7,887.57
EBITDA(3)	1,504.84	1,310.47	638.64
EBITDA Margin (%) (4)	14.87%	12.48%	8.10%
Profit attributable to equity shareholders of holding company (5)	664.01	577.91	341.57
PAT Margin (%) (6)	6.62%	5.52%	4.34%
Net worth (7)	2,206.90	1,542.89	964.99
Return on Net Worth(8)	30.09%	37.46%	35.40%
Return on Capital Employed("RoCE")(%) (9)	19.24%	21.75%	14.41%
Debt- Equity Ratio(10)	2.12	2.36	3.06

1. Revenue from operations represents the revenue from sale of service & product & other operating revenue of our Company as recognized in the Restated financial information.

2. Total income includes revenue from operations and other income.

3. EBITDA means Earnings before interest, taxes, depreciation and amortization expense, which has been arrived at by obtaining the profit for the period/year as adjusted for Minority Interest and adding back Tax expense, interest cost, depreciation, and amortization expense.

4. EBITDA margin is calculated as EBITDA as a percentage of total income.

5. Restated Profit for the year/period represents the restated profits of the Company after deducting all expenses.

6. PAT Margin (%) is calculated as Profit for the year/period as a percentage of Revenue from Operations.

7. "Net-worth" means the aggregate value of the paid-up share capital and all reserves created out of the profits and securities premium account and debit or credit balance of profit and loss account, after deducting the aggregate value of the accumulated losses, deferred expenditure and miscellaneous expenditure not written off, as per the audited balance sheet, but does not include reserves created out of revaluation of assets, write-back of depreciation and amalgamation.

8. Return on net worth is calculated as Net profit after tax as restated (attributable to the owners of the Company) for the year/ period divided by Net worth at the end of respective period/year.

9. Return on capital employed calculated as Earnings before interest and taxes divided by capital employed as at the end of respective period/year. (Capital employed calculated as the aggregate value of Tangible Net worth, total debt and deferred tax liabilities)

10. Debt- equity ratio is calculated by dividing total debt by total equity. Total debt represents long-term and short-term borrowings. Total equity is the sum of share capital and reserves & surplus.

* As Certified on September 26, 2025 by M/s SVJ & Company, Chartered Accountants, FRN: 020356C

FACTORS AFFECTING OUR RESULT OF OPERATIONS

Except as otherwise stated in this Draft Red Herring Prospectus and the Risk Factors given in the Draft Red Herring Prospectus, there are no other factors that could cause actual results to differ materially from the expectations.

Significant Developments after March 31, 2025 that may affect our Future Results of Operations

The Directors confirm that there have been no other events or circumstances since the date of the last financial statements as disclosed in the Draft Red Herring Prospectus which materially or adversely affect or is likely to affect the business or profitability of our Company or the value of our assets, or our ability to pay liabilities within next twelve months.

SIGNIFICANT ACCOUNTING POLICY

BASIS OF ACCOUNTING AND PREPARATION OF FINANCIAL STATEMENTS

The restated summary statement of consolidated assets and liabilities of the Company as at March 31, 2025, March 31, 2024 and March 31, 2023 and the related restated summary statement of consolidated profits and loss and cash flows for the year ended March 31, 2025, March 31, 2024 and March 31, 2023 (herein collectively referred to as ("Restated Summary Statements") have been compiled by the management from the audited consolidated Financial Statements of the Company for the year ended on March 31, 2025, March 31, 2024 and March 31, 2023 approved by the Board of Directors of the Company. Restated Summary Statements have been prepared to comply in all material respects with the provisions of Part I of Chapter III of the Companies Act, 2013 (the "Act") read with Companies (Prospectus and Allotment of Securities) Rules, 2014, Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018 ("ICDR Regulations") issued by SEBI and Guidance note on Reports in Companies Prospectuses (Revised 2019) ("Guidance Note"). Restated Summary Statements have been prepared specifically for inclusion in the offer document to be filed by the Company with the BSE in connection with its proposed SME IPO. The Company’s management has recast the Financial Statements in the form required by Schedule III of the Companies Act, 2013 for the purpose of restated Summary Statements.

The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards specified under Section 133 of the Companies Act, 2013 and the relevant provisions of the Companies Act, 2013 ("the 2013 Act"), as applicable. The financial statements have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

Accounting policies not specifically referred to otherwise are consistent and in consonance with generally accepted accounting principles in India.

All assets and liabilities have been classified as current or non-current as per the Company’s normal operating cycle and other criteria set out in Schedule III to the Companies Act, 2013. Based on the nature of products and the time between the acquisition of assets for processing and their realization in cash and cash equivalents, the Company has determined its operating cycle as twelve months for the purpose of current - non-current classification of assets and liabilities.

The financial statements of the Company and its subsidiary companies have been combined on a line-by-line basis by adding together the book values of like items of assets, liabilities, income and expenses, after fully eliminating intra- group balances and intra-group transactions resulting in unrealized profits or losses as per Accounting Standard 21 - "Consolidated Financial Statements" notified by Companies (Accounting Standards) Rules, 2021. "Minority Interest in the net assets of consolidated subsidiaries is identified and presented in the Consolidated Balance Sheet separately from liabilities and equity of the Company’s shareholders. Minority interest in the net assets of consolidated subsidiaries consists of:

The amount of equity attributable to minority at the date on which investment in a subsidiary is made; and b. The minority share of movements in equity since the date the parent subsidiary relationship came into existence. Minority’s share of net profit for the year of consolidated subsidiaries is identified and adjusted against the Profit After Tax of the Group

USE OF ESTIMATES

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognised in the periods in which the results are known / materialise.

PROPERTY, PLANT & EQUIPMENT AND INTANGIBLE ASSETS

(i) Property, Plant & Equipment

All Property, Plant & Equipment are recorded at cost including taxes (Excluding recoverable in nature), duties, freight and other incidental expenses incurred in relation to their acquisition and bringing the asset to its intended use.

(ii) Intangible Assets

Intangible Assets are stated at acquisition cost, net of accumulated amortization and accumulated impairment losses, if any.

DEPRECIATION / AMORTISATION

"Depreciation on fixed assets is calculated on a Straight-line method using the rates arrived at based on the useful lives estimated by the management, or those prescribed under the Schedule II to the Companies Act, 2013.

Intangible assets including internally developed intangible assets are amortised over the year for which the company expects the benefits to accrue.

Intangible assets are amortized on straight line method basis over 6 years in pursuance of provisions of AS-26.

In case of Nepal subsidiary company, depreciation on fixed assets and Amortisation of intangible assets is calculated on a Straight-line method using the rates arrived at based on the useful lives estimated by the management, as stated below:

Asset Category	Useful Life
Building	20 Years
Plant & Machinery	7 Years
Furniture & Fixtures	4 Years
Office Equipment’s	4 Years
Intangible Assets	5 Years
Vehicle	5 Years

INVENTORIES

Inventories of raw materials, components, stores and spares are valued at lower of cost (net of recoverable taxes) and net realizable value. Cost for the purpose of valuation of such inventories is determined using the first-in, first- out (FIFO) method. Net realizable value is the estimated selling price in the ordinary course of business less the estimated cost of completion and the estimated cost necessary to make the sale.

Finished goods and work-in-progress are valued at lower of cost and net realizable value. The cost of finished goods and work-in-progress includes raw material costs (net of recoverable taxes), direct cost of conversion and proportionate allocation of indirect costs incurred in bringing the inventories to their present location and condition.

Stock-in-trade are valued at lower of cost (net of recoverable taxes) and net realizable value. The provision for inventory obsolescence is assessed regularly based on estimated usage and shelf life of inventory

IMPAIRMENT OF ASSETS

An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. Recoverable amount is the higher of an assets net selling price and its value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of the asset and from its disposal at the end of its useful life. Net selling price is the amount obtainable from sale of the asset in an arms length transaction between knowledgeable, willing parties, less the costs of disposal. An impairment loss is charged to the Statement of Profit and Loss in the year in which an asset is identified as impaired. The impairment loss recognised in prior accounting periods is reversed if there has been a change in the estimate of the recoverable value.

INVESTMENTS

Non-current investments are carried at cost less any other-than-temporary diminution in value, determined on the specific identification basis.

Profit or loss on sale of investments is determined as the difference between the sale price and carrying value of investment, determined individually for each investment. Cost of investments sold is arrived using average method.

Current Investments are carried at cost or fair value whichever is lower. The Company has followed category-wise evaluation of cost vs fair value of investments. Provision for diminution in the value of investments has been recorded wherever there is a decline in fair-value of investments. Profit or loss on sale of investments is determined as the difference between the sale price and carrying value of investment, determined individually for each investment. Cost of investments sold is arrived using average method.

FOREIGN CURRENCY TRANSLATIONS

Income and expense in foreign currencies are converted at exchange rates prevailing on the date of the transaction. Monetary items denominated in foreign currencies at the year-end are re-stated at the year end rates. Non Monetary foreign currency items are carried at cost. Any income or expense on account of exchange difference either on settlement or on translation at the balance sheet date is recognized in Profit & Loss Account in the year in which it arises.

BORROWING COSTS

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalised as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are recognised in Statement of Profit and Loss in the period in which they are incurred.

PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provision involving substantial degree of estimation in measurement is recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognized but are disclosed in the notes. Contingent assets are neither recognized nor disclosed in the financial statements.

REVENUE RECOGNITION

"Revenue from sale of goods is recognised when the goods are dispatched to the customer which coincides with the transfer of risk and rewards in the goods. The sales are recorded at invoice value, net of taxes.

Revenue from services is recognised proportionately by reference to the performance of each act. Revenue is only recognized when it can be reasonably measurable and at the time of rendering of the services it would not be unreasonable to expect ultimate collection.

OTHER INCOME

Interest Income on fixed deposit is recognized on time proportion basis. Other Income is accounted for when right to receive such income is established.

TAXES ON INCOME

Income taxes are accounted for in accordance with Accounting Standard (AS-22) - "Accounting for taxes on income", notified under Companies (Accounting Standards) Rules, 2021. Income tax comprises of both current and deferred tax.

Current tax is measured on the basis of estimated taxable income and tax credits computed in accordance with the provisions of the Income Tax Act, 1961.

Income taxes of the subsidiaries are accounted for in accordance with Accounting Standard (AS-22) - "Accounting for Taxes on Income", notified under the Companies (Accounting Standards) Rules, 2021. Current tax expense of each subsidiary has been recognized as per the income tax laws applicable in the country of the entity.

The tax effect of the timing differences that result between taxable income and accounting income and are capable of reversal in one or more subsequent periods are recorded as a deferred tax asset or deferred tax liability. They are measured using substantially enacted tax rates and tax regulations as of the Balance Sheet date.

Deferred tax assets arising mainly on account of brought forward losses and unabsorbed depreciation under tax laws, are recognized, only if there is virtual certainty of its realization, supported by convincing evidence. Deferred tax assets on account of other timing differences are recognized only to the extent there is a reasonable certainty of its realization.

LEASES

Leases, where the lessor effectively retains substantially all the risks and benefits of ownership of the leased items, are classified as operating leases. Operating lease payments are recognized as an expense in the statement of Profit and Loss on systematic basis over the lease term.

CASH AND BANK BALANCES

Cash and cash equivalents comprises Cash-in-hand, Current Accounts, Fixed Deposits with banks. Cash equivalents are short-term balances (with an original maturity of three months or less from the date of acquisition), highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value. Other Bank Balances are short-term balance (with original maturity is more than three months but less than twelve months).

EARNINGS PER SHARE

Basic earning per share is computed by dividing the profit/ (loss) after tax (including the post tax effect of extraordinary items, if any) by the weighted average number of equity share outstanding during the year. Diluted earning per share is computed by dividing the profit/ (loss) after tax (including the post tax effect of extraordinary items, if any) as adjusted for dividend, interest and other charges to expense or income (net of any attributable taxes) relating to the dilutive potential equity shares, by the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares.

EMPLOYEE BENEFITS

Defined Contribution Plan:

Contributions payable to the recognised provident fund, which is a defined contribution scheme, are charged to the statement of profit and loss.

Defined Benefit Plan:

The Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible employees.

The plan provides for lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount equivalent to 15 days salary payable for each completed year of service without any monetary limit. Vesting occurs upon completion of five years of service. Provision for gratuity has been made in the books as per actuarial valuation done as at the end of the year.

SEGMENT REPORTING

"The accounting policies adopted for segment reporting are in line with the accounting policies of the Company.

Segment revenue, segment expenses, segment assets and segment liabilities have been identified to segments on the basis of their relationship to the operating activities of the segment. Inter-segment revenue is accounted on the basis of transactions which are primarily determined based on market / fair value factors. Revenue and expenses have been identified to segments on the basis of their relationship to the operating activities of the segment.

Revenue, expenses, assets and liabilities which relate to the Company as a whole and are not allocable to segments on reasonable basis have been included under "unallocated revenue / expenses / assets / liabilities".

RESULTS OF OUR OPERATIONS

Based on Consolidated Financial Statement of Profit & Loss as Restated

(Amount Rs. in Lakhs)

Particulars	For the year ended 31st March, 2025 (Rs. in lakhs)	% of Total**	For the year ended 31st March, 2024 (Rs. in lakhs)	% of Total**	For the year ended 31st March, 2023 (Rs. in lakhs)	% of Total**
INCOME
Revenue from Operations	10,036.38	99.20%	10,476.44	99.80%	7,875.79	99.85%
Other Income	80.76	0.80%	20.56	0.20%	11.78	0.15%
Total Revenue (A)	10,117.14	100.00%	10,497.00	100.00%	7,887.57	100.00%
EXPENDITURE
Cost of Material Consumed	3,521.39	34.81%	4,826.05	45.98%	4,580.56	58.07%
Purchase of Stock-in-Trade	1,777.68	17.57%	953.33	9.08%	571.92	7.25%
Direct Expenses	2,082.22	20.58%	2,045.16	19.48%	1,322.66	16.77%
Changes in inventories of work in progress and finished goods & Stock-in-trade	(812.28)	-8.03%	(405.96)	-3.87%	(463.56)	-5.88%
Employee benefits expense	1,284.95	12.70%	1,036.72	9.88%	782.56	9.92%
Finance costs	468.45	4.63%	388.08	3.70%	128.59	1.63%
Depreciation and amortization expense	170.60	1.69%	169.29	1.61%	68.10	0.86%
Other expenses	719.11	7.11%	691.57	6.59%	435.20	5.52%
Total Expenses (B)	9,212.12	91.05%	9,704.24	92.45%	7,426.03	94.15%
Profit/(Loss) before Tax (AB)	905.02	8.95%	792.76	7.55%	461.54	5.85%
Tax Expense/ (benefit)
(a) Current Tax Expense	249.19	2.46%	180.08	1.72%	92.86	1.18%
(b) Deferred Tax	(9.36)	-0.09%	29.42	0.28%	27.19	0.34%
Net tax expense / (benefit)	239.83	2.37%	209.50	2.00%	120.05	1.52%
Profit/(Loss) for the year	665.19	6.57%	583.26	5.56%	341.49	4.33%
Minority interest	1.18	0.01%	5.35	0.05%	(0.08)	0.001%
Profit attributable to equity shareholders of holding company	664.01	6.56%	577.91	5.51%	341.57	4.33%

**Total refers to Total Revenue

COMPONENTS OF OUR PROFIT AND LOSS ACCOUNT

Income

Our total income comprises of revenue from operations and other income.

Revenue from Operations

Our revenue from operations as a percentage of our total income was 99.20%, 99.80%, and 99.85% for the Financial Years ended March 31, 2025, March 31, 2024 and March 31, 2023.

(Rs. In Lakhs)

Particulars	For the year ended 31st March, 2025	For the year ended March 31, 2024	For the year ended March 31, 2023
Sale of Goods	6,674.67	6,894.25	6,318.48
Sale of Services	3,361.71	3,582.19	1,557.31
TOTAL	10,036.38	10,476.44	7,875.79

Other Income

Our Other Income primarily consists of Interest Income on FD, Interest income on loan given, Sundry Balance Written Back and Foreign Exchange Fluctuation etc.

(Rs. In Lakhs)

Particulars	For the year ended 31st March, 2025	For the year ended March 31, 2024	For the year ended March 31, 2023
Interest on Fixed Deposits	16.01	8.96	4.83
Interest on Inter-corporate Loan	5.15	6.90	-
Insurance Claim	1.20	4.29	0.64
Foreign Exchange Difference	0.96	-	1.28
Sundry Balance Written Back	56.82	0.01	4.45
Dividend income	0.62	0.14	0.58
Gain on Fair Value of Investment	-	0.26	-
TOTAL	80.76	20.56	11.78

Expenditure

Our total expenditure primarily consists of Cost of Material Consumed Purchases of Stock-in-Trade, Direct Expenses, Employee benefit expenses, Finance costs, Depreciation & Amortization Expenses and Other Expenses.

Direct Expenses

Our direct expenses comprises of Freight and Forwarding charges, Installation and Job Work Expenses, Power and Fuel, Site Expenses and Repair & Maintenance Expenses.

Particulars	For the year ended March 31, 2025	For the year ended March 31, 2024	For the year ended March 31, 2023
Freight and Forwarding charges	648.41	627.12	558.65
Installation and Job Work Expenses	574.18	620.14	176.99
Power and Fuel	228.27	195.74	162.81
Site Expenses	529.00	511.99	353.63
Repair & Maintenance Expenses	60.98	48.68	47.06
Testing charges	16.72	15.80	12.54
Loading & Unloading charges	9.75	10.78	3.53
Factory Rent Expenses	14.91	14.91	7.45
TOTAL	2,082.22	2,045.16	1,322.66

Employee Benefit Expenses

Our employee benefits expense comprises of Salaries, Wages and Bonus, Directors Remuneration, Contribution to Provident fund & ESIC and Staff Welfare Expenses.

Finance costs

Our Finance cost expenses Interest expenses on borrowings, Loan Processing Charges and Interest on Income Tax and TDS.

Other Expenses

Other expenses primarily include Commission expenses, Rates and Taxes, Rent Expenses Tour & Travelling expense, Business Promotion expenses and Office expenses.

(Rs. In Lakhs)

Particulars	For the year ended March 31, 2025	For the year ended March 31, 2024	For the year ended March 31, 2023
Audit Remuneration	5.27	3.50	3.27
CSR Expenses	10.50	-	-
Commission expenses	78.73	44.63	52.32
Rates and Taxes	87.96	78.78	32.31
Rent Expenses	248.07	328.38	181.80
Insurance expenses	9.56	10.30	7.47
Legal & professional expenses	31.61	22.20	17.85
Tour & Travelling expenses	140.46	112.72	97.84
Fee & Subscription charges	12.97	8.41	6.54
Business Promotion expenses	17.82	15.10	3.84
Conveyance charges	2.40	2.71	-
Miscellaneous Expenses	11.50	21.44	3.09
Office expenses	31.06	17.42	8.31
Postage & Courier charges	7.30	5.04	4.28
Printing & Stationery charges	3.46	6.19	7.85
Telephone & Internet charges	3.90	3.74	2.84
Vehicle Running expense	9.63	4.07	3.71
Loss on Diminution in the value of Investment	2.48	-	1.68
Donation expense	0.11	-	-
Foreign Exchange Fluctuation Loss	-	0.42	-
Software renewal charges	0.12	-	-
Repair & Maintenance Expenses	3.63	2.35	0.10
Transportation Expenses	0.57	4.17	0.10
Total	719.11	691.57	435.20

Provision for Tax

The provision for current taxation is computed in accordance with relevant tax regulation. Deferred tax is recognized on timing differences between the accounting and the taxable income for the year and quantified using the tax rates and laws enacted or subsequently enacted as on balance sheet date. Deferred tax assets are recognized and carried forward to the extent that there is a virtual certainly that sufficient future taxable income will be available against which such deferred tax assets can be realized in future.

Fiscal 2025 compared with fiscal 2024 Revenue from Operations

The revenue from operations for Fiscal 2025 stood at Rs.10,036.38 lakhs as compared to Rs.10,476.44 lakhs in Fiscal 2024, reflecting a decline of 4.20%. This decrease was primarily on account of lower sales in certain regions, particularly Assam. During the year, purchases of stock-in-trade increased; however, the corresponding sales growth did not materialize, resulting in higher closing inventory as compared to the previous year

Other Income

The other income of our company for Fiscal 2025 was Rs. 80.76 Lakhs against Rs. 20.56 Lakhs other income for Fiscal 2024. An increase of 292.80% in other income was primarily due to there are a party whose balance is written back by us for Rs. 56.82 Lakhs and increase in Interest income from FD of Rs. 7.05 Lakh.

Total Income

The total income of our company for Fiscal 2025 was Rs. 10,117.14 Lakhs against Rs. 10,497.00 Lakhs total income for Fiscal 2024. A decrease of 3.62% in total income was primarily due to decrease in revenue from operation of 4.20%.

Expenditure

Cost of Material Consumed

The cost of material consumed by our company for Fiscal 2025 was Rs.3,521.39 lakhs as compared to Rs.4,826.05 lakhs for Fiscal 2024, representing a decrease of 27.03%. The decrease was primarily on account of a reduction in the purchase price of certain raw materials during the year.

Purchases of Stock-in-Trade

The purchases of stock-in-trade for Fiscal 2025 amounted to Rs.1,777.68 lakhs, as compared to Rs.953.33 lakhs for Fiscal 2024, representing an increase of 86.47%. The increase was primarily on account of higher procurement to meet business requirements and support operational needs during the year.

Direct Expenses

The direct expenses for Fiscal 2025 were Rs.2,082.22 lakhs, compared to Rs.2,045.16 lakhs in Fiscal 2024, an increase of 1.81%, mainly due to higher production and expenses of the service division.

Changes in Inventories of Work-in-Progress, Finished Goods, and Stock-in-Trade

The changes in inventories for Fiscal 2025 were Rs. (812.28) Lakhs against Rs. (405.96) Lakhs changes in inventories for Fiscal 2024.

Employee Benefits Expense

The employee benefits expense for Fiscal 2025 was Rs.1,284.95 lakhs, compared to Rs.1,036.72 lakhs in Fiscal 2024, an increase of 23.94%, mainly due to salary hikes and measures to improve employee efficiency.

Finance Costs

The finance costs incurred by our company for Fiscal 2025 were Rs.468.45 lakhs, as compared to Rs.388.08 lakhs for Fiscal 2024, reflecting an increase of 20.71%. The increase was primarily on account of higher working capital funding/overdraft facility and additional finance costs related to construction equipment loans.

Other Expenses

The other expenses incurred by our company for Fiscal 2025 were Rs. 719.11 Lakhs against Rs. 691.57 Lakhs for Fiscal 2024. An increase of 3.98% in other expenses was due to increase in commission expense and travelling expense for the purpose of sales growth.

Profit Before Tax

The profit before tax of our company for Fiscal 2025 was Rs. 905.02 Lakhs against Rs. 792.76 Lakhs for Fiscal 2024. An increase of 14.16% in profit before tax was due to Service business which has high margin compared to manufacturing and trading.

Profit/ (Loss) after Tax

Profit after tax for Fiscal 2025 was Rs. 665.19 Lakhs against a profit after tax of Rs. 583.26 Lakhs in Fiscal 2024. An increase of 14.05% was due to Service business which has high margin compared to manufacturing.

Fiscal 2024 compared with fiscal 2023 Revenue from Operations

The revenue from operations of our company for Fiscal 2024 was Rs. 10,476.44 Lakhs against Rs. 7,875.79 Lakhs revenue from operations for Fiscal 2023. An increase of 33.02% in revenue from operations was due to 130% growth in the Project Execution service business growth from 1557 lakh to 3582 lakhs and 9.5% growth in the Products sale led by our main products Gabions and DT Mesh Netting.

Other Income

The other income of our company for Fiscal 2024 was Rs. 20.56 Lakhs against Rs. 11.78 Lakhs other income for Fiscal 2023. An increase of 74.53% in other income was primarily due to increase in Interest income and Insurance Claim. Interest on Fixed Deposits increased from 4.83 lakh to 8.96 lakh. And there was Interest on Inter-corporate loan of 6.90 lakh in 2024 whereas there was none in 2023.

Total Income

The total income of our company for Fiscal 2024 was Rs. 10,497.00 Lakhs against Rs. 7,887.57 Lakhs total income for Fiscal 2023. An increase of 33.08% in total income was primarily due to 130% growth in the Project Execution service business growth from 1557 lakh to 3582 lac and 9.5% growth in the Products sale led by our main products Gabions and DT Mesh Netting.

Expenditure

Cost of Material Consumed

The cost of material consumed by our company for Fiscal 2024 was Rs. 4,826.05 Lakhs against Rs. 4,580.56 Lakhs cost of material consumed for Fiscal 2023. An increase of 5.36% in cost of material consumed is in line with the increase in manufacturing products sale value increase of 8.5% from 5,612 lakh to 6,092 lakh.

Purchases of Stock-in-Trade

The purchases of stock-in-trade by our company for Fiscal 2024 were Rs. 953.33 Lakhs against Rs. 571.92 Lakhs purchases of stock- in-trade for Fiscal 2023. An increase of 66.69% in purchases of stock-in-trade was due to increase in material consumption in Works Contracts being executed. Service sales increased 130%.

Direct Expenses

The direct expenses incurred by our company for Fiscal 2024 were Rs. 2,045.16 Lakhs against Rs. 1,322.60 Lakhs direct expenses for Fiscal 2023. An increase of 54.62% in direct expenses was due to increase in consumption of inputs for 33% increase in sales.

Changes in Inventories of Work-in-Progress, Finished Goods, and Stock-in-Trade

The changes in inventories for Fiscal 2024 were Rs. (405.96) Lakhs against Rs. (463.56) Lakhs changes in inventories for Fiscal 2023.

Employee Benefits Expense

The employee benefits expense of our company for Fiscal 2024 was Rs. 1,036.72 Lakhs against Rs. 782.56 Lakhs employee benefits expense for Fiscal 2023. An increase of 32.48% in employee benefits expense was due to 130% increase in Service business where the cost of employees as a percentage of total cost is higher than manufacturing business.

Finance Costs

The finance costs incurred by our company for Fiscal 2024 were Rs. 388.08 Lakhs against Rs. 128.59 Lakhs finance costs for Fiscal 2023. An increase of 201.80% in finance costs was due to increase in working capital funding/overdraft facility.

Other Expenses

The other expenses incurred by our company for Fiscal 2024 were Rs. 691.57 Lakhs against Rs. 435.20 Lakhs other expenses for Fiscal 2023. An increase of 58.91% in other expenses was due to increase in rent expenses from 181.80 lakh to 328.38 lakh because of construction machineries rented at project sites for the 130% increase in Services sales and increase in other expense in line with the increase in revenue.

Profit Before Tax

The profit before tax of our company for Fiscal 2024 was Rs. 792.76 Lakhs against Rs. 461.54 Lakhs profit before tax for Fiscal 2023. An increase of 71.76% in profit before tax was due to 33% increase in total revenue and 130% increase in Service business which has high margin compared to manufacturing and trading.

Profit/ (Loss) after Tax

Profit after tax for Fiscal 2024 was Rs. 583.26 Lakhs against a profit after tax of Rs. 341.49 Lakhs in Fiscal 2023. An increase of 70.80% was due to increase in Service business which has high margin compared to manufacturing.

CASH FLOWS

(Amount Rs. in Lakhs)

Particulars	For the year ended March 31,
	2025	2024	2023
Net Cash Flow from/(used in) Operating Activities	(362.56)	(184.73)	(431.37)
Net Cash Flow from/(used in) Investing Activities	(293.95)	(146.45)	(2,143.76)
Net Cash Flow from/(used in) Financing Activities	612.22	339.26	1,976.37

Cash Flows from Operating Activities

1. For the year ended 31st March, 2025, net cash used in operating activities was Rs. 362.56 Lakhs. This comprised the profit before tax of Rs. 905.02 Lakhs, which was primarily adjusted for depreciation and amortisation expenses of Rs. 170.60 Lakhs, interest expenses of Rs. 430.40 Lakhs, gratuity provision of Rs. 16.03 Lakhs, interest income of Rs. 21.16 Lakhs, sundry balance written back of Rs. 56.82 Lakhs, dividend income of Rs. 0.62 Lakhs, and loss on diminution in the value of investment of Rs. 2.48 Lakhs. The resultant operating profit before working capital changes was Rs. 1,445.93 Lakhs, which was primarily adjusted for an increase in inventories of Rs. 926.63 Lakhs, an increase in trade receivables of Rs. 453.64 Lakhs, an increase in loans and advances of Rs. 195.91 Lakhs, an increase in other non-current assets of Rs. 42.01 Lakhs, and an increase in other bank balances of Rs. 22.88 Lakhs. On the liabilities side, there was an increase in trade payables of Rs. 225.05 Lakhs and a decrease in other current liabilities & provisions of Rs. 57.68 Lakhs.

Cash used in operations was Rs. 27.77 Lakhs, which was further reduced by net income tax paid of Rs. 334.79 Lakhs, resulting in a net cash used in operating activities of Rs. 362.56 Lakhs.

2. For the year ended 31st March, 2024, Net cash used in operating activities was Rs. 184.73 Lakhs. This comprised the profit before tax of Rs. 792.76 Lakhs, which was primarily adjusted for depreciation and amortisation expenses of Rs. 169.29 Lakhs, interest expenses of Rs. 353.77 Lakhs, gratuity provision of Rs. 5.96 Lakhs, interest income of Rs. 15.86 Lakhs, sundry balance written back of Rs. 0.14 Lakhs, dividend income of Rs. 0.26 Lakhs, and Reversal of loss on Diminution in the value of Investment of Rs. 0.26 Lakhs. The resultant operating profit before working capital changes was Rs. 1,305.51 Lakhs, which was primarily adjusted for an increase in inventories of Rs. 538.61 Lakhs, an increase in trade receivables of Rs. 820.50 Lakhs, an increase in loans and advances of Rs. 395.18 Lakhs, an increase in other non-current assets of Rs. 76.65 Lakhs, and an increase in other bank balances of Rs. 5.53 Lakhs. On the liabilities side, there was an increase in trade payables of Rs. 66.94 Lakhs and an increase in other current liabilities & provisions of Rs. 548.83 Lakhs.

Cash generated from operations before tax was Rs. 84.81 Lakhs, which was further reduced by net income tax paid of Rs. 269.54 Lakhs, resulting in a net cash used in operating activities of Rs. 184.73 Lakhs.

3. For the year ended 31st March, 2023, Net cash used in operating activities was Rs. 431.37 Lakhs. This comprised the profit before tax of Rs. 461.54 Lakhs, which was primarily adjusted for depreciation and amortisation expenses of Rs. 68.10 Lakhs, interest expenses of Rs. 108.92 Lakhs, gratuity provision of Rs. 4.09 Lakhs, interest income of Rs. 4.83 Lakhs, sundry balance written back of Rs. 4.45 Lakhs, dividend income of Rs. 0.58 Lakhs, and loss on diminution in the value of investment of Rs. 1.68 Lakhs. The resultant operating profit before working capital changes was Rs. 634.47 Lakhs, which was primarily adjusted for an increase in inventories of Rs. 326.06 Lakhs, an increase in trade receivables of Rs. 964.11 Lakhs, an increase in loans and advances of t 262.14 Lakhs, an increase in other noncurrent assets of Rs. 41.80 Lakhs, and an increase in other bank balances of Rs. 42.28 Lakhs. On the liabilities side, there was an increase in trade payables of Rs. 311.06 Lakhs and an increase in other current liabilities & provisions of t 376.42 Lakhs.

Cash used in operations before tax was Rs. 314.44 Lakhs, which was further reduced by net income tax paid of Rs. 116.93 Lakhs, resulting in a net cash flow used in operating activities of Rs. 431.37 Lakhs.

Cash Flows from Investment Activities

1. In FY 2025, net cash used in investing activities was Rs. 293.95 Lakhs, which primarily comprised of cash used for Purchase of property, plant & equipment and intangible assets of Rs. 305.37 Lakhs, Interest Income Received of t 10.80 Lakhs & Dividend Income of Rs. 0.62 Lakhs.

2. In FY 2024, net cash used in investing activities was Rs. 146.45 Lakhs, which primarily comprised of cash used for Purchase of property, plant & equipment and intangible assets of Rs. 304.44 Lakhs, sale of property, plant & equipment and intangible assets of Rs. 152.83 Lakhs, Interest Income Received of Rs. 5.02 Lakhs and Dividend Income of Rs. 0.14 Lakhs.

3. In FY 2023, net cash used in investing activities was Rs. 2,143.76 Lakhs, which primarily comprised of cash used for Purchase of property, plant & equipment and intangible assets of Rs. 2,194.44 Lakhs, sale of property, plant & equipment and intangible assets of Rs. 53.83 Lakhs, Interest Income Received of Rs. 3.22 Lakhs and Dividend Income of Rs. 0.58 Lakhs and Investment in Shares and other securities of Rs. 0.51 lakhs.

Cash Flows from Financing Activities

1. In FY 2025, net cash used in financing activities was Rs. 612.22 Lakhs, which predominantly comprised of proceeds from Borrowings of Rs. 1,303.99 Lakhs, repayment of Borrowings of Rs. 269.55 Lakhs and Finance Cost Paid of Rs. 422.22 Lakhs.

2. In FY 2024, net cash flow from financing activities was Rs. 339.26 Lakhs, which predominantly comprised of Proceeds from Borrowings of Rs. 1,178.00 Lakhs, repayment of Borrowings of Rs. 487.18 Lakhs and Finance Cost Paid of Rs. 351.56 Lakhs.

3. In FY 2023, net cash flow from financing activities was Rs. 1,976.37 Lakhs, which predominantly comprised of Proceeds from Borrowings of Rs. 2,110.29 Lakhs, repayment of Borrowings of Rs. 33.82 Lakhs and payment of finance cost of Rs. 108.92 Lakhs and Minority Interest of Rs. 8.82 Lakhs.

OTHER MATTERS

1. Unusual or infrequent events or transactions

Except COVID-19 or any such kind of pandemic and as described in this Draft Red Herring Prospectus, there have been no other events or transactions to the best of our knowledge which may be described as "unusual" or "infrequent".

2. Significant economic changes that materially affected or are likely to affect income from continuing Operations

Our business has been subject, and we expect it to continue to be subject to significant economic changes arising from the trends identified above in ‘Factors Affecting our Results of Operations’ and the uncertainties described in the section entitled "Risk Factors" beginning on page no. 27 of the Draft Red Herring Prospectus. To our knowledge, except as we have described in the Draft Red Herring Prospectus, there are no known factors which we expect to bring about significant economic changes.

3. Known trends or uncertainties that have/had or are expected to have a material adverse impact on revenue or income from continuing operations

Apart from the risks as disclosed under Chapter titled "Risk Factors" beginning on page no. 27 in this Draft Red Herring Prospectus, in our opinion there are no other known trends or uncertainties that have had or are expected to have a material adverse impact on revenue or income from continuing operations.

4. Future changes in relationship between costs and revenues, in case of events such as future increase in labour or material costs or prices that will cause a material change are known

Our Company’s future costs and revenues will be determined by demand/supply situation and government policies.

5. Extent to which material increases in net sales or revenue are due to increased sales volume, introduction of new products or increased sales prices.

Increases in revenues are by and large linked to increases in volume of business.

6. Total turnover of each major industry segment in which the issuer company operated.

Our company is operating in Infrastructure Industry. Relevant Industry data as available, has been included in the chapter titled "Industry Overview" beginning on page no. 94 of this Draft Red Herring Prospectus.

7. Status of any publicly announced new products or business segment.

Except as disclosed elsewhere in the Draft Red Herring Prospectus, we have not announced any new products or business segments.

8. The extent to which business is seasonal.

Our business and operations may be affected by seasonal factors which may restrict our ability to carry on activities related to our projects and fully utilize our resources. Heavy or sustained rainfalls or other extreme weather conditions such as cyclones could result in delays or disruptions to our operations during the critical periods of our projects and cause severe damages to our premises and equipment.

9. Any significant dependence on a single or few suppliers or customers.

As details provided in the DRHP there is no dependency in the single or few suppliers or customers.

10. Competitive conditions:

We face competition from existing and potential competitors which is common for any business. We have, over a period, developed certain competitors who have been discussed in chapter titles "Business Overview" beginning on page no. 94 of this Draft Red Herring Prospectus.