Grand Foundry Ltd Management Discussions

Industry Overview

Indias telecom sector continues to be one of the key enablers of the countys digital economy. The sector has evolved from a voice-led business to a data-centric infrastructure ecosystem, supported by rising broadband penetration, rapid 5G deployment, increasing enterprise digitisation, cloud adoption, data centre growth, and expanding digital services across urban and rural markets.

The demand for optical fibre infrastructure has increased significantly due to the growing need for high- capacity, low-latency and reliable connectivity. Fibre is now a critical backbone for mobile networks, broadband services, enterprise connectivity, data centres, government digital infrastructure, smart cities, content delivery networks and emerging technologies such as artificial intelligence, Internet of Things, edge computing and 5G/6G-ready networks.

For companies engaged in fibre leasing, the industry environment remains structurally positive. Telecom service providers, internet service providers, enterprises, data centre operators and government agencies increasingly prefer asset-light access to ready fibre routes instead of undertaking full ownership, route development, permissions and maintenance themselves. This creates a strong business case for neutral fibre infrastructure providers that can offer scalable, reliable and cost-efficient fibre networks on lease.

As per TRAIs published telecom subscription data, India continues to maintain a large telecom and broadband user base, with regular monthly reporting indicating the scale and depth of the sector. Government and industry sources also indicate sustained emphasis on optical fibre expansion to support broadband growth, 5G backhaul and rural connectivity.

Outlook and Opportunities

The outlook for the fibre leasing industry remains encouraging. Data consumption in India continues to expand, and telecom networks require deeper fibreisation to improve capacity, coverage, quality of service and network resilience. With mobile operators shifting from coverage-led 5G rollout to densification, backhaul strengthening and network optimisation, fibre infrastructure is expected to remain a core investment area.

Key growth opportunities include:

1. 5G backhaul and network densification

5G networks require denser tower infrastructure, small cells and high-capacity backhaul. Fibre leasing companies can benefit from rising demand for inter-tower connectivity, tower-to-core connectivity and metro fibre routes.

2. Enterprise and data centre connectivity

Cloud computing, digital payments, e-commerce, video streaming, cybersecurity, AI workloads and enterprise digital transformation are increasing the need for secure, high-bandwidth fibre connectivity. Fibre routes connecting business districts, industrial clusters, technology parks, data centres and landing stations are expected to remain commercially attractive.

3. Rural broadband and BharatNet-linked opportunities

The Governments BharatNet and Amended BharatNet Programme aim to extend optical fibre connectivity to Gram Panchayats and underserved areas. The Amended BharatNet Programme provides for optical fibre connectivity to 2.64 lakh Gram Panchayats and connectivity to remaining non-GP villages on demand, with an approved outlay of Rs. 1,39,579 crore. This creates opportunities for fibre deployment, operations, maintenance, last-mile connectivity and leasing partnerships.

4. Fibre-to-the-home and fixed broadband growth

As home broadband, OTT consumption, online education, gaming, work-from-home and smart home usage continue to grow, demand for last-mile and middle-mile fibre infrastructure is expected to increase.

5. Infrastructure sharing and neutral-host models

Telecom operators are increasingly focused on capital efficiency. Leasing fibre from infrastructure providers allows customers to reduce upfront capital expenditure, accelerate rollouts and improve route diversity. This trend supports recurring revenue opportunities for companies with strategically located fibre assets.

Industry analysts have also indicated that Indias telecom sector is expected to continue investing meaningfully in network densification, fibreisation and future-ready digital infrastructure over the coming years.

Government Initiatives

The Government of India has undertaken several policy and infrastructure initiatives to strengthen telecom and broadband connectivity. These initiatives are expected to improve the operating environment for fibre infrastructure companies.

National Broadband Mission 2.0

The Government launched National Broadband Mission 2.0 with the objective of accelerating broadband infrastructure, improving digital inclusion and expanding meaningful connectivity across the country. It is intended to address challenges in broadband access, particularly in rural and difficult areas.

BharatNet and Amended BharatNet Programme

BharatNet is one of the worlds largest rural broadband projects and is aimed at providing broadband connectivity to Gram Panchayats. The Amended BharatNet Programme focuses on improved network architecture, ring topology, IP-MPLS network design and broader rural optical fibre connectivity.

Gati Shakti Sanchar Portal and Right of Way reforms

The Gati Shakti Sanchar Portal was launched to streamline Right of Way approvals for optical fibre cable laying and telecom tower installation. Further, the Telecommunications Act, 2023 and the Telecommunications Right of Way Rules, 2024, effective from January 1, 2025, introduced a more uniform RoW framework to expedite telecom infrastructure deployment. These reforms are expected to reduce delays, improve transparency and support faster execution of fibre projects.

Digital India and rural connectivity initiatives

The Governments broader Digital India framework, public digital infrastructure initiatives, e- governance platforms, smart cities, rural broadband programmes and digital inclusion agenda continue to generate long-term demand for robust telecom infrastructure.

Support for 5G, 6G and advanced telecom ecosystem

Government initiatives around 5G labs, indigenous telecom technology, 6G research and digital infrastructure development are expected to further strengthen demand for high-capacity fibre networks. Budget and policy commentary has continued to highlight BharatNet, Digital Bharat Nidhi, 5G labs and 6G research as part of Indias digital infrastructure roadmap.

Company Strategy for Capitalisation of Growth Opportunities

The Company is positioned to benefit from the continued expansion of Indias digital infrastructure ecosystem. Its strategic focus is to create, acquire, lease, operate and monetise fibre infrastructure in a disciplined and scalable manner.

The Companys growth strategy is built around the following pillars:

1. Expansion of strategic fibre routes

The Company intends to strengthen its fibre network across commercially attractive routes, including telecom-dense corridors, urban clusters, semi-urban growth centres, industrial areas, data centre locations and regions with rising broadband demand. Priority will be given to routes with clear leasing potential, strong customer demand and long-term monetisation visibility.

2. Long-term leasing and recurring revenue model

The Company will continue to focus on fibre leasing arrangements that generate stable and predictable revenue streams. Long-term contracts with telecom operators, internet service providers, enterprises and infrastructure players will help improve revenue visibility and asset utilisation.

3. Partnership-led growth

The Company aims to collaborate with telecom service providers, ISPs, infrastructure companies, government agencies, system integrators and enterprise customers. Partnership-led execution can help reduce market entry barriers, improve project scale and accelerate utilisation of existing and new fibre assets.

4. Capital-efficient network development

The Company will seek to deploy capital prudently by prioritising high-demand routes, sharing infrastructure where feasible, using scalable network architecture and leveraging leasing opportunities instead of speculative build-outs. The objective is to balance growth with return on capital employed.

5. Focus on operations, uptime and service quality

In fibre leasing, network reliability and maintenance are critical differentiators. The Company will focus on route monitoring, preventive maintenance, quick fault restoration, documentation of assets, service- level compliance and customer support to improve customer retention and commercial credibility.

6. Monetisation of government and rural connectivity opportunities

With BharatNet, National Broadband Mission 2.0 and RoW reforms creating a favourable policy environment, the Company will evaluate opportunities in rural broadband, middle-mile connectivity, last-mile partnerships and operations and maintenance services where commercially viable.

7. Enterprise and data-centre-oriented connectivity

The Company will explore opportunities to provide fibre routes and connectivity solutions to enterprise parks, data centres, cloud service providers, fintech companies, content platforms and digital service providers that require reliable, high-capacity and redundant connectivity.

8. Risk-managed growth

The Company recognises risks relating to Right of Way permissions, project execution delays, fibre cuts, pricing pressure, customer concentration, technology changes and regulatory developments. Accordingly, the Company intends to follow a measured growth approach, supported by route due diligence, customer diversification, contractual safeguards, insurance where appropriate and active network monitoring.

Conclusion

The telecom infrastructure sector is expected to remain a key beneficiary of Indias digital

transformation. The continued growth of broadband, 5G, cloud, data centres, digital public infrastructure, enterprise digitisation and rural connectivity will require extensive optical fibre networks. Government initiatives such as BharatNet, National Broadband Mission 2.0, Gati Shakti Sanchar Portal and Right of Way reforms further strengthen the long-term opportunity.

The Company believes that its focus on fibre leasing, capital-efficient expansion, strategic partnerships, network reliability and customer-oriented infrastructure solutions will enable it to capitalise on emerging growth opportunities in the telecom segment. While the sector remains competitive and execution-intensive, the structural demand for fibre infrastructure provides a strong foundation for sustainable growth.

SWOT Analysis

Strengths

The Company operates in a sector that forms the backbone of Indias digital infrastructure. Its presence in the fibre leasing segment provides an opportunity to generate recurring revenue through long-term leasing arrangements with telecom operators, internet service providers, enterprises and other digital infrastructure users.

The Companys key strengths include its ability to develop and monetise fibre infrastructure, serve multiple customer categories, and participate in the growing demand for high-capacity connectivity. Fibre assets, once established on commercially viable routes, can generate long-term value due to repeated leasing opportunities and increasing bandwidth demand.

The Companys infrastructure-led business model also supports scalability, as existing fibre routes can be utilised by multiple customers, subject to technical feasibility and contractual terms. Further, the Companys focus on strategic locations, network reliability, operational maintenance and customer relationships enhances its ability to capitalise on sectoral growth.

Weaknesses

The fibre leasing business is capital-intensive and requires substantial upfront investment in network development, permissions, execution, maintenance and monitoring. Delays in obtaining Right of Way approvals, local permissions or utility clearances may affect project timelines and cost efficiency.

The Company may also face dependence on a limited number of large customers, particularly telecom operators and infrastructure players, which can create customer concentration risk. Pricing pressure may arise due to competition from larger infrastructure providers, telecom-owned fibre networks and alternative connectivity arrangements.

Operational risks such as fibre cuts, network downtime, route disruptions, theft, damage and maintenance challenges may affect service quality and customer satisfaction. In addition, the Companys ability to scale efficiently depends on access to capital, route selection, project execution capability and effective asset utilisation.

Opportunities

The long-term outlook for fibre infrastructure remains positive due to rising data consumption, expansion of 5G networks, fibre-to-the-home growth, data centre development, cloud adoption, enterprise digitisation and increasing demand for low-latency connectivity.

Government initiatives such as BharatNet, National Broadband Mission, Digital India, Gati Shakti Sanchar Portal and Right of Way reforms are expected to improve the telecom infrastructure ecosystem and support faster fibre deployment. These initiatives create opportunities for fibre leasing, network development, operations and maintenance, rural broadband connectivity and public-private partnerships.

The growing requirement for tower fibreisation, small-cell backhaul, enterprise connectivity, smart city infrastructure, data centre interconnectivity and last-mile broadband provides a significant opportunity for the Company. Telecom operators and enterprises increasingly prefer asset-light infrastructure models, which may support higher demand for leased fibre assets.

The Company may also explore strategic partnerships, network sharing, route monetisation, long-term leasing contracts and expansion into high-demand digital corridors to improve revenue visibility and asset productivity.

Threats

The Company operates in a competitive and regulated industry. Competition from established telecom infrastructure companies, telecom operators with captive fibre networks, internet service providers and regional fibre network owners may affect pricing, margins and customer acquisition.

Regulatory changes, delays in implementation of policy reforms, changes in Right of Way charges or local-level execution challenges may adversely affect project economics. Rapid technological developments, though generally supportive of bandwidth growth, may require continuous investment in network upgrades and operational capabilities.

The Company is also exposed to execution risks, including cost overruns, delays in fibre deployment, vendor dependency, damage to underground infrastructure and disruption caused by civic works or third-party activity. Any prolonged network downtime or failure to meet service-level commitments may impact customer relationships and revenue.

Macroeconomic factors such as interest rate movements, inflation in materials and labour costs, funding constraints and delayed customer payments may also affect profitability and cash flows. The Company will need to manage these risks through prudent capital allocation, customer diversification, strong contracts, efficient operations and proactive network monitoring.

Financial and Operational Performance

A. Overview

The financial highlights of the Company for the financial year ended March 31,2026, as compared with the previous financial year, are summarized below:

(Rs. in lakhs)

Particulars	Year Ended 31.03.2026	Year Ended 31.03.2025
Net Sales / Income from operations	1,052.56	-
Other Income	-	2.05
Total Income	1,052.56	2.05
Total Expenditure*	978.18	31.35
Profit before Finance Costs, Depreciation, Tax	74.38	-29.30
Finance costs	56.24	38.75
Depreciation	-	-
Profit before taxation	18.13	-68.06
Less: Tax Expenses	-	-
Net Profit	18.13	-68.06
EPS	0.06	-0.22

*Excluding Depreciation & Amortization and Finance Cost.

The Board of Directors is pleased to report that the Company has achieved profitability during the financial year under review and has shown significant improvement in its financial performance compared to the previous financial year.

B. Review of Operations

During the financial year under review, the Company underwent a strategic transition in its business activities by commencing telecom and allied services sector. In January during the year, the Company revised its business segment with intention to explore opportunities in telecom infrastructure and digital connectivity services.

There was a significant improvement in the operational and financial performance of the Company. The improvement was driven primarily by the change in management and commencement/expansion of business operations under the new management.

During the year, the shareholding and control of the Company underwent a change pursuant to the acquisition of shares from the erstwhile promoters under a Share Purchase Agreement and the Open Offer made in compliance with the applicable provisions of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011.

Post acquisition, the new management initiated and expanded business activities, which resulted in generation of operational revenue during the year. The Company generated revenue from operations amounting to Rs. 1,052.56 Lakhs as against nil revenue from operations in the previous financial year.

The Company reported a Profit Before Tax of Rs. 18.13 Lakhs as compared to a Loss Before Tax of Rs. 68.06 Lakhs in the previous financial year. The improved financial performance was primarily attributable to commencement of business operations, increase in operational income and effective cost management during the year.

The management continues to focus on strengthening the Companys operational capabilities, improving efficiencies and exploring new business opportunities to achieve sustainable growth. Your Directors remain optimistic about the future outlook of the Company and are committed towards enhancing stakeholders value.

C. Financial Ratios

Particular			March 31, 2026	March 31, 2025	% Change	Reason for Changes
a) Current Ratio	Current Assets/Current Liability	Current Assets	1.11	0.00	(1,152.68)	Increase in Current Asset
		Current Liability
b) Debt Equity Ratio	Total Debt/Sharehol ders equity	Total Debt	-1.25	-0.99	-25.70%	Increase in debt
		Shareholder Equity
d) Return on Equity	Net profits after Taxes/ Average Shareholders Equity	Net profits after Taxes	-3.32	12.08	127.52%	Due to positive amount of profit as compared to loss in previous year
		Average Shareholders Equity
e) Inventory Turnover Ratio	COGS/Averag e Inventory	Cost of goods sold(COGS)	21.65	-	1 00.00%	Due to nil inventory in previous year
		Average Inventory
f) Trade Receivable Turnover Ratio	Net Sales/Average Accounts Receivables	Net Sales	84.75	0	100.00%	Increase in sales and trade receivables
		Average Accounts Receivables
g) Trade Payables Turnover Ratio	Net Purchases/Ave rage Trade Payables	Net Purchases	85.89	0.00	100.00%	Increase in purchase & trade payables
		Average Trade Payables
h) Net Capital Turnover Ratio	Net Sales/Sharehol ders Funds	Net Sales	(193.0)	0	100.00%	Due to Nil sales in previous year
		Shareholders Funds
i) Net Profit after Tax Ratio	Net Profit after Tax/ Turnover Ratio	Net Profit After Tax	1.72	0.00	100.00%	Due to Nil sales in previous year
		Turnover
j) Return on Capital Employed (ROCE)	Earning Before Interest and Taxes/Capital Employed	Earning Before Interest and Taxes	13.54	12.08	-12.09%
		Capital Employed

Internal Control Systems and their Adequacy

The Company has established basic internal control systems commensurate with the current scale and nature of its operations, which primarily include fiber leasing activities. These controls are designed to ensure orderly conduct of business, safeguarding of assets, maintenance of proper accounting records, and preparation of reliable financial information.

The Directors have laid down internal financial control policies and procedures, which are being implemented in line with the Companys existing operations. These controls aim to ensure:

• Accuracy and completeness of accounting records

• Timely preparation of financial statements

• Prevention and detection of frauds and errors

• Adherence to applicable policies and procedures

Human Resources and Industrial Relations

The Company maintained cordial industrial relations during the year. The Company recognizes that its employees, though currently limited in number, play an important role in supporting its existing operations.

Given the nascent stage of operations, the Company is in the process of building its human resource base and intends to attract and retain personnel with relevant skill sets appropriate to its proposed business activities. The Company plans to engage professionals and skilled personnel in line with its future operational requirements.

The Companys work processes and its management team have supported the implementation of its current activities, primarily in fiber services. As the Company expands its operations in the telecom sector, it proposes to gradually strengthen its HR processes, systems, and practices to support future growth and sustainability.

Cautionary Statement

Statements in this Management Discussion and Analysis describing the Companys objectives, expectations or predictions may be forward looking within the meaning of applicable laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to your Companys operations include raw material availability and prices, pricing in the Companys principal markets, competitive actions, changes in Government regulations, tax regimes, economic developments in India and in countries in which the Company conducts business and other incidental factors