OF FINANCIAL CONDITIONS AND RESULTS
OF OPERATIONS
You should read the following discussion in conjunction with our restated financial statements attached in the chapter titled "Restated Financial Statements" beginning on page 220 You should also read the section titled
"Risk Factors" on page 24 and the section titled "Forward Looking Statements" on page 22, which discusses a number of factors and contingencies that could affect our financial condition and results of operations. The following discussion relates to us, and, unless otherwise stated or the context requires otherwise, is based on our Restated financial Statements. Our financial statements have been prepared in accordance with Indian GAAP, the Companies Act and the SEBI (ICDR) Regulations and restated as described in the Report of our Auditor dated January 12, 2026 which is included in this RHP under "Financial Statements". The Restated Financial Statement has been prepared on a basis that differs in certain material respects from generally accepted accounting principles in other jurisdictions, including US GAAP and IFRS. Our financial year ends on March 31 of each year, and all references to a particular financial year are to the twelve- month period ended March 31 of that year.
Business Overview
Our Company was incorporated in 1996 and is an integrated manufacturer of Safety-Critical, Forged and Machined Transmission and Driveline components for On-highway vehicles, Off-highway vehicles, EV and Defence applications. Our Companys product portfolio consists of wide range of Axles, Long Spline Shafts, Spindle and other related components that are critical of vehicle performance and safety.
Over the years, our Company has developed strong capabilities in manufacturing safety-critical, high strength and load-bearing components through a combination of forging, precision machining, and stringent quality control processes that are supplied to original equipment manufacturers ("OEMs") and Tier-I suppliers in India and overseas.
Our manufacturing operations are supported by an integrated process covering raw material procurement, forging, heat treatment, machining, gear cutting, drilling, surface hardening, grinding, inspection and packing. These capabilities enable us to manufacture components with defined mechanical properties, dimensional accuracy and consistency, in line with customer specifications.
Since commencement of our commercial operations in 1996, we have progressively scaled our operations and achieved production volumes of 7,023.33 MT per annum of machines in cutting process, 6,268.33 MT per annum of machines in Forging Process and 4,597.13 MT per annum of machines in Machining Process during the Financial Year 2026.
Our operations are engineering-driven and include capabilities such as reverse engineering of components, process design, validation and quality control. We work closely with our customers at various stages of the product lifecycle, including design finalisation, process development and serial production. Our in-house facilities for forging, machining, heat treatment and testing allow us to maintain control over quality parameters and production timelines.
We have established long-term relationships with several customers, including OEMs and Tier-I suppliers, supported by our focus on consistent quality, timely delivery and ability to manufacture products across multiple specifications. Our customer base is diversified across domestic and export markets, reducing dependence on any single customer or vehicle segment.
Financial Snapshot
The table below set forth the details of KPIs of the Company for the financial years ended March 31, 2026, March 31, 2025 and March 31, 2024 are as below:
| Unit | As at and for the Fiscal | |||
| Metric | 2026 | 2025 | 2024 | |
| Financial KPIs | ||||
| Revenue from Operations (1) | (in Lakhs) | 9,464.26 | 8,214.03 | 8,090.85 |
| EBITDA (2) | (in Lakhs) | 1,527.49 | 849.16 | 1,107.91 |
| EBITDA Margin (3) | (%) | 16.14 | 10.34 | 13.69 |
| EBIT (4) | (in Lakhs) | 1,214.61 | 606.23 | 890.58 |
| EBIT Margin (5) | (%) | 12.83 | 7.38 | 10.84 |
| PAT (6) | (in Lakhs) | 710.22 | 234.19 | 468.93 |
| PAT Margin (7) | (%) | 7.50 | 2.85 | 5.80 |
| Debt to Equity Ratio (8) | Times | 1.18 | 1.04 | 1.17 |
| ROE (9) | (%) | 19.49 | 7.39 | 16.63 |
| ROCE (10) | (%) | 20.89 | 13.07 | 20.11 |
| Net Worth (11) | (in Lakhs) | 3,998.27 | 3,288.04 | 3,053.85 |
| Debt to Service Coverage Ratio (12) | Times | 13.43 | 4.46 | 5.86 |
Operational KPIs |
||||
Installed Capacity (in MT) |
||||
| Cutting Process | (in MT) | 8,640.00 | 8,640.00 | 7,200.00 |
| Forging Process | (in MT) | 7,776.00 | 7,776.00 | 7,776.00 |
| Machining Process | (in MT) | 5,861.21 | 4,492.80 | 4,492.80 |
Revenue Split between domestic and exports |
||||
| Domestic Market | (in Lakhs) | 7,707.89 | 7,384.70 | 8,051.39 |
| Export Market | (in Lakhs) | 1,756.38 | 829.33 | 39.46 |
| Domestic Market | (%) | 81.44% | 89.90% | 99.51% |
| Export Market | (%) | 18.56% | 10.10% | 0.49% |
Contribution on revenue from operations of top 1 / 3 / 5 / 10 customers |
||||
| Top 1 Customer | (%) | 12.81% | 14.19% | 12.46% |
| Top 3 Customers | (%) | 35.99% | 37.65% | 35.10% |
| Top 5 Customers | (%) | 50.43% | 50.66% | 54.23% |
| Top 10 Customers | (%) | 67.47% | 72.17% | 81.14% |
Notes:
1. Revenue from Operations means the revenue from operations as appearing in the Restated Financial Statements.
2. EBITDA is calculated as restated profit before tax, plus finance costs, depreciation, and amortisation expenses.
3. EBITDA Margin (%) is calculated as EBITDA divided by revenue from operations.
4. EBIT is calculated as restated profit before tax plus finance costs.
5. EBIT Margin (%) is calculated as EBIT divided by revenue from operations.
6. PAT (Profit after Tax) means profit / (loss) for the year/ period from continuing operations as appearing in the Restated Financial Statements.
7. PAT Margin refers to the percentage margin derived by dividing profit after tax by revenue from operations.
8. Debt to Equity ratio is calculated as Total of long term borrowings and short term borrowings / Total Equity.
9. Return on Equity (%) is calculated as PAT divided by average Total Equity, multiplied by 100. Average Total Equity is the average of opening and closing total equity.
10. Return on Capital Employed is calculated as EBIT as a percentage of Capital Employed, where EBIT is calculated as is calculated as restated profit tax, plus finance costs and Capital Employed is calculated as Total Equity (excluding non-controlling interest) plus Total long-term liabilities, Interest and minus cash & cash equivalent.
11. Net Worth is defined as total equity, which is equity share capital plus general reserve and retained earnings
(not including minority interest/ non-controlling interest).
12. Debt Service Coverage Ratio is earnings for debt service divided by Debt Service. Earnings for debt service is Profit after Taxes plus Noncash operating expenses like depreciation and other amortizations plus interest. Debt Service is interest plus principal repayments.
Explanation for KPI metrics:
Revenue from Operations |
Revenue from Operations is used to track the revenue profile of the business and in turn helps assess the overall financial performance of the Company and size of the business. |
EBITDA |
EBITDA provides information regarding the operational efficiency of the business. |
EBITDA Margin (%) |
EBITDA Margin (%) is an indicator of the operational profitability and financial performance of the business. |
EBIT |
EBIT is a measure of a companys operational profitability that shows how much profit a business generates from its core operations, excluding the costs of debt (interest) and income taxes. |
EBIT Margin (%) |
EBIT margin (%) is a profitability ratio calculated as Earnings Before Interest and Taxes (EBIT) divided by total revenue, expressed as a percentage. |
PAT |
Profit after Tax is an indicator which determine the actual earning available to equity shareholders. |
PAT Margin (%) |
PAT Margin (%) is an indicator of the overall profitability and financial performance of our business. |
Debt to Equity Ratio |
It compares a companys total liabilities (debt) to its total shareholder equity, showing how much debt is used to finance the companys assets relative to the capital invested by its owners. |
ROE |
Return on Equity provides how efficiently Company generates profits from shareholders funds. |
ROCE / Return on Capital Employed (%) |
Return on Capital Employed provides how efficiently the Company generates earnings from the capital employed in the business. |
Net Worth |
Net worth provides a real-time view of an entitys overall financial health by subtracting total liabilities (debt) from total assets (what is owned). |
Debt to Service Coverage Ratio |
The Debt-Service Coverage Ratio (DSCR) measures a borrowers ability to use operating income to pay current debt obligations, including principal and interest |
Installed Capacity |
The maximum production or processing capability of the Companys facilities, as approved and commissioned, under normal operating conditions. |
Revenue split between Domestic and Exports |
The segregation of the Companys total operating revenue into revenue derived from domestic sales and revenue derived from export sales for a specified period. |
Contribution to revenue from operations of top 1 / 3 / 5/ 10 customers |
The portion of the Companys revenue from operations attributable to its top 1, top 3, top 5 and top 10 customers, respectively, for a specified period. |
Note: The above mentioned KPIs are calculated as per Restated Standalone Financial Statements prepared in accordance with the Indian GAAP.
Geographical Revenue Break up
(Amount in Rs. Lakhs)
| Sr. No. | Particulars | For FY 2026 | For FY 2025 | For FY 2024 | |||
| Amount | %* | Amount | %* | Amount | %* | ||
| 1. | Domestic Sales | 7,707.89 | 81.44 | 7,384.70 | 89.90 | 8,051.39 | 99.51 |
| 2. | International Sales | 1,756.37 | 18.56 | 829.33 | 10.10 | 39.46 | 0.49 |
Revenue from Operations |
9,464.26 | 100.00 | 8,214.03 | 100.00 | 8,090.85 | 100.00 | |
SIGNIFICANT/ MATERIAL DEVELOPMENTS SUBSEQUENT TO THE STUB PERIOD
There have been no material events have occurred after the date of last Balance sheet i.e., March 31, 2026.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
For details in respect of "Statement of Significant Accounting Policies", please refer to Note 1 of Restated Financial Statements beginning on page 220.
SIGNIFICANT FACTORS AFFECTING OUR RESULTS OF OPERATIONS
1. General economic and business conditions in the markets in which we operate and in the local, regional, national and international economies;
2. Global economic conditions, geopolitical developments, trade restrictions, and changes in tariffs or customs duties in key export markets may impact demand, logistics costs, and supply chain stability. Any slowdown in international markets or escalation in geopolitical tensions could adversely affect the Companys export performance.
3. Operating margins are affected by capacity utilization levels, production efficiency, labor productivity, energy costs, and overhead absorption. Improved utilization and operational efficiencies contribute positively to profitability, while under-utilization of capacity may adversely impact results.
4. The Companys manufacturing operations are dependent on the availability and pricing of key raw materials such as steel, alloy steel, forgings. Volatility in raw material prices, supply chain disruptions, and changes in import duties may adversely affect operating margins. The Companys ability to pass on cost increases through price revisions, optimize sourcing strategies, and improve operational efficiencies remains a key determinant of profitability.
5. Failure to successfully upgrade our product portfolio, from time to time;
6. Any change in government policies resulting in increases in taxes payable by us;
7. Our ability to retain our key managements persons and other employees;
8. Changes in laws and regulations that apply to the industries in which we operate.
9. Our failure to keep pace with rapid changes in technology;
10. Our ability to grow our business;
11. Our ability to make interest and principal payments on our existing debt obligations and satisfy the other covenants contained in our existing debt agreements; 12. Companys ability to successfully implement its growth strategy and expansion plans; 13. Failure to comply with regulations prescribed by authorities of the jurisdictions in which we operate;
SUMMARY OF RESULT OF OPERATIONS
The following discussion on results of operations should be read in conjunction with the Restated Financial Statements for the financial years ended on March 31, 2026, 2025 and 2024.
(Amount in lakhs)
| Particulars | March 31, 2026 | % of Total Income | March 31, 2025 | % of Total Income | March 31, 2024 | % of Total Income |
| Revenue from Operation | 9464.26 | 98.00% | 8214.03 | 99.53% | 8090.85 | 98.38% |
| Other Income | 193.04 | 2.00% | 38.40 | 0.47% | 132.99 | 1.62% |
Total Income |
9657.31 | 100.00% | 8252.43 | 100.00% | 8223.85 | 100.00% |
Expenditure |
||||||
| Cost of material Consumed | 5451.63 | 56.45% | 4805.89 | 58.24% | 5160.02 | 62.74% |
| Changes in inventories of finished goods and work-in-progress | (759.35) | (7.86)% | (254.22) | (3.08) % | (935.08) | (11.37) % |
| Employee Benefit Expenses | 973.62 | 10.08% | 855.54 | 10.37% | 1054.43 | 12.82% |
| Finance Cost | 262.49 | 2.72% | 286.09 | 3.47% | 254.42 | 3.09% |
| Depreciation and Amortization Expenses | 312.88 | 3.24% | 242.93 | 2.94% | 217.33 | 2.64% |
| Other Expenses | 2463.93 | 25.51% | 1996.06 | 24.19% | 1836.57 | 22.33% |
Total Expenditure |
8705.19 | 90.14% | 7932.29 | 96.12% | 7587.69 | 92.26% |
Profit/(Loss) Before Tax |
952.12 | 9.86% | 320.15 | 3.88% | 636.15 | 7.74% |
Tax Expense |
||||||
| Tax Expense for Current Year | 218.00 | 2.25% | 71.70 | 0.87% | 134.00 | 1.63% |
| Short/(Excess) Provision of Earlier Year | 11.33 | 0.12% | 0.68 | 0.01% | 8.64 | 0.11% |
| Deferred Tax | 12.56 | 0.13% | 13.58 | 0.16% | 24.59 | 0.30% |
| Total Tax expense | 241.89 | 2.50% | 85.95 | 1.04% | 167.23 | 2.03% |
Profit/(loss) after tax |
710.23 | 7.35% | 234.19 | 2.84% | 468.93 | 5.70% |
Revenue from operations:
Revenue from operations mainly consists of revenue from Domestic and Export sale of products.
Other Income:
Other income primarily comprises of Interest income, Export incentives, foreign exchange gains/ losses, Other miscellaneous income and gain on sale of Property, Plant and Equipment.
Total Expenses:
Total expenses consist of operating cost like Cost of material consumed, Change in inventories of finished goods and work in progress, Employee benefits expense, Finance Costs, Depreciation and Amortization Expenses and other expenses.
Cost of Material consumed
Cost of Material consumed expenses primarily comprises of opening stock, Purchases during the year and closing stock.
Change in inventories of finished goods, work in progress and stock in trade
Change in inventories of finished goods and work in progress comprises of opening and closing stock of finished goods, work in progress and stores and spares.
Employee benefits expense:
Employee benefits expense primarily comprises of Salaries and Wages, Contribution to provident and other funds, Staff welfare expenses and Directors Remuneration.
Finance Costs:
Our finance cost includes bank borrowing costs, Other (WCDL) and other borrowings cost.
Depreciation and Amortization Expenses:
Depreciation includes Depreciation on Property, Plant & Equipment and Amortisation of Intangible Assets.
Other Expenses:
Other Expenses consists of Consumption of stores & spares, Job work expenses, Power and fuel, Repairs and Maintenance, Provision for doubtful debts, Bad debts written off, Insurance, rates & Taxes, Freight, Forwarding and clearing charges, Sales commission, travelling expenses, Packing expenses, General expenses, Annual maintenance charge, Exhibition expenses, Legal & Professional Charges, Software charges, Corporate Social Responsibility, Printing & Stationary, Audit fees and other miscellaneous expenses.
FINANCIAL YEAR 2026 COMPARED TO FINANCIAL YEAR 2025
Total Income
Total income for the FY 2026 stood at Rs. 9657.31 Lakhs whereas in FY 2025 the same stood at Rs. 8252.43 Lakhs representing an increase of 17.02%. The factors affecting the revenue are described hereinbelow:
Revenue from Operations
We manufacture a diversified range of Axles, Long Spline Shafts, Spindle and other related components catering to both on-highway and off-highway vehicles. Revenue from operations is derived from sale of products from Domestic and International markets. In FY 2026, Company increased its exports sale in line with its expansion strategy. Company has optimized its revenue mix by focusing on sales with better margins. Company has also focused on better cost efficiency.
The Domestic sales stood at Rs. 7,384.70 Lakhs in FY 2025 which increased to Rs. 7,707.89 Lakhs in FY 2026 resulting in an increase of 4.38% or Rs. 323.19 Lakhs. In FY 2025 export sales of the Company stood at Rs. 829.33 Lakhs, which increased to Rs. 1,756.37 Lakhs in FY 2026 resulting in an increase of 111.78% or Rs. 927.04 Lakhs.
The major portion of the revenue of the company is derived from domestic sales, however the increase in revenue is primarily attributable to increase in export sales as the increase in domestic sale is comparatively lower than the export sales. The Company as part of its growth strategy is expanding its geographical presence leading to increase in export sales by 111.78%.
The bifurcation of revenue from operations is bifurcated hereinbelow:
Product-wise Revenue Bifurcation
(Rs. in Lakhs)
| For FY 2026 | For FY 2025 | ||||
| Sr. No. | Particulars | Amount | %* | Amount | %* |
| 1. | Axle | 6324.64 | 66.83 | 5,276.75 | 64.24 |
| 2. | Shaft | 899.99 | 9.51 | 776.68 | 9.46 |
| 3. | Rough Steel Forging | 644.53 | 6.81 | 264.95 | 3.23 |
| 4. | Spindle | 489.84 | 5.18 | 224.24 | 2.73 |
| 5. | Stub Axle | 194.90 | 2.06 | 333.48 | 4.06 |
| 6. | Knuckle, Case Diff, Stearing Arms | 83.69 | 0.88 | 183.28 | 2.23 |
| 7. | Scrap | 652.45 | 6.89 | 568.09 | 6.92 |
| 8. | Job Work$ | 21.94 | 0.23 | 481.51 | 5.86 |
| 9. | Others# | 152.27 | 1.61 | 105.05 | 1.28 |
Total |
9,464.26 | 100.00 | 8,214.03 | 100.00 | |
*% of Revenue from Operations. $Job work revenue represents processing charges earned by the Company for undertaking forging or machining operations on raw materials or semi-finished goods supplied by customers. Further, Job Work does not represent our core business and it contributes to a minor part of our Revenue from Operations. #Others include Consumables, Semi-Finished Goods, Cut Pieces and Hand Tools & Dies.
Industry-Wise Revenue Breakup
| Sr. No. | For FY 2026 | For FY 2025 | ||
| Particulars | Amount | %* | Amount | %* |
| 1. Non-Automotive Industry (Off-highway Vehicles)(1) | 5,587.42 | 59.04 | 5,553.50 | 67.61 |
| 2. Automotive Industry (On- highway Vehicles) (2) | 3,007.13 | 31.77 | 1,328.92 | 16.18 |
| 3. Scrap(3) | 652.45 | 6.89 | 568.09 | 6.92 |
| 4. Others(4) | 217.26 | 2.30 | 763.52 | 9.29 |
Total |
9,464.26 | 100.00 | 8,214.03 | 100.00 |
| *% of Revenue from Operations | ||||
*% of Revenue from Operations
Notes:
(1)
Non-Automotive Industry (On-Highway) involves Industrial equipment, agricultural (tractors), construction and other off highway applications where design priorities differ from passenger and commercial vehicles. (2) Automotive Industry (Off Highway) involves OEM and Tier 1/Tier 2 suppliers of two wheelers, passenger cars and light, medium and heavy commercial vehicles. (3) Scrap involves residual metal material generated during various stages of the manufacturing process. (4) Others include products such as job work, consumables, semi-finished goods, cut pieces and hand tools & dies, which are supplied for use across the above-mentioned industries. Accordingly, it is not feasible to determine or present the exact proportion attributable to each specific industry.Further, others also include products such as Spindles and Steering Arms supplied to Tier-1/ Tier-2 suppliers of Defence OEMs and Axle Shafts supplied to Tier-1 Supplier of the Electric Forklift OEM. The Company does not directly supply to any Government Entity, Defence OEMs or Electric Forklift OEMs, and its role is limited to being a part of the broader supply chain of the Defence Sector and Industrial Electric Vehicle Segment.
Geography-wise Revenue from operations:
(Rs. in Lakhs)
| For FY 2026 | For FY 2025 | |||
| Sr. No. State | Amount | %* | Amount | %* |
| 1. Punjab | 2,721.84 | 28.76 | 2,648.60 | 32.24 |
| 2. Haryana | 1,595.89 | 16.86 | 1,321.70 | 16.09 |
| 3. Tamil Nadu | 1,398.10 | 14.77 | 1,435.01 | 17.47 |
| 4. Maharashtra | 853.89 | 9.02 | 482.41 | 5.87 |
| 5. Himachal Pradesh | 372.48 | 3.94 | 34.50 | 0.42 |
| 6. Karnataka | 254.54 | 2.69 | 290.88 | 3.54 |
| 7. Madhya Pradesh | 156.86 | 1.66 | 933.66 | 11.37 |
| 8. Delhi | 127.72 | 1.35 | 43.93 | 0.53 |
| 9. Uttar Pradesh | 76.12 | 0.80 | 92.34 | 1.12 |
| 10. Others | 150.46 | 1.58 | 93.18 | 1.26 |
Total |
7,707.90 | 81.43 | 7,384.69 | 89.89 |
| 1. Indonesia | 921.87 | 9.74 | 397.59 | 4.84 |
| 2. USA | 632.35 | 6.68 | 255.16 | 3.11 |
| 3. Others | 202.15 | 2.14 | 176.58 | 2.16 |
Total |
1,756.37 | 18.56 | 829.33 | 10.10 |
Revenue from Operation |
9,464.26 | 100.00 | 8,214.03 | 100.00 |
*% of Revenue from Operations
Other Income:
Other income increased from Rs. 38.40 lakhs in FY 2025 to Rs. 193.04 lakhs in FY 2026. This increase was primarily on account of receipt of proceeds from two keyman insurance policies aggregating Rs. 103.10 lakhs during the period. This income is one-time and non-recurring in nature and directly added to the bottom line with no associated cost impact in FY 2026.
Total Expenses
Total expenses consist of cost like cost of material consumed, change in inventories of finished goods and work in progress, employee benefits expense, finance costs, depreciation and amortization expenses and other expenses. For FY 2026 the total expenses of our company increased to Rs. 8,705.19 lakhs from Rs. 7,932.29 Lakhs in FY 2025. Such increase was due to increase in business operations of the Company.
Cost of Material consumed
In FY 2026 Cost of Material consumed increased to Rs. 5,451.63 Lakhs from Rs. 4,805.89 Lakhs in FY 2025. The cost of material consumed has increased by 13.44% due to increase in operations of the Company.
Change in inventories of finished goods and work in progress
Change in inventories of finished goods and work in progress of our Company has increased from Rs. (254.22) lakhs in FY 2025 to Rs. (759.35) Lakhs in FY 2026 representing an increase of 198.70%.
The closing inventories of finished goods, work in progress and store and spares for the FY 2026 Rs. 3,830.57 Lakhs which increased from Rs. 3,071.22 Lakhs, resulting increase of inventory by Rs. 759.35 lakhs. Inventory level increased by 24.72% in FY 2026 as compared to FY 2025. The Company maintains relatively higher inventory levels to support its OEM customers, who follow a Just-in-Time (JIT) inventory model and require assured availability to meet demand fluctuations. The high inventory level in FY 2026 is primarily to meet the demand from the OEM customers.
Employee benefits expense:
The employee benefit expenses of our Company for FY 2026 increased to Rs. 973.62 lakhs from Rs. 855.54 Lakhs in FY 2025.
The increase of 13.80% was due to (i) Increase in Employees Salary and wages Expenses from Rs. 616.45 lakhs in FY 2025 to Rs. 733.61 lakhs in FY 2026 amounting to an increase of 19.01% (ii) Decrease in Contribution to provident and other funds from Rs. 92.35 lakhs in FY 2025 to Rs. 87.89 lakhs in FY 2026 which amounts to a decrease of 4.82% (iii) Increase in Staff welfare expenses increased from Rs. 14.85 lakhs in FY 2025 to Rs. 26.11 lakhs in FY 2026 amounting to an increase of 75.81% (iv) Decrease in Directors Remuneration from Rs. 131.89 lakhs in FY 2025 to Rs. 126.00 lakhs in FY 2026 which amounts to a decrease of 4.47%.
Finance Costs:
Our Company has incurred Rs. 262.49 Lakhs as finance cost in FY 2026 as compared to Rs. 286.09 Lakhs in FY 2025. The decrease of 8.25% was due to decrease in other finance cost pertaining to working capital demand loan and other borrowing costs.
Depreciation and Amortization Expenses:
Depreciation for FY 2026 increased to Rs. 312.88 Lakhs from Rs. 242.93 Lakhs in FY 2025. The increase in depreciation of 28.79% is primarily due to increase in Amortisation of Intangible Assets.
Other Expenses:
Our Company has incurred Rs. 2,463.93 Lakhs in FY 2026 on other expenses as against Rs. 1,996.06 Lakhs in FY 2025. The increase of 23.44% mainly due to (i) increase in expenses for consumption of stores and spares by 32.27% % from Rs. 240.31 lakhs in FY 2025 to Rs. 317.85 lakhs in FY 2026 (ii) increase in job work expenses by 18.53% from Rs. 398.17 lakhs in FY 2025 to Rs. 471.97 lakhs in FY 2026, (iii) Increase in power and fuel expense by 20.37% % from Rs. 751.96 lakhs in FY 2025 to Rs. 905.10 lakhs in FY 2026 (iv) increase in freight charges by 32.19% from Rs. 128.13 lakhs in FY 2025 to Rs. 169.37 lakhs in FY 2026, (v) increase in forwarding & clearing charges by 103.45% from Rs. 19.21 lakhs in FY 2025 to Rs. 39.08 lakhs in FY
2026 (vi) increase in sales commission by 75.44% from Rs. 36.63 lakhs in FY 2025 to Rs. 64.27 Lakhs in FY 2026, (vii) increase in travelling expense by 47.48% from Rs. 23.39 Lakhs in FY 2025 to Rs. 34.50 Lakhs in FY 2026, (viii) increase in packing expense by 78.68% from Rs. 108.59 Lakhs in FY 2025 to Rs. 194.03 Lakhs in FY 2026, (ix) increase in legal & professional expenses by 96.59% from Rs. 16.78 Lakhs in FY 2025 to Rs. 33.00 Lakhs in FY 2026, increase in audit fees by 100% from Rs. 0.5 lakhs in FY 2025 to Rs. 1.00 lakhs in FY 2026.
Restated Profit before tax:
Net profit before tax (PBT) for the FY 2026 increased to Rs. 952.12 Lakhs from Rs. 320.15 Lakhs in FY 2025. The PBT margin increased to 9.86% in FY 2026 from 3.90% in FY 2025. The increase was primarily due to numerous factors affecting the bottomline of the Company. During FY 26 Company received the proceeds from maturity of its 2 keyman insurance policies which amounted to an increase in PBT by Rs. 103.10 Lakhs compared to FY 2025. During FY 2026 Finance cost decreased by Rs. 23.6 Lakhs. The increase in PBT is directly attributable to the increase in total income by 17.02% in FY 2026 from FY 2025 in comparison to increase in total expenses by 9.74% in FY 2026 from FY 2025.
The decrease in the expenses compared to increase in revenue from operations during FY 2025-26 are directly attributable to the increase in bottomline of the Company.
Restated profit after tax:
As a result of the foregoing factors, our profit after tax for the year increased from net profit of Rs. 234.19 Lakhs in FY 2025 to net profit of Rs. 710.23 lakhs in FY 2026. Consequently, our PAT Margin increased to 7.50%in FY 2026 from 2.85% in FY 2025 due to increase in total income in comparison with the total expenses.
FINANCIAL YEAR 2025 COMPARED TO FINANCIAL YEAR 2024
Total Income:
Total income for the financial year 2024-25 stood at Rs. 8,252.43 Lakhs whereas in Financial Year 2023-24 the same stood at Rs. 8,223.85 Lakhs representing an increase of 0.35%. The factors affecting the revenue are described hereinbelow:
Revenue from Operations
During the financial year 2024-25 the revenue from operation of our Company increased to Rs. 8214.03 Lakhs as against Rs. 8090.85 Lakhs in the Financial Year 2023-24 representing an increase of 1.52%. The revenue from operations for FY 2024-25 and FY 2023-24 consists of sale of Axles, Shafts, Stub Axle, Spindle, Knuckle, Case Diff, Stearing arms, rough steel forging, Job work, Scrap sale etc. Revenue from operations is derived from sale of products from Domestic and International markets. This relatively flat growth masks significant compositional changes in our revenue streams, with a notable strategic shift from domestic to international markets.
The changes in our revenue from operations during FY 2024-25 reflect a business in transition, navigating domestic market challenges while successfully executing an international expansion strategy. The 1.52% overall revenue growth, while modest, masks the significant compositional shift in our business with domestic sales declining by 8.28% and export sales growing by over 2,000%. This transformation represents both challenges and opportunities. The domestic sales decline, driven by cyclical factors, changes in business relationships, and OEM demand moderation, has been partially offset by exceptional export growth achieved through strategic product mix optimization and successful penetration of international markets offering superior margins.
Domestic sales constituted the predominant portion of our revenue base but experienced a decline during FY 2024-25. Domestic sales decreased from Rs. 8,051.39 lakhs in FY 2023-24 to Rs. 7,384.70 lakhs in FY 2024-25, representing a reduction of Rs. 666.69 lakhs or 8.28%. As a proportion of total revenue, domestic sales declined significantly from 99.51% in FY 2023-24 to 89.90% in FY 2024-25, reflecting a strategic and operational shift in our business composition. This decline, while substantial in absolute terms, was partially offset by the exceptional growth in our export business. The decrease was primarily due to change in business arrangements due to which there was change in customer relationships. During FY 2024-25, our Company underwent changes in its directorship and management structure. These organizational transitions resulted in modifications to certain existing business arrangements and customer relationships. The loss of these customers directly impacted our domestic sales volumes.
In FY 2024-25 Companys export sales increased exceptionally by 2001.67% amounting to a surge of Rs. 789.87 lakhs. Companys revenue from operations were Rs. 829.33 lakhs and Rs. 39.46 lakhs from its export sales in FY
2024-25 and 2023-24 respectively. The twenty-fold increase in export revenues within a single financial year is particularly noteworthy and reflects both the scalability of our export operations and the strong acceptance of our products in international markets. During FY 2024-25, our Company strategically optimized its product portfolio for international markets by focusing on products that command higher demand and better pricing in overseas markets. The favorable margin profile of export sales have helped partially offset the impact of domestic sales decline on our overall profitability.
The bifurcation of revenue from operations is bifurcated hereinbelow:
Product-wise Revenue Bifurcation
(Rs. in Lakhs)
| For FY 2025 | For FY 2024 | |||
| Sr. No. Particulars | Amount (in lakhs) | %* | Amount (in lakhs) | %* |
| 1. Axle | 5,276.75 | 64.24 | 5,722.13 | 70.72 |
| 2. Shaft | 776.68 | 9.46 | 668.55 | 8.26 |
| 3. Rough Steel Forging | 264.95 | 3.23 | 546.51 | 6.75 |
| 4. Spindle | 224.24 | 2.73 | 125.15 | 1.55 |
| 5. Stub Axle | 333.48 | 4.06 | 338.86 | 4.19 |
| 6. Knuckle, Case Diff, Stearing Arms | 183.28 | 2.23 | 48.68 | 0.60 |
| 7. Scrap | 568.09 | 6.92 | 424.63 | 5.25 |
| 8. Job Work$ | 481.51 | 5.86 | 45.95 | 0.57 |
| 9. Others# | 105.05 | 1.28 | 170.38 | 2.11 |
Total |
8,214.03 | 100.00 | 8,090.85 | 100.00 |
*% of Revenue from Operations $Job work revenue represents processing charges earned by the Company for undertaking forging or machining operations on raw materials or semi-finished goods supplied by customers. Further, Job Work does not represent our core business and it contributes to a minor part of our Revenue from Operations. #Others include Consumables, Semi-Finished Goods, Cut Pieces and Hand Tools & Dies.
Industry-Wise Revenue Breakup
(Rs. in Lakhs)
| For FY 2025 | For FY 2024 | |||
| Sr. No. Particulars | Amount | %* | Amount | %* |
| 1. Non-Automotive Industry (Off-highway Vehicles)(1) | 5,553.50 | 67.61 | 6,180.40 | 76.39 |
| 2. Automotive Industry (On-highway Vehicles)(2) | 1,328.92 | 16.18 | 1,139.92 | 14.09 |
| 3. Scrap(3) | 568.09 | 6.92 | 424.63 | 5.25 |
| 4. Others(4) | 763.52 | 9.29 | 345.90 | 4.27 |
Total |
8,214.03 | 100.00 | 8,090.85 | 100.00 |
*% of Revenue from Operations
Notes:
(1)
Non-Automotive Industry (On-Highway) involves Industrial equipment, agricultural (tractors), construction and other off highway applications where design priorities differ from passenger and commercial vehicles. (2) Automotive Industry (Off Highway) involves OEM and Tier 1/Tier 2 suppliers of two wheelers, passenger cars and light, medium and heavy commercial vehicles. (3) Scrap involves residual metal material generated during various stages of the manufacturing process.(4)
Others include products such as job work, consumables, semi-finished goods, cut pieces and hand tools & dies, which are supplied for use across the above-mentioned industries. Accordingly, it is not feasible to determine or present the exact proportion attributable to each specific industry.Further, others also include products such as Spindles and Steering Arms supplied to Tier-1/ Tier-2 suppliers of Defence OEMs and Axle Shafts supplied to Tier-1 Supplier of the Electric Forklift OEM. The Company does not directly supply to any Government Entity, Defence OEMs or Electric Forklift OEMs, and its role is limited to being a part of the broader supply chain of the Defence Sector and Industrial Electric Vehicle Segment.
Geography-wise Revenue from operations:
(Rs. in Lakhs)
| For FY 2025 | For FY 2024 | |||
| Sr. No. State | Amount | %* | Amount | %* |
| 1. Punjab | 2,648.60 | 32.24 | 3,008.56 | 37.18 |
| 2. Haryana | 1,321.70 | 16.09 | 1,264.65 | 15.63 |
| 3. Tamil Nadu | 1,435.01 | 17.47 | 1,224.13 | 15.13 |
| 4. Maharashtra | 482.41 | 5.87 | 829.24 | 10.25 |
| 5. Himachal Pradesh | 34.50 | 0.42 | 17.88 | 0.22 |
| 6. Karnataka | 290.88 | 3.54 | 227.15 | 2.81 |
| 7. Madhya Pradesh | 933.66 | 11.37 | 835.96 | 10.33 |
| 8. Delhi | 43.93 | 0.53 | 66.46 | 0.82 |
| 9. Uttar Pradesh | 92.34 | 1.12 | 480.07 | 5.93 |
| 10. Others | 101.66 | 1.24 | 77.25 | 1.22 |
Total |
7,384.69 | 89.89 | 8,051.39 | 99.51 |
| 1. Indonesia | 397.59 | 4.84 | 0.00 | 0.00 |
| 2. USA | 255.16 | 3.11 | 29.13 | 0.36 |
| 3. Others | 176.58 | 2.16 | 10.34 | 0.13 |
Total |
829.33 | 10.10 | 39.46 | 0.49 |
Revenue from Operation |
8,214.03 | 100.00 | 8,090.85 | 100.00 |
*% of Revenue from Operations
Other Income:
During the financial year 2024-25 the other income of our Company reduced to Rs. 38.40 Lakhs as against Rs. 132.99 lakhs in the Financial Year 2023-24 representing a decrease of 71.12% which was primarily due to reduction in gain from sale of Property, Plant and Equipment amount to Rs. 11.53 lakhs during the FY 2025 in comparison with Rs. 125.28 lakhs during the financial year 2024.
Total Expenses
The total expense for the financial year 2024-25 increased to Rs. 7,932.29 Lakhs from Rs.7,587.69 Lakhs in the Financial Year 2023-24 representing an increase of 4.54%. Such increase was due to increase in business operations of the Company.
Cost of material consumed
The Cost of material consumed for the financial year 2024-25 decreased to Rs. 4,805.89 lakhs from Rs. 5,160.02 lakhs in the Financial Year 2023-24 representing a decrease of 6.86%. Such decrease was due to reduction in purchase during the year of the Company. The Company is proactively investing in new technology and machines, resulting in reduction in overall cost of production and increasing the operational efficiency.
Change in inventories of finished goods and work in progress
In FY 2024-25, Changes in inventories of finished goods and work-in-progress of the Company stood at Rs. (254.22) Lakhs resulting an increase of Rs. 680.85 lakhs compared to Rs. (935.08) lakhs in FY 2023-24.
The closing inventories of finished goods, work in progress and store and spares for the financial year 2024-25 was Rs. 3071.21 Lakhs, increased from Rs. 2816.99 Lakhs, resulting increase of inventory by 254.22 lakhs, thus reducing reduction in overall expenses by 254.22 lakhs. Inventory level increased by 9.02% in FY 24-25 as compared to FY 23-24. The Company maintains relatively higher inventory levels to support its OEM customers, who follow a Just-in-Time (JIT) inventory model and require assured availability to meet demand fluctuations. The high inventory level in FY 2024-25 is primarily to meet the immediate demand from the OEM customers.
Employee benefits expense:
Our Company has incurred Rs. 855.54 Lakhs as Employee benefits expense during the financial year 2024-25 as compared to Rs. 1054.43 Lakhs in the financial year 2023-24. The decrease of 18.86% was due to change in (i) Employees Salary and wages Expenses reduced from Rs. 839.53 lakhs to Rs. 616.45 lakhs which amount to a decrease of 26.57% (ii) Contribution to provident and other funds from Rs. 84.58 lakhs in financial year 2023-24 as compared to Rs. 92.35 lakhs in financial year 2024-25 which amounts to an increase of 9.18% (iii) Staff welfare expenses increased from Rs. 7.01 lakhs in financial year 2023-24 as compared to Rs. 14.85 lakhs in financial year 2024-25 which amounting an increase of 111.84% (iv) Directors Remuneration increased from Rs. 123.30 lakhs in financial year 2023-24 as compared to Rs. 131.89 lakhs in financial year 2024-25 which amounts to an increase of 6.97%.
Finance Cost
Our Company has incurred Rs. 286.09 Lakhs as finance cost during the financial year 2024-25 as compared to Rs. 254.42 Lakhs inthe financial year 2023-24. The increase of 12.45% was due to increase in other finance cost pertaining to working capital demand loan.
Depreciation and Amortization Expenses:
Depreciation for the financial year 2024-25 stood at Rs. 242.93 Lakhs as against Rs. 217.33 Lakhs during the financial year 2023-24. The increase in depreciation was around 11.78% which was primarily due to increase in depreciation charged on purchase of Buildings, Plant & Equipment, Furniture & Fixtures, Office Equipment, Computer etc. During FY 2024-25, Company purchased Building, Plant and Equipment and other Tangible Assets for Rs. 271.96 Lakhs which resulted in an increase in depreciation expense.
Other Expenses:
Our Company has incurred Rs. 1,996.06 Lakhs during the Financial Year 2024-25 on other expenses as against Rs. 1,836.57 Lakhs during the financial year 2023-24. There was an increase of 8.68% mainly due (i) increase in job work expenses by 64.07% from Rs. 242.67 lakhs in financial year 2023-24 to Rs. 398.17 lakhs in financial year 2024-25, the increase was primarily due to equipment shutdown and to continue the business operations Company increased the outsourcing of production for job-work, (ii) increase in freight charges by 27.63% from Rs. 100.39 lakhs in financial year 2023-24 to Rs. 128.13 lakhs in financial year 2024.25, (iii) increase in sales commission from 17.06 lakhs in financial year 2023-24 to Rs. 36.63 lakhs in financial year 2024-25 an increase of 114.71% as compared with previous year.
Restated profit before tax:
Net profit before tax (PBT) for the financial year 2024-25 decreased to Rs. 320.15 Lakhs as compared to Rs. 636.15 Lakhs in the financial year 2023-24. The decrease of 49.67% was primarily due to numerous factors affecting the bottomline of the Company. During FY 2023-24 Company received a gain of Rs. 125.28 lakhs on sale of Property, Plant and equipment which amounted to an increase in PBT by Rs. 113.75 Lakhs compared to FY 2024-25. During FY 2024-25 Finance cost and depreciation expenses of the Company increased by Rs. 31.67 Lakhs and Rs. 25.6 Lakhs respectively. During FY 2024-25, change in inventory stood at Rs. (254.22) compared to Rs. (935.08) lakhs in FY 2023-24 resulting in an overall decrease in inventory expenses.
Furthermore, during FY 2024-25 other expenses such as job work expenses, provision for doubtful debts, bad debts written off, freight and forwarding and clearing charges increased by Rs. 155.50 lakhs, Rs. 17.68 lakhs, Rs. 43.19 lakhs, Rs. 27.74 Lakhs and Rs. 19.21 lakhs, respectively compared to FY 2023-24.
The increase in the expenses compared to increase in revenue from operations during FY 2024-25 are directly attributable to the decrease in bottomline of the Company.
Restated profit for the year:
As a result of the foregoing factors, our profit after tax for the year decreased by 51.93% from net profit of Rs. 468.93 Lakhs in in financial year 2023-24 to net profit Rs. 234.19 lakhs in financial year 2024-25. Consequently, our PAT Margin reduced to 2.85%in financial year 2024-25 from 5.80% in financial year 2023-24 due to decrease in revenue more in comparison with the other expenses.
DISCUSSION ON THE STATEMENT OF CASH FLOWS
The following table sets forth certain information relating to our Companys statement of cash flows for the previous three financial years:
(Rs. in Lakhs)
| For the Financial year ended | |||
| Particulars | 31st March 2026 | 31st March 2025 | 31st March 2024 |
| Net cash flows generated from/ (used in) operating activities | 581.04 | 1,017.58 | (366.52) |
| Net cash flows generated from/ (used in) investing activities | (1,618.64) | (563.65) | (317.69) |
| Net cash flows generated from/ (used in) financing activities | 1,034.03 | (433.95) | 676.68 |
Net generated from/ (used in) cash and cash equivalents |
(3.56) | 19.98 | (7.53) |
Operating Expenses:
For the financial year 2025-26, net cash generated from operating activities was Rs. 581.04 lakhs. This comprised of the profit before tax of Rs. 952.12 lakhs, which was primarily adjusted for depreciation and amortization expenses of Rs. 312.88 lakhs, finance cost of Rs. 262.49 lakhs, Provision for gratuity of Rs. 12.59 lakhs, Interest income of Rs. (6.26) lakhs, Gain on sale of property plant and equipment of 9.43 lakhs. The resultant operating profit before working capital changes was Rs. 1,543.25 lakhs, which was primarily adjusted for an increase in inventories, decrease in trade receivables and increase in loans and advances of Rs. (669.25) lakhs, Rs. 327.27 lakhs and Rs. (155.97) lakhs respectively, decrease in trade payables and increase in provisions of Rs. (108.26) lakhs and Rs. 123.09 lakhs respectively, increase in other liabilities and increase in other assets of Rs. 57.31 lakhs and Rs. (307.07) lakhs respectively. Company paid Income Tax of Rs. (223.33) lakhs.
For the financial year 2024-25, net cash generated from operating activities was Rs. 1,017.58 lakhs. This comprised of the profit before tax of Rs. 320.15 lakhs, which was primarily adjusted for depreciation and amortization expenses of Rs. 242.93 lakhs, finance cost of Rs. 286.09 lakhs, Provision for gratuity of Rs. 18.93 lakhs, Provision for doubtful debt of Rs. 17.68 lakhs, Gain on sale of property plant and equipment of (Rs. 11.53) lakhs. The resultant operating profit before working capital changes was Rs. 872.86 lakhs, which was primarily adjusted for an increase in inventories, decrease in trade receivables and decrease in loans and advances of Rs. (318.36) lakhs, Rs. 590.04 lakhs and Rs. 16.73 lakhs respectively, increase in trade payables and decrease in provisions of Rs. 69.76 lakhs and Rs. (134.00) lakhs respectively, increase in other liabilities and decrease in other assets Rs. (29.73) lakhs and Rs. 22.64 lakhs respectively. Company paid Income Tax of Rs. (72.38) lakhs.
For the financial year 2023-24, net cash used in operating activities was Rs. (366.52) lakhs. This comprised of the profit before tax of Rs. 636.15 lakhs, which was primarily adjusted for depreciation and amortization expenses of Rs. 217.33 lakhs, finance cost of Rs. 254.42 lakhs, Provision for gratuity of Rs. 1.81 lakhs, Gain on sale of property plant and equipment of (Rs. 125.28) lakhs. The resultant operating profit before working capital changes was Rs. 979.83 lakhs, which was primarily adjusted for an increase in inventories, decrease in trade receivables and decrease in loans and advances of Rs. (821.86) lakhs, Rs. 121.14 lakhs and Rs. 62.41 lakhs respectively, decrease in trade payables and increase in provisions of Rs. (781.75) lakhs and Rs. 134.00 lakhs respectively, increase in other liabilities and increase in other assets Rs. 105.79 lakhs and Rs. (23.44) lakhs respectively. Company paid Income Tax of Rs. (142.64) lakhs.
Investing Activities:
For the financial year 2025-26 net cash used in investing activities was Rs. 1,618.64 lakhs, which primarily comprised of purchase of property, plant and equipment of Rs. (816.40) lakhs, Proceeds from sale of property plant and equipment of Rs. 21.25 lakhs, increase in Intangible assets under development of Rs. (293.84) lakhs, increase in capital Work in progress of Rs. (285.34) lakhs, interest received of Rs. 6.26 lakhs and Bank balances not considered as cash and cash equivalents Rs. (61.37) lakhs.
For the financial year 2024-25, net cash used in investing activities was Rs. 563.65 lakhs, which primarily comprised of purchase of property, plant and equipment of Rs. (271.96) lakhs, Proceeds from sale of property plant and equipment of Rs. 55.92 lakhs, increase in Intangible assets under development of Rs. (359.74) lakhs, decrease in capital Work in progress of Rs. 12.72 lakhs, interest received of Rs. 1.38 lakhs and Bank balances not considered as cash and cash equivalents Rs. (1.96) lakhs.
For the financial year 2023-24, net cash used in investing activities was Rs. 317.69 lakhs, which primarily comprised of purchase of property, plant and equipment of Rs. (491.95) lakhs, Proceeds from sale of property plant and equipment of Rs. 177.11 lakhs, increase in capital Work in progress of Rs. (6.82) lakhs, interest received of Rs. 4.60 lakhs and Bank balances not considered as cash and cash equivalents Rs. (0.63) lakhs.
Financing Activities:
For the financial year 2025-26 net cash generated from financing activities was Rs. 1,034.03 lakhs, which primarily comprised of proceeds from long term borrowings of Rs. 533.88 lakhs, proceeds from short term borrowings of Rs. 762.64 lakhs and interest paid of Rs. (262.49) lakhs.
For the financial year 2024-25, net cash used in financing activities was Rs. 433.95 lakhs, which primarily comprised of repayment of long-term borrowings of Rs. (52.34) lakhs, repayment of short-term borrowings of Rs. (95.52) lakhs and interest paid of Rs. (286.09) lakhs.
For the financial year 2023-24, net cash generated from financing activities was Rs. 676.68 lakhs, which primarily comprised of proceeds from long term borrowings of Rs. 160.31 lakhs, proceeds from short term borrowings of Rs. 770.80 lakhs and interest paid of Rs. (254.42) lakhs.
FINANCIAL INDEBTEDNESS
As of May 31, 2026, we had total outstanding indebtedness of Rs. 4,727.18 Lakhs, which comprises of Fund based borrowings Rs. 4,759.65 Lakhs and non-fund based borrowings of Rs. 3.48 Lakhs. The following table sets out our indebtedness as of period ended on May 31, 2026.
Particulars |
Sanctioned Limit | Outstanding as on May 31, 2026 |
(A) Fund Based |
||
| Secured | ||
| Term Loans | 1,299.67 | 1,055.41 |
| Working Capital Facilities | 3,500.00 | 3,101.57 |
| Vehicle loan | 54.62 | 21.44 |
| Unsecured | ||
| Loan from Related Party | NA | 581.23 |
Total Fund Based (A) |
4,854.29 | 4,759.65 |
(B) Non-Fund Based |
||
| Secured | ||
| Bank Guarantees | 3.48 | 3.48 |
| Unsecured | ||
| Bank Guarantees | - | - |
Total Non-Fund Based (B) |
3.48 | 3.48 |
Total (A) + (B) |
4,857.77 | 4,727.18 |
CAPITAL EXPENDITURE
Our capital expenditures include expenditures on tangible assets and intangible assets.
The following table sets out our capital expenditures for the financial year ended March 31, 2026, 2025 and 2024:
| For the Financial year ended | |||
| Particulars | 31st March 2026 | 31st March 2025 | 31st March 2024 |
Tangible Assets |
|||
| Land (Free hold) | - | - | - |
| Buildings | 6.73 | 129.39 | 11.24 |
| Plant & Equipment | 764.25 | 114.78 | 399.98 |
| Furnitures & Fixtures | 1.33 | 5.33 | 10.71 |
| Vehicles | 18.42 | - | 46.22 |
| Office Equipment | 17.26 | 17.84 | 22.49 |
| Computer | 8.40 | 4.63 | 1.30 |
Intangible Assets |
189.19 | 102.36 | - |
Total |
1,005.57 | 374.33 | 491.94 |
RELATED PARTY TRANSACTIONS
For further information please refer "Note 38 - Related Party Disclosures" under the Chapter titled "Restated Financial Statements" beginning from page 220.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
In the course of undertaking our business, we are exposed primarily to fluctuations in interest rates, credit risk, liquidity risk and foreign currency risk. Our primary focus is to achieve better predictability of financial markets and seek to minimize potential adverse effects on our financial performance.
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 debt obligations with floating interest rates.
The Companys fixed rate borrowings are carried at amortised cost. They are therefore not subject to interest rate risk, since neither the carrying amount nor the future cash flows will fluctuate because of a change in market interest rates.
Foreign currency risk
Our Company derives a portion of our revenue from exports, primarily denominated in foreign currencies such as the U.S. Dollar and the Euro. A significant portion of our capital equipment purchases may also be denominated in foreign currencies. Consequently, fluctuations in foreign currency exchange rates may affect our revenue, cost of operations, profitability and cash flows.
Credit Risk
Credit risk is the risk that a customer or counterparty to a financial instrument will fail to perform or fail to pay amounts due causing financial loss. Credit risk arises from our exposure to domestic and international customers, trade receivables, cash and cash equivalents, and other financial assets. We assess the creditworthiness of our customers and establish appropriate credit limits. We actively monitor outstanding receivables and undertake collection efforts to minimise credit losses. Our maximum exposure to credit risk is reflected in the carrying amounts of financial assets presented in our financial statements.
Liquidity Risk
Liquidity risk is the risk that the Company will encounter difficulty in meeting its financial obligations as they fall due. We manage liquidity risk through effective working capital management, maintaining adequate cash reserves, committed credit lines and ongoing monitoring of future cash flow requirements.
INFORMATION REQUIRED AS PER ITEM (II)(C)(IV) OF PART A OF SCHEDULE VI TO THE SEBI REGULATIONS
An analysis of reasons for the changes in significant items of income and expenditure is given hereunder:
1. Unusual or infrequent events or transactions
There has not been any unusual trend on account of our business activity. Except as disclosed in this Red Herring Prospectus, there are no unusual or infrequent events or transactions in our Company.
2. Significant economic changes that materially affected or are likely to affect income from continuing operations.
There are no significant economic changes that may materially affect or likely to affect income from continuing operations except as disclosed in this Red Herring Prospectus.
3. Known trends or uncertainties that have had or are expected to have a material adverse impact on sales, revenue or income from continuing operations.
Apart from the risks as disclosed under Section "Risk Factors" beginning on page 24, in our opinion there are noother 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
Other than as described in the sections "Risk Factors", "Our Business" and "Managements Discussion and
Analysis of Financial Condition and Results of Operations" on pages 24, 151 and 266 respectively, to our knowledge, no future relationship between expenditure and income is expected to have a material adverse impact on our operations and finances.
5. Segment Reporting
As we deal in manufacturing of auto components and other related products our business activities fall under a single segment, for details of geographical segment refer to "Segment Reporting" in the chapter titled "Restated Financial Statements" beginning on page 220.
6. Status of any publicly announced New Products or Business Segment
Except as disclosed in the Chapter "Our Business", our Company has not announced any new product or service.
7. Seasonality of business
Our business is not subject to seasonality. For further information, see "Industry Overview" and "Our Business" on pages 124 and 151 respectively.
8. Dependence on single or few customers
For FY 25-26, FY 24-25 and FY 23-24 our top 10 customers contributed to 67.47%, 72.17% and 81.14% of our revenue from operations. For further information, see "Risk Factors" on page 24.
9. Competitive conditions
Competitive conditions are as described under the Chapters "Industry Overview" and "Our Business" beginning on pages 124 and 151 respectively.
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