Hitachi Energy India Ltd Management Discussions

Economic overview India economy

The Indian economy is projected to continue with its growth trajectory, with an estimated growth of 6.50% in FY 2024-25, according to the second advance estimates released by the National Statistical Office (NSO), as compared to 9.20% economic growth in FY 2023-24. Indias economic growth reflects a steady and resilient performance in a dynamic global economic environment. The Indian economy continues to be driven by a revitalised manufacturing base and a thriving services sector, and supported by key reform-based policies of the government.

In spite of challenges like stagnant wages affecting domestic consumption, slowing global demand and climate disruptions, India maintains its status as the fastest growing economy, set to dominate the global economic landscape. With global growth expected to be around 2.70% in 2025 and 2026,

Indias performance underscores its resilience and growing significance in shaping the worlds economic trajectory and establishing its role as a key driver of economic stability.

Economic outlook – growth projections (%)

As per International Monetary Funds (IMF) list of World GDP Rankings 2025, India is currently among the top five largest economies in the world, with a GDP of USD 3.89 trillion (RS 332.50 Lakh Crores) at current prices, having grown at an impressive rate in FY 2023-24. Despite global uncertainties, the Indian economy demonstrated remarkable resilience in 2024, characterised by strong GDP growth, substantial foreign exchange reserves, and record levels of foreign direct investment (FDI) inflows. Additionally, third-largest economy in the world in terms of GDP based on purchasing power parity (PPP) with a GDP size of USD 16.02 trillion (RS 1,369.31 Lakh Crores), as per the data from IMF.

Industry structure and developments Strong growth in electricity demand

Global electricity demand rose by 4.30% in CY 2024 and is forecast to continue to grow at close to 4% out to CY 2027. Rising global electricity demand is primarily fueled by growing expansion of electrification, industrial production, growing electricity consumption by data centers and growth in electric vehicles. Over the next three years, global electricity consumption is forecast to rise by an unprecedented 3,500 TWh, at its fastest pace in years over the Calender Year (CY)

2025-27 period. While the electricity consumption of the advanced economies as a whole remained almost unchanged in CY 2024 compared with CY 2021, these economies are expected to account for 15% of global demand growth over the CY 2025-27 period. Most of the additional demand for electricity over the next few years is projected to come from the emerging economies, which is expected to make up 85% of this growth. More than half of the global electricity demand in CY 2024 came from China. Overall electricity demand in CY 2024 grew 7%, similar to CY 2023. Supported by economic expansion and with the growing ownership of air conditioners, the South-East Asian countries, India and other emerging markets are recording strong demand growth. Electricity demand in China is forecast to increase by 6% on an average annually by 2027.

Indias electricity demand is forecast to grow at an average 6.30% annually over the next three years till 2027, stronger than the 5% average growth rate of demand for electricity recorded during FY 2015 to FY 2024.

Source: Electricity 2025 Report by IEA

India power sector

On the path to becoming a global energy leader

FY 2024-25 was a landmark year for Indias power sector, with significant progress in energy generation, transmission, and distribution. From meeting peak power demand of 250 GW to reducing energy shortages at the national level to 0.10% during FY 2024-25, Indias power sector exhibited resilience and commitment to sustainable growth. The governments efforts to ensure reliable, affordable, and clean energy for all is evident from important strides made in energy conservation.

India is set on the path to becoming a global energy leader with pioneering initiatives such as universal electrification, increasing availability of rural power, and by embracing cutting-edge technologies. India is the third-largest producer and consumer of electricity worldwide. Power demand has increased rapidly in India and is projected to rise further. Indias diversified sources of power generation range from conventional sources

(such as coal, lignite, natural gas, oil and nuclear power) to viable non-conventional sources (such as wind, solar, hydro, agricultural, and domestic waste). Among the G20 nations, India is the only country to have achieved the targets under the Paris Agreement. However, to be able to meet the increasing demand for electricity, there is a need for massive addition in Indias installed generating and transmitting capacity.

During FY 2024-25, Indias total installed electricity generation capacity increased by 4.9% to 1,821 billion units, as per data from the Central Electricity Authority, compared with 1,739 billion units in the previous financial year. With 33.24 GW of new generation capacity added in FY 2024-25, capacity addition also witnessed a strong momentum, taking the total installed capacity to 475 GW. Renewable energy contributed 89% to the new capacity additions, compared with 71% in FY 2023-24. As on March 31, 2025, Indias renewable energy installed capacity reached 220.10 GW, compared to 190.57 as on March 31, 2024. Source: https://www.ibef.org/industry/power-sector-india

India – Peak electricity load amid economic growth

Following a strong 8.30% increase in 2023, electricity demand in India grew 5.80% in 2024 amid strong economic growth. Peak electricity load in India has shown strong growth in recent years, rising from 148 GW in 2014 to 250 GW (+68%) in 2024, led by the rapid expansion of its industry, development of agriculture, enhanced electricity access and increased use of air conditioning and appliances in residential and commercial sectors.

Source: Electricity 2025 Report by IEA

Rising power demand, transmission & distribution

(T&D) network expansion and upgradation, and reduction in energy intensity are some of the growing opportunities in Indias power industry. With the governments focus on enabling 24/7 electricity supply and on transforming the energy mix, the sector is poised to witness significant growth. However, the nation continues to face several key challenges such as fuel supply, timely investments and execution of transmission, intermittency & load-balancing as proportion of renewables increase, counter-party risk posed by distribution companies, monopoly restrictions on open access, and the availability of project finance.

Improvement in power supply position

• Meeting record demand: During FY 2024-25, India catered to a peak power demand of 250 GW.

• Sharp reduction in power shortages: Owing to significant addition in power generation and transmission capacities, energy shortages at the national level reduced to 0.10% in FY 2024-25, as compared with a shortage of 4.20% in FY 2013-14.

• Increase in per capita electricity consumption:

Per capita electricity consumption in India increased to 1,395 kWh in FY 2023-24, indicating an increase of 45.80% or 438 kWh over electricity consumption of 957 kWh recorded in FY 2013-14.

• Universal electrification:With the launch of Pradhan Mantri Sahaj Bijli Har Ghar Yojana Saubhagya in 2017, all states in India reported 100% electrification of all villages by March 31, 2021.

• Improved power availability: There is a drastic improvement in the reliability and reach of electricity services in India between FY 2013-14 and FY 2023-24. In rural areas, the average availability of electricity has drastically increased from 12.50 hours in FY 2013-14 to 22.60 hours in FY 2024-25. On the other hand, urban areas enjoy up to 23.40 hours of power supply in FY 2024-25, as compared to 22.10 hours in FY 2013-14.

Source: Economic Survey, 2024-25

Indias power sector is entering a transformative phase, with a massive investment opportunity of RS 42 Lakh Crores over the next decade. This investment is driven by the need to upgrade aging power infrastructure, meet growing energy demand, and achieve the countrys ambitious renewable energy goals.

Around 85% of this capex directed towards power generation, which will play a pivotal role in Indias energy transition. Power demand in India is projected to accelerate at a 6%+ CAGR, up from the previous estimate of 5%, fueled by new demand drivers such as electric vehicles, data centers, and increased electrification across industries. This surge in demand highlights the critical need for expanded generation capacity, especially with the country moving from a surplus phase to a potential supply gap.

Over the next five years ending in FY 2029-30, India aims to add 250 GW of new power generation capacity, with a focus on renewable energy, battery storage, and other supporting infrastructure. This represents a three-fold increase compared to the previous five years ending in FY 2024-25. Moreover, Indias infrastructure development is set for substantial growth, with investments planned in roads, airports, and logistics, further strengthening the demand for energy.

Indias energy targets

Indias energy targets remain intact as the country marches towards its Net Zero goal, and energy investment gains momentum across verticals.

• The renewable generation sector in India is set to attract close to RS 18.80 Lakh Crores between FY 2024-25 and FY 2029-30.

• The National Electricity Plan outlines an increase in the countrys power transmission capacity by 35% by 2032, with an estimated investment of RS 9.16 Lakh Crores.

Indias data center market value is expected to touch close to USD 6 billion (RS 0.51 Lakh Crores) to USD 7 billion (RS 0.60 Lakh Crores) by 2027, at a growth rate of 12% to 14% CAGR between 2024 and 2027.

• Indias railway modernization is on track, with major advancements in high-speed rail, freight corridors, renewable energy, station infrastructure and safety systems.

• India has become the third-largest metro network in the world, with the government focusing on making it more powerful and advance and laying multiple development projects, reshaping urban travel and furthering connectivity.

India has set an ambitious target of achieving 100 GW nuclear power capacity by 2047 to reduce carbon emissions and meet future energy demands. The governments larger objective of Viksit Bharat ensures energy reliability and reducing fossil fuel dependency.

These expected and committed investments indicate the countrys energy segments growth trajectory for the immediate and upcoming future.

Investment in the energy sector

Growth in power consumption will be in tandem with growth in Indias nominal GDP, which is expected to cross USD 7 trillion (RS 598.33 Lakh Crores) by FY 2030-31 from US$ 3.60 trillion (RS 307.71 Lakh Crores) in FY 2023-24, according to an estimate by S&Ps Global Market Intelligence. Companies in the Indian power sector ecosystem have witnessed robust revenue growth and growing return on equity in the past few years, driven by a clean-up of stressed power assets, higher capacity utilisation and multi-decadal infrastructure policies aimed at doubling

Indias installed capacity by 2030. Adequate financing of power projects led by renewable energy will be instrumental in achieving the near-doubling of installed capacity in India by 2030.

Strengthening transmission and distribution

In the supply of power to consumers, the transmission system plays a key role, acting as the vital link between power-generating stations and the distribution system.

Indias major power load centers are in the northern, western and southern regions. The skewed resource distribution makes the robust transmission system an imperative. This includes the establishment of inter-regional corridors to seamlessly transfer power from surplus regions to the areas that are deficient in power generation to enable consumers across the country to gain access to power. The power sectors transformation is driven by the nations energy goals of achieving energy independence by 2047 and net-zero emissions by 2070.

With an inter-regional transmission capacity of 1,12,250 MW, the National Grid ensures reliable power transmission. Transmission lines spanning 4,64,286 ckm and a transformation capacity of 11,48,167 MVA underscore Indias prowess. Fueling this momentum, plans envision adding 17,500 ckm of transmission lines and 80,000 MVA transformation capacity annually over the next three years.

The power transmission sector in India is on the cusp of a massive expansion. It has transitioned into a congestion-free, well-integrated and interconnected network, upon being consolidated into one of the worlds largest synchronous grids. An estimated investment of RS 10 Lakh Crores is required to double the power capacity to 900 GW by 2032. The transmission sector is being continuously strengthened and transformed with the addition of transmission lines and inter-regional capacity to expand the physical infrastructure of the grid. The earlier strategic initiative of "One Nation One Grid One Frequency" seamlessly connected regional grids and enabled enhanced power availability and transfer across the nation. The Governments visionary Transmission System for Integration of over 500 GW Renewable Energy Capacity by 2030 identifies potential renewable energy sites, aligning with sustainable goals. The Revamped Distribution Sector Scheme further solidifies reliable power supply, with a 36.74 billion (RS 3.14 Lakh Crores) allocation and USD 11.81 billion (RS 1.01 Lakh Crores) support from the Central Government.

Source: https://indiainvestmentgrid.gov.in/sectors/ transmission-and-distribution The expansion of transmission and distribution networks, alongside renewable generation, will ensure that Indias power infrastructure can meet future consumption needs efficiently. The countrys power sector is benefiting from improved asset quality and supportive policy reforms, reducing risks and enhancing across projects.

Addition in Indias transmission capacity

Source	Addition in transmission lines (ckm)	Addition in transformation capacity (MVA)
FY 2014-15	22,101	65,554
FY 2015-16	28,114	62,849
FY 2016-17	26,300	81,816
FY 2017-18	23,119	86,193
FY 2018-19	22,437	72,705
FY 2019-20	11,664	68,230
FY 2020-21	16,750	57,575
FY 2021-22	14,895	78,982
FY 2022-23	14,625	75,902
FY 2023-24	14,203	70,728
FY 2024-25	8,830	86,433

Opportunities and threats

Indias renewable energy sector – an overview

The renewable energy sector in India is growing rapidly and presents an opportunity for strong financial returns. India has a golden opportunity to shape its energy mix. Social and economic growth are at the top of the governments agenda, and new energy sources to serve this demand are increasingly coming from renewable energy, with a number of factors having contributed to this.

Renewable energy contributes a significant portion of the overall power mix, as Indias total electricity generation capacity touches 475 GW. As on March 31, 2025, the nations total renewable energy installed capacity stood at 220.10 GW, a rise of 15.50% from 190.57 GW in the previous t designs, fiscal year. Renewable energy now constitutes about 46.30% of Indias total installed capacity, highlighting a growing dependence on cleaner, non-fossil fuel-based energy sources.

Source: Economic Survey, FY 2024-25

About 220.10 GW of renewable energy capacity was installed till March 31, 2025, crossing a key milestone of 200 GW. This includes 105.65 GW of solar power, 50.04 GW of wind power, 11.58 GW of bioenergy, and 5.10 GW of small hydro power, demonstrating Indias strong commitment to clean energy.

Source: https://mnre.gov.in/en/physical-progress/

The government policy has been supportive and a wider set of actions incentives, infrastructure and investment promotions were taken up. Technology development, larger-scale projects and the learning effecthaveallowedtheuseof renewable energy attractive to power utilities that are contracting new long-term capacity.

Particulars	FY	FY	FY	FY	FY
	2020-21	2021-22	2022-23	2023-24	2024-25
Fossil	61.40	59.10	57.00	55.00	51.96
Non-Fossil	38.60	40.90	43.00	45.00	48.04

The renewable energy sector in India is growing rapidly and presents an opportunity for strong

India has a golden opportunity to shape its energy mix.

Contribution to renewable energy sources

A variety of renewable energy resources contribute to this impressive figure:

1. Solar power leads the way with 105.65 GW, playing a crucial role in Indias efforts to harness its abundant sunlight.

2. Wind power follows closely with 50.03 GW, driven by the vast potential of the coastal and inland wind corridors across the country.

3. Hydroelectric power is another key contributor, with large hydro projects generating 47.73 GW and small hydro power adding 5.10 GW, offering a reliable and sustainable source of energy from Indias rivers and water systems.

4. Biopower, including biomass and biogas energy, adds another 11.58 GW to the renewable energy mix. These bioenergy projects are vital for utilizing agricultural waste and other organic materials to generate power, further diversifying Indias clean energy sources.

Together, these renewable resources are helping the country reduce its dependence on traditional fossil fuels while driving progress towards a more sustainable and resilient energy future.

This milestone reflects the result of years of dedicated efforts to harness Indias natural resources. From sprawling solar parks to wind farms and hydroelectric projects, the country has steadily built a diverse renewable energy base. These initiatives have not only reduced reliance on fossil fuels but also strengthened the nations energy security. When factoring in the 8.18 GW of nuclear capacity, the total non-fossil fuel-based power now accounts for almost half of the countrys installed electricity generation capacity, signaling a strong move toward clean energy leadership on the global stage.

Source: https://pib.gov.in/PressReleaseIframePage. aspx?PRID=2073038

Government policies and initiatives

The Government has identified the power sector as a key sector of focus to promote sustained industrial growth. Some initiatives by the Government to boost the Indian power sector are as below:

The Government implemented multiple initiatives aimed at ensuring uninterrupted power supply to every household. Under the Deen Dayal Upadhyaya Gram Jyoti Yojana (DDUGJY), Integrated Power Development Scheme (IPDS) introduced in 2014, and the Pradhan Mantri Sahaj Bijli Har Ghar Yojana (SAUBHAGYA), introduced in 2017, about RS 1.85 Lakh Crores has been invested to boost distribution infrastructure across various states. Consequently, 18,374 villages have been electrified under DDUGJY, and 2.90 Crores households have gained access to electricity through SAUBHAGYA.

Since July 2021, the government is implementing the Revamped Distribution Sector Scheme to enhance the quality and reliability of the power supply for consumers. This initiative aims to create a financially sustainable and efficient distribution sector. With a total outlay of RS 3.00 Lakh Crores and gross budgetary support of RS 97,631 Crores allocated for the period from FY 2021-22 to FY 2025-26, projects worth RS 2.80 Lakh Crores have been approved to develop distribution infrastructure and implement smart metering solutions.

The Government has approved new Inter State Transmission System (ISTS) schemes to evacuate 9 GW of RE power from Rajasthan and Karnataka.

These schemes will be implemented through

Tariff Based Competitive Bidding (TBCB) mode. These schemes are part of the 500 GW renewable energy capacity by 2030, out of which 200 GW has already been connected.

The Union Cabinet has sanctioned the PM-Surya Ghar: Muft Bijli Yojana. This initiative, with a total budget of RS 75,021 Crores aims to install rooftop solar systems and offer complimentary electricity of up to 300 units per month to one crore households.

In the Union Budget FY 2024-25, the governments power sector initiatives have been allocated funds that are 50% higher. Increased funds have been allocated to green hydrogen, solar power, and green-energy corridors in line with the renewable energy target for 2030.

In the Union Budget FY 2022-23, the government allocated RS 7,327 Crores for the solar power sector, including grid, off-grid, and PM-KUSUM projects.

In the Union Budget FY 2022-23, the government announced the issuance of sovereign green bonds, as well as conferring infrastructure status to energy storage systems, including grid-scale battery systems.

The Green Energy Corridor projects have been initiated to facilitate renewable power evacuation and reshaping the grid for future requirements.

Source: https://www.ibef.org/industry/power-sector-india

Revision of SHAKTI policy

The Government of India is reviewing the coal allocation policy to encourage private sector participation. The revised policy proposes two simplified windows. Window-I permits allocation of coal at “Notified Price” to Central Generating Companies and State Governments. Window-II allows allocation to all generating companies (Central, State, or Private) at a premium over the “Notified Price”, irrespective of ownership or nature of PPAs. The new policy aims to support the development of an additional 80 GW of thermal capacity.

Union budget 2025-26: Initiatives for the power sector

The government is working towards incentivizing electricity distribution reforms and enhancing intrastate transmission capacity by states, which will lead to an improvement in the financial health and capacity of electricity companies.

Below are some other key initiatives proposed by the government towards Indias power sector:

The government proposed setting up a Nuclear Energy Mission for Viksit Bharat, aimed towards research and development of small modular reactors (SMR) with a RS 20,000 Crores outlay, positioning nuclear energy as a key pillar in

Indias energy mix.

• The basic customs duty on solar cells has been revised from 25% to 20%, and that of solar modules from 40% to 20%. It has imposed an agriculture and infrastructure cess on solar cells and solar modules at 7.50% and 20%, respectively.

The government has allocated RS 20,000 Crores towards Pradhan Mantri Surya Ghar Muft Bijli

Yojana to boost Indias solar rooftop sector, solarise one Crore households by providing free electricity up to 300 units per month.

The government allocated RS 2,600 Crores towards the Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan Scheme to push demand for solar components and solarized pumps and to ensure energy security for farmers.

The government announced support for clean technology manufacturing with an aim to enhance domestic value addition and strengthen the ecosystem for producing solar photovoltaic cells, electric vehicle batteries, motors, electrolyzers, wind turbines, high voltage transmission equipment and grid scale batteries.

The government allocated a sum of RS 600 Crores towards the National Green Hydrogen Mission to drive self-sufficiency through clean energy. With this, it aims to serve as a model for global transition towards sustainable energy solutions.

• A sum of RS 600 Crores has been allocated towards the Green Energy Corridor for the expansion of inter-state transmission infrastructure.

• A total of RS 16,021 Crores has been allocated towards the Revamped Distribution Sector Scheme to improve the quality of power supply by eliminating the gap between the average cost of supply and average revenue realized.

Outlook

Outlook for Indias power sector

Indias growing demand for electricity, coupled with its focus on clean energy, presents a bright outlook for the sector. As power consumption continues to rise, especially with Indias per capita electricity usage still well below the global average, the sector is set for sustained growth and robust returns for investors over the next decade.

Indias electricity sector is witnessing a major transformation in the current decade of

CY 2020-29 with respect to demand growth, energy mix and market operations. India wants to ensure that everyone has reliable access to sufficient electricity at all times, while also accelerating the clean energy transition by lowering its reliance on dirty fossil fuels and moving towards more environmentally friendly, renewable sources of energy. Future investments willbenefitfrom strong demand fundamentals, policy support and increasing government focus on infrastructure.

The Government of India is preparing a rent a roof policy for supporting its target of generating 40 GW of installed capacity through solar rooftop projects by 2026, and further to generate 100 GW by 2030. It also plans to set up 21 new nuclear power reactors with a total installed capacity of 15,700 MW by 2031. The Central Electricity Authority (CEA) estimates Indias power requirement to grow to reach 817 GW by 2030. Also, by CY 2029-30, CEA estimates that the share of renewable energy generation would increase from

18% to 44%, while that of thermal energy is expected to reduce from 78% to 52%.

Source: https://www.ibef.org/industry/power-sector-india

Company overview

Hitachi Energy India Limited (referred to as “the Company”) is a part of Hitachi Energy Ltd., a global technology leader that is advancing a sustainable energy future for all.

Headquartered in Zurich, Switzerland, Hitachi Energy Ltd. has a proven track record and unparalleled installed base in more than 140 countries, serving customers in utility, industry, transportation, data centers and infrastructure sectors. Its innovative technologies and services include the integration of more than 150 gigawatts of HVDC links into the power system. Together with its stakeholders across sectors and geographies, it enables digital transformation to accelerate the energy transition towards a carbon-neutral future. It has a presence in 60 countries, employs 50,000 people and generates business volumes of around USD 16 billion (RS 1.37 Lakh Crores)

Your Company powers 9 out of 17 HVDC links in India, and its transformers power 1 out of 3 Indian railways locomotives. Furthermore, the Companys technology connects over 60 GW of renewable energy and 80% of metros run on its solutions. The Company has 19 manufacturing facilities across 8 locations in India. With an employee strength of 2,481, it has 12 sales offices and 7 sales touchpoints. It offers innovative solutions and services in the utility, industry and infrastructure sectors, powering digital transformation to fast-forward the nations energy transition to a carbon-neutral future. It helps make Indias energy value chain more efficient and make electricity more accessible to all.

The Company operates through four business units Grid Automation, Grid Integration, Transformers and High-Voltage Products, that offer a variety of software, systems and services for energy networks. The solutions ensure a quality power supply to the customers for operations in the field of transmission networks, utilities, transport networks, renewable energy, data centers, industries and many other enterprises.

Hitachi Energy India Limited operates on a sustainable business model that supports carbon-neutral and Net Zero operations of our clients sites by implementing modern technologies thus saving energy.

With a vision to provide the customers with solutions, products and services, the Company focuses on profitable operations by continuously upgrading the existing products and introducing new products in the market to meet the demands of customers.

The Company continues leveraging ‘Service, Export and Digital for growth, while also strengthening its capabilities for high-growth segments that will see your Company benefits as it moves into the future.

Adding a new Business Unit

Hitachi Energy Ltd., the parent company, introduced its service business unit from April 1, 2025, in order to intensify lifecycle engagement with its partners. The unit will provide services to various sectors throughout the asset lifecycle - from installation to sustainable end-of-life solutions. This is aimed at enhancing customer experience with a strengthened and future-focused service system globally. From FY 2025-26, the Service business unit will be added to Hitachi Energy India Limiteds businesses too. As part of this, all in-scope service teams have been integrated into this business unit. All the business units will work closely with this unit to maximize its reach and to shape an end-to-end service opportunity.

Segment-wise or product-wise performance

Core segments

With its business units of Grid Automation, Grid Integration, High-Voltage Products and Transformers, your Company serves its clients in the areas of renewables, transmission, utilities, data centers and railways. The Company continues leveraging ‘Service, Export and Digital for growth, while also while strengthening its capabilities for high-growth segments that will see your Company advantageously into the future. It continues its focused approach toward improving the overall operational efficiency to further boost productivity and keep increasing the quality level.

Customer-centricity

The Company adheres to a principle of collaboration and co-creation with those most familiar with the challenges. It works closely with its customers and partners to foster a sustainable energy future for present and future generations. Under the banner of Energy and Digital World (EDW), customer roadshows were organized across different locations, including Hyderabad, Jamshedpur and Pune, culminating with mega event- Energy and Digital World 75 (EDW75) in New Delhi. The Company also participated in several industry-level events by CII, Solar Congress, IEEMA, and others.

Discussion on financial performance with respect to operational performance

Operational performance

The Company remained focused on improving its operational efficiencies, which helped achieve a sustainable inflow of orders and pushed the order backlog to a high of RS 19,245.90 Crores at close of FY 2024-25, providing revenue visibility for several quarters.

It works towards maximizing efficiencies in converting the significant order backlog to revenue, while in the short-term staying agile regarding the evolving situation on trade routes. Nevertheless, such execution, when coupled with operational excellence across manufacturing and functional processes, will result in value accretion. This was achieved by the Company through various efforts that included setting a standard operational process through Leading Operating Model (LOM) deployment, and process visibility and transparency through digital project reviews.

It also achieved efficiencies by removing waste through Quality On Time (QOT) (Kaizen) culture. Lean 6-Sigma culture development was reinforced through capability building and employee engagement, which also helped drive customer focus. Enhanced customer value was driven by a deep understanding of customer expectations and management of perceptions with proactive feedback from tender to execution. Additionally, customer value was delivered while optimizing costs through design optimization, DtV (Design to Value) and excellence in supply chain management (SCM).

The Company adheres to a principle of collaboration and co-creation with those most familiar with the challenges. It works closely with its customers and partners to foster a sustainable energy future for the present and future generations.

Key developments, FY 2024-25

Hitachi Energy India Limited bagged its largest single order in FY2024-25. Renewables led the charge – from studies across utilities and industries to large scale grid integration projects, along with several power quality projects. Secured an order for ?800 kV, 6,000 MW Line Capacity Bi-pole and bi-directional, Khavda-Nagpur HVDC link.

Share of exports for FY 2024-25 was 37.10% of the total orders booked for the period excluding the HVDC order. Diverse geographies and industries help sustain the exports momentum during the year.

Orders for transformers, power quality technologies and other key products were booked from markets like Europe, the Middle

East, Australia and neighboring countries in

South Asia.

Expansion, upgrades and improved efficiency also resulted in orders from existing power plants. It received orders from distribution utilities, for the upgrade of digital solutions to provide better real-time visibility and network management. These expansion projects were across transformers and interrupters facilities. The expansion project at Mysuru is currently operational.

Service orders included GIS upgrades, Annual Maintenance Contracts and replacement equipment as well as overhaul of key transformer components.

The transformer business unit at Savli rolled out 1,000th locomotive transformers as part of an order placed in 2017 to supply 1,600 units.

Segment-wise and product-wise performance

Below are some of the key orders received sector-wise:

• Renewables: 400 kV AIS substation order in

Siyambar, Rajasthan

• Thermal: 18X400 kV GIS order from traditional power plants, Odisha

• Industries: 7x220 kV Substation for captive renewable generation by cement major

• Metro rail: Multiple Transformer orders for deploying in Bangalore Metro

• Rail: ICF67 MEMU 120 units of Traction Transformers

• Data centers: 2x90 MVA 220/33kV Transformer for facility in Hyderabad; 51 x 2000 kVA, 33 kV dry type transformers

• Steady momentum of renewable energy projects

400 kV, 375MW substation in Jaisalmer, Rajasthan

500 MW Solar integration s/s in Fatehgarh, Bhimsar

600 MW s/s for NHPC in Baiya, Rajasthan

300 Mvar Statcom at Anantapur

Sustainability

The Company places sustainability at the heart of everything it does. In line with this purpose, it remains committed to driving business with a focus on four key areas - Planet, People, Peace and

Partnerships - with a specific target to be achieved by the respective pillars by 2030. In FY 2024-25, initiatives were taken on emissions reduction, energy and water conservation and waste reduction. From the baseline year 2019, the Company achieved emissions reduction by 84%, energy intensity per Crores RS revenue by 42%, reduction in absolute water by 18% and reduction in waste sent to landfill and incineration by 69%. Our refreshed sustainability strategy, which now consists of three strands of action, People, Planet and Principles, provides guidance on the way forward into FY2025-26 and beyond, as we have set our sustainability targets and commitments for 2030 and our overall transition to net .changeof25% -zero by 2050.

Certified as a “Green Leader” in L&Ts Responsible Supply Chain Assessment for ESG

Industry collaborations

In FY 2024-25, the Company contributed to thought leadership and technology sessions in the

CII Karnataka ESG Summit, where it emphasized the importance of concerted efforts to accelerate the countrys energy transition by adopting ESG practices.

The Company also participated in Tamil Nadus growth strategy, where, as part of focus group discussions of IT and IT-enabled services, segment development through strategic research, technology transfer and skill development in the state.

The Company convened the Power System Communication User Forum 2024 and organized a comprehensive technical training program on HVDC and STATCOM at its Peenya and Maneja facilities. Also, a technical seminar on transformer On-Load Tap Changer (OLTC) and bushings was arranged for Bhutan Power Corporation Limited.

Under the banner of Energy and Digital World (EDW), customer roadshows were organized across different locations, including Hyderabad, Jamshedpur and Pune, culminating mega event Energy and Digital World 75, which witnessed over 2,500 attendees from customers, government, academia, analysts and media.

Outlook

Management outlook

The Company is a pioneering technology leader with a purpose of advancing a sustainable energy future for all. As India underscores its commitment to economic development, the energy transition will be critical in ensuring sustainable and reliable electricity to power this growth. Deployment of technologies to make the grid flexible, digital, and secure will continue to be key drivers providing attractive medium to long-term opportunities for power technologies, especially in our identified high-growth segments renewables, HVDC, data centers, and

A growing urgency to accelerate energy transition in India and globally has investments in Indias energy sector. This momentum is expected to continue in the coming years, creating more opportunities in the energy segment for the portfolio of Hitachi Energy India Limited, especially in the renewable space. It remains steadfast to its parent company Hitachi Energys 2030 vision and overarching goal, and maintains a singular focus on cementing its leadership in core segments.

Moving ahead, the Company is set to focus on operational excellence to improve productivity, quality and opportunities in One Hitachi. It shall also continue its focus on maintaining its leadership in core businesses, harness new and high-growth segments like renewables, HVDC, datacenters, battery energy storage, and increase penetration in industries to maintain its growth trajectory. Furthermore, Hitachi Energy India Limited is accentuating its focus on exports, strengthen its margins and cash focus, and shifting the centre of gravity to digital, increasing its digital contributions to overall growth, as part of its key growth levers. It will leverage its largest ever backlog to deliver on revenue and margin accretion onandprofitability and improving its overall operational efficiency productivity and quality.

License to operate: Safety, integrity and quality

At Hitachi Energy India Limited, safety will always be paramount as it is entrenched in the DNA of the organization. It will continue to implement a safety work culture across functions. It is committed to safety, integrity and quality and takes continuous efforts towards reiterating the importance of reporting safety incidents at its work sites. The Company has refreshed its health, safety and environment policy to ensure positive health, well-being and safe working conditions for all its employees. It continues to strengthen its safety practices across all its manufacturing locations and offices, thus achieving 100% on-time closure of high-risk hazard situations. During the year, the Company reported total recordable injury frequency rate of 0.09 vs 0.10 targeted for the year.

The Companys Sustainability 2030 commitments set out ‘Zero Harm as one of the key priorities. In FY 2024-25, the Company organized multiple awareness training sessions and health camps across its offices, facilities, and project sites for the well-being of the employees. To mention a few, it conducted sessions on health precautions during monsoon, lifestyle diseases, mental health, yoga and ergonomics manual material handling. Also, it had multiple health camps for diabetes and pulmonary health and held a blood donation camp as well.

Integrity is the foundation of our business principles and operational excellence. The Company is committed to maintaining the highest standards ofoftransport. ethical conduct, transparency, and compliance in all areas. The Hitachi Code of Ethics and Business Conduct is emphasized through onboarding sessions, boosted annual refresher trainings, and creative awareness campaigns. Integrity is a regular topic in leadership team meetings, often illustrated with real-life case studies to promote ethics and leadership. Hitachi Energy in India is certified for our Anti-Bribery Management System under ISO 37001, showcasing our strong framework to prevent, detect, and respond to bribery, thereby reducing financial and reputational risks.

Research and development

Your Companys legacy of innovation and deep expertise in the power technology sector have enabled it to continually provide enhanced value to customers, foresee industry trajectory, anticipate the next phase of growth and stay ahead of the curve.

Its focus and targeted actions towards sustainability while staying at the forefront of the clean energy tech and digital-led revolution have helped it consolidate its position as a leader in this sector. Encompassing every customers journey in its entirety right from site reviews, customized solutions, maintenance cycles, technical handholding, and planning for the future today helps us go beyond creating value to to boost becoming a strategic partner in their growth journey. To understand this, your Companys R&D activities are conducted globally in the R&D and technology centers of Hitachi Energy, and are then locally

The Company believes its employees are the most valuable assets and core strength in preserving its high-quality standards and facilitating its growth. embedded in businesses basis local inputs and requirements. This approach leverages local competence to create social, environmental, and economic value on a global scale. By developing new and localized products, features, and solutions, your

Company can secure existing revenue streams while creating additional revenue by increasing customer engagement and installed bases. Your Companys large pool of expert technologists, shopfloor specialists, solution providers, technicians and R&D teams, capacity to innovate, and investment in the creation of modern technologies have ensured it remains a well-regarded voice in the industry now and in the years to come. It remains committed to identifying and developing key powergrid technologies that will enable a digital-led future more focused on renewable energy sources. During the FY 2024-25, your Company has incurred RS 254.49 Crores as royalty fees to Hitachi Energy Ltd.

Material developments in human resources / industrial relations front

People have always been at the center of the Companys key strategies and priorities, powering it for over 75 years. The Company believes its employees are the most valuable assets and core strength in preserving its high-quality standards and facilitating its growth. Embracing the ethos of empowering its workforce, the Company has meticulously crafted an HR policy, aimed at establishing a secure, harmonious, and transparent work environment. It ensures that employees goals are in harmony with the organisations vision for growth. The HR team consistently organizes training and engagement initiatives aimed at enhancing the skills and capabilities of employees. The Company is set to reinforce its safety culture, upskill and cross-skill talent for agile energy transition, and also build capacities for future growth. Aligned with the Companys values, and guided by its foundational pillars of transparency and agility, the Companys talented workforce is motivated to elevate the organization to new levels of success. As on March 31, 2025, the Companys total employee strength stood at 2,481.

Risks and Concerns

An effective and well-planned risk management framework enables the Company to implement its strategy and deliver long-term value toallthe l performance. financia stakeholders. It helps in identifying and evaluating the business risks and opportunities, both in the short and long term. Over the past year, your Company worked to reduce its exposure to risks and introduce more risk management practices and to insulate the Company. The approach of integrated quantitative risk analysis into day-to-day management and performance management of the Company guides corporate decision-making. To effectively mitigate these risks, your Company has employed a risk management framework, which helps in proactively identify, prioritize, and mitigate risks. The framework is based on principles laid out in the globally recognized standards. The risk management structure addresses the risks in complete interest of the shareholders and equips the Company to continue creating value. Your Company made continuous efforts to promptly identify business risks and implement effective risk mitigation action plans to monitor and address these risks.

Internal control systems and their adequacy

The Companys internal control framework is meticulously designed to safeguard all stakeholders interests by fostering an environment conducive to effective operations. This framework comprehensively focuses on maintaining effective controls over financial reporting and addresses financial & operational risks through a multi-layered structure, including a country management committee, group directives and instructions, local management instructions, entity-level controls, process-level controls, and management testing programs. This holistic and rigorous approach ensures that control processes are proportionate to the Companys size and complexity. Enhancing this robust framework, the Company boasts a well-established, independent, multi-disciplinary

Internal Audit, Risk & Internal Control team. This team operates strictly with governance best practices, delivering valuable insights to management and the audit committee regarding compliance with internal controls, operational efficiency, and key process risks. Their independent evaluations and recommendations are crucial in maintaining the integrity and effectiveness of the Companys control environment. All audit findings and reports are submitted to the Audit Committee every quarter, ensuring continuous oversight and improvement.

Cautionary statement

Certain statements made in the Management Discussion and Analysis Report relating to the Companys business are forward-looking statements.

These include all statements other than those of performance highlights and historical facts, including those regarding the market and financial position, business strategy, and objectives for future operations. Forward-looking statements shall be identified by words such as anticipates, expects, intends, may, will, believes, estimates, outlook, and other words of similar meaning in connection with a discussion of future operational, environmental, social and Forward-looking statements are necessarily dependent on projections and trends and constitute our current expectations based on reasonable assumptions. Actual results could differ from the projected in any forward-looking statements due to risks and uncertainties and other external factors.

By proactively identifying, prioritizing, and mitigating risks, your Company potential challenges through its risk management framework.