India Steel Works Ltd Management Discussions

Management discussions, analysis Report provides a perspective of the managementon the external environment and steel industry, operating and financial performance, material developments in human resources and industrial relations, risks and opportunities and internal control systems and their adequacy in the Company during the FY 2024-25.

The Report should be read along with the Companys financial statements, the schedules and notes thereto and other information provided in the Annual Report. The Companys financial statements have been prepared in accordance with Indian Accounting Standards ("Ind AS”) complying with the requirements of the Companies Act, 2013. as amended and regulations issued by the Securities and Exchange Board of India (SEBIfrom time to time.

Management Discussion and Analysis Report for the year under review, as per regulation 34 (2) of SEBI (Listing Obligations and Disclosures Requirements} Regulations,2015 is as follows:

External Environment, Global/ Indian Economy&Steel Industry:

The global economy is experiencing uneven recovery post-pandemic, with major economies like the US showing moderate growth, while Europe faces stagnation due to geopolitical tensions and energy costs, Russia-Ukraine. Middle East conflicts are disrupting global trade routes and commodity flows, particularly affecting energy and metal prices. Central banks are cautiously cutting rates after aggressive hikes in 2022-23. Inflation is cooling but remains above long-term targets in some regions. Chinas slow economic recovery, weaker real estate sector and reduced industrial demand are affecting global commodity markets, especially steel.

India remains one of the fastest-growing major economies (-6.5-7% GDP growth) expected in 2025, driven by consumption, infrastructure, and manufacturing Government-led infrastructure spending on roads, railways ports etc and the Production Linked Incentive schemes are pushing industrial growth . Controlled inflation (-4-5%). stable currency, and strong forex reserves are keeping investor confidence high. Focus on renewable energy, electric vehicles and clean tech offers new demand vectors for materials including steel.

Global steel demand is relatively flat due to lower consumption In China and a slowdown In real estate/construction In many developed economies. Chinas over production remains a concern, often leading to export dumping in global markets. Amajor theme, especially in Europe and Japan — de carbonization through hydrogen-based production, electricarc furnaces (EAFs) and scrap recycling.

India is the 2nd largest producer of steel globally and is also among the few countries with strong steel demand growth. The key drivers are among others Government projects (Bharatmala, Sagarmala, Smart Cities), Urbanization and real estate growth, Auto, railways defense, and renewable sectors etc. Major players in the industry are investing heavily in expanding capacity and modernizing plants. The challenges are Raw material availability (coking coal dependency on imports), Environmental norms and pressure to decarbonize. Industry consolidation continues in the West to optimize operations and transition togreenerprocesses.

Industry Structure and Developments:

The Company was engaged in the manufacturing of Bright Bars, Wire Rods, Bars and Billets in various sizes at its manufacturing facility located at Zenith Compound, Khopoll. Raigad-410203. However, the Companys operations were severely impacted due to a combination of adverse factors, including non-availability of working capital, debt burden, negligible capacity utilization, disruptions caused by theCOVID-19 pandemic.

As a result of continued financial stress, Kotak Mahindra Bank Limited initiated recovery proceedings and took physical possession of the Companys assets andfactory premises Consequently, all manufacturing and job work operations were halted

The Company has been actively put its efforts to resolve its financial challenges, including ongoing discussions with workers unions.

lenders, potential investors, and suppliers aimed at reviving operations. Despite these efforts, no tangible progress has been achieved.

Efforts are also underway to repay the outstanding debts owed to Kotak Mahindra Bank Limited. Accordingly, a one-time settlement has been reached, and a portion of the dues was repaid by the end of the financial year The remaining balance is expected to be cleared soon.

Given the prevailing drcLiinstances the Company is shifting its strategic focus from steel manufacturing to real estate business activities, with an aim to exp lore more viable and sustainable growth opportunities.

Opportunities and threats:

The Company operates in an interconnected world characterized by stringent regulatory and environmental requirements, heightened geopolitical risks, and rapid technological disruptions.

Opportunities:

-Infrastructure Growth: Govemment-dnven initiatives like PM Gati Shakti, Smart Cities, Bharatmala. and Sagarmala are creating sustaineddemand for steel in roads, railways, ports, and logistics infrastructure.

-Automotiveand EV Sector: Rising demand forpassengerand commercial vehicles, especially electricvehides (EVs), is increasing the need for high-strength lightweight, and specialty steel

-Real Estate & Urbanization: Rapid urbanization in India, is fueling demandfor construction-grade steel in housing, commercial, and industrial Infrastructure.

-Export Potential: Indias growing competitiveness in steel production costs and quality opens doors for exports, espedally to Southeast Asia, the Middle East, and Africa.

Threats:

-Global Steel Overcapacity: Countnes like China and Vietnam often create global overcapacity, leading to dumping and price suppression in international and domestic markets.

-Environmental Regulations & Carbon Costs: Stricter emission norms and potential carbon border taxes (like CBAM in the EU) could affectexports and profitability for high-emission steel producers

-High Capital Intensity & Long Gestation: Steel plants are capital- and time-intensive, making it harder for smaller players to stay competitive or pivot quickly.

-Technological Obsolescence: Rapid advancements in green technology could render older blastfurnace setups inefficient and environmentally non-compliant.

-Price Volatility: Steel prices are highly cyclical and influenced by macroeconomic factors. This unpredictability affects working capital and long-term planning.

-Labor & Industrial Relations: laboris sues, union disputes, or regulatory hurdles can delay expansions or Impact operations. Segment-wise / Product-wise performance:

Thecompany has single business segment viz. Manufacturing & Trading of Stainless Steel & Allied Products and hence segment wise results have not been given. Further the manufacturing activities, job work activities have been stopped.

For the reasons and facts as stated above in Industrial Structure & development” para, thecompany has nothing more to report under this head.

Outlook:

In view of what has been stated in foregoing paragraphs, your Management perceives that the outlook of the Steel Industry in the subsequent financial years may improve subject to the effective and positive steps upon availing of finance and addressing issues that stuck the Companys working profitably. However, for the reasons and facts as stated above in "Industrial Structure & development" para, the company has nothing more to report underthis head.

Risks HConcerns:

It is essential to conectly assess the risk so that the same can be mitigated before it becomes a possible threat. General risks, as are associated with statutory compliances, economy, financials, Government policies, market related, operational, products, safety and technology etc., The company is not immune from these risks. Normally the Board reviews of likely risk areas with the objective to define a framework for identification, evaluation and mitigating therisk in the decision-making process

However, in view of the reasons and facts as stated above in “Industrial Structure & development" para, the company has nothing more to report under this head.

Internal Control System and its Adequacy:

The Company has proper and adequate system of internal controls commensurate with its size and nature of operations to provide reasonable assurance that all assets are safeguarded, transactions are authorized, recorded and reported properly and applicable statutes are duly complied with.

TheCompany has constituted an Audit Committee to monitor the adequacy and efficacy of internal control systems.

The adequacy of these compliances and their effectiveness is subject to statutory audit and the same has been reported by the Auditors in their report as required under the relevant pro visions of the Companies Act. 2013. The Company also has an Internal Audit System

Discussions on financial performance with reference to operational Performance:

During the Financial Year ended March 31.2025. theCompany did notcarryout any manufacturing activities, as such operations have been discontinued. Consequently, the Company did not record any operational financial performance during the year. The Companys revenue from operations stood at Rs. 0.75 Lacs (Previous Year: Rs 81.60 Lacs), and other income also stood at Rs. 112.00 Lacs (Previous Year: F?s. 644.42 Lacs), resulting in atoial incomeofRs 112.75 Lacs (Previous Year: Rs. 726.02 Lacs).

TheCompany incuned a post-tax net loss of Rs. 1,339.35 Lacs during the year underreview, as compared to a net loss of Rs 1,162.47 Lacs in the previous financial year.

The manufacturing operations of the Company remain suspended, and there were no significant business activities during the financial year under review.

Material Developments in HRD and industrial Relations Front:

The Company recognizes its employees as valuable assets. Developing, motivating, and retaining talented personnel remains a key responsibility and an integral part of the Companys policy.

In light of the current situation, with no business activities and nil operations during the year, the Companys workforce has been considerably reduced As on March 31,2025, the Company had approximately 4 permanent employees on its rolls, serving at various organizational levels.

Delai Is of Significant changesinKey Financial Ratios -FY 2024-25:

The significant changes in the ratios and net worth was on account of no manufacturing activities & losses. The continuing scarcity of working capital needs, closure of manufacturing activities has caused significant losses, activities & losses. The continuing scarcity of working capital needs, closure of manufacturing activities has caused significant losses.

Ratio	Numerator	Denomi nator	31-Mar-25	31-Mar-24
Current Ratio (In times)	Total CurrentAssets	Total Current Liabilities	0.50	0.48
Debt-Equity Ratio (In times)	Debt consists of borrowings	Total Equity	3,08	2.34
Debt Service Coverage Ratio (In limes)	Net Operating Income	Debt service = lnterest+ Principal Repayments	-0.24	0.03
Return on Equity Ftatio (In %)	Net Profits Afte r Taxes	Average Shareholders Equity	-40.52%	-26.33%
InventoryTumover Ratio (In times)	Cost of Goods Sold	Ave rage 1 nve ntory	0.00	0.01
Trade Receivable Turnover Ratio (In times)	Revenue from Operations	Average Trade Receivable	0.00	7.25
Trade Payable Turnover Ra tio (In times)	Purchase and Other Expenses	AverageTrade Payable	0.03	0.03
Net Capital Turnover Ratio (In times)	Revenue from Operations	Working Capital (i.e. Total CurrentAssets lessTota! CunrentLiabilities)	0.00	0.00
Net Profit Ratio (In %)	Ne t Prof tsAfter Taxes	Revenue from Operations	-178580.42%	-1424.68%
Returnon Capital Employed (In %)	Earnings Before Tax and f nance cost	Total Assets - Total Cu rrent Liabilities	-3.26%	-2.00%
NetWorthRatio(ln%)	Net Prof ts After Taxes	Total Assets - Total Liabilities	-16.75%	-15.40%

Statutory Compl iance:

The Company ensures that it is in compliance with all applicable laws The Managing Director, places before the Board, at each meeting, a certificate of compliance with deviations if any with the applicable laws

Accounting Treatment:

The Company consistently follows a treatment that has been prescribed in Indian Accounting Standards (Ind AS) in the preparation of financial statements which shows true and fair view of the financial statements.

Cautionary Statements:

This discussion and ana lysis have been provided with a view toenable shareholders with a better understanding of theperformance of the Company. The Shareholders must read and understand the same with due understanding and necessary caution as they may be forward looking and prone to change in the dynamic economic environment and tax regime. In certain areas, if there is any discussion covering strategic decision and management expectations from the same, the same should not be construed as a guarantee of performance and actual results may differ significantly depending upon the operating conditions and external environment

	For and on behalf of the Board of Directors of
	INDIA STEEL WORKS LIMITED
	Sudhir H. Gupta
	Executive Chairman
	(DIN: 00010853)
Place: Mumbai
Date: 21st May, 2025.