Jash Engineering Ltd Management Discussions

ECONOMIC REVIEW

GLOBAL ECONOMY

Geopolitical Shock Reshaped the Global Outlook

The global economy entered 2026 with improved momentum on the back of technology-led investment, easing trade frictions in some corridors, and resilient activity in major economies. However, the escalation of geopolitical tensions in the Middle East significantly altered the outlook by disrupting energy flows, raising commodity prices, reviving in ationary pressures, and tightening financial conditions.The sharp rise in energy and related commodity prices has become the most immediate macroeconomic headwind. Disruptions involving the Strait of Hormuz and damage to energy infrastructure have increased oil, gas, fertilizer and several critical industrial input prices, creating broad-based cost pressure across manufacturing, infrastructure, logistics and utility-linked sectors. This has also raised the risk of supply bottlenecks and input-cost volatility for engineering businesses operating across global value chains.

Trade Policy Remained Fluid, Reinforcing Diversi cation

During the year, global trade policy remained uid, with the U.S. Supreme Court striking down the use of tariffs on international economic emergency grounds, following which the U.S. administration introduced a temporary 10% tariff surcharge under an alternate law, effective until late July. As a result, the U.S. effective tariff rate moderated to about 12% from nearly 14% earlier in the year. Despite continued trade policy uncertainty, several new free trade

Global Growth to Slow Before Gradual Recovery

Global growth is forecast to slow this year to 2.5 %, the lowest rate since the COVID-19 pandemic, as higher energy prices, rising in ation, tighter monetary conditions, and weaker trade weigh on activity. The expected deceleration is driven by slowing growth in advanced economies and EMDEs reliant on imported energy, as well as sharply weaker exports in economies in the Middle East directly exposed to the con ict. Global growth is envisaged to pick up to 2.8 % on average in 2027 28 as energy prices moderate, financial conditions ease, and trade recovers. Growth in advanced economies is forecast to slow this year, to 1.5 %, from 1.8 % in 2025, mainly due to the impact of substantially higher energy prices. United States a large oil producer is proving resilient to the disruptions in global energy markets, with the adverse impacts of the conflict expected to be offset by scal easing and continued AI-related investment. agreements and market access measures including agreements involving the European Union, Mercosur, India, Australia, and the United Kingdom, along with Chinas zero-tariff treatment for African countries and the U.S. reauthorization of the African Growth and Opportunity Act

Commodity Volatility Emerged as a Major Cost Risk

Commodity markets witnessed sharp volatility during the year due to severe disruptions in shipping through the Strait of Hormuz, which significantly affected crude oil, LNG and fertiliser supplies. Spot prices in April were substantially higher than January levels, with Brent crude, European natural gas and urea rising by around 80%, 31% and 106%, respectively.

The baseline outlook assumes that the most acute phase of disruption will ease by July, with shipping volumes gradually normalising by the end of 2026; however, prolonged disruptions or further damage to regional energy infrastructure could keep commodity prices elevated for longer and intensify in ationary pressures. Against this backdrop, average global

In ation Pressures Re-Emerged on Commodity Disruptions

Prior to the escalation of the Middle East con ict, global headline and core in ation had remained broadly stable, though still above pre-pandemic levels across most economies. However, disruptions in the supply of key commodities particularly oil and natural gas along with wider supply chain pressures, led to renewed in ationary pressures through higher input and energy costs, despite fuel subsidies and price caps in some countries. As a result, global headline in ation is projected to rise to around 4.0% in 2026, affecting both advanced economies and emerging markets, before moderating to 3.1% in 2027 as crude oil prices ease from an estimated USD 94 per barrel in 2026 to are expected to support trade diversi cation and improve market access. These developments reinforce the importance of supply-chain flexibility, regional diversi cation, and localisation strategies in sustaining growth momentum. commodity prices are projected to rise by about 22% in 2026, led by higher energy prices, with Brent crude expected to average around USD 94 per barrel. Industrial metal prices are expected to increase by about 18 % in 2026 on tighter supply conditions and rm demand, including from the energy transition, electri cation, and data center infrastructure.

USD 76 per barrel in 2027, assuming energy flows through the Strait of Hormuz gradually normalise and curtailed production recovers. Nevertheless, the in ation outlook remains uncertain and will depend on the duration and intensity of commodity market disruptions.

Monetary Easing Continued, but Policy Risks Remain

Global monetary easing continued through 2025 as moderating in ation, robust cross-border capital flows, and reduced depreciation pressures provided policy space for many central banks. By November 2025, roughly two thirds of central banks worldwide were in an easing cycle, with the trend most pronounced in developed economies and in developing economies across Asia and Latin America. Nonetheless, policy rates in many countries remain above pre-pandemic levels, and further cuts in 2026 are expected to proceed gradually. Risks of renewed in ation or currency volatility are likely to complicate the nal stage of the disin ation cycle in many countries.

Investment Recovery Stayed Uneven Across Regions

Global investment remained subdued in 2025 amid economic uncertainty, geopolitical tensions and limited scal space. While monetary easing, selective scal support and AI-led spending in digital infrastructure supported investment in parts of the U.S. and Europe, trends across developing economies remained uneven. Several Asian markets recorded relatively stronger investment growth, supported by exports and industrial expansion, whereas many economies in Africa and Latin America continued to face weak momentum due to high borrowing costs, policy uncertainty and constrained public nances. Global FDI flows also remained soft, reflecting cautious business sentiment and elevated geopolitical risks.

Labour Markets Stayed Stable Despite Structural Gaps

Global labour markets remained broadly stable in 2025, with the unemployment rate holding at around 5.0% and expected to improve marginally in 2026. Although higher U.S. tariffs and trade policy uncertainty initially raised concerns over employment conditions, the partial rollback later in the year helped ease such pressures. However, structural challenges remain significant, particularly in relation to low youth employment, high NEET levels, persistent gender gaps in labour force participation, and limited workforce inclusion for persons with disabilities. These trends underscore the need for continued investment in skills, employability and inclusive labour policies to support sustainable long-term growth.

2026 Outlook Remains Cautious but Resilient

Overall, the global growth outlook for 2026 remains subdued, shaped by elevated macroeconomic uncertainty, persistent geopolitical tensions, trade frictions and scal constraints across several economies. While the world economy has shown resilience, slow growth, limited policy space and weakening multilateral support continue to weigh on development momentum, particularly in least developed and vulnerable economies exposed to debt pressures and external shocks. In ationary pressures have eased from recent peaks but remain above comfort levels in many regions, continuing to strain households and widen inequalities. Against this backdrop, sustaining growth will require renewed focus on investment, trade cooperation, climate resilience, social inclusion and stronger international policy coordination.

Source: World economic outlook IMF, Global economic prospects- World Bank

INDIAN ECONOMY

India remained the fastest-growing major economy

Despite trade tensions and elevated policy uncertainty in 2025, India remained the fastest-growing major economy in FY2025-26, with real GDP growth accelerating to 7.6%, compared with 7.1% in FY2024-25, despite heightened global trade tensions, policy uncertainty and renewed geopolitical disruptions toward

Domestic demand remained the primary growth engine

On the demand side, economic activity was driven primarily by private consumption and investment. Private consumption strengthened on the back of low in ation, tax relief measures and improved disposable income, while investment activity was supported by both private sector capex and continued public infrastructure spending. The imposition of steep tariffs by the US on its trading partners initially raised concerns about a possible drag on the external sector and overall GDP growth. However, the adverse spill overs remained contained, with net exports exerting only a marginal drag of 0.1 percentage points in 2025-26.

Manufacturing and services led the supply-side expansion

On the supply side, manufacturing and services remained the key drivers of growth. Manufacturing was supported by strong performance in sectors such as automobiles, consumer goods and industrial production, while services growth was underpinned by trade, hospitality, transportation, real estate, financial services and professional services. Industrial GVA growth rose sharply to 9.5% in FY2025-26, with manufacturing activity broad-based across sectors. The services sector continued to be the dominant contributor to economic activity, reflecting the rising importance of high-value-added and consumption-linked segments in the economy. Growth in the agriculture and the end of the year. Growth was supported by strong domestic demand, sustained investment activity, supportive policy measures and sound macroeconomic fundamentals. While the external environment became more challenging following the conflict in the Middle East, India entered this phase from a position of strength, supported by resilient consumption, stable macroeconomic conditions and a relatively diversi ed growth base allied sector moderated during FY2025-26 due to weather-related disruptions affecting kharif crops, although favourable rabi conditions provided some support. The normal south-west monsoon helped ^{replenish reservoir levels to record highs,} Annual Report 2025-26 83 while foodgrain production remained healthy. Looking ahead, the outlook for agriculture in FY2026-27 remains dependent on monsoon performance, with possible El Nino conditions posing downside risks.

In ation moderated sharply during most of FY2025-26

In ation during FY2025-26 remained broadly moderate, marking a clear improvement over the previous year. Headline in ation eased to 2.1%, supported by food price de ation, favourable base effects and GST rationalisation in September 2025, which helped contain price pressures across several goods and services. However, core in ation remained relatively rm due to higher precious metal prices. Toward the end of the year, the outbreak of the West Asia conflict and the resulting increase in domestic LPG prices led to some upward pressure on the fuel and light component of in ation. Fuel in ation increased to 2.4 % during April-

Monetary easing supported growth, while the RBI remained cautious

The reserve Bank of India (RBI) cut the policy rate by a cumulative 125 basis points (bps) between february and December 2025, down to 5.25 percent. Moderating in ation created room for monetary easing, allowing policy rate cuts to support growth amid trade policy uncertainty. However, the RBI changed its monetary policy stance from “accommodative” to “neutral” in June 2025, citing reduced room for additional growth support. The RBI viewed the scope for further rate cuts as limited, given earlier front-loaded monetary support 100 bps cuts between february and June, ample liquidity, and risks of currency depreciation and capital out flows.

Capital flows were weaker and the Rupee came under pressure

Capital flows turned less supportive during the year. Net foreign direct investment (FDI) in flows declined from US$2.2 billion in April January FY2024-25 to around

December 2025 from a de ation of 3.2 % during the corresponding period a year ago, due to a price hike of 50 per LPG cylinder in April 2025. Consequently, the fuel groups contribution to headline in ation increased to 8.8 % in April-December 2025 from (-) 4.3 % a year ago.

US$1.7 billion in the same period of FY2025-26, while net foreign portfolio investment (FPI) recorded out flows of US$6.2 billion amid global financial volatility and portfolio reallocation toward advanced economies. As a result, the Indian Rupee depreciated against the U.S. dollar, moving from an average of around 85/USD in FY2024-25 to 88.3/USD in FY2025-26. Foreign exchange reserves remained adequate, rising to nearly US$730 billion by end-February 2026 before declining to around US$698 billion by end-March following the onset of the Middle East con ict, lower gold valuations, persistent FPI out flows and RBI forex operations. By end-March 2026, the Rupee had fallen to around 95/USD, while Indian equity markets corrected by about 13% between the end of February and March 31, 2026.

FY2026-27 may see some pressure on scal and external balances

Indias external sector remained relatively stable in FY2025-26 despite volatility in trade flows, capital movements and currency markets, with the current account de cit narrowing to 1.0% of GDP in the first three quarters from 1.3% a year earlier, supported by strong remittances and a higher services trade surplus, even as merchandise imports grew faster than exports. Looking ahead, both the scal and external balances may face some pressure in FY2026-27 due to higher global energy prices. The general government scal de cit is projected to rise modestly to around 7.6% of GDP, driven by higher fuel and fertiliser subsidy outlays and constrained revenue growth, while the current account de cit is expected to widen to 1.8% of GDP because of a higher energy import bill. Over the medium term, however, both indicators are expected to improve gradually, supported by scal consolidation, stronger nominal GDP growth, resilient foreign capital in flows and adequate foreign exchange reserves, which should continue to provide a buffer against external shocks.

Middle East conflict has increased near-term macroeconomic risks

A prolonged conflict in the Middle East could pose significant risks to Indias macroeconomic outlook. Persistent disruption to energy supplies or damage to critical infrastructure could keep oil and natural gas prices elevated for longer, raise fertiliser costs and put additional pressure on in ation, the scal balance and the current account. Indias reliance on energy imports from the region makes the economy particularly sensitive to such shocks. In addition, any disruption to labour markets in Gulf countries which account for a significant share of Indias remittance in flows could weaken secondary income flows and put further pressure on the Rupee. Fiscal risks may also rise if consumer-facing fuel price containment measures, such as subsidy increases or excise duty cuts, are expanded materially.

Structural priorities remain critical for resilience

While Indias macroeconomic buffers and policy support mechanisms provide some insulation against downside risks, energy diversi cation, prudent scal management and trade liberalisation remain critical priorities. The current global environment reinforces the need to diversify energy sources, accelerate the transition toward renewables, maintain a credible scal consolidation path and strengthen trade resilience through the implementation of recently concluded free trade agreements and negotiation of new ones. These measures will be important in improving Indias ability to navigate a more fragmented and uncertain global economic environment.

Outlook

The outlook for the Indian economy remains positive, though more cautious, in FY2026-27. Growth is expected to moderate from the high base of FY2025-26, reflecting the impact of higher energy prices, geopolitical uncertainty, global trade frictions and tighter external conditions. However, India continues to benefit from strong domestic demand, resilient financial institutions, continued public capital expenditure, improving trade architecture and ongoing structural reforms. While downside risks remain linked to prolonged geopolitical tensions, oil price volatility, exchange-rate pressures and weather-related disruptions, Indias macroeconomic fundamentals and policy buffers continue to position it relatively well to sustain medium-term growth momentum.

Source: RBI Annual Report, Economy Survey 25-2026

WATER TREATMENT EQUIPMENT INDUSTRY STRUCTURE AND DEVELOPMENTS

GLOBAL INDUSTRY DEVELOPMENTS

The global water and wastewater treatment equipment market size was valued at USD 71.0 billion in 2025 and is projected to grow from USD 74.2 billion in 2026 to USD 106.4 billion by 2033, at a CAGR of 5.3% from 2026 to 2033.

The market in Asia Pacific dominated with a revenue share of 36.0% in 2025. The market growth is driven by factors such as population growth, urbanization, industrialization, and stricter environmental regulations.

Rising awareness of environmental pollution, stringent management regulations, and a growing demand for sustainable and efficient wastewater treatment solutions are expected to contribute to the expansion of the industry. The market is further set to grow due to increasing industrialization, population growth, and stricter government regulations on wastewater discharge. Companies in the water and wastewater treatment equipment industry are forming partnerships with end-users to promote the adoption of new technologies. Increased investment in research and development to improve technology ef ciency is also expected to drive market growth. Small and medium-sized businesses are adopting new water and wastewater treatment technologies, creating opportunities for growth.

The water and wastewater treatment equipment industry is moderately concentrated, led by established global players with strong R&D capabilities and broad solution portfolios across industrial, municipal and commercial applications. At the same time, growing demand in developing markets continues to create opportunities for smaller and regional companies. The industry is strongly driven by technological innovation, with increasing adoption of advanced solutions such as membrane bioreactors, UV disinfection and high-ef ciency ltration systems. As sustainability, regulatory compliance and water quality requirements become more critical, continuous investment in technology and process improvement remains essential for competitiveness.

Process Equipment Insights

Within the water and wastewater treatment equipment industry, the tertiary treatment segment remained the largest in 2025, accounting for 44.5% of the market. This segment represents the nal stage of treatment and is focused on re ning water quality to meet increasingly stringent standards for discharge or reuse. The growing adoption of advanced technologies such as membrane ltration,

UV disinfection and chemical treatment reflects the rising importance of tertiary treatment in addressing tighter regulatory requirements, improving water quality and supporting reuse across industrial and municipal applications.

The secondary treatment segment continues to be an essential part of the treatment process, primarily addressing the biological removal of dissolved organic matter and suspended solids. Technologies such as activated sludge systems and trickling lters remain widely used to reduce pollutant loads and improve wastewater quality before further treatment. This stage remains critical for both municipal and industrial wastewater management, as it helps reduce environmental impact and forms the basis for more advanced treatment processes.

Application Insights

From an application perspective, the municipal segment accounted for the largest share of the market at 65.8% in 2025. Demand in this segment continues to be driven by the need to provide safe drinking water, manage wastewater efficiently and meet increasingly stringent environmental standards for growing urban populations. Rising urbanisation, increasing water stress and the need to modernise ageing infrastructure are encouraging municipalities to adopt advanced treatment solutions that improve ef ciency, sustainability and water reuse potential.

Regional Insights Asia Paci c

Asia Pacific remained the largest regional market, accounting for 36% of global market share in 2025.

Growth is being driven by rapid urbanisation, industrialisation and population growth, particularly in China, India and Japan.

Rising investment in water infrastructure, coupled with stricter regulations and increasing awareness of water scarcity, is supporting adoption of advanced treatment technologies such as membrane ltration, reverse osmosis and biological treatment.

China

China continued to dominate the Asia Pacific market in 2025.

Demand is being supported by rising industrial activity, urban expansion, severe water pollution challenges and strong government focus on improving water quality.

Stringent environmental regulations and wastewater management requirements are accelerating investment in advanced treatment solutions.

India

The Indian water and wastewater treatment equipment market is expected to grow at a CAGR of 6.3% from 2026 to 2033.

Growth is being driven by rapid urbanisation, industrialisation, and increasing concerns around water pollution and water scarcity.

Rising infrastructure investment and policy support are expected to sustain long-term demand.

North America

North America is witnessing steady growth, supported by a strong focus on sustainability, regulatory compliance and infrastructure modernisation.

The region is investing significantly in replacing and upgrading ageing water and wastewater treatment systems.

Climate resilience and improved water quality standards are key long-term demand drivers.

United States

The U.S. market is projected to grow at a CAGR of 3.6% from 2026 to 2033.

Growth is being driven by concerns over water quality, pollution and ageing infrastructure, especially in urban areas.

Adoption of advanced solutions such as membrane ltration, reverse osmosis and UV disinfection continues to increase.

Canada

The Canadian market is expected to grow at a CAGR of 4.1% from 2026 to 2033.

Demand is supported by the need for sustainable water resource management and effective wastewater treatment across both urban and remote regions.

The focus remains on protecting freshwater ecosystems while improving treatment capacity and ef ciency.

Europe

Europes market is being supported by stringent environmental regulations, sustainability targets and the growing need for efficient water management systems.

Continued investment in wastewater treatment and pollution reduction is driving adoption of advanced treatment technologies.

Regulatory compliance and resource ef ciency remain central themes across the region.

Germany

Germanys market is driven by a strong regulatory framework and a high focus on sustainability and industrial water management.

Demand is growing for solutions that improve water quality, reduce pollutants and enhance energy ef ciency.

Technologies such as membrane

ltration and energy-ef cient treatment systems are seeing increasing adoption.

France

The French market is expanding due to strict environmental norms, particularly around nutrient removal and wastewater treatment from agriculture and industry.

The countrys push toward net-zero emissions is also creating demand for energy-ef cient water treatment systems.

Environmental compliance and sustainability are central growth drivers.

Middle East & Africa

The region is experiencing strong growth due to water scarcity, urbanisation and industrial development.

Countries such as Saudi Arabia, UAE and South Africa are investing significantly in water treatment and wastewater recycling infrastructure.

In the Middle East, desalination remains a critical solution due to limited freshwater availability.

Saudi Arabia

Saudi Arabia is one of the fastest-growing markets in the region, driven by acute freshwater scarcity and strong reliance on desalination and wastewater reuse.

Government-led infrastructure investments are expanding treatment capacity in both urban and industrial zones.

The country continues to remain a global leader in large-scale desalination development.

Latin America

Latin America is witnessing growth as countries address water pollution, scarcity and rapid urban expansion.

Investments in water treatment infrastructure are increasing across Brazil, Mexico and Argentina to improve access to clean water and wastewater services.

Water reuse, recycling and sustainable infrastructure solutions are becoming increasingly important.

Brazil

Brazils market is expanding due to increasing focus on improving water access, reducing pollution and modernising infrastructure.

Government initiatives such as the National Sanitation Plan are supporting investment in treatment capacity.

Environmental protection and demand for sustainable solutions, particularly in ecologically sensitive regions, are driving further market opportunities.

Global Government Initiatives Driving Market Opportunities

Global government initiatives are creating strong and visible opportunities in the water and waste water treatment industry through a mix of large infrastructure funding, stricter water-quality regulations, universal access targets, reuse mandates and water-security strategies. Major examples include the U.S. PFAS funding and drinking water rules, the EUs revised Urban Wastewater Treatment Directive mandating tighter nutrient and micro pollutant removal, Indias Jal Jeevan Mission, AMRUT 2.0 and Namami Gange, Saudi Arabias National Water Strategy 2030, Australias National Water Grid Fund, Canadas Build Communities Strong Fund, and Brazils sanitation universalisation framework, all of which are driving investments in drinking water systems, sewage networks, advanced treatment technologies, reuse infrastructure, desalination and utility modernisation. In parallel, multilateral platforms such as the World Banks Water Forward initiative are further supporting project pipelines, utility reforms and financing across developing markets, reinforcing long-term global demand for water and wastewater treatment equipment.

Promising Outlook for the Industry

With increasing regulatory support, rising environmental awareness, and growing investments in water infrastructure, the global water and waste water treatment equipment market is poised for robust expansion. As nations prioritize sustainability and climate resilience, market players have a unique opportunity to innovate and scale solutions that meet evolving needs. The future holds strong potential for technological advancement, cross-border collaboration, and impactful contributions to global water security.

Source: Grandview Research.

INDIAN INDUSTRY DEVELOPMENTS

In FY25, Indias water and waste water treatment equipment market continues to gain momentum, driven by rapid urbanization, industrial expansion, and increasing regulatory focus on sustainable water management. With growing pressure on freshwater resources and rising pollution levels in major rivers and water bodies, the demand for advanced treatment technologies has surged across both municipal and industrial sectors. At present, it is sustaining 18 % of world population with only 4 % of global water resources. Therefore management of water resources has assumed great importance. Today availability of water resources is a major issue and is a big challenge facing our country.

Rising public health awareness and growing environmental accountability are reshaping national priorities across the globe including in India where the focus on access to safe drinking water and effective waste water management has intensi ed. Recognizing the critical link between water quality and quality of life, the Government of India has accelerated efforts to modernize urban infrastructure and curb industrial pollution, particularly from sectors like power generation and oil re ning. This paradigm shift toward sustainable urban living is expected to drive a new wave of investments in both upgrading outdated waste treatment facilities and building advanced, future-ready systems. For companies operating in the Indian water and waste water treatment space, these developments represent a compelling opportunity to expand their footprint and contribute meaningfully to the nations public health and environmental goals.

The India water treatment market benefits from Zero-Liquid-Discharge (ZLD) mandates that push red-category industries toward high-recovery membrane trains, while federal schemes such as AMRUT 2.0 and Swachh Bharat Mission channel record funding into tertiary reuse at municipal plants. Per-capita freshwater availability has slipped to 1,486 m3 annually, classifying the country as water-stressed by international benchmarks. About 70% of surface reserves exhibit varying contamination levels, forcing utilities and industries to escalate treatment capacity. The India water treatment market sees robust uptake of high-recovery reverse-osmosis (RO) lines now delivering 60-80% water reclamation in re nery, textile, and pharma facilities. Water-intensive factories increasingly test closed-loop operations and atmospheric water generators to de-risk supply shocks. These trends reinforce long-term demand for modular zero liquid discharge (ZLD) systems, nano- ltration polishing steps, and smart leak-detection networks across the India water treatment market.

Market Segments By Equipment

Membrane Separation continues to hold the largest share in the Indian water treatment market, driven by its high ef ciency in removing contaminants and delivering high-purity water across municipal and industrial applications. Technologies such as reverse osmosis and ultra ltration remain central to modern treatment systems.

Disinfection is emerging as the fastest-growing segment, supported by stricter water quality standards, rising awareness of water borne diseases, and increasing demand for advanced, chemical-ef cient solutions such as UV radiation and ozone treatment.

Sludge Treatment is also gaining relevance as industries and municipalities place greater emphasis on sustainable waste management, resource recovery and compliance with tightening environmental norms.

By Process

Primary Treatment remains the dominant process segment, as it serves as the first and essential stage of water and waste water treatment by removing suspended solids and other physical impurities through methods such as sedimentation and ltration.

Tertiary Treatment is witnessing faster growth, driven by the increasing need for advanced puri cation, treated water reuse and compliance with more stringent discharge standards.

The growing adoption of tertiary systems highlights the sectors shift toward higher treatment ef ciency, sustainability and water reuse across both municipal and industrial applications.

By Application

The Municipal segment continues to account for the largest share of the Indian water treatment market, supported by urbanisation, public investments in safe drinking water and sanitation, and government programmes aimed at strengthening water and wastewater infrastructure.

The Industrial segment is the fastest-growing application area, driven by rising industrialisation and increasing demand from sectors such as chemicals, pharmaceuticals and manufacturing for efficient water treatment, recycling and compliance-driven solutions.

As industries intensify their focus on sustainability and water-use ef ciency, demand for advanced process treatment and reuse technologies is expected to strengthen further.

Key Growth Drivers for the Water Treatment Industry Stronger focus on water security

Central and state governments are intensifying efforts to build more effective and equitable water management systems.

The proposed Integrated Water Resources Management Authority (IWRMA) in each state is expected to strengthen planning across villages, cities, districts and states.

Its scope is likely to include ground water management, ood plain regulation and river conservation, reinforcing long-term demand for water infrastructure.

Push towards 24x7 water supply

Policy efforts are increasingly focused on ensuring continuous water supply to urban households.

A few cities such as Puri, Malkapur and parts of Bengaluru and Delhi have already made progress, while several others are actively moving in this direction.

New schemes, such as the Jorhat 24x7 Water Supply Scheme in Assam, indicate growing investment in water distribution and treatment infrastructure.

Rising private sector participation

Private participation in the water sector is increasing under models such as hybrid annuity, performance-based contracts, and city-level operator frameworks.

This trend is expected to bring greater expertise, ef ciency, innovation and capital into the sector.

Increasing private involvement is likely to accelerate the implementation and modernization of water infrastructure projects.

Reduction in non-revenue water (NRW)

Governments are increasingly prioritising the reduction of non-revenue water through metering, monitoring and distribution ef ciency.

AMRUT 2.0 aims to reduce NRW levels in cities to 20%.

Smart metering initiatives, such as the installation of 105,000 smart water meters in Thane, highlight the growing focus on digital water management.

Growing adoption of desalination

Desalination is emerging as an important solution in water-stressed coastal states such as Gujarat, Maharashtra and Tamil Nadu.

A large 400 MLD desalination plant is being developed in Perur, Chennai, reflecting the scale of future opportunity in this segment.

The increasing use of desalination is expected to support long-term water supply resilience and create demand for advanced treatment technologies.

Union Budget 2026-2027 - Strengthening Water Supply, Sanitation and River Rejuvenation

The Union Budget 2026 27 reinforces the Governments continued focus on water supply, sanitation, river rejuvenation, waste water treatment and treated water reuse, with a combined Budget Estimate of 2,16,654 crore across major central and centrally sponsored programmes.

The Budget signals a renewed policy emphasis on strengthening both urban and rural water infrastructure, improving access to safe water, expanding wastewater treatment capacity, promoting water conservation and supporting sustainable resource management.

·Key programme allocations include

67,670 crore for Jal Jeevan Mission,

8,000 crore for AMRUT

2,500 crore for Swachh Bharat Mission-Urban,

3,100 crore for the National Ganga Plan,

7,192 crore for SBM-Grameen,

2,500 crore for the Watershed Development Component of PMKSY,

95,692 crore for the Viksit Bharat Guarantee for Rozgar and Ajeevika Mission (Gramin), in addition to

30,000 crore for the MGNREGA programme component.

The Budget also highlights measurable outcomes across schemes, including urban tap water expansion, sewerage and septage management, increased sewage treatment capacity, recycled water utilisation, water-body rejuvenation, rural household water access and water harvesting structures. Overall, the Budget underscores the long-term importance of investment in water treatment, waste water management, water reuse, river conservation and resilient water infrastructure, thereby continuing to support the structural growth outlook for the sector.

Scope of the Water & Wastewater Treatment Industry

Water continues to be one of the worlds most vital yet increasingly stressed resources, making its efficient management central to public health, environmental sustainability and long-term economic development. Rising urbanisation, industrialisation, climate-related water stress and growing concerns over water quality are intensifying the need for reliable drinking water, wastewater treatment, reuse and resilience-oriented water infrastructure across both developed and emerging economies. In response, governments and multilateral institutions are increasingly placing water security at the centre of infrastructure, climate and development agendas.

The industry continues to benefit from strong structural momentum, supported by regulatory tightening, public infrastructure spending and growing adoption of advanced treatment technologies.

·In the United States, implementation under the Bipartisan Infrastructure Law and fresh PFAS-related drinking water funding are accelerating investments in contaminant removal, advanced ltration and utility modernisation.

·In Europe, the revised Urban Wastewater Treatment Directive, effective from 1 January 2025, is driving long-term investments in nutrient removal, micropollutant treatment, quaternary treatment and energy-ef cient wastewater systems.

·In India, large-scale initiatives such as Jal Jeevan Mission, AMRUT 2.0 and Namami Gange continue to support investments in drinking water supply, sewage treatment, septage management, river rejuvenation, reuse and source sustainability. As of June

2026, rural tap-water coverage under Jal Jeevan Mission had reached 81.81%, while AMRUT 2.0 has approved thousands of projects across water supply, sewerage and water-body rejuvenation. Namami Gange has also continued to expand sewage treatment capacity and sewerage infrastructure in key river basin states.

·Water reuse, recycling and desalination are also emerging as important growth avenues globally. Countries such as Saudi Arabia continue to prioritise desalination, waste water reuse and integrated water security under the National Water Strategy 2030, while Australias National Water Grid Fund is supporting water recycling, treatment plants and climate-resilient water infrastructure through 2031.

·In Canada, the newly launched Build Communities Strong Fund is creating fresh opportunities in drinking water and wastewater infrastructure linked to housing growth, municipal renewal and climate adaptation.

Across markets, tightening environmental norms and rising water quality concerns are accelerating the adoption of more advanced treatment solutions, including membrane systems, disinfection, tertiary and quaternary treatment, desalination, reuse infrastructure and utility modernisation technologies. At the same time, the sector is increasingly shifting toward water circularity, where waste water is being viewed as a recoverable resource rather than only a disposal challenge. This trend is being reinforced by reuse mandates, municipal sustainability targets, industrial water ef ciency requirements and large-scale multilateral support, including the World Banks Water Forward platform launched in April 2026.

Overall, the long-term outlook for the water and wastewater treatment industry remains constructive. As governments continue to prioritise water security, environmental compliance, wastewater reuse and climate-resilient infrastructure, the sector is expected to remain a critical enabler of both sustainable growth and ecological resilience

OPPORTUNITIES

Accelerating Urban and Rural Drinking Water Programs

Government programs like the Jal Jeevan Mission continue to drive large-scale investments in 24x7 piped water supply, targeting both urban and rural regions. The push to provide potable water to over 146 million households across 700,000 villages, backed by a 3.7 lakh crore (~USD 51 billion) budget, creates a substantial demand for valves, gates, process equipment, and screens areas where Jash holds significant capabilities. This market alone presents a business potential of over

315 Cr/year.

Urban Water Infrastructure Upgrades in Developed Markets

In countries like the U.S., strong capex programs and a supportive regulatory backdrop are driving consistent earnings growth for utilities and water-focused engineering rms. Priorities such as lead pipe replacement, PFAS mitigation, and climate resilience are fuelling demand for advanced water infrastructure equipment. Similarly, the U.K. water sector is entering a new phase with AMP 8, a regulatory framework expected to nearly double water sector investment over the next ve years, started with April 2025. These programs present a significant opportunity for companies like Jash to expand their export footprint.

Rising Sea Level Mitigation

The rising sea levels worldwide are exacerbating the challenge of maintaining clean and accessible freshwater sources, as salt water intrusion contaminates supplies. This has led to a heightened demand for advanced water treatment solutions, driving significant growth in the water treatment equipment market. Technologies such as reverse osmosis, UV puri cation, and advanced ltration are becoming essential in both coastal and inland regions to ensure a sustainable water supply. One stark example of the consequences of rising sea levels is the ongoing crisis in Jakarta, Indonesias current capital. The city faces severe congestion and pollution issues and is the fastest sinking city in the world, with over a third of it predicted to be underwater by 2050. This critical situation underscores the urgent need for effective water treatment solutions to mitigate the impacts of saltwater intrusion and ensure a reliable water supply.

Jashs products are well-suited for use in coastal ood control and salinity mitigation, with rising global demand for smart water control systems capable of managing tidal flows and storm surges. The total addressable market for rising sea water solutions is estimated at over 100 Cr/year.

Desalination Technologies

With rising water scarcity, advancements in desalination technologies are making fresh water production more cost-effective and energy-ef cient, especially in arid regions. This provides a reliable source of fresh water and presents a growth opportunity for water treatment equipment manufacturers. The total addressable market for Desalination solutions is estimated at over 80 Cr/year.

Stormwater Management and Smart Cities

Smart city programs and the growing impact of climate change are driving the need for effective stormwater drainage systems. Jashs products particularly screw pumps, screens, and gates play a vital role in managing excess rainfall and urban ooding. This emerging vertical, coupled with retro ts in existing drainage networks, offers an estimated 50 Cr/year market.

Irrigation and Agricultural Infrastructure

Indias focus on improving agricultural productivity through minor irrigation and lift irrigation schemes has unlocked opportunities in rural infrastructure. Jash contributes to this space with trash rakes, water hammer control systems, screens, and valves tailored for irrigation use. This segment represents an annual potential of

75 Cr, which may further grow with increased public spending on farm infrastructure.

Industrial Water Solutions

Global water-intensive industries are under pressure to reduce fresh water dependency and adopt closed-loop water management practices. Increasing investment in industrial desalination and waste water reuse particularly in the Middle East, Southeast Asia, and Latin Americais creating strong tail winds for Jashs product lines catering to high-performance industrial water systems.

Wastewater Treatment and Reuse Water

Only ~38% of Indias sewage is currently treated, leaving a massive infrastructure gap. Jashs offerings, including screw pumps, knife gate valves, and tertiary treatment systems, are well-positioned to capture this growing market. Coupled with policy mandates on reuse for urban and industrial sectors, the combined waste water and reuse water opportunity is estimated at over 900 Cr/year.

Technological Advancements & Product Innovation

Continued innovation in ltration, automation, smart monitoring, and energy-ef cient pumping systems is shaping the future of the water treatment industry. Jashs ability to integrate these technologies into its product offerings will be key to unlocking market share across urban, industrial, and rural deployments.

Jash Engineerings diverse and technically robust product suite is aligned with the key water infrastructure priorities of both developed and emerging markets. With strong regulatory tail winds, rising environmental consciousness, and sustained infrastructure investments globally and domestically, the company is well-placed to tap into a multi-billion-rupee opportunity across core segments such as drinking water, wastewater, irrigation, desalination, and industrial reuse.

THREATS

Intensifying Market Competition

The global water treatment equipment industry is marked by high levels of competition, comprising approximately 350 companies ranging from multinational giants to regional players. While about 15% of these are large global rms, nearly 50% operate within specific national boundaries. To stay competitive, industry players are deploying diverse strategies such as product innovation, strategic alliances, mergers & acquisitions, and joint ventures. This heightened competition often leads to price pressures, margin compression, and the need for continuous differentiation.

Sensitivity to Economic Conditions

Macroeconomic volatility can have a direct bearing on capital expenditure and project rollout in the water sector. Potential slowdowns in industrial activity, evolving environmental policy frameworks, and rising raw material costs often in uenced by geopolitical tension scan constrain spending on water infrastructure. These factors collectively contribute to uncertainty in demand, pressure on revenue growth, and potential disruptions in long-term planning.

Supply Chain Disruptions

Water treatment equipment manufacturing is heavily reliant on a global supply chain for raw materials, specialized components, and logistics. Events such as natural disasters, political instability, or pandemics can interrupt supply continuity, leading to delays in production schedules, elevated input costs, and short-term revenue impacts. Strategic supplier diversi cation and localized sourcing are increasingly critical to building resilience.

Evolving Regulatory Environment

Stringent environmental regulations, while creating demand for advanced treatment solutions, also introduce compliance challenges. Non-adherence to these regulations can attract significant financial penalties, impact brand credibility, and restrict market access. Maintaining consistent compliance across multiple jurisdictions adds to the operational complexity, particularly for exporters and multinational rms.

Climate Change and Extreme Weather Events

Climate-related disruptions such as oods, droughts, and shifting rainfall patterns are complicating water treatment planning and infrastructure design. These events can alter water availability, quality, and seasonality, demanding greater adaptability and technical sophistication in treatment solutions. Companies must invest in systems capable of operating under variable and often extreme conditions.

Aging Infrastructure

Many municipal and industrial water treatment systems especially in developed markets continue to rely on legacy infrastructure nearing the end of its life cycle. Upgrading or replacing outdated equipment demands significant investment, and delays in modernization may limit the ef ciency and performance of water treatment facilities. This poses a challenge as utilities balance maintenance costs with new infrastructure demands.

Shortage of Skilled Manpower

As the water treatment industry becomes more technology-intensive, there is a growing demand for engineers, technicians, and plant operators with specialized skills in automation, process design, and regulatory compliance. However, a limited talent pipeline in these areas is emerging as a key constraint. The challenge is particularly pronounced in emerging markets where vocational and technical training infrastructure is still developing, potentially leading to execution bottlenecks and slower project delivery.

SEGMENT WISE PERFORMANCE

The business activities of the Group predominantly fall within a single primary business segment viz “Manufacturing and trading of varied engineering products for general engineering industry, water and waste water industry, power plant and bulk solids handling industry”. There is no separate reportable business segment. As part of secondary reporting for geographical segments, the Group operates in two principal geographical areas i.e. in India, its home country, and other countries. The following table presents revenue from operations, segment assets and capital expenditure regarding geographical segments.

Particulars	Current Year Ended 31st March 2026	Current Year Ended 31st March 2025
Amt in Lakhs	Audited	Audited
Segment revenue from external
Within India	32,729.64	26,918.51
Outside India	40,888.88	46,600.25
Revenue from Operations	73,618.52	73,518.76
Segment Assets
Within India	62,189.24	50,721.02
Outside India	25,870.44	24,063.79
Total Assets	88,059.68	74,784.81
Segment Liabilities
Within India	27,421.77	20,726.42
Outside India	8,147.53	10,426.01
Total Liabilities	35,569.30	31,152.43
Capital Expenditure
Within India	3,566.23	2,347.92
Outside India	148.28	2,112.32
Total Capital Expenditure	3,714.51	4,460.24

FUTURE & FORWARD OUTLOOK

Looking ahead, the global water and waste water treatment industry continues to offer a strong long-term growth opportunity, supported by rising concerns around water quality, water scarcity, sustainability and regulatory compliance. Governments and utilities across developed and emerging markets are accelerating investments in drinking water infrastructure, waste water treatment, reuse systems, desalination and utility modernisation, while technologies such as AI-enabled monitoring, smart control systems, advanced membrane treatment and digital water management are gaining wider acceptance. These structural trends are expected to support sustained demand for efficient and advanced treatment solutions across municipal, industrial and infrastructure applications.

For Jash Engineering Limited, FY2025-26 remained relatively challenging and below initial expectations, largely due to U.S. tariff-related uncertainty on previously booked orders and geopolitical disruptions, particularly toward the end of the year, which affected global shipment flows, execution cycles and billing momentum. However, despite these short-term pressures, Jash Engineering Limited remained well-positioned and continued to strengthen its foundation. During the year, Jash Engineering Limited improved liquidity, increased plant capacities and completed strategic acquisitions, including WesTech Process Equipment (India) Pvt. Ltd., Mumbai, and Penstock UK Ltd., Hinckley, which are expected to enhance its capabilities in the process industry business and further strengthen its position in the UK market.

With its diversi ed geographical presence, strong engineering capabilities and expanding product portfolio, Jash Engineering Limited continues to remain aligned with evolving global industry trends. As FY2026-27 begins, the external environment appears relatively more favourable, with U.S. tariff levels having moderated and early signs of geopolitical stabilisation emerging. Backed by stronger internal capabilities and renewed strategic con dence, Jash Engineering Limited is entering the new financial year with a clear focus on higher growth, improved performance and long-term value creation. Over the medium term, Jash Engineering Limited remains committed to strengthening its participation in the global transition toward more sustainable, technology-driven and resilience-oriented water infrastructure, while progressing toward its long-term aspiration of achieving 1,500 crore revenue by FY2030-31.

RISKS AND CONCERNS, INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

Risk Management Strategy

During FY2025-26, the Company continued to strengthen its risk management framework through a proactive and forward-looking approach designed to maintain a moderate-to-low risk pro le. The framework is guided by a clearly defined risk appetite approved by the Board of Directors and supported by a structured process for the identi cation, assessment, analysis, treatment, mitigation, control and continuous monitoring of business risks.

The Companys risk management philosophy is embedded across key functions and is aligned with the scale and complexity of its operations. This approach enables timely evaluation of emerging risks arising from changes in the business environment, global markets, regulatory developments and operational processes. Going forward, the Company remains committed to further strengthening its risk governance architecture and leveraging technology to enhance responsiveness, visibility and control across its evolving business operations.

Foreign Exchange Exposure

Given the Companys engagement in international business activities, fluctuations in foreign currency exchange rates continue to remain an important area of risk management focus. Exchange rate movements can have a direct impact on operational performance, pro tability, cash flows and the carrying value of foreign currency-denominated assets and liabilities.

To manage this exposure effectively, the Company follows a well-de ned Foreign Exchange Risk Mitigation Policy, supported by appropriate hedging strategies and periodic exposure reviews. The Company continuously evaluates its foreign exchange risk across key areas, including:

1. International trade transactions, covering export and import operations

2. Foreign currency-denominated assets and liabilities, including loans, receivables, payables and investments

3. Overseas operations and subsidiaries, where exchange-rate movements may affect financial results across different geographies

The Company also remains conscious that broader macroeconomic, geopolitical and policy developments both domestic and international may affect currency markets and, consequently, business performance. Accordingly, foreign exchange positions are reviewed regularly and managed within approved policy parameters.

Process Re-engineering and Compliance

During FY2025-26, the Company continued its process re-engineering initiatives with the objective of improving operational ef ciency, strengthening governance and enhancing compliance oversight. Business processes are being progressively aligned with both internal control requirements and the evolving external regulatory environment.

The Company remains committed not only to meeting statutory and regulatory obligations, but also to building a culture of compliance that goes beyond the minimum prescribed standards. Technology continues to play an increasingly important role in this journey, supporting process standardisation, real-time monitoring, improved documentation and stronger compliance controls across functions.

Internal Control System & Monitoring Mechanism

The Companys internal control framework remains a critical pillar of its governance structure and is designed to safeguard assets, ensure accuracy and reliability of financial and operational information, support regulatory compliance and improve overall business effectiveness. The internal control environment is closely linked to the risk management process, with risk assessment outcomes being used to identify and implement appropriate control measures.

Where risks cannot be fully eliminated, they are continuously monitored and periodically reported to the Risk Management Committee and the Audit Committee for oversight and review. The Company also de nes transaction-level limits and approval mechanisms in accordance with internal policies and banking norms in order to ensure that exposure remains within acceptable thresholds.

The monitoring process includes:

1.Periodic review of net open positions and risk exposure levels

2.Assessment of the effectiveness of risk mitigation and hedging instruments

3.Timely revision of strategies and controls in response to changing business and market conditions

The Company remains focused on continuously upgrading its internal control and monitoring systems to ensure alignment with business requirements and an increasingly dynamic risk environment.

Adequacy and Review of Internal Controls

The Companys internal control systems are considered adequate and commensurate with the size, nature and complexity of its operations. These controls support timely preparation of accounts, generation of reliable management information, and compliance with applicable laws, regulations and internal policies.

The adequacy and effectiveness of internal controls are reviewed on an ongoing basis through an independent internal audit function as well as by the statutory auditors. The Audit Committee of the Board periodically reviews the internal audit ndings, evaluates the effectiveness of control mechanisms and monitors the implementation of corrective actions and recommendations.

Overall Governance Outlook

The Company remains vigilant and disciplined in its approach to risk management, foreign exchange exposure, compliance and internal control. As the business environment continues to evolve in response to market volatility, regulatory developments and operational complexity, the Company will continue to strengthen its control frameworks, improve process resilience and leverage technology to uphold high standards of governance, accountability and operational excellence.

DISCUSSION ON FINANCIALPERFORMANCE WITH RESPECT TO OPERATIONALPERFORMANCE

The Financial performance of the Company for the year 2025-26 is described in the Directors Report under the headings Summarized Pro t & loss Account and State of Companys Affairs & Review of operations.

MATERIAL DEVELOPMENTS IN HUMAN RESOURCES / INDUSTRIAL RELATIONS FRONT, INCLUDING NUMBER OF PEOPLE EMPLOYED

Our collective strength stems from the synergy of experience, innovation, and an unwavering commitment that de nes our leadership and propels our success. Backed by a seasoned leadership team, an agile middle management, and a high-performing junior workforce, we continue to deliver large-scale, complex projects with precision and ef ciency.

We are committed to fostering a constructive and inclusive workplace, guided by robust policies and best-in-class HR practices that ensure transparency and equal opportunities for all employees. We uphold a strict zero-tolerance policy towards any form of harassment be it racial, sexual, religious, gender-based, or any other form protected under law.

The dedication and perseverance of our people remain at the heart of our growth journey. To strengthen this foundation, the Company has undertaken several strategic initiatives aimed at improving operational ef ciency, enabling process enhancements, and deepening employee engagement. These efforts have significantly boosted productivity across the organisation.

Recognising the need to attract, retain, and nurture top talent, we continue to implement progressive, employee-focused policies. A key initiative in this direction is the Employee Stock Option Scheme (ESOS), introduced to foster a sense of ownership and align long-term interests. This scheme extends to employees of both the Company and its subsidiaries, in India and abroad.

Furthering our commitment to employee well-being and engagement, we have invested in a dedicated sports turf at Unit II, which serves as the venue for our internal Turf League and Jash Premier League training sessions. Adjacent to the turf, a leased restaurant offers discounted meals to employees, with the lease revenue directed toward supporting engagement initiatives.

We also continue to invest in leadership development and the strengthening of technical and functional capabilities to meet evolving talent needs. Our approach to human resource management centred around continuous training, performance-based incentives, and fair practices in promotion, transfer, and remuneration has played a vital role in maintaining our competitive edge in product quality, pricing, brand equity, and service excellence.

As of March 31, 2026, our workforce has grown to over 1,221 employees, comprising both permanent and contractual staff. The Company remains committed to upskilling and reskilling our teams through structured training and development programs. We take pride in the strong, collaborative relationship shared between management and employees at all levels, united in our pursuit of achieving the Companys strategic goals and performance benchmarks.

Cautionary Statement

The information presented in the Boards Report and the Management Discussion and Analysis includes projections and anticipations about future events, which can be identified as forward-looking statements under the relevant securities laws and regulations. It is important to recognize that a multitude of factors could cause actual outcomes to differ materially from what has been forecasted. These factors encompass economic fluctuations, alterations in government regulations, tax laws, other statutes, market dynamics, and a range of related and incidental elements. Investors and stakeholders should be aware that forward-looking statements are not guarantees of future performance. They involve known and unknown risks, uncertainties, and assumptions that may cause the companys actual results, performance, or achievements to be significantly different from any future results, performance, or achievements expressed or implied by such statements. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by applicable law. Stakeholders are advised to exercise caution and not to place undue reliance on these forward-looking statements when making investment decisions.