Jash Engineering Ltd Management Discussions

Annexure B

ECONOMIC REVIEW GLOBAL ECONOMY

Resilient Yet Uneven Amid Geopolitical and Structural Headwinds

The global economy maintained its resilient momentum through 2024, but progress remained uneven across regions amid escalating geopolitical tensions, fragmented trade relationships, and rising public debt. A wave of national elections around the world added further uncertainty, creating a more complex and unpredictable global economic landscape. The sharp increase in tariffs and the resulting policy uncertainty have contributed to a broad-based slowdown in growth, casting a shadow over medium-term prospects. Structural policy shifts are reshaping the global trade architecture and testing the resilience of the world economy. While inflationary pressures have begun to ease, and many central banks have pivoted toward monetary easing, ongoing conflicts, supply-side disruptions, and fiscal constraints in developing economies are expected to limit the pace of global recovery.

Global economic growth is projected at 2.8% in 2025 and 2.9% in 2026, broadly in line with the estimated pace of 2023 and 2024 but still below the pre-pandemic average of 3.2% (2010-2019). While modest recoveries are expected in the European Union, Japan, and the United Kingdom, and growth in China and the United States continues, albeit at a slower pace, many low-income and vulnerable nations face weakening growth prospects. Persistent challenges such as high debt burdens, weak investment, demographic headwinds, and post-pandemic scarring continue to weigh on long-term potential, particularly for the least developed countries. Although the green transition and rapid technological progress offer opportunities, their benefits remain largely concentrated in advanced economies. Many developing countries lack the financing capacity and institutional readiness to upgrade infrastructure, build human capital, and enhance value-added sectors.

Monetary Policy Shift and Financial Market Volatility

Monetary and fiscal policy dynamics are expected to significantly influence the global economic trajectory in the years ahead. Central banks across advanced economies are projected to continue monetary easing, though the pace and magnitude will vary. In the United States, the federal funds rate is expected to decline to 4% by the end of 2025, before gradually reverting to its estimated long-run neutral level of 2.9% by 2028. The European Central Bank is anticipated to reduce policy rates further, reaching 2% by mid-2025, while Japan is likely to proceed cautiously in tightening, gradually lifting rates to a neutral level of around 1.5% in line with its 2% inflation objective.

On the fiscal front, advanced economies are set to adopt a more restrained stance. The United States is projected to improve its structural fiscal balance by 1 percentage point of GDP in 2025, though federal debt is expected to rise from 121% of GDP in 2024 to 130% by 2030 under current policy assumptions. In the euro area, increased defence spending and public investment are likely to widen Germanys primary deficit by the end of the decade, with broader implications for France, Italy, and Spain. As a result, the eurozones overall debt-to-GDP ratio is projected to rise from 88% in 2024 to 93% by 2030.

Emerging market and developing economies (EMDEs) face growing fiscal stress, with primary deficits expected to widen slightly in 2025 before a gradual tightening begins in 2026. Chinas structural fiscal balance is forecast to deteriorate by 1.2 percentage points in 2025, contributing to a broader trend of rising debt across EMDEs, where the average public debt is expected to increase from 70% of GDP in 2024 to 83% by 2030.

Trade Policy Shifts and Rising Global Uncertainty

Global trade dynamics have worsened considerably following the U.S. announcement in early April of prospective tariffs tied to bilateral trade deficits. This move triggered a sharp escalation in trade tensions with China. Although country-specific tariffs were later replaced with a uniform 10% rate easing some of the most prohibitive measures overall U.S. tariff levels have reached their highest point in nearly a century. In response, several trading partners imposed retaliatory tariffs, adding to global trade policy uncertainty. Limited exemptions for sectors such as pharmaceuticals, semiconductors, energy, and critical minerals have done little to offset the broader drag on global trade sentiment.

Before these tariff actions, global goods trade had shown signs of recovery, partly due to inventory restocking in anticipation of policy changes. However, this momentum proved short-lived, By April, new export orders had fallen to a 20-month low, reflecting weakening demand and fading confidence, Services trade, while nearing prepandemic travel activity levels, has also plateaued, with growth momentum slowing in most categories.

Consequently, global trade growth in goods and services is expected to decline sharply from 3,4% in 2024 to just 1,8% in 2025 before gradually recovering to 2,4% in 2026 and 2,7% in 2027, This remains well below the pre-pandemic average of 4,6%, The near-term outlook remains fragile, with elevated risks from renewed trade restrictions, persistent geopolitical tensions, and policy unpredictability all of which could depress investment and prolong the trade recovery

Growth Patterns Across Economies: Resilience and Divergence

Economic growth in advanced economies is projected to remain modest but broadly stable, GDP growth is expected to inch up from 1,7% in 2024 to 1,8% in 2025, as inflation pressures ease and monetary policy settings normalize, The United States continues to lead among peers, supported by robust consumer spending and a tight labour market, In contrast, the Euro Area and Japan are expected to post slower recoveries due to structural rigidities, demographic challenges, and weaker productivity gains.

Growth in emerging markets and developing economies is expected to moderate from 4,3% in 2024 to 3,7% in 2025, before improving slightly to 3,9% in 2026, The temporary slowdown reflects tighter global financial conditions, reduced external demand, and policy constraints at home, However, within EMDEs, Asia remains a strong performer, India and Southeast Asia are poised to maintain high growth momentum, buoyed by resilient domestic consumption, rising investment activity, and improving infrastructure.

Elsewhere, regional outlooks remain mixed, Latin America continues to grapple with commodity-driven volatility and limited fiscal headroom, while Sub-Saharan Africa faces challenges from fluctuating commodity prices, elevated debt, and food security risks, Despite these pressures, countries with diversified growth drivers and reform momentum may outperform peers over the medium term.

Commodity Markets: Mixed Signals and Regional Impacts

Commodity prices are expected to decline overall in 2025, with a projected 10% drop, followed by further softening in 2026 driven primarily by falling fuel prices, Oil and coal prices are forecast to fall by 15,5% and 15,8%, respectively, reflecting rising supply and subdued demand, In contrast, natural gas prices are projected to rise by 22,8%, driven by weather anomalies and disruptions to Russian gas transit through Ukraine, Non-fuel commodities are expected to rise modestly, with a projected 4,4% increase in 2025, Food and beverage prices have been revised upward amid weather-related supply disruptions, Meanwhile, base metal prices, which fell sharply in early April amid weaker global industrial activity, have since partially recovered, Copper and aluminium benefited from anticipatory buying ahead of new tariff rules, with U,S, aluminium prices trading at a premium to global benchmarks, The broader metals index is expected to decline by 5% in 2025 and edge lower in 2026 before stabilizing, In contrast, the precious metals index dominated by gold, silver, and platinum is forecast to rise more than 30% in 2025, reflecting demand for safe-haven assets amid heightened market volatility.

Inflation Dynamics and Financial Market Volatility

Global headline inflation is expected to ease to 4,3% in 2025 and 3,6% in 2026, Advanced economies are forecast to reach near-target inflation levels of 2,2% by 2026, while inflation in EMDEs is expected to moderate to 4,6%, However, the pace of disinflation has slowed in recent months, with persistent service-sector price pressures and heightened trade uncertainty keeping core inflation elevated in several economies.

Financial markets remained volatile throughout 2024, with equity indices and long-term bond yields experiencing sharp swings, The announcement of trade restrictions in April led to a steep sell-off in global equities, though markets stabilized after a 90-day tariff pause and a partial rollback in U,S,-China tariffs, Despite easing monetary policy, risk sentiment continues to fluctuate due to geopolitical developments, structural shifts in technology valuations, and uncertainties around fiscal sustainability

Outlook

As the global economy navigates a challenging and rapidly evolving landscape, the overall outlook remains cautiously optimistic but clouded by significant downside risks, While the resilience demonstrated in 2024 has laid a foundation for gradual recovery, multiple headwinds including elevated geopolitical tensions, tighter fiscal space, and persistent trade frictions continue to weigh on confidence and investment sentiment, Global growth is expected to remain steady yet subdued in 2025 and 2026, supported by easing inflation, accommodative monetary policies, and modest recoveries in major economies, However, the benefits of this recovery are likely to be unevenly distributed, with advanced economies stabilizing faster than many emerging and developing nations, which continue to face structural constraints and limited policy buffers.

Going forward, the pace and sustainability of global growth will hinge on several key factors: the trajectory of monetary easing, the resolution of geopolitical and trade tensions, the ability of economies to manage public debt prudently, and the extent to which technological and green transitions can be leveraged inclusively, In this dynamic environment, adaptability, prudent policymaking, and strategic investment in resilience will be essential to unlocking new opportunities and sustaining long-term global growth.

Source: World Economic Outlook 2025 - IMF, Global Economic Prospects -World Bank Reports

INDIAN ECONOMY

Steady Strides Toward a USD 4 Trillion Economy

FY 2024-25 marked a pivotal phase in Indias economic trajectory, shaped by sustained growth momentum and the continued impact of structural reforms, The economy advanced on the back of a robust, investment-led expansion, driven by a strong push in public infrastructure and active participation from the private sector, Despite prevailing global uncertainties, domestic demand remained resilient and continued to serve as a key growth engine, Rising consumption, rapid urbanization, and expanding financial inclusion contributed to broad-based growth across sectors, The services sector witnessed strong momentum, while manufacturing and construction gained from increased capital outlays by both government and industry, A key highlight of the year was Indias accelerating progress in digital transformation and financial inclusion areas increasingly central to the countrys economic development, The expansion of digital public infrastructure, rapid fintech adoption, and formalization of financial services created new growth opportunities, especially for small businesses and rural economies, With GDP approaching the USD 4,1 trillion mark, India further cemented its position as a major contributor to global economic output and trade, Strengthened by strategic international partnerships, diversified exports, and sound macroeconomic fundamentals, the countrys global standing has risen, Simultaneously, ongoing domestic reforms continue to reinforce the foundation for long-term, sustainable growth.

Domestic Demand and Monsoon-Led Agricultural Growth Support FY25 GDP Expansion

Indias real GDP growth for FY25 is estimated at 6,4%, according to NSOs advance estimates, reflecting a moderation from 9,2% in the previous year, Aggregate demand, measured by GDP at constant prices, grew by 6,5%, with private final consumption expenditure (PFCE) rising by 7,6%, This was largely driven by strong rural consumption, supported by robust agricultural performance, as evidenced by higher sales of two-wheelers, tractors, and rural FMCG products, In contrast, urban demand softened, indicated by weaker sales of consumer non-durables and passenger vehicles, PFCEs share in GDP increased to 56,7% during the year, Government final consumption expenditure (GFCE] growth slowed to 3,8% from 8,1% in the previous year, while net exports provided a positive contribution as export growth outpaced imports, On the supply side, real gross value added (GVA) at basic prices rose by 6,4%, compared to 8,6% in FY24,While industrial activity slowed partly due to an unfavourable base and services sector growth moderated, an improvement in agriculture helped sustain the momentum, Agriculture and allied sectors recovered during 2024-25, supported by an above normal south-west monsoon, The overall SWM rainfall in 2024 (June-September] was 108 per cent of the long-period average (LPA) at the all-India level as against a deficit of six per cent in 2023.

Industrial Growth Moderates on High Base; PLI Scheme Supports Manufacturing Momentum

Growth in the industrial sectors gross value added (GVA] slowed to 4,3% in 2024-25, down from 11,0% in the previous year, This moderation was largely due to a high base, particularly in the manufacturing segment, which constitutes around 80% of the industrial sector and also expanded by 4,3% in FY25 compared to a robust 12,3% in FY24, The slowdown was reflected in weaker profitability within the corporate manufacturing sector, Industrial activity, as captured by the Index of Industrial Production (IIP], also showed signs of deceleration during the year, Nevertheless, 17 out of 23 industry groups within manufacturing registered year-on-year growth, From a use-based perspective, all industrial categories-except consumer non-durables-posted gains, Meanwhile, the Production Linked Incentive (PLI] scheme continued to play a catalytic role in driving growth across key manufacturing industries, helping integrate India more deeply into global production and export value chains.

Moderating Inflation and Eased Input Costs Create Supportive Policy Space in Fy25

In FY25, headline inflation in India moderated to an average of 4.6%, down from 5.4% in the previous year, primarily influenced by fluctuations in food prices arising from recurrent weather-related supply disruptions, Consumer Price Index (CPI) inflation softened during April to August 2024 but spiked in September and October due to a sharp rise in food prices, especially vegetables and edible oils, This surge, however, was reversed from November 2024 to March 2025 with the arrival of winter crops, easing food inflation, Fuel inflation remained in deflation throughout the year, led by a decline in LPG prices, Core inflation excluding food and fuel also eased, reflecting the lagged effects of tighter monetary policy and reduced input cost pressures, Government interventions on the supply side further helped contain price pressures, Against this backdrop, the Reserve Bank reduced the policy rate by 25 basis points, using the available space to support growth while also conducting targeted market operations to maintain durable liquidity, Consequently, system liquidity returned to surplus by the end of March 2025, Looking ahead, economic activity is expected to gain traction after a subdued first half of the year, with headline inflation projected to ease further towards the target in FY26, The Reserve Bank remains committed to maintaining price stability while ensuring sufficient liquidity to support productive sectors and sustained economic growth.

Engineering Goods Drive Export Gains, Bilateral Deficits widen with Strong Import Rebound

Indias merchandise exports in FY25 recorded a marginal year-on-year increase of 0,1% to USD 437,4 billion, marking a recovery from the 3,1% contraction seen in FY24, Imports, on the other hand, rose by 6,2% to USD 720,2 billion, reversing a 5,3% decline in the previous year, Export growth was led by strong performances in electronic goods, engineering goods, pharmaceuticals, rice, and readymade garments, while petroleum products and gems & jewellery registered declines, Engineering goods, which made up 26,7% of total exports, grew by 6,7%, supported by rising shipments of aircraft and spacecraft parts, electric machinery, motor vehicles, auto components other miscellaneous engineering items, However, this momentum was partly offset by declines in exports of metals such as iron, steel, aluminium, and copper, as well as office equipment and mica products, On the import front, the expansion was driven by gold, electronics, and petroleum-related products, Petroleum, oil, and lubricants (POL) imports rose by 3,9% to US$ 185,8 billion, contributing 25,8% to total imports, with a volume growth of 6,8%, Russia continued to be the largest crude oil supplier, while the UAEs share increased and that of Iraq and Saudi Arabia declined, As a result of stronger import growth, the merchandise trade deficit widened to US$ 282,8 billion from US$ 241,1 billion a year earlier, with oil accounting for 43,3% of the total deficit, Bilateral trade deficits with China, Russia, and the UAE widened, while trade surpluses improved with the US, the Netherlands, and the UK.

FPIs Pull Back in FY25 Amid Global Uncertainty While Domestic Mutual Funds Drive Market Support

In FY25, the Indian equity market experienced a two-phase performance, The first half saw benchmark indices touch fresh highs, driven by strong domestic sentiment, However, the second half was marked by a sharp correction triggered by a combination of global factors, including shifting expectations around monetary policy in advanced economies, evolving US tariff policies, and heightened geopolitical tensions in the Middle East and Europe, Despite the volatility, the broader market showed resilience, with the BSE Midcap and BSE SmallCap indices posting gains of 5,6% and 8%, respectively, Sectoral indices displayed a mixed performance over the year, On the investment front, foreign portfolio investors (FPIs) turned net sellers, offloading D,4 lakh crore worth of equities in FY25, as against net purchases of T2,1 lakh crore in the previous year, In contrast, domestic mutual funds significantly increased their participation, making net purchases of T4,7 lakh crore, more than double the T2,0 lakh crore recorded in FY24.

INR Depreciates 2.4% in FY25 Amid Global Pressures and Capital Outflows

The Indian Rupee depreciated by 2,4% in FY25, closing at T85,46 per US dollar, with most of the weakness concentrated in the second half of the year, In Q1FY25, the INR remained stable, supported by easing crude oil prices and net foreign portfolio investment (FPI) inflows, despite a rising US dollar index (DXY) and firm US Treasury yields, ending flat at T83,38, Depreciation began in Q2 due to the unwinding of carry trades and rising safe-haven demand amid US recession concerns, with the rupee slipping to T83,79, The sharpest decline occurred in Q3, driven by a 7,7% surge in the US dollar index (DXY) and over US$ 11 billion in FPI equity outflows, taking the INR to T85,62, Continued external uncertainties and additional FPI outflows of more than US$ 13 billion kept the rupee under pressure in Q4, However, some recovery in March 2025, supported by easing DXY and debt inflows, led to a marginal 0,2% appreciation in the quarter.

Government Advances Fiscal Consolidation with Focus on Revenue Strength and Quality Capex

In FY25, both central and state governments advanced fiscal consolidation, supported by strong tax collections, Gross tax revenue exceeded budget estimates by T13,285 crore, rising to 11,6% of GDP, led by buoyant income tax and GST collections, Net tax revenue to the Centre grew by 9,9%, moderated by higher devolution to states, Non-tax revenue surged by 32,2%, aided by a large surplus transfer from the Reserve Bank, However, capital expenditure fell short of the budget estimate by T92,682 crore and was placed at 3,1% of GDP, slightly below 3,2% in FY24, Effective capital expenditure rose by 5,2%, reaching 4,0% of GDP.

Looking ahead, the Union Budget 2025-26 reaffirmed the governments fiscal prudence with a targeted fiscal deficit of 4,4% of GDP, Capital expenditure is budgeted to grow by 10,1%, remaining steady at 3,1% of GDP, Capital support to states via the 50-year interest-free loan scheme has been enhanced to D,5 lakh crore, while grants for asset creation are expected to push effective capital expenditure to 4,3% of GDP, Fiscal consolidation, through rationalisation of revenue expenditure and enhanced revenue generation, remained a key focus of the Union Budget 2025-26, While focusing on rebuilding its fiscal buffers, the Union government has also maintained its expenditure quality by budgeting a robust growth in its capital expenditure in 2025-26.

Resilient Today, Poised for Sustainable Growth Ahead

To conclude, the Indian economy remained resilient in FY2024-25, navigating a complex global environment through strong macroeconomic fundamentals, prudent fiscal management, and proactive policy interventions, Inflation edged closer to the target, aided by easing input costs, effective supply-side measures, and the cumulative impact of earlier monetary tightening, The financial sector remained a pillar of strength, with improved asset quality, healthy capital buffers, and stable credit flows supporting economic momentum, Despite global uncertainties, financial markets functioned in an orderly manner, and external balances remained stable, with the current account deficit contained by robust services exports and steady remittance inflows, While global risks-ranging from geopolitical tensions and trade fragmentation to climate-related disruptions-pose challenges, India is well-positioned to maintain its growth leadership among major economies in FY2025-26, anchored by structural reforms, sustained investment, and a continued focus on inclusive and sustainable development.

Source: RBI Press release & Annual report FY25, Economic Reports by Department of Economic affairs, IBEF

WATER AND WASTEWATER TREATMENT EQUIPMENT INDUSTRY STRUCTURE AND DEVELOPMENTS GLOBAL INDUSTRY DEVELOPMENTS

Water scarcity continues to pose a critical global challenge, significantly impacting consumption patterns and access to safe drinking water, According to the United Nations, nearly 1,2 billion people approximately one-fifth of the worlds population reside in regions facing physical water scarcity, while an additional 1,6 billion people struggle with economic water scarcity due to a lack of financial means to access freshwater, This growing pressure on water resources, coupled with deteriorating water quality, is particularly severe in many developing nations.

Countries with large and growing populations, such as India and China, face acute drinking water challenges, offering substantial opportunities for the water and wastewater treatment equipment industry, The World Health Organization reported that as recently as 2012, more than half of the population in these two countries lacked access to safe drinking water, As global population growth intensifies the demand for potable water amidst finite freshwater availability, there has been a marked shift toward technologies that enable the treatment and reuse of alternative water sources, such as desalinated and reclaimed water, These dynamics are expected to drive sustained growth in the market for water and wastewater treatment equipment.

The global water ond wostewoter treatment equipment market wos valued ot USD 69,783,8 million in 2024 and is estimated to grow to USD 93,435,6 million in 2029, This will create on incremental growth opportunity worth USD 23,651,8 million between 2024 and 2029, which translates to oround 34% of the market size in 2024, The market growth is driven by factors such os populotion growth, urbonizotion, industriolizotion, ond stricter environmental regulotions, Rising awareness of environmental pollution, stringent management regulations, and a growing demand for sustoinoble ond efficient wastewater treatment solutions are expected to contribute to the expansion of the water ond wastewater treatment equipment industry, The market is further set to grow due to increasing industrialization, population growth, ond stricter government regulations on wastewater discharge.

Innovative technologies, including membrane filtration systems, ultraviolet (UV) disinfection, and advanced oxidation processes, are gaining popularity, For instance, reverse osmosis systems are commonly used for desalination, tackling freshwater scarcity concerns, Furthermore, UV disinfection technologies are becoming more prevalent due to their efficiency in removing microorganisms from water sources, Additionally, the global push for circular economy concepts and resource recovery fuels market expansion, encouraging the use of wastewater treatment technology to capture valuable resources and energy from wastewater, As end user industries prioritize sustainable practices and governments invest in water infrastructure, the global water and wastewater treatment equipment market is expected to grow further, providing a range of solutions to global water concerns, Owing to such factors, the global water and wastewater treatment equipment market is expected to witness significant growth.

Regional Breakdown:

• Asia-Pacific accounts for 36% of the market shore, or USD 1,91 billion in 2024, growing at o CAGR of 4,2%, fuelled by rapid industriolizotion, urbanization, and increasing investments in water infrastructure, particularly in India ond China.

• North America holds o 23% ond Latin America holds 4% market shore, USD 1,64 billion in 2024, with a CAGR of 3,7%, driven by stringent regulations on water quality ond advancements in water treatment technologies.

• Europe holds 28% of the market shore, USD 1,37 billion in 2024, with a CAGR of 3,8%, supported by strict environmentol regulotions and high adoption of advanced water treatment systems in countries like Germany, France, and the UK.

• Rest of the World captures 9% of the global market, equating to USD 0,54 billion in 2024, with a CAGR of 3,5%, driven by growing awareness about water reuse and increasing adoption in regions like the Middle East and Africa.

Market based on Application

In 2024, the global water and wastewater treatment equipment market was dominated by municipal segment contributing to a market share of 62.1% and the industrial segment held the smallest market share of 37.9%. By 2029, the Municipal segment is projected to lead the global water and wastewater treatment equipment market with a 61.1% share, while the industrial segment will hold 38.9%. Between 2024 and 2029, the municipal segment is expected to grow by USD 13.78 billion, and the industrial segment by USD 9.87 billion.

Market based on Process

In 2024, the tertiary treatment process led the global water and wastewater treatment equipment market, contributing approximately 43.73% of total revenue. This segment is projected to grow at the fastest CAGR of 6.3% from 2025 to 2034, driven by its ability to enhance effluent quality before reuse or environmental discharge. Tertiary treatment effectively removes residual inorganic chemicals, pathogens, and parasites, making water suitable for reuse.

Primary treatment, which involves the removal of heavy sediments and floating debris through tanks and filters, benefits from low operating costs and strong market visibility. These factors are expected to support its continued expansion during the forecast period.

The secondary treatment segment is anticipated to grow at the second-fastest CAGR of 6.8%. It primarily targets soluble organic pollutants like phosphorus and nitrogen using biological processes such as trickling filters, bio-towers, rotating biological contactors, and activated sludge systems. Advanced technologies like membrane bioreactors (MBRs)-which combine membrane filtration with biological treatment-are gaining traction for their efficiency in removing suspended and organic matter through microfiltration or ultrafiltration.

Product Segment Breakdown

• The water and wastewater treatment equipment market is led by the filtration segment comprising granular/sand filtration, adsorption, reverse osmosis (RO), and microfiltration (MF) which accounts for approximately 50% of total sales, valued at USD 2.73 billion in 2024. This segment is growing at a CAGR of 4.2%, propelled by ongoing advancements in membrane filtration technologies and heightened global demand for clean drinking water.

• Disinfection technologies, including chlorine and ultraviolet (UV) systems, represent around 30% of the market, totalling USD 1.64 billion in 2024, with a CAGR of 3.5%. The growth is supported by the increasing adoption of UV-based purification solutions in both residential and industrial applications.

• Desalination contributes approximately 15% of the market share, or USD 0.82 billion in 2024, and is expanding at a CAGR of 4.0%, driven by escalating water scarcity issues and rising global investments in desalination infrastructure.

• The Testing segment, focused on monitoring water quality in industrial and municipal sectors, holds the remaining 5% share, amounting to USD 0.27 billion in 2024, and is growing at a CAGR of 3.2%, reflecting the growing emphasis on regulatory compliance and environmental monitoring.

• In 2024, the Membrane separation segment was dominant and held 19% of the overall market share in terms of revenue. Membrane separation is a physical treatment method that involves forcing feed water through a semi-permeable membrane at high pressure to remove certain components from the solution. Membrane separation has various advantages over previous approaches, including a small operating area and great filtration efficiency.

• The Sludge treatment segment is expected to grow at the second-fastest rate. Sludge screening, drying, dewatering, and thickening are all part of these systems. To prevent sludge treatment operations from being disturbed, sludge screening equipment is used to remove particles such as hair, plastics, and Fibers.

Global Government Initiatives Driving Market Opportunities

Governments worldwide are actively investing in water infrastructure and sustainable management practices, creating significant growth opportunities for water and wastewater treatment equipment providers. Australias USD 2.5 billion National Water Grid Fund supports decentralized treatment systems, while Chinas ESG-driven water governance and five- year plan aim to enhance water quality and ecological restoration. Indias National Mission for Clean Ganga and regional investments in decentralized sewage treatment reflect a strong commitment to pollution control and water reuse. Japans collaboration with India to implement Johkasou technology further highlights the global push toward decentralized and efficient wastewater solutions. These initiatives not only address environmental challenges but also stimulate demand for advanced treatment technologies and equipment.

Promising Outlook for the Industry

With increasing regulatory support, rising environmental awareness, and growing investments in water infrastructure, the global water and wastewater 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: Technavio, Precedence Research Reports

INDIAN INDUSTRY DEVELOPMENTS

In FY25, Indias water and wastewater 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 wastewater management has intensified. 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 refining. 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 wastewater treatment space, these developments represent a compelling opportunity to expand their footprint ond contribute meaningfully to the notions public health ond environmental gaols.

Indio ranked as the 4th-lorgest market for water ond wastewater treatment equipment in 2024, with a market size of USD 4,466,1 million, It is expected to retain this position through 2029, driven by strong economic growth, rapid urbonizotion, ond rising environmental regulotions, The Indian market is projected to expond at o CAGR of 6,2% from 2024 to 2029 outpacing the global overoge growth rote-reflecting sustained momentum in infrastructure investments and public sector initiotives.

Among the major markets worldwide, Indio will be the 3rd-fostest growing country over this period, with the market size expected to reach USD 6,030,4 million by 2029, The country is anticipated to contribute 6,6% to the globol markets incremental growth between 2024 and 2029, Indias shore in the global water ond wastewater treatment equipment market stood ot 6,4% in 2024, and this is projected to rise slightly to 6,5% by 2029, underscoring its growing significance in the global landscape.

In March 2024, the National Mission for Clean Ganga (NMCG), a flagship initiative under the broader Namami Gange Programme, continued to play a pivotal role in restoring and preserving the Ganga River. The mission focuses on eliminating the discharge of untreated wastewater into the river through the development of sewage treatment plants (STPs) and the promotion of decentralized wastewater management solutions. By prioritizing sustainable infrastructure and pollution control, the NMCG aims to significantly improve water quality, support biodiversity, and restore the ecological balance of the river for future generations.

Earlier, in October 2022, the Delhi State Government approved a funding of INR 5.7 billion (USD 69.95 million) for the implementation of sewer line projects and construction of decentralized sewage treatment plants (DSTPs) in the Bawana and Mundka regions. These initiatives are part of a broader effort to bring the Yamuna River up to bathing water quality standards by 2025, particularly addressing the long-standing sewage issues in unauthorized colonies. These targeted actions reflect a growing commitment by both central and state governments to strengthen urban water infrastructure and reinforce demand for advanced water and wastewater treatment technologies.

India, as one of the most populated nations and the second-largest consumer of water, presents significant growth potential for the water and wastewater treatment equipment market. Improving economic conditions, coupled with a strong policy push, are expected to accelerate the development of the wastewater treatment sector. Key challenges such as rising water scarcity, declining groundwater levels, and infrastructure gaps are driving the demand for advanced treatment solutions. In response, the government continues to introduce targeted initiatives and schemes aimed at strengthening water management capabilities. These efforts are set to further propel market expansion, reinforcing the critical role of innovative and efficient treatment technologies in securing Indias water future.

Scope of the Water & Wastewater Treatment Industry

Water, the lifeblood of our planet, is a finite and increasingly stressed resource that demands vigilant management. With the global population surpassing 8 billion and accelerating rates of urbanization and industrialization, the demand for clean, safe, and reliable water supplies has reached an all-time high. In response, the water and wastewater treatment industry has emerged as a critical pillar in safeguarding water quality, ensuring public health, and supporting economic development.

As of FY 2024-25, the industry has seen robust growth, driven by mounting concerns over water quality, tighter environmental regulations, and the widening gap between water demand and supply. Technological advancements across filtration, disinfection, desalination, and testing continue to transform the landscape of water treatment solutions.

A key challenge confronting the industry is the exponential rise in wastewater generation, especially from sectors involved in chemicals, pharmaceuticals, mining, and agriculture, These industries discharge effluents that are often toxic, persistent, and difficult to treat, heightening risks to ecosystems and human health, According to global estimates, more than 40% of the population experiences severe water scarcity annually, underscoring the urgent need for scalable and effective treatment technologies, Moreover, water stress is increasingly a dual threat-arising not only from limited quantity but also deteriorating quality.

Countries across the globe have demonstrated strong commitments to water sustainability through investments in wastewater reuse and recycling:

• Israel remains a global leader, treating and reusing over 90% of its wastewater, mainly for agricultural irrigation.

• Singapore, through its NEWater initiative, meets up to 40% of its water needs via high-grade reclaimed water.

• Australia continues to expand decentralized reuse systems, especially in drought-prone areas like Perth.

• Spain treats and reuses a significant share of municipal wastewater, primarily for agriculture and landscape irrigation.

• Indonesia, facing climate and infrastructure challenges in Jakarta, is repositioning its capital to Nusantara in Borneo, with sustainable water infrastructure at its core.

• United States, particularly in California and Florida, is scaling up water reuse to tackle chronic water shortages.

• India, driven by rapid urbanization and industrial expansion, has intensified its focus on municipal and industrial wastewater management through landmark initiatives such as the Jal Jeevan Mission, Jal Shakti Abhiyan, and National Rural Drinking Water Programme.

In water-scarce regions like the Middle East, mega-scale desalination projects are accelerating the adoption of advanced water treatment systems, creating strong tailwinds for the industry.

Looking ahead to FY 2025-26, the water and wastewater treatment industry is set to grow steadily at a CAGR of 4-5%, driven by stricter environmental regulations, rising investments, and increasing water stress, Advances in AI, IoT, and realtime monitoring are improving treatment efficiency and compliance, while climate challenges are prompting a shift toward resilient and circular water systems, Growing adoption of wastewater reuse across industrial, agricultural, and portable applications further supports demand, With strong momentum in membrane filtration, disinfection, and smart analytics, the industry is well-positioned to support global water security and sustainability goals.

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 Rs. 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 Rs. 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 firms, 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 five years, starting 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 saltwater 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 purification, and advanced filtration 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 flood 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 Rs. 100 Cr/year.

Desalination Technologies

With rising water scarcity, advancements in desalination technologies are making freshwater production more cost- effective and energy-efficient, 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 Rs. 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 flooding, This emerging vertical, coupled with retrofits in existing drainage networks, offers an estimated Rs. 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 Rs. 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 freshwater dependency and adopt closed-loop water management practices, Increasing investment in industrial desalination and wastewater reuse, particularly in the Middle East, Southeast Asia, and Latin America, is creating strong tailwinds 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 wastewater and reuse water opportunity is estimated at over Rs. 900 Cr/year.

Technological Advancements & Product Innovation

Continued innovation in filtration, automation, smart monitoring, and energy-efficient 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 tailwinds, 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 firms, 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 influenced by geopolitical tensions can 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 diversification 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 firms.

Climate Change and Extreme Weather Events

Climate-related disruptions such as floods, 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 lifecycle, Upgrading or replacing outdated equipment demands significant investment, and delays in modernization may limit the efficiency 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.

SEGEMENTWISE 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 wastewater 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 2025	Current Year Ended 31st March 2024
Amt in Lakhs	Audited	Audited
Segment revenue from external customers
Within India	50,721,02	20,576,81
Outside India	24,063,79	30,990,17
Revenue from Operations	74,784.81	51,566.98
(Segment Assets)
Within India	20,726,42	44,876,16
Outside India	10,426,01	15,549,39
Total Assets	31,152.43	60,425.55
Capital Expenditure
Within India	2,347,92	1,973,81
Outside India	2,112,32	462,28
Total Capital Expenditure	4,460.24	2,436.09

FUTURE & FORWARD OUTLOOK

As we look ahead, the demand for clean and safe water continues to rise sharply, driven by growing concerns over water quality, scarcity, and sustainability, This presents a significant growth opportunity for water treatment equipment manufacturers, particularly in the face of tightening environmental regulations and increasing global awareness around water conservation, Both developed and developing economies are investing heavily in water infrastructure, reinforcing the long-term potential of this industry.

The future trajectory of the water treatment sector will be shaped by rapid technological advancements aimed at developing more efficient, sustainable, and environmentally friendly solutions, Companies that successfully integrate these innovations into their offerings-such as smart monitoring systems, decentralized treatment units, and energy-efficient purification technologies-will gain a strong competitive edge, The demand for intelligent, modular, and portable water treatment systems is expected to rise, especially in regions lacking centralized infrastructure.

In FY25, key trends influencing the industry include real-time water quality monitoring, next-generation desalination, biobased remediation, carbon-based filtration, IIoT integration, and advanced oxidation processes, Emerging technologies such as membrane filtration, UV disinfection, and smart control systems are improving operational efficiency and expanding applications across municipal, industrial, and agricultural sectors.

At Jash Engineering Limited, we are well-positioned to capitalize on these evolving opportunities, With a robust portfolio of customized equipment for Water and Sea Water Intake Systems, Pumping Stations, Treatment Plants, Desalination Projects, and Hydropower Installations, we serve a diverse range of sectors including Power, Steel, Cement, Pulp & Paper, Petrochemicals, and Fertilizers.

Our strategic priorities for the coming years include:

• Strengthening our leadership position across our product segments in the global water and wastewater treatment market.

• Expanding our manufacturing footprint and market reach, including the operationalization of our facility in Glasgow, UK & New Facility in Chennai.

• Leveraging technological innovation and recent acquisitions to enhance product offerings and meet evolving customer needs.

• Achieving a revenue growth of approximately 30% in FY26 and targeting a top line of n,000 crore by FY27.

With a specialized product and skillset, a strong global presence, and rising public and private investments in water infrastructure especially in India and the United States, we remain confident in our growth trajectory, While industry margins may experience some volatility due to evolving ESG norms and environmental regulations, we anticipate an overall upward trend supported by operational efficiencies and value-driven solutions.

The outlook for the water treatment equipment industry remains strong, and Jash Engineering Limited is firmly positioned to lead through innovation, customer focus, and sustainable growth.

RISKS AND CONCERNS, INTERNAL CONTROLSYSTEMS AND THEIR ADEQUACY

Risk Management Strategy

Our Company has crafted and executed a risk management policy that is proactive and anticipatory in nature, enabling us to sustain a moderate-to-low risk profile, This is achieved through a clearly defined risk appetite set by the Board of Directors, coupled with the systematic identification, Assessment, Analysis, Treatment, Mitigation, Controlling & Monitoring of potential risks, Moving forward, we remain committed to enhancing our risk management framework, leveraging technological advancements to align with the evolving landscape of our restructured business operations.

Foreign Exchange Exposure

We recognize that fluctuations in foreign currency exchange rates can have a material impact on our operational performance and financial health, To address this, the Company follows a robust Foreign Exchange Risk Mitigation Policy, which incorporates strategic hedging mechanisms, We actively assess our exposure to currency risk, considering the potential effects of exchange rate volatility on key financial activities, including:

I, International trade - covering both export and import operations

II, Foreign currency - denominated assets and liabilities - such as loans, investments, and receivables

III, Global operations - where exchange rate movements affect subsidiaries operating across different geographies

Despite these measures, we remain mindful that broader global and domestic economic and political developments beyond our control may influence our forecasts and have a direct bearing on our business operations.

Process Re-engineering and Compliance

The Company has embarked on a process re-engineering journey, integrating process elements designed to monitor and adhere to a multitude of internal and external business requirements, Our commitment to exceeding standard compliance will remain a fundamental principle guiding our business processes, We are dedicated to leading the industry by expanding the role of technology in monitoring and meeting compliance obligations.

Internal Control System & Monitoring Mechanism

The integrity of our internal control systems is paramount to the health and success of our Company across all sectors, An effective internal control framework serves as the foundation for building shareholder trust, enhancing value, and improving the overall quality of our business operations, It utilizes the output of risk assessments to implement countermeasures that reduce identified risks to acceptable levels, In situations where certain risks cannot be adequately mitigated, their status is continuously monitored and periodically presented to the Risk Management Committee and the Audit Committee for review and oversight.

Additionally, the company defines transaction limits in accordance with banking norms for specific activities, ensuring that exposure to risk remains within acceptable thresholds, The policy also includes procedures for monitoring the effectiveness of these strategies, which involve:

I, Regular assessment of the companys net open position

II, Evaluation of the performance of implemented instruments

III, Adjustments to strategies as needed to respond to changing conditions

Moving forward, we remain committed to refining our internal control and risk monitoring systems to ensure they remain aligned with the evolving needs of our operations.

Adequacy and Review of Internal Controls

Our internal control system is robust and proportionate to the size and nature of our business, It facilitates the prompt compilation of accounts and the generation of Management Information Reports, while ensuring compliance with relevant laws and regulations, The efficacy of our internal controls is regularly assessed by an independent internal audit function and by our statutory auditors, The Audit Committee of the Board conducts periodic reviews of the internal audit function and oversees the implementation of recommendations to bolster the internal control mechanisms.

Overall our Company remains vigilant and proactive in managing risks, safeguarding against foreign exchange volatility, reengineering processes for optimal compliance, and maintaining stringent internal controls to uphold the highest standards of corporate governance and operational excellence.

DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

The Financial performance of the Company for the year 2024-25 is described in the Directors Report under the headings Summarized Profit & 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 defines 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 efficiency.

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 efficiency, 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, 2025, our workforce has grown to over 1,088 employees, comprising both permanent and contractual staff, The Company remains committed to up skilling 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.