Jupiter Wagons Ltd Management Discussions

Jupiter Wagons Limited

This Management Discussion and Analysis reviews the macroeconomic environment, industry developments, business performance, key financial indicators, risk management framework, human resources, internal controls and governance practices relevant to Jupiter Wagons Limited during FY 202526.

Global Economic Overview

In 2025, the global economy demonstrated notable resilience despite navigating an increasingly complex geopolitical and economic landscape. Global growth stood at 3.4% in 2025; however, the outlook moderated amid heightened geopolitical tensions, evolving trade realignments and persistent inflationary pressures.

A significant escalation in geopolitical risks emerged following the military conflict in the Middle East, which disrupted maritime and air transportation, strained energy supply chains and heightened volatility across commodity and financial markets. These developments added fresh uncertainty to an already fragile global environment shaped by changing trade regimes and shifting international alliances.

Global trade dynamics continued to undergo structural transformation during the year. While technology-led exports and AI-driven investments supported trade activity across several Asian economies, the broader environment remained impacted by tariff measures, supply chain realignments and increasing economic fragmentation. The United States maintained elevated tariff structures, while countries across regions accelerated efforts to establish alternative trade partnerships and diversify economic linkages.

Inflationary trends remained uneven across major economies. Although inflation moderated in several regions, energy and food price volatility, coupled with geopolitical disruptions, continued to exert pressure on global markets. Central banks adopted a cautious and differentiated monetary policy approach, balancing inflation control with the need to sustain economic growth and financial stability.

Looking ahead, the IMF projects global growth at 3.1% in 2026 and 3.2% in 2027, reflecting a moderation from the estimated 3.4% growth achieved in 2025. For companies operating in infrastructure-linked and transportation sectors, the outlook suggests a mixed environment, geopolitical uncertainty, evolving trade policies, commodity price volatility and tighter financial conditions may create near-term pressure, while investments in digitalisation, artificial intelligence, infrastructure and supply chain diversification are expected to provide long-term structural support to global economic activity.

Indian Economic Overview

Indias economy demonstrated strong resilience and sustained growth momentum during FY 2025-26, supported by robust domestic consumption, improving investment activity, continued infrastructure spending and supportive policy interventions. According to the revised national accounts series released with FY23 as the base year, Indias GDP growth for FY26 was estimated at 7.6%, reflecting the strength of domestic economic activity and improved data capture methodologies.

The revised GDP series highlighted private consumption as the primary growth driver during the year, supported by fiscal measures such as income tax relief, GST cuts, direct benefit transfers by states, lower interest rates and moderating inflation. Private Final Consumption Expenditure (PFCE) growth was revised upward to 7.7%, while Government Final Consumption Expenditure (GFCE) also recorded stronger growth at 6.6%.

Investment activity remained healthy despite a moderation in growth estimates. Gross Fixed Capital Formation (GFCF) growth was revised to 7.1% for FY26, supported by sustained public infrastructure spending and improved private sector investment sentiment. The share of fixed investment in nominal GDP increased under the revised series, indicating strengthening capital formation within the economy.

On the supply side, industrial growth emerged as a key contributor to economic expansion. Industrial GVA growth was revised upward to 8.8%, led by strong manufacturing growth of 11.5% and recovery in mining activity. The revised methodology, including double deflation and improved use of administrative data, enabled better measurement of manufacturing activity and strengthened the representation of the informal sector within the national accounts framework.

The services sector maintained healthy momentum during the year, supported by strong performance across financial services, trades, hotels, transports and communication-related activities. Meanwhile, agriculture growth moderated due to softer performance during the later part of the fiscal year.

Indias exports experienced some pressure amid global trade disruptions and tariff-related challenges, particularly in the United States market. However, domestic demand remained resilient and helped offset external headwinds. Continued policy support, infrastructure investments and government capex spending contributed to sustaining overall economic momentum.

Looking ahead, Indias economic outlook remains positive, with projected GDP growth of 7.1% in the next fiscal year, supported by robust private consumption, improving private investment, continued government capex and favourable policy support.

For Jupiter Wagons, continued infrastructure development, manufacturing incentives, logistics modernisation and digital transformation initiatives provide a supportive long-term backdrop. However, geopolitical uncertainty, commodity price volatility, global trade disruptions and potential weather- related risks remain key monitorable factors for the broader economy.

Industry Overview

Rail Freight and Wagons Segment

Indian Railways continued to strengthen its position as a critical enabler of the countrys logistics and infrastructure ecosystem during FY26. Freight loading reached a record 1,670 million tonnes (MT) in FY26, registering growth of 3.25% over the previous year, driven by strong movement in fertilisers, steel, iron ore and cement. Fertiliser, pig iron and finished steel transportation recorded growth of nearly 13%, while iron ore and cement loading grew by 6.73% and 3.41%, respectively. (Source: Ministry of Railways, Government of India)

Indian Railways continues to play a pivotal role in supporting industrial production, power generation, mining and infrastructure development across the country. While coal transportation remains a major contributor to freight movement, the increasing share of steel, cement, containers, automobiles and industrial commodities reflects improving diversification in freight composition. The Governments continued focus on multimodal logistics integration, industrial corridors and manufacturing expansion is expected to further strengthen long-term freight demand.

The sector also continued to benefit from sustained policy support and infrastructure investments. Government initiatives such as PM Gati Shakti, National Logistics Policy and Mission 3,000 MT continue to drive capacity enhancement, multimodal integration and freight efficiency improvements across the railway ecosystem. Indian Railways aims to achieve freight loading of 3,000 MT by 2027, supported by large-scale investments in infrastructure, rolling stock modernisation and dedicated freight connectivity. (Source: Ministry of Railways, Government of India)

In parallel, Indian Railways continued to modernise its freight operations through digitalisation, automation, advanced signalling systems and introduction of higher-capacity locomotives and wagons. The increasing focus on operational efficiency, turnaround optimisation and network decongestion is expected to further enhance rail freight competitiveness compared to road logistics.

Dedicated Freight Corridors (DFC) Update

In FY26, Indias Dedicated Freight Corridor (DFC) projects, particularly the Eastern Dedicated Freight Corridor (EDFC) and Western Dedicated Freight Corridor (WDFC), achieved neartotal operational readiness. Following successful trial runs on the final 102 km JNPT-New Saphale stretch, the initial 2,843 km network transitioned into mature heavy-haul operation. Daily freight train operations increased to an average of 403 trains per day, while the network also recorded a milestone by interchanging 907 freight trains with zonal railways in a single day. (Source: DECCIL, Ministry of Railways, Government of India)

The Ministry of Railways is actively advancing plans to transform these routes into integrated economic grids, highlighted by the announcement of a massive new East-West Dedicated Freight Corridor designed to directly link Dankuni in West Bengal to Surat/Maroli in Gujarat. While final statutory approvals for the broader network expansions remain tied to technical feasibility and a targeted 4.5 lakh crore investment roadmap, the strategic blueprints for the East-Coast Corridor (Kharagpur to Vijayawada) and the North-South Sub-corridor (Vijayawada-Nagpur-Itarsi) continue to move forward to systematically enhance freight connectivity across key industrial regions.

The operational DFCs have fundamentally optimised bulk commodity transportation, significantly driving up national freight loading volumes to consistently surpass 4.4 million tonnes daily. By moving heavy bulk traffic like coal, cement and containers at speeds of60-70 km/h—more than double the speed on conventional lines—the corridors have substantially cut transit times, elevated the punctuality of both goods and passenger services and structurally multiplied railway earnings. (Source: PIB)

Modernisation efforts have scaled under an overhauled regulatory framework, with 124 Gati Shakti Multi-Modal Cargo Terminals (GCTs) commissioned and operational across the country to streamline first- and last-mile logistics. To support the target of expanding to more than 500 terminals within the next five years, more than 300 GCT proposals have received formal approval under simplified, investor-friendly clearance processes. The Railways is also accelerating rolling stock upgrades, including the rollout and deployment of indigenously co-developed 9,000 HP electric freight locomotives alongside heavy-duty 12,000 HP WAG12 units, strengthening the networks heavy-haul capabilities.

Load Body and Components for Commercial Vehicles

The Indian Commercial Vehicle (CV) market is undergoing a dynamic transformation and is expected to grow at a steady 7.2% CAGR from 2026 to 2033. The market generated revenue of approximately USD 13.9 billion in 2025 and is projected to reach nearly USD 24.4 billion by 2033, supported by large- scale infrastructure development, logistics modernisation, technological advancements and the increasing shift towards sustainable and electrified transport solutions. Light Commercial Vehicles (LCVs) continue to remain the largest and fastest-growing segment within the Indian CV market, driven by expanding e-commerce, urban logistics and last-mile delivery requirements. (Source: Grand View Research)

Growth across sectors such as construction, mining, industrial manufacturing, warehousing and multimodal logistics continues to drive demand for Medium and Heavy Commercial Vehicles (MHCVs), specialised load bodies and advanced freight transportation systems. As a leading mobility and transportation infrastructure player, Jupiter Wagons Limited is strategically positioned to capitalise on this expanding market opportunity through its strong engineering capabilities and diversified commercial vehicle solutions portfolio.

Built on the legacy, Jupiter Wagons continues to strengthen its position in the specialised load body manufacturing segment through application-based transportation solutions catering to a wide range of industrial and commercial requirements. The Companys diversified Commercial Vehicle Load Bodies portfolio caters to multiple high-demand sectors including mining, road construction, goods transportation, defence and civic infrastructure.

Its offerings include high-tensile tipping bodies (tippers), bulkers, tanker bodies, cargo load bodies and customised trailer configurations such as box, skeletal, tip and flatbed trailers engineered to optimise payload efficiency, operational durability and heavy-duty transportation performance. The Company also manufactures specialised mobility solutions including troop carrier bodies, water bowsers and customised utility vehicles designed to meet stringent institutional and government standards.

With the Indian government continuing to prioritise freight decarbonisation, electric mobility and modernisation of urban logistics infrastructure, the broader commercial vehicle ecosystem is increasingly shifting towards low and zero- emission transportation solutions. Indias electric vehicle market is projected to grow at a CAGR of 29.4% from 2026 to 2033, while the electric commercial vehicle segment globally is expected to grow at a CAGR of 18.3% through 2030, driven by regulatory support, urban logistics demand and advancements in EV technologies. (Source: Grandview research)

This transition aligns with the strategic growth direction of Jupiter Electric Mobility (JEM), the Companys dedicated green mobility subsidiary. JEM has expanded into the electric commercial mobility segment through its indigenously designed electric Light Commercial Vehicles (eLCVs). A key milestone in this journey has been the rollout of the JEM TEZ e-LCV, a 1.05-ton payload vehicle specifically engineered for intra-city logistics and last-mile delivery applications. Supported by partnerships with regional logistics operators and an increasingly localised component ecosystem, Jupiter Wagons is strategically bridging conventional heavy engineering expertise with next-generation electric mobility architecture.

Company Overview

Jupiter Wagons Limited (JWL) has evolved into an integrated mobility and transportation solutions company with a strong presence across railway freight systems, commercial vehicle components, container solutions and electric mobility. Backed by advanced manufacturing capabilities and strategic partnerships, the Company operates at the intersection of Indias expanding logistics infrastructure and the accelerating transition towards sustainable transportation. Through its diversified portfolio and technology-driven approach, JWL continues to strengthen its position as a key enabler of efficient freight movement across rail and road ecosystems.

Strategic Positioning in Rail and Freight Mobility

Indias rail freight sector is entering a transformative phase, supported by initiatives such as PM Gati Shakti, Dedicated Freight Corridors (DFCs), multimodal logistics parks and the Governments Mission 3,000 MT vision for rail freight loading. In this evolving landscape, JWL is strategically positioned as one of the countrys leading manufacturers of railway wagons, braking systems, bogies, couplers and other critical rail components.

The Company continues to enhance its integrated manufacturing capabilities while focusing on innovation, localisation and operational efficiency to support the modernisation of Indias rail infrastructure. Its expanding portfolio and partnerships with global technology players strengthen its ability to cater to rising demand from Indian Railways and private freight operators. With increasing investments in rail-led logistics and infrastructure development, JWL is well placed to contribute to the creation of a faster, more efficient and sustainable freight transportation ecosystem in India.

Expanding Presence in Commercial Electric Mobility

Through its subsidiary, Jupiter Electric Mobility Private Limited (JEM), the Company is actively participating in Indias fast-growing commercial EV ecosystem. JEM focuses on sustainable and scalable mobility solutions designed to address the evolving needs of logistics operators and last-mile transportation networks.

The Company has introduced flagship electric light commercial vehicles such as JEM TEZ and EV STAR CC, targeting the rapidly expanding e-commerce, urban logistics and fleet mobility segments. Built with advanced battery technology, telematics integration and fast-charging capabilities, these vehicles are designed to enhance fleet efficiency while reducing operating costs and emissions.

JEM is simultaneously expanding its manufacturing footprint, dealership network, charging accessibility and after-sales ecosystem across key logistics hubs in India. Supported by favourable government policies, rising EV adoption and growing demand for clean mobility solutions, the Company is strategically positioned to emerge as a significant player in the commercial electric vehicle market.

Credit Rating

The credit ratings of the Company were carried out by CRISIL and ACUITE.

Particulars	CRISIL	ACUITE
Long-Term Rating	AA(-)	AA
Short-Term Rating	A1(+)	A1(+)

Financial Overview - On Standalone Basis

Particulars	For the year ended 31st March 2026	% of Net Sales	For the year ended 31st March 2025	% of Net Sales
Income
Revenue from operations	2,53,915	-	3,87,063	-
Expenses
Raw material cost and changes in inventory	1,86,161	73.32%	2,96,458	76.59%
Employee benefits expense	6,470	2.55%	5,854	1.51%
Operating other expenses	31,334	12.34%	29,960	7.74%
Operating profit (EBITDA)	29,950	11.80%	54,790	14.16%
Finance costs	5,630	2.22%	5,310	1.37%
Depreciation and amortisation expense	3,539	1.39%	3,070	0.79%
Other income	3,817	1.50%	3,424	0.88%
Profit before tax and exceptional items	24,598	9.69%	49,834	12.87%

Revenue Bifurcation

Particulars	FY26 (1 in lakh)	FY26 (Qty in Nos.)	FY25 (1 in lakh)	FY25 (Qty in Nos.)
Railway Wagons	2,02,553	5,498	3,35,633	8,718
CMS Crossing	3,460	1,321	2,023	933
Commercial Vehicle Load Bodies & Components	32,038	10,909	29,752	8,548
Containers	8,732	1,460	6,993	1,012
Others	7,132	-	12,662	-
Total Revenue	2,53,915	-	3,87,063	-

Performance Analysis

(a) During the year, revenue from operations stood at ^2,53,915 lakhs as compared to ^3,87,063 lakhs in the previous year, reflecting a decline of 34%. The decline in profitability was primarily attributable to lower sales volumes, coupled with elevated operating costs

(b) Employee costs and other operating expenses increased as compared with the previous year, mainly due to higher cost absorption and increased recurring operating expenses.

(c) Finance costs have increased from ^5,310 lakhs in FY25 to ^5,630 lakhs in FY26, which is mainly due to increased working capital requirement, investment in plant and machinery and equity investments in joint ventures and subsidiaries.

Borrowings

(a) As of 31^st March, 2026, the Company held outstanding long-term debt of ^610 lakhs, secured working capital borrowings of ^46,166 lakhs, and other unsecured and bill discounting liabilities of ^11,491 lakhs, primarily to support business expansion, capacity enhancement and operational requirements.

(b) The Company continued to monitor its borrowing costs and debt servicing position during FY26, with a focus on maintaining adequate liquidity and a prudent capital structure.

(c) The Company remains confident of meeting all its debt servicing obligations in a timely manner, supported by stable cash flows, prudent financial management and a disciplined approach towards capital allocation, barring any significant unforeseen circumstances.

Key Financial Ratios

Particulars	FY 2025-26 (as of 31st March 2026)	FY 2024-25 (as of 31st March 2025)
PBDIT as % of Revenue from Operations	11.80%	14.16%
Profit Before Tax and Exceptional Items (% of Revenue)	9.69%	12.87%
Profit Before Tax (% of Revenue)	9.69%	12.87%
Return on Net Worth	6.39%	17.20%
Debt-equity Ratio	0.16	0.11
Current Ratio	2.03	2.09
Interest Coverage Ratio	4.99	8.64
Debtor Turnover Ratio	3.43	6.06
Inventory Turnover Ratio	2.23	3.70

Note on the Change in Ratios

a) PBDIT / Operating Margin

During the year, the PBDIT margin was lower than the 14.16% recorded in FY25. The movement in margins was primarily attributable to changes in revenue mix, operating leverage, commodity prices and overall business performance.

b) Profit / (Loss) Before Tax and Exceptional Items

During the year, the Company registered profit before tax and exceptional items that was lower than ^49,833.74 lakh recorded in FY25, reflecting the impact of lower revenue and elevated operating costs.

c) Return on Net Worth

Please refer to (a) above.

d) Debt-equity Ratio

The movement in debt-equity ratio was primarily on account of business expansion, working capital utilisation and continued investments towards growth initiatives. The Company remains focused on maintaining a prudent capital structure.

e) Current Ratio

The current ratio stood at 2.03 in FY26 as compared to 2.09 in FY25. The liquidity position of the Company remained stable and the Company continues to remain reasonably confident of meeting its short-term obligations.

f) Interest Coverage Ratio

The interest coverage ratio stood at 4.99 times in FY26 as compared to 8.64 times in FY25. This indicates the Companys continued ability to service its finance costs through operating earnings.

g) Debtor Turnover Ratio

The debtor turnover ratio stood at 3.43 times in FY26 as compared to 6.06 times in FY25. The movement was primarily driven by changes in revenue scale, receivable cycle and customer collections.

h) Inventory Turnover Ratio

The inventory turnover ratio stood at 2.23 times in FY26 as compared to 3.70 times in FY25. The movement reflects changes in inventory holding levels, procurement planning and execution schedules.

Technology - IT Process and Systems

During FY26, the Company continued to strengthen its IT infrastructure, operational systems and digital integration capabilities to support business growth and enhance operational efficiency. The Company remained focused on improving enterprise-wide visibility, process automation, cybersecurity preparedness and data management systems.

The Company continued initiatives towards system enhancement, cloud integration, process digitisation and implementation of advanced business applications to improve operational monitoring and decision-making across functions.

Corporate Governance

The Company continues to uphold the highest standards of corporate governance and ethical business practices. Its governance framework is guided by principles of transparency, accountability, integrity and compliance, ensuring sustainable value creation for all stakeholders.

The Board and its Committees provide strategic oversight and guidance on business operations, risk management, internal controls, compliance and sustainability practices. The governance framework continues to evolve in line with changing regulatory requirements and business needs.

Risk Management

The Management and the Board periodically review internal and external risk factors that may affect the Companys operations, financial performance and strategic priorities. Appropriate mitigation measures are implemented and monitored on an ongoing basis. The key risks and mitigation approaches are outlined below:

a) Dependence on Railways: The Companys railway business remains linked to investments and procurement plans of Indian Railways and private freight operators. To mitigate concentration risk, the Company continues to diversify its product portfolio and expand into adjacent mobility and logistics segments.

b) Cyclicality of the Commercial Vehicle Industry: Demand in the commercial vehicle industry remains cyclical and linked to economic activity, infrastructure development and logistics demand. The Company continues to diversify its offerings across railway wagons, fabricated products, containers and electric mobility solutions.

c) Delay in Execution of Orders: Delays in project execution or customer approvals may impact revenue recognition and operational planning. The Company continues to strengthen project management capabilities and execution monitoring mechanisms.

d) Raw Material Costs: The Company remains exposed to volatility in steel and other input prices. Strategic sourcing initiatives, vendor partnerships and inventory planning measures are being undertaken to mitigate such risks.

e) Competition: The Company operates in competitive business segments with participation from established and emerging players. Continuous focus on quality, technology, execution efficiency and customer relationships helps to strengthen competitiveness.

f) Increase in Interest Rates / Costs: Rising interest rates may impact borrowing costs and working capital financing. The Company continues to focus on efficient treasury management and prudent capital allocation.

g) Technological Disruption and Automation: Rapid technological changes and increasing automation across industries may require continuous investments in innovation and process upgrades. The Company continues to invest in technology integration, automation and workforce capability enhancement.

Material Developments in Human Resources and Industrial Relations

The Company continued to focus on strengthening its human capital capabilities through employee engagement, skill development, leadership building and workplace safety initiatives. Multiple learning and development programmes were undertaken during the year to support employee growth and enhance organisational capabilities.

The Company remains committed to fostering an inclusive, collaborative and performance-driven work culture that supports long-term business sustainability. Employee wellbeing, safety and professional development remain key priorities.

Industrial relations across manufacturing locations remained cordial during the year.

Internal Control System and their Adequacy

The Company has established internal control systems commensurate with the size, scale and complexity of its operations. These systems are designed to support orderly and efficient business conduct, safeguard assets, ensure the accuracy and completeness of accounting records and maintain compliance with applicable laws and regulations.

The internal control framework supports: a) Safeguarding of the Companys assets from loss or misuse.

b) Monitoring and strengthening operational efficiencies and process controls.

c) Ensuring reliability and accuracy of financial and accounting information.

d) Compliance with applicable statutes, policies and regulatory requirements.

The Company continuously reviews and strengthens its internal control mechanisms in line with evolving business requirements and regulatory developments.

Internal Audit

The Company has an independent internal audit mechanism commensurate with the size and complexity of its operations. The internal auditors periodically review operational processes, financial controls, compliance systems and risk management practices across business functions and locations.

The Audit Committee regularly reviews audit observations and monitors implementation of corrective actions to strengthen governance and operational effectiveness.

Cautionary Statement

Statements made in the Management Discussion and Analysis describing the Companys objectives, projections, estimates, expectations or predictions may constitute "forward-looking statements" within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed or implied due to various factors including changes in economic conditions, government policies, industry dynamics, raw material prices, competitive intensity, demand fluctuations, regulatory developments and other incidental factors.