Kamdhenu Ltd Management Discussions

Global Economic ovErviEw

In 2024, the global economy stood at a sensitive turning point, under the weight of mounting trade tensions, shifting policies, and a volatile geopolitical backdrop. Global GDP was estimated to grow at 3.3% in 2024, driven largely by a resilient services sector that managed to soften the blow of shrinking manufacturing output in regions like Europe and parts of Asia. Despite this support, inflation fueled by tariffs, supply chain disruptions, and higher input costs has cast a shadow on business sentiment. As a result, many companies, particularly those in trade-heavy nations, have held off on large-scale investments and short-term growth risks and underlined the hiringplans.Theseconditionshaveamplified fragile state of the global economic environment.

Performance of Advanced Economies

Growth across advanced economies eased to 1.8% in 2024 and is expected to edge down to 1.4% in 2025 before seeing a modest rebound to 1.5% in 2026. This deceleration stems largely from waning consumer demand, tighter policy conditions, and rising trade tensions. In the United States, growth is expected to drop from 2.8% in 2024 to 1.8% in 2025, as household spending cools and tariff barriers increase. The Euro Area is likely to expand by just 0.8% in 2025, with weak domestic demand and lingering pressures on manufacturing activity continuing to weigh on momentum, even as some economies introduce fiscal support. Meanwhile, Japan and the UK are also set for slower growth, as both external trade pressures and internal policy shifts take their toll.

Performance of Emerging Markets & Developing Economies

Emerging markets and developing economies (EMDEs) continue to drive global growth, with an estimated expansion of 4.3% in 2024. However, this momentum is expected to ease, with growth projections declining to 3.7% in 2025 and 3.9% in 2026. The slowdown is more evident in countries directly affected by trade tensions such as China, where GDP is forecast to moderate to 4.0% in both 2025 and 2026. In contrast, India is anticipated to sustain relatively strong growth, supported by robust private consumption and rural demand, with a forecasted expansion of 6.2% in 2025. Meanwhile, other EMDEs are contending with weaker exports, rising debt service costs, and tighter global financial conditions, which could further constrain their medium-term economic prospects.

Outlook

Amid persistent global economic headwinds, the current outlook offers a valuable opportunity to enhance resilience and chart a more sustainable path for growth. The experiences of many economies under pressure highlight that recovery is attainable through coordinated policymaking and well-targeted structural reforms. By promoting a stable and transparent trade environment, accelerating debt resolution, and addressing long-standing structural imbalances, countries can lay the foundation for a more equitable and inclusive global recovery. Ensuring clear monetary policy guidance, deploying macroprudential tools effectively, and implementing credible fiscal frameworks will be critical to safeguarding financial stability and supporting long-term economic expansion.

In this context, international cooperation is more vital than ever. Through collaborative strategies and unified action, the global community can restore economic momentum, rebuild policy buffers, and foster conditions for broad-based prosperity across regions.

Policy PrioritiEs

Balancing Near-Term Support with Long-Term Sustainability

Amid fragile global growth and elevated uncertainty, policymakers must calibrate their responses carefully to support recovery while safeguarding fiscal and stability . Monetary policy should financial remain focused on anchoring inflation expectationsandpreservingfinancialresilience. In economies where inflation remains persistent, maintaining a restrictive stance is warranted. In contrast, countries where inflation is easing may consider gradual policy loosening to support demand.

fr governmentsOnthefiscal must adopt credible and gradual consolidation strategies to address elevated public debt levels without compromising economic growth. The focus should be on strengthening revenue mobilisation, phasing out inefficient subsidies, and ensuring continued support for strategic investments in infrastructure, healthcare, education, and digital transformation, areas that are essential for enhancing productivity and fostering inclusive development.

Advancing Structural Reforms for Productivity and Inclusion

Structural reforms remain essential to unlocking medium-term growth and strengthening economic foundations. Key focus areas include labor market efficiency, improved access to quality education, gender inclusion, and the development of digital infrastructure. Countries with aging populations should prioritize policies that promote healthy aging, upskilling, and increased workforce participation, especially among women and youth.

Emerging markets and developing economies (EMDEs) would benefit from targeted reform agendas, including stronger governance frameworks. Additionally, efforts to better integrate migrants into the labor force would enhance competitiveness and promote social inclusion.

Strengthening Multilateral Cooperation

Global challenges demand coordinated global solutions. Restoring trust in a rules-based multilateral trading system is vital to ensuring predictability and resilience in international trade. Policymakers must prioritize transparency in trade policy, support debt restructuring for vulnerable economies, and enhance collaboration on climate change, digital governance, and financial stability.

Reinforcing global institutions and engaging in constructive dialogue will be critical to managing cross-border spillovers and fostering a more stable, equitable global economy.

Indian Economy

In FY 2024–25, Indias economy sustained its robust growth trajectory, with GDP projected to expand by 6.5% despite global volatility and cyclical headwinds. This momentum underscores the countrys strong domestic demand, resilient consumption base, and the impact of sustained public and private sector investments. The nations rise as the worlds fourth-largest economy, surpassing Japan in nominal GDP, highlights the scale and dynamism of its structural transformation and reinforces its growing influence on the global economic stage.

Key enablers of this performance include increased infrastructure investments, continued digitization of services, and progressive reforms that have stimulated entrepreneurship and formalization. Government-led initiatives such as the National Infrastructure Pipeline and Gati Shakti have spurred large-scale capital expenditure, while enabling multiplier effects across allied sectors.

A stable inflationary environment, with the Consumer Price Index averaging 4.9% during April 2024 to March 2025, has supported purchasing power and enabled lower borrowing costs, encouraging credit flow and consumption recovery.

For the steel industry, a core enabler of infrastructure-led growth, these trends have created a sustained demand cycle. Increased construction activity in both urban and rural markets, the governments housing push, and rapid industrialisation have driven steel consumption across segments. India, already the second-largest producer of crude steel, is projected to witness a significant rise in per capita steel usage as infrastructure spending continues and manufacturing expands under the Production-Linked Incentive (PLI) schemes. For Kamdhenu Limited, this macroeconomic environment presents a solid platform for growth across its TMT bars, structural steel, and decorative paints businesses.

Indias economic outlook for FY 2025–26 remains robust, with sustained growth anticipated, driven by rising private investments, stronger corporate earnings, and improving consumer confidence. A favorable monsoon season coupled with moderating food inflation is expected to boost rural incomes and underpin a broader recovery in consumption.

As India progresses toward its ambitious goal of becoming a USD 7 trillion economy by 2030, sectors such as steel will be instrumental in establishing the critical capacity required for this transformation. Kamdhenu Limited is strategically positioned to leverage these favorable trends, with a product portfolio that aligns closely with the countrys evolving construction and infrastructure demands.

Global stEEl markEt

The global steel market was valued at USD 974.4 billion in 2024 and is projected to reach nearly USD 1,290 billion by 2033, at a CAGR of 3.14%. As a critical material for infrastructure, manufacturing, and mobility, steel remains central to global economic development.

The Asia-Pacific region continues to dominate consumption, accounting for over 60% of global demand, led by large-scale infrastructure investments in China and India. In the US, demand has been supported by renewed infrastructure spending and a rebound in manufacturing.

Beyond traditional sectors, steel is gaining traction in areas like packaging, appliances, and consumer goods driven by its durability, recyclability, and adaptability. The industry is also transitioning toward greener production models, with a growing emphasis on hydrogen-based steelmaking and circular economy practices.

The global TMT steel bar market, a key category for Kamdhenu, was valued at USD 80 billion in 2024 and is expected to grow to USD 120 billion by 2033 at a CAGR of 4.5%. Growth is being fueled by urbanization, infrastructure expansion, and demand for high-strength, earthquake-resistant construction materials.

The global steel market outlook remains optimistic, underpinned by strong demand fundamentals and structural transformation across various industries. Major infrastructure initiatives in India,

China, USA, and the Middle East are expected to remain primary drivers of steel demand. The rapid to expansion of renewable energy infrastructure, including solar power plants, wind farms, and electric grids, will further contribute to rising demand for specialized steel products.

INDIAN STEEL MARKET

Indias steel industry is at a pivotal stage, playing a vital role in the nations economic development and positioning itself as a global benchmark for production excellence, innovation, and self-reliance. With accelerating demand across sectors and strong policy support, the Indian steel market is undergoing a significant structural transformation, reflecting both the magnitude of its ambitions and the depth of its potential.

Domestic Demand as the Primary Growth Driver

Housing and Urbanization

The Indian housing sector is witnessing strong tailwinds driven by urbanization, income growth, and government-backed housing programs. As per Mordor Intelligence, the housing construction sector is expected to expand from USD 189.8 billion in 2024 to USD 272.67 billion by 2029, representing an average annual growth rate of 7.5%. This demand is propelled by the Pradhan Mantri Awas Yojana (PMAY), a flagship housing initiative aimed at providing affordable homes in urban areas. By 2030, Indias urban population is expected to reach approximately 400 million, necessitating large-scale residential construction, and in turn, significant steel consumption for structural and reinforcement purposes.

Reforms by the Reserve Bank of India (RBI), such as rationalizing loan-to-value ratios, along with government-led housing policies, have enhanced affordability and widened access, thereby stimulating demand across real estate segments.

Infrastructure and Energy Projects

Indias infrastructure development remains a national priority. In 2024, the country achieved an average road construction pace of 27 km per day, supported by mega infrastructure initiatives. The introduction of High-Speed Rail Corridors (HSRC), Delhi-Varanasi (865 km), Delhi-Mumbai (1,384 km), and Delhi-Kolkata (1,459 km) will significantly increase steel consumption in rail infrastructure. By 2030, the total length of HSRCs is expected to reach 10,000 km.

In parallel, the power sector is expanding rapidly. In 2024 alone, India commissioned 34 GW of new capacity. As part of its Energy Development Plan, India aims to achieve 500 GW of renewable energy capacity by 2030, rising to 600 GW by 2032. This shift to green energy entails large-scale deployment of steel-intensive infrastructure for solar, wind, hydro, and transmission networks.

Automotive and Industrial Manufacturing

Indias automotive industry continues to be one of the fastest-growing steel-consuming sectors. Despite a slight decline in 2024 due to cyclical factors, production volumes remained robust: 2021: 4.39 million units 2022: 5.45 million units 2023: 5.84 million units 2024: 5.31 million units Rising income levels and vehicle affordability, supported by localization strategies, have made passenger vehicles more accessible. The passenger car market is valued at USD 39.82 billion in 2024 and is projected to grow to USD 53.04 billion by 2029, at a CAGR of 5.9 %. Additionally, the governments aggressive push for electric vehicle (EV) adoption through road tax waivers and purchase subsidies is also stimulating demand for lighter and more advanced grades of steel.

Consumer Durables and Appliances

The household appliances market, another key end-user segment for steel, is projected to grow from USD 27.27 billion in 2024 to USD 34.47 billion by 2029, driven by rising aspirations, urbanization, and improved electrification. As demand for appliances like refrigerators, washing machines, and kitchen equipment grows, so does the need for cold-rolled and coated steel.

The Road Ahead

India is emerging as a global hub for steel exports, with an annual export range of 25 million tons.

The country is prioritising:

Developing export-ready production capacities Adhering to global quality and sustainability standards Encouraging innovation in steel grades for shipbuilding, automotive, and clean energy infrastructure Adopting a future-ready approach, the government is encouraging the industry to adopt next-generation technologies, expand R&D capabilities, and deepen integration into global value chains.

A significant policy step includes the classification of shipbuilding as infrastructure, which is opening new avenues for steel use in maritime applications.

Nearly every major steel-consuming sector in India, including housing, infrastructure, automotive, consumer goods, and energy, is experiencing rapid growth. With strategic policy backing, production-linked incentives, and domestic capacity expansion, Indias steel industry is not only addressing growing internal demand but also setting new standards for global manufacturers.

As the industry advances toward the 2030 target of 300 million tons and aligns with national decarbonization goals, Indias steel industry is set to play a key role in driving infrastructure development, industrial growth, and global competitiveness.

Budget 2025–26 and its Impact on the Indian Steel Industry

The Union Budget 2025–26 outlines a targeted strategy to strengthen Indias steel sector, focusing on both supply-side resilience and demand-side growth.

Infrastructure Boost

A capital expenditure outlay of 11.2 Lakh Crores (a 10% increase year-on-year), including a 1 Lakh Crore Urban Challenge Fund, is set to drive steel demand through large-scale investments in roads, railways, ports, and smart cities.

Import Safeguards

The proposed 12% safeguard duty on select steel products along with ongoing anti-dumping investigations, aims to protect domestic mills from low-cost imports and maintain market stability.

Green Steel Incentives

Financial incentives for steelmakers with emissions below 2.2 tCO2e/tonne, coupled with green bonds and PPPs, support cleaner production methods aligned with Indias net-zero commitments.

Mining Reforms

The introduction of a State

Mining Index and a focus on critical minerals are expected to enhance raw material availability, reduce import dependence, and strengthen upstream supply chains.

Tax and Fiscal Measures

Income tax rebates up to 12.75 Lakhs and customs duty exemptions on industrial inputs are likely to boost consumption across key steel-intensive sectors like auto, housing, and manufacturing.

COMPANY OVERVIEW

Kamdhenu Limited (referred to as eature‘Kamdhenuor‘theCompany), of Kamdhenus Indias largest branded TMT bar company in retail segment, achieved a brand sales turnover of approximately 22,000 Crores during FY 2024–25. Over the last decade, the Company has maintained a strong compound annual growth rate (CAGR) of 14%, a reflection of a consistently effective strategy and its disciplined execution.

Founded in 1994, Kamdhenu has grown into a key force in the construction steel market, offering a diverse portfolio that includes TMT bars, structural steel, pipes, roofing solutions, and other value-added offerings. The Companys reach spans the country, supported by a vast distribution network of over 10,000 dealers and over 400 distributors, with a focused push toward the retail segment where volume drives scale.

Adefining business approach is its innovative Franchisee Model, which enables scalable growth with minimal capital outlay. With over 80 franchise partners manufacturing products under the Kamdhenu brand, the Company provides end-to-end support spanning product design, quality standards, marketing, and distribution. This model ensures consistency in quality, builds strong brand equity across regions, and generates steady royalty income, making it both capital-efficient and ROCE-accretive. Importantly, the franchisee network allows Kamdhenu to extend its product reach into vast, underserved territories, particularly in Tier II and Tier III cities, where direct access may otherwise be limited. This decentralised structure enhances responsiveness to local demand while strengthening the brands nationwide presence.

Kamdhenus brand-led positioning provides a distinct competitive edge in the market. Backed by targeted marketing, consistent quality standards, and strong dealer engagement, the Company has cultivated a premium brand image that clearly differentiates it from unbranded alternatives. This reputation not only enhances pricing power but also deepens Kamdhenus presence across Indias growing construction and infrastructure landscape. Customers trust Kamdhenus products for their assured quality, reliability, and alignment with modern building standards.

Sustainability is equally embedded in the Companys operations. From adopting cleaner energy sources to promoting responsible manufacturing, Kamdhenu continues to pursue eco-conscious practices that support long-term value creation. With its trusted brand, agile partner ecosystem, and demand-responsive product strategy, the Company is well positioned to capitalise on Indias infrastructure-led economic momentum.

Key Performance Highlights

During the year under review, the revenue of the Company for FY 2024-25 stood at 747.49 Crore which is higher than the previous years revenue of 738.29 Crore. The Profit after Tax (PAT) attributable to the Shareholders of the Company for FY 2024-25 stood at 60.87 Crore as compared to the previous FY 2023-24 which was 50.13 Crore.

Financial Ratios

Metric	FY 2024–25	FY 2023–24	Change (%)	Details of Significant Changes(i.e. Change of 25% or More)
Debtors Turnover	15.07	10.61	42.06	The trade receivables turnover ratio has improved due to better realization from trade receivables.
Inventory Turnover	41.63	44.64	(6.74)	-
Current Ratio	7.11	6.10	16.58
Debt-Equity Ratio	0.00	0.01	(65.27)	The debt-equity ratio has improved because the Company has repaid all its debts.
Debt Service Coverage	51.34	40.95	25.37	The debt service coverage ratio has improved due to an increase in profitability and a decrease in finance costs.
Ratio
Return on Equity (ROE) (%)	21.98	24.81	(11.41)
Inventory Turnover Ratio	41.63	44.64	(6.74)
Net Profit Ratio (%)	8.14	6.92	17.71
Return on Capital	24.97	27.71	(9.88)
Employed (ROCE) (%)
Interest Coverage Ratio	392.60	114.00	244.40	Due to an increase in operating profit.
Operating Profit Margin (%)	10.78	9.32	15.67
Return on Net Worth	21.98	24.81	(11.41)	Due to the conversion of warrants into equity.

Corporate Social Responsibility

The Company, for three decades, has been driven by its dedication to responsible growth, complemented by its endeavor to cultivate harmonious relationships. Rooted its Charter value of enriching peoples lives, the Companys CSR vision is anchored in trust, fairness, and compassion. To maximize its impact, the Company has formulated an effective CSR policy and established a structured Committee comprising members from the Board of Directors.

Risk Management

At Kamdhenu, managing risks with care and foresight is seen as essential for lasting strength and growth. The Company has put in place a thorough Enterprise Risk Management (ERM) framework that helps identify, assess, and mitigate both strategic and operational risks. Each risk is judged based on how likely it is to happen and how much it could impact the business. This method aims to protect capital, maintain the trust of stakeholders and support future expansion.

The Risk Management Committee, keeps a close watch on new risks and reviews how well current controls are working.

Their governance approach makes sure that risk is a constant consideration in strategic decisions, daily operations and compliance efforts.

Below is the snapshot of the primary risk categories and how Kamdhenu addresses them:

Risk Category	Description	Mitigation Measures
Macroeconomic Risk	Unpredictable global economic conditions could impact business stability.	A well-diversified product mix and flexible market positioning reduce exposure to any one sector.
Industry Risk	Variations in steel pricing can ripple across industries like construction.	Active collaboration with infrastructure and real estate sectors helps absorb and respond to price shifts.
Competitive Risk	New entrants might pressure pricing and market share.	Strong brand identity, ongoing innovation, and unique product offerings keep Kamdhenu ahead.
Regulatory & Compliance Risk	Changing laws may create challenges in compliance.	Robust internal controls, continuous legal monitoring, and training programs keep the Company aligned.
Financial & Credit Risk	Adverse market conditions may affect cash flows and increase financing costs.	A prudent capital structure characterized by a zero debt and a strong reliance on internal accruals.
Capacity Risk	Failure to meet market demand could impact customer confidence and hinder business growth.	Asset-light franchisee model, performance reviews of partners, and scale optimisation.
Raw Material Price Risk	Volatility in key input prices could inflate costs and disrupt supply chains.	Spot procurement of billets and ingots, supported by real-time price monitoring to enable timely and informed purchasing decisions.
Risk Category	Description	Mitigation Measures
Health & Safety Risk	Safety incidents could disrupt operations and harm the workforce.	Safety protocols led by senior officials, mandatory inductions for employees and contractors.
Supply Chain Risk	Logistics or distribution disruptions may lead to delivery delays and impact service quality.	End-to-end supply chain visibility, strong distribution infrastructure across geographies.
Brand & Goodwill Risk	Inconsistent product quality from franchisee units could harm brand equity.	Strict quality protocols, regular audits, and technical training for franchisee personnel.
ESG Risk	Environmental and social issues could impact stakeholder perception and regulatory compliance.	Upholding commitment to ethical conduct, legal compliance, and responsible environmental practices.
Human Capital Risk	Attrition or skill gaps could impact continuity and capability.	Talent development, succession planning, and an engaging, inclusive work culture.
Information & Cybersecurity Risk	Cyber threats or IT non- compliance could affect operations or compromise data integrity.	Strengthened fraud control systems, IT governance protocols, and cybersecurity investments.

Internal Control System and its Adequacy

Kamdhenu has established an internal control system that fits with its risk management approach, built thoughtfully to reflect the size, scale, and complexity of its operations. This framework serves to protect the companys assets from misuse or misappropriation, while also ensuring that every transaction is properly authorized, accurately recorded, and reported in a timely manner.

Each key function and operation of the Company is governed by a well-articulated system of internal checks and balances, including controls on financial activity. These measures have been operating as intended throughout the year in review, reflecting their consistency and dependency.

To further strengthen this framework, Kamdhenu has appointed an independent external consultant to act as its internal auditor. In close alignment with the Statutory Auditor, this role involves assessing how well the internal financial controls are structured, how effectively they work in practice, and how well they align with the requirements laid down in the Companies Act, 2013, as well as the audit guidance provided by the Institute of Chartered Accountants of India.

Overseeing this entire audit structure is the Audit Committee, which not only recommends the appointment of the Internal Auditor to the Board but also ensures the Auditors independence by fostering regular and structured interactions.

Supporting this process, the finance team carries out routine internal control assessments and conducts follow-up audits to confirm that any observations and recommendations from previous audits are being followed through.

The audit process itself spans the Companys offices, factories, and business-critical zones. During these reviews, both the

Internal Auditor and finance team examine whether core systems and operational processes are integrated with appropriate checks, both preventive and detective. Alongside this, they conduct sample-based reviews of transactions to ensure alignment with internal norms, regulatory standards, and ethical codes.

All findings from these audits are shared with senior leadership, who then take necessary action to address any gaps. These outcomes, together with managements responses and the steps taken, are presented before the Audit Committee for their consideration and guidance.

The internal financial controls do not operate in isolation. Instead, they form a part of the broader Enterprise

Risk Management (ERM) framework, which anchors the Companys governance practices and ensures that any potential risk to financial integrity or reporting is identified and addressed well in advance.

Throughout FY 2024–25, Kamdhenu remained fully compliant with every relevant provision of the Companies Act and SEBI (Listing Obligations and Disclosure Requirements)

Regulations, 2015, as amended, demonstrating continued diligence in financial governance.

The internal control system is designed to provide reasonable assurance on the following:

Accuracy and completeness of accounting records and timely financial disclosures. Reliability of financial and operational information. Compliance with applicable laws and regulations.

Protection of assets against unauthorized use or disposition.

Execution of transactions in accordance with management authorization and corporate policies.

Minimization of errors and irregularities through preventive controls.

The Company has adopted FINTRAKS, an automated software provided by its Registrar and Transfer Agent, KFin Technologies Limited, for maintaining the Structured Digital Database in compliance with the SEBI (Prohibition of Insider Trading)Regulations, 2015. This has enabled smooth and timely compliance with the provisions of the SEBI Regulations and the Code, thereby improving the adequacy and effectiveness of internal control measures on insider trading.

Cautionary Statement

The statement in the Management

Discussion and Analysis Report describing the Companys objectives, projections, estimates, and expectations may be forward-looking statements within the meaning, if applicable, of securities laws and regulations. The Companys expectations are based on reasonable assumptions; thus, the forward-looking statements may be influenced by numerous risks and uncertainties. This could cause actual outcomes and results to be materially different from the given or implied details. Important factors that could influence the Companys operations include economic developments within the country, demand and supply conditions in the industry, input prices, changes in Government regulations, tax laws, and other factors such as litigation and industrial relations. The Company is not responsible for the forward-looking statements herein, which may undergo changes in the future based on subsequent development, information, or events, and holds no obligation to update these in the future.