Keto Motors Ltd Management Discussions

1. MANAGEMENT OVERVIEW

FY 2025—26 was the first full reporting period following implementation of the Resolution Plan approved by the Honble National Company Law Tribunal, Hyderabad Bench, on 12 June 2025. Pursuant to the NCLT Order, the Company has given effect to the restructuring and consequential changes in its financial statements for the year ended 31 March 2026.

Accordingly, the financial performance of FY 2025—26 should be viewed in the context of this transition. The year was primarily focused on commercialisation, product development, capability building and preparation for the next phase of business growth. Historical comparisons with the preresolution entity should therefore be interpreted with caution.

Managements focus during the year was to strengthen the Companys commercial electric mobility platform and translate the capabilities developed during the transition into customer engagement, production readiness and commercial deployment.

2. BUSINESS PERFORMANCE & COMMERCIAL PROGRESS

The Companys business performance during FY 2025—26 reflects the continuing transition from product development towards commercial execution.

Following the commercial launch of the Urbanova KE9 electric bus, the Company has been progressing customer engagement and commercial opportunities across employee transportation, B2B fleet mobility and institutional applications.

The Company has also been developing its broader product and technology capabilities, with the objective of supporting future applications in passenger and freight mobility.

Managements immediate priority is to convert commercial opportunities into firm orders, followed by production, delivery, commissioning and after-sales support.

3. FINANCIAL PERFORMANCE

FY 2025—26 financial performance should be read in conjunction with the financial statements and the impact of the restructuring implemented pursuant to the NCLT Order.

The Companys financial results reflect the transition period, including the development and commercialisation activities undertaken during the year.

Metric	FY 2025-26 (Year Ended 31 Mar 2026)	Q1 FY 2026-27 (Quarter Ended 30 Jun 2026)
Revenue from Operations	~ 221 lakh	~ 634 lakh
Net Profit / (Loss)	~ (17.6) lakh (net loss)	~ 43.5 lakh (net profit)
Business Context	Restructuring, KE9 commercialisation, capability building	Step-up following KE9 commercial launch

Managements objective is to improve revenue visibility, strengthen operating performance and progress towards sustainable profitability as commercial deployment increases.

Detailed financial performance, revenue, expenses, profit / loss and year-on-year movements should be read from the audited financial statements.

4. FINANCIAL POSITION & KEY RATIOS

The Companys financial position and key financial ratios for FY 2025—26 are set out below. Key Financial Ratios:

Ratio	FY 2025-26	FY 2024-25	% Variance
Current Ratio (times)	5.31	6.38	-20%
Debt-Equity Ratio (times)	0.65	0.46	29%
Return on Equity (%)	-0.54%	-0.75%	-40%
Inventory Turnover Ratio (times)	0.03	0	100%
Trade Receivables Turnover Ratio (times)	0.31	0	100%
Trade Payables Turnover Ratio (times)	1.37	0	100%
Net Capital Turnover Ratio (times)	0.08	0	100%
Net Profit Ratio (%)	-8.27%	0.00%	100%
Return on Capital Employed (%)	-0.33%	-0.11%	67%

Current Ratio

The Current Ratio stood at 5.31 times in FY 2025—26 as compared to 6.38 times in FY 2024—25, representing a decrease of 20% as reflected in the ratio table. The movement is primarily attributable to changes in the composition of current assets and current liabilities during the year.

Debt-Equity Ratio

The Debt-Equity Ratio stood at 0.65 times in FY 2025—26 as compared to 0.46 times in FY 2024—25, representing an increase of 29% as reflected in the ratio table. The increase is primarily attributable to changes in borrowings and the equity base during the year.

Return on Equity

Return on Equity stood at -0.54% in FY 2025—26 as compared to -0.75% in FY 2024—25, with a variance of -40% as reflected in the ratio table. The movement is primarily attributable to the change in loss for the year and the corresponding equity base.

Inventory Turnover Ratio

Inventory Turnover Ratio stood at 0.03 times in FY 2025—26 as compared to 0 times in FY 2024—25, with a variance of 100% as reflected in the ratio table. The ratio became applicable during the year due to inventory and the corresponding cost of operations being recorded during the year.

Trade Receivables Turnover Ratio

Trade Receivables Turnover Ratio stood at 0.31 times in FY 2025—26 as compared to 0 times in FY 2024—25, with a variance of 100% as reflected in the ratio table. The ratio became applicable during the year due to revenue and corresponding trade receivables being recorded during the year.

Trade Payables Turnover Ratio

Trade Payables Turnover Ratio stood at 1.37 times in FY 2025—26 as compared to 0 times in FY 2024—25, with a variance of 100% as reflected in the ratio table. The ratio became applicable during the year due to trade payables and the corresponding purchases / expenses being recorded during the year.

Net Capital Turnover Ratio

Net Capital Turnover Ratio stood at 0.08 times in FY 2025—26 as compared to 0 times in FY 2024—25, with a variance of 100% as reflected in the ratio table. The ratio became applicable during the year due to revenue being recorded against the net working capital base.

Net Profit Ratio

Net Profit Ratio stood at -8.27% in FY 2025—26 as compared to 0.00% in FY 2024—25, with a variance of 100% as reflected in the ratio table. The movement is primarily attributable to the loss reported during the year against the revenue generated during the year.

Return on Capital Employed

Return on Capital Employed stood at -0.33% in FY 2025—26 as compared to -0.11% in FY 2024—25, with a variance of 67% as reflected in the ratio table. The movement is primarily attributable to the change in operating results and capital employed during the year.

5. RISK MANAGEMENT:

Management has identified the following principal risks and corresponding mitigation approaches:

Principal Risk	Potential Impact	Management Response
Execution & Scale-up	Production delays, quality issues or slower-than-planned ramp-up	Stage-gated production plan; vendor readiness; quality KPIs; delivery and service-network monitoring
Order Conversion	MoUs and soft commitments may not convert into firm orders, affecting capacity utilisation	Structured pipeline management; TCO evidence; milestone-based order tracking; disciplined opportunity management
Technology Dependency	Reliance on TRON Energy Technology may affect continuity, cost or development timelines	Localisation roadmap; alternative-source assessment; contractual protections; business-continuity planning
Capital Execution	Planned Telangana expansion may face funding, approval or execution delays	Board-approved capex gates; funding plan; project governance; periodic variance reporting
Competition	Established OEMs possess greater manufacturing scale and installed base	Product differentiation, KETO Connected, targeted B2B/PPP opportunities and customer responsiveness
Battery & Product Reliability	Performance, warranty or battery-life issues could affect TCO and customer confidence	Battery analytics, preventive maintenance, warranty tracking, field-failure monitoring and supplier quality controls
Working Capital	Commercial-vehicle production requires significant working capital ahead of collections	Disciplined inventory management, customer advances, supplier-credit optimisation and cash-flow monitoring

6. INTERNAL CONTROL SYSTEMS:

The Company maintains internal financial controls commensurate with the size, scale and nature of its operations, designed to provide reasonable assurance regarding the reliability of financial reporting, the safeguarding of assets, authorised recording of transactions and compliance with applicable laws. These controls have been assessed as adequate for the year under review and continue to be strengthened as the Company transitions from a resolution-plan environment to a scaled, listed-company operating model. The control framework spans financial, operational, technology and compliance processes and is supported by defined authorisation limits, documented approval workflows and clear segregation of duties, with the Audit Committee periodically reviewing effectiveness in consultation with the statutory and internal auditors.

Following the change in corporate identity, business model and listed-company status, management continues to strengthen regulatory compliance monitoring, Board and committee reporting, related- party transaction controls and timely stock-exchange communication — with particular attention to clearly distinguishing confirmed facts, commitments under negotiation and future plans in all public disclosures relating to operational milestones, MoUs, capacity commitments and funding arrangements.

7. MANAGEMENT OUTLOOK

Managements immediate focus is on ramping up production and deliveries, strengthening service and after-sales readiness, and converting commercial opportunities into firm orders.

In the medium term, the Company intends to progress its capacity expansion plans, subject to funding and approvals, and advance the Urbanova KE13 through development and homologation.

Over the longer term, the Company aims to build a differentiated position in Indias commercial electric mobility market through technology, connected fleet management, manufacturing capability and product breadth.

Management believes that disciplined execution, sound governance and responsible capital allocation will be important to achieving sustainable growth.

8. DISCLOSURE OF ACCOUNTING TREATMENT

The Company has complied with the appropriate accounting policies and has ensured that they have been applied consistently. There have been no deviations from the Indian Accounting Standards prescribed under Section 133 of the Companies Act, 2013 read with the relevant rules.

9. CAUTIONARY STATEMENT

This Management Discussion and Analysis contains forward-looking statements concerning the Companys objectives, expectations, plans, strategies, product development, manufacturing capacity, market opportunities and future business prospects.

Such statements are subject to risks and uncertainties, including market conditions, regulatory changes, technology developments, customer adoption, tender outcomes, availability of financing, supply-chain conditions, competition, manufacturing execution and other factors that may cause actual results to differ materially from those expressed or implied.

References to order pipelines, soft commitments, MoUs, targeted orders, planned manufacturing capacity and future product performance should not be construed as guarantees of future revenues or financial results.

The Company assumes no obligation to publicly update or revise forward-looking statements except as may be required under applicable laws and regulations.