Krishna Ventures Ltd Management Discussions

Global Economic Overview

The global economy is navigating a period of tempered expansion in 2025 2026, transitioning from an inflation-heavy post-pandemic recovery into a phase defined by geopolitical tensions, trade frictions, and rising energy costs. Worldwide GDP is projected to hover between 2.5% and 3.3%, cooling from earlier post-pandemic levels. Nominal world GDP is projected to reach approximately $126.3 trillion, with a decelerating growth rate as supportive factors like early tariff front-loading fade. Disinflation has stalled. Global inflation is projected to pick up slightly in developed economies (averaging 2.9%), largely driven by second-round shocks from energy prices and lingering trade shifts. With the U.S. average effective tariff rate settling near 17% the highest level since the 1930s global goods and services trade growth is forecast to slow considerably from earlier surges.

As the Middle East conflict drives sharp energy price increases, global growth is projected to slow to 2.5 percent in 2026, with emerging market and developing economies (EMDEs) facing the weakest per capita income growth since the pandemic. Risks remain skewed to the downside and include escalating hostilities, further commodity market disruptions, and additional geopolitical strains, while broader AI adoption offers some upside. Globally to safeguard energy and food security and advance the energy transition, and domestically to control inflation, strengthen fiscal sustainability, and support job creation. Rising debt is driving up EMDE borrowing costs, particularly for those most indebted, underscoring the need for stronger revenue mobilization and improved debt management. For commodity exporters, building fiscal resilience will also require strong institutional frameworks and revenue diversification. Continuing its streak as the fastest-growing major economy, Indias real GDP growth closed the fiscal year at 7.7% and is projected to moderate to 6.3% in FY27 as energy prices and tighter financial conditions weigh on household power. The Reserve Bank of India balances slowing momentum with sticky inflation (averaging 4.9%), potentially leaning toward monetary tightening.

Global growth is projected at 3.0 percent for 2025 and 3.1 percent in 2026, an upward revision from the April 2025 World Economic Outlook. This reflects front-loading ahead of tariffs, lower effective tariff rates, better financial conditions, and fiscal expansion in some major jurisdictions. Global inflation is expected to fall, but US inflation is predicted to stay above target. Downside risks from potentially higher tariffs, elevated uncertainty, and geopolitical tensions persist. Restoring confidence, predictability, and sustainability remains a key policy priority.

The latest World Economic Outlook reports a slowdown in global growth as downside risks intensify. While policy shifts unfold and uncertainties reach new highs, policies need to be calibrated to rebalance growth-inflation trade-offs, rebuild buffers, and reinvigorate medium-term growth, thereby reducing both internal and external imbalances. Policies that promote healthy aging, bridge gender disparities, and enhance the alignment of migrants skills with local labor market demands can play a crucial role in countering slow economic growth and fiscal pressures, especially when coupled with infrastructure investment.

On a central case scenario, the global economy should continue with a steady expansion in 2026, aided by monetary and fiscal easing, and the ongoing AI boom. The US should be the fastest-growing G7 economy, with the administration likely to double down on efforts to boost growth ahead of the mid-terms. But it is a fragile global backdrop, amid heightened geopolitical uncertainty, risks of an escalation in trade tensions, and concerns about threats to the Federal Reserves independence.

Indian Economy Overview

Indias economy has cemented its position as the fastest-growing major economy, with provisional estimates for FY 2025-26 indicating a robust real GDP growth rate of 7.7%. The valuation stands at approximately $4.15 trillion. The expansion is driven by strong domestic consumption and robust government capital expenditure. The Indian economy continues to navigate the global landscape with resilience. Key performance indicators for FY 2025-26 include:

GDP Growth: Maintained a provisional 7.7% real GDP growth for the fiscal year, outperforming many global forecasts.

Per Capita Income: Reached $2,813 per capita, an increase of $137 from the previous year.

Inflation: Dropped to decadal lows, sitting around 1.7% during periods of 2025 2026, which provided a major boost to purchasing power.

Services Sector: Surged, seeing up to 9.2% growth and now contributing roughly 60% of Gross Value Added (GVA).

Global Standing: Retained its World Bank GDP Forecasts and IMF status as the Worldometer India GDP Overview as the fastest-growing major economy, despite global trade tensions and shifting tariff regimes.

The Indian real gross domestic product expanded by 7.8% from the previous year in the March quarter of 2026, slowing slightly from the upwardly revised 8% growth from the earlier period, but still well ahead of market expectations of 7.2%. The data reflected Indias momentary resilience to higher energy prices and a week rupee following efforts to source oil outside Russia and the outbreak war in the Middle East. Output was higher for manufacturing (7.3%), trade, hotels, transportation, and communication (12.5%), financial and real estate services (10.4%), and construction (8.4%), offsetting slower growth in mining and quarrying (5.4%) and agriculture and feedstock (3.6%). For the whole 2026 financial year, the Indian GDP expanded by 7.7%, the most since the rebound from the Covid pandemic recession in FY2022.

The Private Consumption is a significant driver, especially in rural areas, ensuring steady domestic demand despite global economic challenges.

o Indias private consumption has nearly doubled to Rs. 1.83 lakh crore in 2024, growing at a 7.2% Compound Annual Growth Rate (CAGR), surpassing the US, China, and Germany.

o The country is on track to become the worlds third-largest consumer market by 2026, with the middle class expanding rapidly.

o By 2030, the number of individuals earning over Rs. 8.73 lakh annually is expected to nearly triple.

o Indias per capita income is projected to exceed Rs. 3.49 lakh by 2030, driving consumption growth. Indias robust fiscal management, with a lower debt-to-GDP ratio of 56.8% in FY25 compared to its competitors like the US, which has a debt-to-GDP ratio of 124.0%, along with structural reforms, helps maintain stability. Investment in infrastructure and digitalization boosts productivity and job creation, enhancing long-term growth prospects. Indias digital economy has become a significant contributor to its economic growth, accounting for 11.74% of GDP in 2022-23. Initiatives like the Pradhan Mantri Jan Dhan Yojana for financial inclusion, and Make in India along with Production-Linked Incentive schemes to boost manufacturing have strengthened Indias economic dynamism.

Moreover, the growing adoption of digital technologies, including Artificial Intelligence and renewable energy solutions, supports higher productivity and resilience in economic activities. Indian startups are likely to create 50 million new jobs and add USD 1 trillion to the economy by 2029-30 (FY30). Indias technology sector is witnessing rapid growth and is projected to reach USD 300-350 billion over the next five years. External Demand and Trade Diversification : Indias increased integration into global value chains and trade agreements provides growth opportunities and buffers against global volatility. Indias share in global services exports has doubled from 1.9% in 2005 to 4.3% in 2023.

Outside of Asia, the developing world is becoming a development-free zone, said Indermit Gill, the World Bank Groups Chief Economist and Senior Vice President for Development Economics . It has been advertising itself for more than a decade. Growth in developing economies has ratcheted down for three decades from 6 percent annually in the 2000s to 5 percent in the 2010s to less than 4 percent in the 2020s. That tracks the trajectory of growth in global trade, which has fallen from an average of 5 percent in the 2000s to about 4.5 percent in the 2010s to less than 3 percent in the 2020s. Investment growth has also slowed, but debt has climbed to record levels. Growth is expected to slow in nearly 60 percent of all developing economies this year, averaging 3.8 percent in 2025 before edging up to an average of 3.9 percent over 2026 and 2027. That is more than a percentage point lower than the average of the 2010s. Low-income countries are expected to grow 5.3 percent this year a downgrade of 0.4 percentage point from the forecast at the start of 2025. Tariff increases and tight labor markets are also exerting upward pressure on global inflation, which, at a projected average of 2.9 percent in 2025, remains above pre-pandemic levels.

Finally, to accelerate economic growth, countries will need to improve business climates and promote productive employment by equipping workers with the necessary skills and creating the conditions for labor markets to efficiently match workers and firms. Global collaboration will be crucial in supporting the most vulnerable developing economies, including through multilateral interventions, concessional financing , and, for countries embroiled in active conflicts, emergency relief and support.

Industry Structure and Development

The heating, ventilation, and air conditioning (HVAC) market size has grown strongly in recent years. It will grow from $310.58 billion in 2025 to $333.55 billion in 2026 at a compound annual growth rate (CAGR) of 7.4%. The growth in the historic period can be attributed to increasing use of mechanical climate control systems, early adoption of centralized air cooling, rise in commercial hvac deployments, steady residential hvac expansion, growth in industrial ventilation needs.

The heating, ventilation, and air conditioning (HVAC) market size is expected to see strong growth in the next few years. It will grow to $438.64 billion in 2030 at a compound annual growth rate (CAGR) of 7.1%. The growth in the forecast period can be attributed to increasing adoption of smart hvac platforms, growing demand for low-emission heating, expansion of IOT-connected air systems, rising focus on energy efficiency regulations, development of predictive climate management solutions. Major trends in the forecast period include increasing deployment of smart hvac controls, rising adoption of energy-efficient hvac units, growth in centralized air quality monitoring, expansion of low-emission heating solutions, increasing shift toward predictive hvac maintenance.

Rising global temperatures are expected to drive growth in the HVAC market in the coming years. Temperature measures the average kinetic energy of particles in a substance, reflecting how hot or cold it is. The increase in temperature is primarily caused by rising concentrations of greenhouse gases in the atmosphere, which trap solar heat and prevent it from escaping, leading to a gradual warming of the Earths surface. This rise in temperatures is boosting demand for HVAC systems, as higher heat levels increase the need for effective cooling solutions to maintain indoor comfort and safety, especially during extended periods of extreme weather. For example, in January 2024, a report by the National Oceanic and Atmospheric Administration (NOAA), a US government agency, noted that in July, August, and September 2023, global temperatures exceeded the long-term average by more than 1.0°C (1.8°F), marking the first time any month surpassed this threshold in NOAAs records. Therefore, rising global temperatures are expected to accelerate the growth of the HVAC market.

Key players in the HVAC market are focusing on developing advanced AI-powered HVAC solutions to enable predictive maintenance and reduce operational downtime. AI-powered HVAC systems leverage artificial intelligence to optimize heating, ventilation, and air conditioning operations, enhancing energy efficiency, comfort, and maintenance predictability. For instance, in September 2023, KOVA, a US-based HVAC manufacturer, launched the KOVA Comfort Intelligent HVAC system. It uses behavioral, environmental, and unit-specific occupancy data to personalize and optimize comfort and energy use within living spaces. Its compact design and minimal footprint make it suitable for multifamily, student housing, hospitality, and residential applications. The system combines advanced machine learning with an AI-driven processor to continuously improve performance and energy efficiency over time. Unlike traditional HVAC systems, KOVA Comfort reduces downtime and energy waste through the integration of AI technology with a variable-speed compressor and fan, resulting in enhanced productivity.

The heating, ventilation, and air conditioning (HVAC) market consists of revenues earned by entities by providing services such as installation services, system maintenance, repair services, and ductwork services. The market value includes the value of related goods sold by the service provider or included within the service offering. The HVAC market also includes sales of furnaces, thermostats, ventilation systems, refrigerants and HVAC chemicals. Values in this market are factory gate values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

Heating, Ventilation, And Air Conditioning (HVAC) Market Global Report 2026 provides strategists, marketers and senior management with the critical information they need to assess the market. This report focuses heating, ventilation, and air conditioning (hvac) market which is experiencing strong growth. The report gives a guide to the trends which will be shaping the market over the next ten years and beyond.

The Indian HVAC and refrigeration market is valued at roughly USD 12 billion to USD 15 billion, expanding at a rapid annual growth rate of 10% to 15%. Driven by rising temperatures, urbanization, and government initiatives like Atmanirbhar Bharat, demand surges across residential spaces, data centers, and commercial infrastructure. The India HVAC market is on a strong growth path from USD 6.77 Billion in 2020 to USD 49.02 Billion by 2034. Air conditioning has shifted from a discretionary luxury to a near-essential household and workplace appliance, particularly in metro and tier-2 cities. Falling unit prices, easy EMI financing, and rising power efficiency standards are encouraging consumers to upgrade or buy first-time cooling systems. Direct expansion systems dominate product type at 62.4% in 2025, supported by mass-market split and window air conditioner adoption across homes and small commercial premises. Residential leads the end user segment at 55.8%, fueled by rising household incomes, longer summers, and growing aspirations for indoor comfort. North India commands 32.6%, led by Delhi-NCR, Punjab, and Uttar Pradesh, where prolonged heat exposure and dense urban housing keep cooling demand high. In March 2026, Delhi recorded its warmest day of the year, with the temperature hitting 40.1 degrees Celsius in the Ridge area. The opportunities in this sector make it attractive for local and international companies.

Market Expansion: The expanding middle-class population and increasing urbanization present vast opportunities for market expansion, especially in Tier II and Tier III cities. Technology Adoption: With advancements in HVAC technology such as variable refrigerant flow (VRF) systems, smart controls, and IoT integration, there is a significant opportunity to enhance energy efficiency, comfort, and operational efficiency. Green Building Initiatives: The growing focus on sustainability and green building certifications, such as Leadership in Energy and Environmental Design (LEED), and Green Rating for Integrated Habitat Assessment (GRIHA) create opportunities for the adoption of energy-efficient HVAC systems and solutions. Aftermarket Services: The demand for aftermarket services, such as maintenance, retrofitting, and upgrades is expected to rise, presenting opportunities for HVAC service providers and contractors. Despite the promising growth prospects, the HVAC sector in India faces challenges, including: High Initial Costs: The high initial costs associated with HVAC systems often deter price-sensitive consumers, particularly in the residential segment. Lack of Skilled Manpower: The shortage of skilled technicians and HVAC professionals in India can affect the installation, maintenance, and servicing of HVAC systems. Regulatory Compliance: Meeting energy efficiency standards and regulations imposed by the government, such as the Bureau of Energy Efficiency (BEE) guidelines, can be challenging for HVAC manufacturers. Consumer Awareness and Education: Many consumers may not be aware of the benefits of energy-efficient HVAC systems, which can slow the adoption of greener technologies.

INVESTMENTS/DEVELOPMENTS Train HVAC Market Trends

The global train HVAC market is valued at approximately $15.74 billion in 2026 and is projected to reach over $21 billion by the early 2030s. Key investment and development trends focus on eco-friendly natural refrigerants, IoT-driven smart controls, and high-speed rail expansion.

Increasing Demand for Rapid Transit

In order to meet the growing transportation needs across the world, several governments are expanding their rapid transit networks within the countries to make public transportation more feasible for the population. The governments of major countries are investing heavily in developing urban rail transit. The focus is on developing high-speed trains for passenger travel.

Key Market Trends & Developments

Eco-Friendly Refrigerants: Transitioning to low Global Warming Potential (GWP) alternatives like propane (R-290) to meet strict environmental regulations Smart IoT & AI Controls: Integrating real-time sensor diagnostics and predictive maintenance to reduce lifecycle costs and lower energy use by up to 35%. Modular and Roof-Mounted Units: Prioritizing lightweight, roof-mounted modular designs that simplify retrofitting and maximize passenger cabin space

Regional Investments & Drivers

Asia-Pacific Leadership: Holding nearly half of the global market share, driven by massive metro expansions and high-speed rail corridor upgrades. Fleet Refurbishment: Funding shifts toward retrofitting older passenger coaches with modern, quiet, and energy-efficient climate control systems.

Segment wise or product wise performance:

Your company operates in business of Manufactures, assemblers, dealers, merchant, importers and agents for the purchase, sale and hiring of all kinds of air conditioners, air conditioning and Refrigeration, machinery, Refrigerants, Liquids and Gases, ice Cream Freezers, Quick Freezing cabinets and like deodorisers, Refrigerated trucks, Vans, Wagons Etc, Heaters, Heating appliances, Coolers, Diffusers, compressors, Condensers, Fans of all types, pumps, Motors, Thermostats, Sprayers, Cold Storages or ice cream plants, appliances, tools, machinery apparatuses, devises, instruments, chemicals and all types of machinery, equipments, appliances and instruments of all kinds, sizes, types and their parts accessories of all descriptions.

Risks and Concerns:

1. Environmental liabilities.

2. Infrastructure.

3. Stricter lending requirements and credit crunch.

4. Ever - changing nature of the industry.

5. The real estate investment market is still in its infant stage.

6. Regulatory risks.

7. Property market risks.

8. Pricing uncertainties/ Commodity price fluctuations

9. Economy and market fluctuations.

10. Global trade uncertainties 11. Power disruptions

12. Major business and operational risks, including persistent skilled labor shortages, expensive transitions to low-GWP refrigerants and high-efficiency standards, rising raw material and equipment costs, and increasing operational complexity from smart/AI-driven technology integration.

Company Performance and Outlook

Krishna Ventures Limited deals in Manufactures, assemblers, dealers, merchant, importers and agents for the purchase, sale and hiring of all kinds of air conditioners, air conditioning and Refrigeration, machinery, Refrigerants, Liquids and Gases, ice Cream Freezers, Quick Freezing cabinets and like deodorisers, Refrigerated trucks, Vans, Wagons Etc, Heaters, Heating appliances, Coolers, Diffusers, compressors, Condensers, Fans of all types, pumps, Motors, Thermostats, Sprayers, Cold Storages or ice cream plants, appliances, tools, machinery apparatuses, devises, instruments, chemicals and all types of machinery, equipments, appliances and instruments of all kinds, sizes, types and their parts accessories of all descriptions. The Indian electronics manufacturing industry is projected to reach US$ 520 billion by 2025. The demand for electronic products is expected to rise to US$ 400 billion by 2025 from US$ 33 billion in FY20. Electronics market has witnessed a growth in demand with market size increasing from US$ 145 billion in FY16 to US$ 215 billion in FY19 the market witnessed a growth of 14% CAGR from 2016-19. Electronics system market is expected to witness 2.3x demand of its current size (FY19) to reach US$ 160 billion by FY26.

Internal Control Systems and their adequacy

The company has developed an Internal Control System and procedures to ensure efficient conduct of business and security of its assets. The auditors review the effectiveness and adequacy of the internal control system by reviewing, analysing and testing controls and make recommendations to the management to improve controls wherever necessary.

Particulars	March 31, 2026	March 31, 2025
Revenue from operations	946.87	172.59
Other Income	47.87	44.09
Total Revenue	994.74	216.68
Earnings before interest, taxes depreciation and amortization	44.11	-72.72
Earnings before interest and taxes	29.71	-87.36
Profit before Taxation	29.71	-87.36
- Current Tax	0.00	0.00
- Deferred Tax	-0.16	0.20
Net Profit/ (Loss) For the Year	29.87	-87.56

Revenue from Operation: The Revenue has raised from Rs. 946.87 Lakhs in the financial year 2025-2026 to Rs. 172.59 lakhs in the financial year 2024-2025. The growth in revenue can be attributed to the change in market scenario, opening up of the economy and trade resumptions.

Operational Performance

EBITDA: The Company incurred profit of Rs. 44.11 Lakh in the financial year 2025-26 as compare to the previous financial year 2024-25 in which the loss was Rs. -72.72 Lakh.

PAT: Net Profit of the Company in the financial year 2025-26 is Rs. 29.87 Lakhs as compare to the previous financial year 2024-25 in which the Net loss was Rs. 87.56 Lakh.

Other Income: Other income for the financial year 2025-2026 increased by Rs. 47.87 lakhs as compared to Rs. 44.09 lakh in the previous year due to exchange fluctuations gains & other non-operating income.

Debt and Finance cost: During the year under review, the debt of the company is of Rs. 379 lakh against the Financial cost Rs. 21.71 lakh.

Particulars	Units	2026	2025
Profitability Ratios
EBITDA Margin	%	4.43%	-32.95%
EBIT Margin	%	2.98%	-41.43%
Net Profit Margin	%	3.00%	-50.62%
Growth Ratios
Net worth	%	Rs. 1088.80 (in lacs)	Rs. 1,058.93 (in lacs)
Return Ratios
Return on Equity	%	2.74%	-7.94%
Return on Capital Employed	%	2.10%	-6.75%
Return on Assets	%	1.06%	-3.45%
Leverage Ratios
Debt to Equity	Times	1.59 Times	1.38 Times
Debt to EBITDA	Times	26.29 Times	-25.07 Times
Interest Coverage	Times	0.73 Times	-4.51 Times
Debt to Assets	Times	0.61 Times	0.57 Times
Efficiency Ratios
Asset Turnover	Times	0.34 Times	0.07 Times
Receivable Turnover	Times	21.82 Times	3.15 Times
Receivable Days	Days	16.72 Days	115.98 Days

Growth Ratios: The Net worth has increased to Rs. 1088.80 (in lacs) for the financial year 2025-26 from Rs. 1,058.93 (in lacs) for the financial year 2024-25.

(Rs. In Lakhs)

Particulars	2026	2025
Net Cash Generated from Operating Activities(A)	-19.59	132.03
Net Cash used in Investing Activities (B)	18.12	-116.13
Net Cash Generated from Financing Activities (C)	-21.71	-15.85
Net increase/decrease in cash (D=A+B+C)	-23.18	0.04
Cash and Cash Equivalents at the beginning (E)	31.34	31.30
Cash and Cash Equivalents at the end (F=D+E)	8.16	31.34

Liquidity: Cash balances increased to Rs. 31.34 Lakhs in the financial year 2025-26 as compared to Rs. 31.30 Lakhs in the previous year.

Material developments in Management

There has been no material developments in management of the company.

Material developments in Human Resources / Industrial Relations front, including number of people employed

Your company is currently engaged in the development of a performance system that incorporates system-of-care principles and scope for continuous professional development.

CAUTIONARY STATEMENT

The Board of Directors have reviewed the Management Discussion and Analysis prepared by the Management. Statement in this report of the Companys objective, projections, estimates, exceptions, and predictions are forward looking statements subject to the applicable laws and regulations. The statements may be subjected to certain risks and uncertainties. Companys operations are affected by many external and internal factors which are beyond the control of the management. Thus the actual situation may differ from those expressed or implied. The Company assumes no responsibility in respect of forward looking statements that may be amended or modified in future on the basis of subsequent developments, information or events.

ACKNOWLEDGEMENT

Your directors take this opportunity to place on record their appreciation to all employees for their hard work, spirited efforts, dedication and loyalty to the Company.

Sd/-	Sd/-
(NEERAJ GUPTA)	(Mahesh Chandra Sharma)
Managing Director	Director
DIN : 07176093	DIN: 09088347
Place: Noida	Place: Noida
Date: August 24, 2026	Date: August 24, 2026