L. T. Elevator Ltd Management Discussions

OVERVIEW

INDUSTRY STRUCTURE AND DEVLOPEMENT

The elevator industry continues to witness steady growth, driven by rapid urbanization, infrastructure development, increasing construction activities, and the expansion of residential, commercial, and industrial projects. The demand for elevators, spares, and accessories is increasing with the development of high-rise buildings, shopping malls, hospitals, hotels, residential complexes, and other infrastructure projects. The industry is also evolving with the adoption of modern technologies, including energy-efficient elevators, smart and connected systems, advanced safety features, and automated solutions. Increasing emphasis on passenger safety, convenience, energy efficiency, and modernization of existing elevator systems is expected to create further opportunities for manufacturers, traders, distributors, dealers, and service providers in the elevator industry.

OPPORTUNITIES AND OUTLOOK

The outlook for the coming year remains positive, with expected growth across both business verticals. We anticipate strong demand in the aerospace, defense, and telecom sectors, driven by technological advancements and increased investment in R&D. The power systems market is expected to benefit from the ongoing transition to renewable energy sources and the development of smart grid infrastructure.

Opportunities:

The growing urbanization, infrastructure development, construction of residential and commercial projects, and smart city initiatives present significant opportunities for the elevator and vertical transportation industry. The Company aims to leverage its manufacturing capabilities, technical expertise and established market presence to expand its customer base and order book. Further, the growing demand for automated and multi-level car parking solutions provides additional growth opportunities through its subsidiary, Park Smart Solutions Limited. The Company remains focused on expanding its operations and delivering safe, reliable and energy-efficient solutions.

RISK, CONCERNS AND THREATS

Risk:

- Market Volatility: Fluctuations in demand due to global economic conditions or geopolitical factors.

- Technological Obsolescence: The rapid pace of technological change necessitates continual innovation to stay competitive.

- Supply Chain Disruptions: Potential disruptions in the supply chain, especially for critical components in electronics and semiconductors.

- Cybersecurity Risks: Increasing reliance on digital systems poses significant cybersecurity risks that need to be managed.

Threats:

- Intense competition in the technology solutions market.

- Rapid technological changes requiring constant innovation and adaptation.

- Geopolitical risks impacting global supply chains, particularly in the semiconductor and defense sectors.

- Economic uncertainties that may lead to reduced spending in R&D and technology upgrades.

INTERNAL CONTROL SYSTEMS AND ITS ADEQUACY

The company has established robust internal control systems to ensure the integrity of financial reporting, compliance with applicable laws, and the efficiency of operations. These controls are regularly reviewed and updated to adapt to changing business environments and regulatory requirements. The audit committee periodically reviews the adequacy and effectiveness of the internal controls and risk management processes.

SEGMENT-WISE OR PRODUCT-WISE PERFORMANCE

The Company primarily operates in the elevator and vertical transportation system segment. Its key products and services include manufacturing, installation, commissioning and annual maintenance of passenger elevators, goods/car elevators, home elevators and hospital elevators. The Company also provides automated multi-level car parking solutions through its subsidiary, Park Smart Solutions Limited. During the year, there was no significant change in the nature of the Company s business or its product segments.

DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

During the year under review, the Company continued to focus on manufacturing, installation, commissioning and maintenance of elevators and vertical transportation systems. The Company maintained its operational focus on timely execution of projects, quality control and customer service. The financial performance of the Company remained aligned with its operational activities, supported by execution of existing orders and continued business development. The Company remains focused on improving operational efficiency, strengthening its order book and achieving sustainable growth in the coming years.

A. Standalone and Consolidated Financial Performance:

During the year ended 31st March, 2026, the Company reported a Standalone Total Income of INR 7,104.03 Lakhs, as compared to INR 4,523.42 Lakhs for the corresponding previous year ended 31st March, 2025. On a Consolidated basis, the Total Income stood at INR 11,173.07 Lakhs for the year ended 31st March, 2026, as compared to INR 5,493.58 Lakhs for the previous year.

The Standalone Total Expenses, excluding depreciation and tax, for the year ended 31st March, 2026 amounted to INR 5,515.01 Lakhs, as compared to INR 3,630.14 Lakhs in the previous year. On a Consolidated basis, the corresponding expenses amounted to INR 8,501.65 Lakhs in FY 2025-26, as compared to INR 4,274.94 Lakhs for the previous year.

The Standalone Profit Before Tax (PBT) for the year ended 31st March, 2026 stood at INR 1,360.56 Lakhs, as compared to INR 679.32 Lakhs in the previous year. On a Consolidated basis, the Profit Before Tax stood at INR 2,398.09 Lakhs, as compared to INR 989.26 Lakhs in the corresponding previous year.

The Standalone Net Profit After Tax for the year ended 31st March, 2026 amounted to INR 955.91 Lakhs, as compared to INR 488.66 Lakhs in the previous year. On a Consolidated basis, the Net Profit After Tax stood at INR 1,702.10 Lakhs, as compared to INR 697.75 Lakhs for the corresponding previous year.

The Basic Earnings Per Share (EPS) on a Standalone basis stood at INR 6.38 per share for the year ended 31st March, 2026, as compared to INR 3.28 per share in the previous year. On a Consolidated basis, the Basic EPS stood at INR 4.72 per share, as compared to INR 0.36 per share in the previous year.

MATERIAL DEVELOPMENTS IN HUMAN RESOURCES / INDUSTRIAL RELATIONS FRONT, INCLUDING NUMBER OF PEOPLE EMPLOYED

The Company considers its human resources to be an important contributor to its growth and operational performance. During the year under review, the Company maintained cordial and healthy relations with its employees and continued to focus on employee development, skill enhancement, safety and a positive work environment. There were no material developments in industrial relations during the year. The Company had 351 employees as on 31 st March, 2026.

The company continues to prioritize employee development and engagement. Significant investments have been made in upskilling our workforce to keep pace with technological advancements. The total number of employees as of the end of the financial year stood at F y 2025-26. Industrial relations remained harmonious, with no significant disruptions during the year.

The number permanent employees on the roles of the Company as on 31 st March 2026 is 351 employees.

DETAILS OF SIGNIFICANT CHANGES IN KEY FINANCIAL RATIOS

Ratio	Current Period	Previous Period	Variance in %	Reason for variance by more than 25%
Current Ratio	2.25	1.49	0.51	The increase in current ratio is mainly on account of increase in
				current assets as compared to the previous year.
Debt-Equity Ratio	0.18	0.35	(0.49)	The decrease in debt-equity ratio is mainly on account of increase in share capital and profit.
Debt service coverage ratio	(15.18)	9.09	(2.67)	The decrease in debt service coverage ratio is mainly on account of repayment of borrowings.
Return in equity ratio	0.14	0.15	( 0 . 10 )	NA
Inventory turnover ratio	3.49	2.73	0.28	The increase in inventory turnover ratio is mainly on account of increase in average inventory as compared to the previous year.
Debtors Turnover ratio	2.71	2.95	(0.08)	NA
Trade payables turnover ratio	9.73	6.52	0.49	The increase in trade payables turnover ratio is mainly on account of increase in operating expenses as compared to the previous year.
Net capital turnover ratio	1.54	2.85	0.49	The decrease in net capital turnover ratio is mainly on account of improvement in average working capital as compared to the previous year.
Net profit ratio	0.13	0.10	0.36	The increase in net profit ratio is mainly on account of increase in profit as compared to the previous year.
Return on capital employed	0.12	0.13	(0.08)	NA
Return on investment	-	-	-	-

DETAILS OF ANY CHANGE IN RETURN ON NET WORTH AS COMPARED TO THE IMMEDIATELY PREVIOUS FINANCIAL YEAR ALONG WITH A DETAILED EXPLANATION THEREOF

During the year under review, the Return on Net Worth of the Company increased as compared to the immediately preceding financial year, primarily due to the increase in profitability during the year. The improvement in the Company s operational performance and higher net profit contributed to the increase in Return on Net Worth. The Company continues to focus on improving operational efficiency, strengthening its financial position and generating sustainable returns for its stakeholders.

ENVIRONMENT, HEALTH & SAFETY (EHS)

The Company is committed to maintaining a safe and healthy working environment and to minimizing the environmental impact of its operations. Appropriate safety measures are followed at the manufacturing and project sites, with emphasis on employee safety, quality standards, proper handling of materials and compliance with applicable environmental and safety requirements. The Company continues to promote awareness and responsible practices among its employees and workers to ensure a safe and sustainable workplace.

DISCLOSURE OF ACCOUNTING TREATMENT

The Company has followed all the treatments in the Financial Statements as per the prescribed Accounting Standard: our company has followed all required accounting standards also disclosed significant accounting policy. Financial statements include balance sheet, profit and loss, cash flow statement with schedules/Notes.

CORPORATE GOVERNANCE REPORT

As per regulation 15(2) of the Listing Regulation, the Compliance with the Corporate Governance provisions shall not apply in respect of the following class of the Companies:

a. Listed entity having paid up equity share capital not exceeding Rs. 10 Crore and Net worth not exceeding Rs. 25 Crore, as on the last day of the previous financial year;

b. Listed entity which has listed its specified securities on the SME Exchange.

Since, our Company falls in the ambit of aforesaid exemption (b); hence compliance with the provisions of Corporate Governance shall not apply to the Company and it does not form the part of the Annual Report for the financial year 202526.

DECLARATION SIGNED BY THE CHIEF EXECUTIVE OFFICER STATING THAT THE MEMBERS OF BOARD OF DIRECTORS AND SENIOR MANAGEMENT PERSONNEL HAVE AFFIRMED COMPLIANCE WITH THE CODE OF CONDUCT OF BOARD OF DIRECTORS AND SENIOR MANAGEMENT

Since, our Company falls in the ambit of SME Listed entity; hence compliance with the provisions of declaration signed by the chief executive officer stating that the members of board of directors and senior management personnel have affirmed compliance with the code of conduct of board of directors and senior management shall not apply to the Company and it does not form the part of the Annual Report for the financial year 2025-26.

COMPLIANCE CERTIFICATE FROM EITHER THE AUDITORS OR PRACTICING COMPANY SECRETARIES REGARDING COMPLIANCE OF CONDITIONS OF CORPORATE GOVERNANCE

Since, our Company falls in the ambit of SME Listed entity; hence compliance with the provisions of Compliance certificate from either the auditors or practicing company secretaries regarding compliance of conditions of corporate governance shall not apply to the Company and it does not form the part of the Annual Report for the financial year 2025-26.

DISCLOSURES WITH RESPECT TO DEMAT SUSPENSE ACCOUNT/ UNCLAIMED SUSPENSE ACCOUNT

During the year under review there are no shares in the DEMAT suspense account or unclaimed suspense account, hence this provision is not applicable.

DISCLOSURE OF CERTAIN TYPES OF AGREEMENTS BINDING LISTED ENTITIES (1) INFORMATION DISCLOSED UNDER CLAUSE 5A OF PARAGRAPH A OF PART A OF SCHEDULE III OF THESE REGULATIONS

During the year under review the Company has not executed certain types of agreements binding listed entities as required to be disclosed under clause 5A of paragraph A of Part A of schedule III of the Listing Obligations and Regulations Act, 2015.

CAUTIONARY STATEMENT

The statements in the "Management Discussion and Analysis Report" section describes the company objectives, projections, estimates, expectations, and predictions, which may be "forward looking statements" within the meaning of the applicable laws and regulations. The annual results can differ materially from those expressed or implied, depending upon the economic and climatic conditions, Government policies and other incidental factors.