Lakshya Powertech Ltd Management Discussions

1. Industry Structure and Developments

Our Company is primarily serving Oil & Gas, Data Centre, Renewable Energy and Industry Services sectors.

I) Oil & Gas: The Oil & Gas industry demands expertise and precision, and we deliver just that. Specializing in turnkey solutions for both upstream and downstream operations, we offer services ranging from the construction of drilling rigs and refineries to the maintenance of pipelines and storage facilities. Leveraging cutting-edge technologies and best practices, we ensure safety, efficiency, and environmental compliance, enabling our clients to navigate the complexities of the Oil & Gas sector with confidence.

II) Data Centre and Power Infrastructure: We have strategically positioned ourselves to address the complex demands of the ever-evolving digital landscape, particularly in enhancing the resilience and efficiency of Data Centre amid the exponential growth of data. Leveraging our expertise in emergency power generation and fuel handling systems, we are committed to ensuring uninterrupted power supply and operational integrity for Data Centres. We are committed to advance our emergency power solutions, optimizing fuel handling systems for sustainability and efficiency, and offering comprehensive, end-to-end services for Data Centre operations and ensure sustainable growth and enhancing the digital infrastructure that reinforces our economy.

III) Renewable Energy: In the era of sustainable energy, Lakshya Powertech leads the charge in supporting the growth of clean and green power sources. Committed to renewable energy revolution, we provide end-to-end solutions for solar, wind, hydro, and biomass energy projects. From feasibility studies to design, engineering, construction, and operation & maintenance, our team facilitates the transition towards a sustainable future. By harnessing the power of nature, we assist our clients in reducing carbon footprints and promoting renewable energy adoption.

IV) Industrial Services: As the backbone of economies, the Industrial sector requires specialized attention. Lakshya Powertech offers tailored EPC services to meet the unique needs of various industrial projects. Whether it involves setting up new manufacturing facilities, expanding existing plants, or modernizing operations, our team ensures precise execution, efficiency, and safety. Our industrial services aim to optimize production processes, reduce operational costs, and enhance overall productivity, empowering our clients to thrive in a competitive landscape.

2. Opportunities and Threats

1. Oil & Gas Sector

Opportunities

The Oil & Gas sector continues to offer strong growth opportunities as natural gas supports the global energy transition by providing reliable power alongside renewable energy. Emerging technologies such as Carbon Capture, Utilization and Storage (CCUS) and blue hydrogen are creating new low-carbon business avenues. In addition, digital technologies including AI-driven predictive maintenance and automated operations are improving efficiency, reducing costs, and enhancing safety across the industry.

Threats

The sector faces increasing regulatory and environmental challenges due to stricter ESG compliance requirements, emissions regulations, and potential carbon pricing mechanisms. In addition, volatility in oil and gas prices and the accelerated shift towards renewable energy increase the risk of long-term projects becoming economically unviable, requiring companies to continuously adapt and diversify their operations.

2. Data Centres & Power Infrastructure

Opportunities

Rapid adoption of artificial intelligence, cloud computing, and digital transformation is driving significant investments in data centre infrastructure worldwide. Growing demand for uninterrupted power supply, coupled with advancements in energy-efficient cooling technologies and alternative power solutions, presents substantial opportunities for engineering, infrastructure, and energy management service providers.

Threats

The rapid expansion of data centres is placing considerable pressure on existing power infrastructure, resulting in grid connection delays and increasing project timelines. Additionally, growing concerns over electricity consumption, water usage, and environmental impact are leading to stricter regulatory requirements and higher compliance costs.

3. Renewable Energy Sector

Opportunities

The Renewable Energy sector continues to expand due to government incentives, corporate sustainability commitments, and increasing demand for clean energy solutions. Growing deployment of Battery Energy Storage Systems (BESS) alongside renewable projects is improving grid reliability and enhancing the commercial viability of clean energy investments.

Threats

The industry faces challenges from supply chain disruptions, rising raw material costs, and shortages of critical minerals required for renewable technologies. Limited transmission infrastructure can also result in power curtailment and reduced project profitability during periods of excess renewable generation.

4. Industrial Sector

Opportunities

The Industrial sector is benefiting from automation, electrification, and supply chain diversification, encouraging investments in modern manufacturing facilities. Growing adoption of energy-efficient technologies, waste heat recovery systems, and green hydrogen solutions is helping industries reduce operating costs while supporting sustainability objectives.

Threats

Industrial companies continue to face pressure from volatile energy prices, rising raw material costs, and the significant capital investment required for decarbonization. These factors may affect profitability and delay the adoption of cleaner technologies, particularly in energy-intensive industries.

3. Segment-wise or Product-wise Performance

The total revenue across all business sectors during the reporting period stood at Rs 17992.95 lakhs.

- Oil and Gas was the top contributor, generating Rs7886.67 lakhs, which represents approximately 43.83% of the total revenue.

- The Renewable segment recorded revenue of Rs5470.66 lakhs, accounting for nearly 30.40%.

- The Data Center segment contributed Rs4278.82 lakhs, which is about 23.78%.

- The Special Service segment had the contribution of Rs1356.80 lakhs, forming 1.98% of the total.

SALES

Oil & Gas	Renewable Energy	Data Centre	Special Service
78, 86, 66, 827	54, 70, 66, 437	42, 78, 81, 548	3, 56, 80, 373
			SALES

3. Outlook

Oil & Gas

The outlook for the Oil & Gas Engineering, Procurement, Construction & Commissioning (EPCC) and Operations & Maintenance (O&M) industry remains positive, supported by sustained investments in energy infrastructure, refinery expansions, pipelines, LNG facilities, and production assets. Growing emphasis on energy security, modernization of existing facilities, and digitalization is expected to drive continued demand for engineering and maintenance services. Increasing adoption of automation, predictive maintenance, and decarbonization initiatives is creating new growth opportunities, although fluctuations in crude oil prices and geopolitical uncertainties continue to remain key industry risks.

Data Centre & Power Infrastructure

The Data Centre infrastructure sector is expected to witness robust growth, driven by rapid digital transformation, increasing adoption of cloud computing, artificial intelligence (AI), 5G technologies, and rising demand for data storage and processing capabilities. Continued investments by hyperscale cloud providers, colocation operators, and enterprises, supported by government initiatives promoting digital infrastructure and data localization, are expected to sustain demand for our services, including electrical systems, cooling infrastructure, power distribution, and building management solutions. Our Company with strong execution capabilities and technical expertise is expected to benefit from the sectors long-term growth prospects.

Renewable Energy

The Renewable Energy sector, particularly Biomass, Biogas, and Compressed Biogas (CBG), offers significant growth opportunities as governments and industries increasingly focus on clean energy, waste-to-energy solutions, and decarbonization. Policy support for sustainable fuels and circular economy initiatives is expected to drive investments in biomass and CBG infrastructure. The increasing number of operational plants is anticipated to generate sustained demand for specialized Operations & Maintenance (O&M) services, while technological advancements in automation and predictive maintenance are expected to enhance operational efficiency and reliability.

Industrial Services

The outlook for industrial support services, including refurbishing, piping, skid fabrication, equipment installation, and allied engineering solutions, remains favourable due to ongoing investments in industrial infrastructure, capacity expansion, and modernization across sectors such as oil & gas, power, data centres, chemicals, and manufacturing. Rising demand for plant upgrades, brownfield expansion projects, and maintenance shutdowns is expected to support business growth. Companies possessing strong engineering capabilities, high quality standards, and efficient project execution are expected to benefit from the increasing demand for reliable industrial infrastructure services.

5. Risks and Concerns

Oil & Gas

The Companys Oil & Gas EPCC and Operations & Maintenance (O&M) business is exposed to risks arising from geopolitical uncertainties and changing customer investment patterns. Supply chain disruptions, inflationary pressures, and project execution challenges may impact costs and timelines. The business is also subject to stringent environmental, health, safety, and regulatory requirements. The Company mitigates these risks through diversified service offerings, disciplined project management, operational excellence, and long-term customer relationships.

Data Centre & Power Infrastructure

The Data Centre infrastructure business is exposed to risks relating to high capital investment, project execution delays, and fluctuations in material and equipment costs. Rapid technological advancements, increasing competition, evolving customer expectations, and sustainability requirements necessitate continuous capability enhancement. The Company addresses these risks through strong technical expertise, efficient project execution, prudent cost management, and a customer-focused approach.

Renewable Energy

The Biomass, Biogas and Compressed Biogas (CBG) business faces risks associated with feedstock availability, regulatory changes, government policy support, and operational reliability. Rising input costs, technological advancements, and skilled manpower requirements may also affect business performance. The Company seeks to mitigate these risks through robust maintenance practices, process optimization, technical expertise, and adherence to stringent safety and environmental standards.

Industrial Services

The Companys industrial support services business is exposed to risks arising from fluctuations in raw material prices, supply chain disruptions, project execution delays, and increasing competitive intensity. Skilled manpower availability and compliance with quality, safety, and environmental standards also remain key challenges. These risks are managed through efficient project management, cost optimization, robust quality control systems, and continuous enhancement of technical capabilities.

6. Internal Control Systems and Adequacy

The Company continues to maintain adequate and effective internal control systems commensurate with the size, scale, and complexity of its business operations. The internal control framework covers critical areas such as procurement, project costing, billing, vendor management, and financial risk oversight. Periodic internal audits are conducted to evaluate the effectiveness of controls, ensure operational efficiency, and verify compliance with applicable laws and regulations. The Audit Committee of the Board regularly reviews the observations and recommendations of the internal auditors and monitors the implementation of corrective actions, thereby strengthening the overall governance and control environment.

7. Discussion on financial performance with respect to operational performance

During FY 2025–26, the Company reported Revenue from Operations of Rs17,992.95 Lakhs, representing a growth of 12.38% over the previous year. Profit Before Tax (PBT) stood at Rs1,409.00 Lakhs as against Rs1,944.77 Lakhs in FY 2024–25, while Profit After Tax (PAT) was Rs1,013.90 Lakhs compared to Rs1,580.18 Lakhs in the previous year. The decline in profitability was primarily due to the deferment of revenue recognition relating to certain project milestones at the Bokaro site, where milestone approvals were delayed owing to prolonged rainfall. Consequently, the corresponding revenue could not be recognized during the financial year in accordance with contractual terms and applicable accounting standards. Despite this temporary impact, the Company maintained healthy revenue growth and continued to focus on efficient project execution and operational excellence.

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

As of March 31, 2026, the Company employed over 750 professionals across various functions, including engineering, procurement, project management, safety, and corporate operations. The Company continues to focus on strengthening its human capital through structured learning and development initiatives aimed at enhancing technical and managerial competencies. Regular training and skill development programs are conducted through in-house learning platforms to foster continuous improvement. The Company also leverages technology-driven solutions, including AI-enabled workforce planning and productivity monitoring tools, to improve operational efficiency. A strong emphasis is placed on maintaining the highest standards of safety, regulatory compliance, and ethical business practices across the organization. Industrial relations remained harmonious throughout the year, with no significant disruptions to business operations.

9. details of significant changes (i.e. change of 25% or more as compared to the immediately previous financial year) in key financial ratios, along with detailed explanations therefor,

Ratios	For the year ended March 31, 2026	For the year ended March 31, 2025	Variation (%)	Justification
(a) Current Ratio	2.00	2.56	(21.88)	Ratio is decreased due to Growth in EPCC or ongoing projects required higher working capital deployment, resulting in temporary pressure on liquidity ratios.
(b) Debt-Equity Ratio	0.71	0.27	162.96	Ratio is increased due to increase of borrowings during the year.
(d) Return on Equity Ratio	10.27 %	24.78%	(58.56)	Ratio is significantly decreased due to decrease in profits during the year.
(e) Inventory turnover ratio	2.25	4.03	(44.17)	Ratio is decrease due to significant increase in inventory of work-in-progress as compared with previous year.
(f) Trade Receivables turnover ratio	2.64	3.18	(16.98)	Ratio is decrease due to increase in trade receivables in comparison to Revenue from operations.
(h) Net capital turnover ratio	2.03	2.87	(29.27)	Ratio is decreased due to increase in amount of receivables and inventories as compared with previous year.
(j) Return on Capital employed	10.86 %	18.86%	(42.42)	Ratio is decreased due to decrease in profits during the year.
(k) Debt Service Coverage Ratio	0.26	0.81	(67.90)	Ration is decreased due to decrease in profits during the year.

10. details of any change in Return on Net Worth as compared to the immediately previous financial year along with a detailed explanation thereof

In FY 2025–26, the Company reported a Return on Net Worth (RoNW) of 9.93%, compared to 16.58% in FY 2024–25, reflecting a decline of 40.12%. The decrease was primarily attributable to the deferment of revenue recognition from certain project milestones at the Bokaro site, as the scheduled milestones could not be approved during the year owing to weather-related disruptions caused by the prolonged rainy season. Consequently, the corresponding revenue could not be recognized during the financial year, which adversely impacted the Companys profitability and, consequently, its Return on Net Worth.

Despite the lower RoNW percentage, the Company continued to demonstrate strong profitability, ensuring that returns remained healthy even with the expanded net worth.

11. Forward-Looking Statements

This report may contain forward-looking statements that are based on current assumptions, expectations, and projections about future performance and market conditions. These statements involve known and unknown risks, uncertainties, and other factors that could cause actual outcomes to differ materially from those expressed or implied. The Company does not undertake any obligation to publicly revise or update any forward-looking statements in light of future events or changes in expectations.

For and on behalf of Board of Directors of

Lakshya Powertech Limited

Sd/-

Rajesh Anne

Chairman & Managing Director

DIN: 05294345

Date: 31/08/2026

Place: Ahmedabad