Lloyds Engineering Works Ltd Management Discussions

Global economy

Overview

Global economic grew marginally at an 3.4% in 2025 compared to 3.3% in the previous year, influenced by the US tariff shock of April 2025. Despite being partially unwound through subsequent trade deals, it left effective tariff rates well above pre-2025 levels and heightened trade policy uncertainty.

Advanced economies witnessed a marginal growth from 1.8% in 2024 to

1.9% in 2025, while emerging market and developing economies demonstrated relative resilience, expanding by 4.4% in

2025 compared to 4.3% in 2024.

Global inflation continued its multi-year downward trend in 2025, declining to an estimated 4.1% from 5.8% in 2024.

Regional growth (%)	FY 25	FY 24
World output	3.4	3.3
Advanced economies	1.9	1.8
Emerging and developing economies	4.4	4.3

(Source: IMF, un.org)

Performance of the major economies, 2025

United States	China	United Kingdom	Japan	Germany
GDP growth of 2.1% in 2025 compared to 2.8% in 2024.	GDP growth was 5.0% in 2025 compared to 5.0% in 2024.	GDP growth was 1.3% in 2025 compared to 1.1% in 2024.	GDP growth was 1.2% in 2025 compared to (0.2)% in 2024.	GDP growth was 0.2% in 2025 compared to a (0.5)% in 2024.

Outlook

Given the challenge of forming stable, real-time assumptions for projections, the IMF World Economic Outlook report adopted a ‘reference forecast instead of a conventional baseline, assuming the war remains contained in duration, intensity, and reach, with disruptions easing by mid-2026, in line with commodity futures as of March 10, 2026.

Under this reference view, global growth is projected at 3.1% in 2026 and 3.2% in 2027. Global inflation is expected to rise to 4.4% in 2026 before easing to 3.7% in 2027.

(Source: OECD Interim Economic Outlook, IMF, World Economic Forum, Federal Reserve, Bank of England, European Central Bank, Bank of Japan)

Indian economy

Overview

The Indian economys real GDP grew at 7.7% in FY 2025-26, compared to 7.1% in FY 2024-25. This growth was driven by strong consumption and increasing investments, reaffirming Indias position as the fastest-growing major economy.

Indias Real GDP at Constant Prices was estimated at Rs. 323.12 Lakh Crores in FY 2025-26, compared with Rs. 299.89 Lakh Crores in FY 2024-25.

Growth of the Indian economy

	FY 23	FY 24	FY 25	FY 26
Real GDP growth (%)	7.0*	7.2	7.1	7.7

* The FY 2022-23 figure (7.0%) is from the old base year series (FY 2011-12) as the new series back-data for FY 2022-23 will only be available after December 2026.

Growth of the Indian economy quarter by quarter, FY 2025-26

	Q1FY 26	Q2FY 26	Q3FY 26	Q4FY 26
Real GDP growth (%)	6.7	8.4	7.8	7.8

Note: Q2 revised upward from 8.2% and Q3 from 7.35% under the new base year FY 2022-23 series released February 27, 2026. Q4 remains an estimate. (Source: MoSPI)

Inflation, policy and currency dynamics

Inflation remained benign through much of FY 2025-26, with full-year CPI estimated at an exceptionally low 2.1%. This created room for 125 basis points of cumulative rate cuts, supporting consumption and investment.

However, macro stability was accompanied by currency volatility. The Indian rupee depreciated sharply by 9.88% during FY 2025-26 - its steepest fall since FY 2011-12 - touching Rs. 94.83 against the US dollar. This reflected global capital flows, a strong dollar environment, and geopolitical uncertainties.

Capital flows and market behaviour

Foreign portfolio investors remained risk-averse, withdrawing a record Rs. 1.8 Trillions during FY 2025-26 – the largest outflow in 36 years. However, strong domestic institutional inflows of Rs. 8.50 Trillions provided a crucial counterbalance, highlighting the growing maturity and depth of Indias domestic capital markets. Indias market capitalisation declined 8% year on year in FY 2025-26 to USD 4.5 Trillions from USD 4.83 Trillions in FY 2024-

25, marking the sharpest drop since FY 2022-23. The BSE Sensex declined

7% or 5,467 points in FY 2025-26, against a gain of 5.1% or 3,763 points, in FY 2024-25. Similarly, the Nifty 50 fell 5%, or 1,188 points, in FY 2025-26, compared to a gain of 5.3% or 1,192 points, in FY 2024-25. against a gain of 5.34%, or 1,192 points, in the corresponding period. The downturn was largely driven by the ongoing West Asia conflict and concerns around potential tariff measures under Donald Trump, which weighed on global investor sentiment.

Gold prices surged 64.1% during FY 2025-

26 reflecting global risk aversion and safe-haven demand.

Indias net direct tax collections rose

5.12% y-o-y to Rs. 23.40 Lakh Crores in FY 2025-26, though this fell short of the Revised Estimate of Rs. 24.21 Lakh Crores by approximately Rs. 80,000 Crores Corporate tax collections came in at Rs. 10.99 Lakh Crores against a target of Rs. 11.09 Lakh Crores, while personal income tax (including STT) stood at Rs. 12.41 Lakh Crores against a target of Rs. 13.12 Lakh Crores - the larger of the two misses, partly reflecting the income tax relief extended to the middle class in the Union Budget FY 2025-26.

Banking sector

Indias banking sector reflected improving financial health, with the gross non-performing asset ratio declining to a robust 2.1% as of September 2025, indicating stronger asset quality and disciplined lending practices. This stability was mirrored in profitability metrics, as scheduled commercial banks reported a return on assets of 1.3% and a return on equity of 12.5% during the first half of FY 2025-26, underscoring sustained operational efficiency and a healthier balance sheet trajectory.

Indias growth story

Real Gross Value Added (GVA), which measures economic output excluding taxes and subsidies, grew 7.9% in FY 2025-26, compared with 7.3% in FY 2024-25. At current prices, nominal GVA rose 9.1% to Rs. 314.87 Lakh Crores from Rs. 288.54 Lakh Crores a year earlier.

The tertiary services sector remained a key growth driver, expanding by 9.0% in FY 2025-26 and increasing its share in nominal gross value added to 54.3% from

52.8% in FY 2024-25, supported by broad-based momentum across segments. During FY 2025-26, financial, real estate,

IT and professional services grew by

9.9%, while trade, hotels, transport, communication and broadcasting recorded a strong 10.1% growth, and public administration and other services expanded by 5.8%.

The secondary sector grew 9.1%, accelerating from 8.0% in the previous year, driven by manufacturing alongside construction growth of 7.1%. This combination of services-led scale and manufacturing acceleration is shaping a more balanced and resilient economic structure.

Consumption and investment

During FY 2025-26, Private Final Consumption Expenditure (PFCE) and Gross Fixed Capital Formation (GFCF) maintained an above-7% growth, reflecting a well-balanced demand composition across household spending and investment activity.

Growth catalysts

Policy-led consumption boost:

The Union Budget FY 2026-27s tax relief measures - particularly income tax exemptions up to Rs. 12 Lakh - are expected to stimulate discretionary spending and reinforce consumption-led growth.

Anticipatory Pay Commission impact:

The 8th Pay Commission, though expected to be implemented from FY 2027-28, is already shaping consumer sentiment, creating a forward consumption impulse.

Monetary stability: The Reserve Bank of Indias calibrated stance, with the repo rate at 5.25%, balances inflation risks with growth support, ensuring macroeconomic stability.

Credit expansion: Improved banking health and liquidity conditions are expected to sustain strong credit growth across

MSMEs, housing, and retail segments.

Fiscal prudence with growth focus: The Union Budget maintains fiscal discipline while prioritising infrastructure, MSME support, skilling, and innovation-key levers for long-term productivity.

Outlook

The year under review underscores a defining divergence: a world grappling with uncertainty, and an India navigating it with confidence.

In a global environment marked by fragmentation and caution, India stands out as a rare convergence of stability, scale and structural opportunity. The World Bank has revised its FY 2026-27 growth estimate upward to approximately 6.6%, reflecting resilient domestic momentum even as growth moderates from the previous year.

India is expected to retain its position as the fastest-growing major economy.

Growth will be shaped by a combination of strong domestic demand and resilient private consumption, supported by low inflation and GST rationalisation, alongside stable export performance with improved access to key markets. This momentum is further reinforced by sustained policy support, ongoing economic reforms, and a favourable demographic advantage. While risks persist, particularly from elevated energy prices, subsidy pressures on government spending, and uncertainty in global demand, Indias macroeconomic fundamentals remain strong. Over the medium term, sustained consumption, gradual investment recovery, and expanding global trade linkages are expected to reinforce Indias position as a key driver of global economic growth.

(Source: Upstox, Economic Times, India Today, 5paisa, Livemint, The Logical India)

Global engineering market overview

The global engineering services market is estimated at USD 1.81 Trillions in 2026, up from USD 1.74 Trillions in 2025, and is projected to reach USD 2.22 Trillions by 2031, registering a CAGR of 4.16% during 2026 to 2031. Growth is being supported by large scale infrastructure investments, energy transition projects and the increasing adoption of digital twin technologies. Asia Pacific remains the largest market, while North America continues to witness steady growth driven by clean energy and infrastructure funding.

Key industry insights

By discipline: Civil engineering accounted for 37.86% share in 2025, while electrical engineering is expected to grow at a CAGR of 4.93% through 2031.

By delivery model: Onsite services held 66.83% share in 2025, while offshore services are projected to grow at a CAGR of 5.05%.

By service category: Product engineering accounted for 40.74% share in 2025, while automation services are expected to grow at a CAGR of 5.11%.

By end user: Oil and gas held 16.22% share in 2025, while electric power generation is projected to grow at a CAGR of 4.89%

By geography: Asia Pacific accounted for 39.52% share in 2025 and is expected to grow at a CAGR of 5.13% through 2031.

Industry trends

Civil engineering continues to dominate due to investments in transportation and water infrastructure, while electrical engineering is the fastest growing discipline, supported by USD 369 Billions in clean energy incentives in the United States and funding under the European Green Deal. Increasing electrification, distributed energy resources and grid modernisation are driving demand for electrical engineering services.

Onsite services remain dominant due to the complexity of regulated projects, although offshore engineering delivery is expanding with 40 to 60% cost advantages supported by cloud-based design platforms and global engineering centres.

Regional outlook

Asia Pacific remains the largest market with 39.52% share, supported by around

USD 1.7 Trillions in annual infrastructure investments and large scale transport and manufacturing projects.

North America continues to grow steadily, supported by USD 369 Billions in U.S. clean energy incentives and USD 1.2 Trillions in infrastructure spending.

Europe is witnessing investments driven by decarbonisation initiatives, including Germanys EUR 500 Billions infrastructure programme and the U.K.s Sizewell C nuclear project.

Middle East and Africa are investing in energy diversification projects such as green ammonia hubs and utility scale solar installations, though growth remains uneven across markets.

(Source: Mordor Intelligence)

Indian engineering market overview

The global engineering services market continues to expand steadily. The market is projected to grow from USD 1,141.89 Billions in 2025 to USD 1.17 Trillions in 2026, reflecting a compound annual growth rate (CAGR) of 2.8%. The growth has been supported by the expansion of industrial infrastructure projects, increasing complexity of engineering standards, growth in automotive and manufacturing sectors, greater reliance on specialised engineering expertise, and the availability of advanced design tools.

The global engineering services market is expected to reach USD 1,371.48 Billion by 2030, growing at a CAGR of 4% during the estimated period. This growth will be driven by increasing demand for digital engineering platforms, sustainability focused design, expansion of smart infrastructure projects, faster product validation cycles, and deeper integration of software and hardware engineering. Key industry trends include the rising adoption of integrated engineering solutions, simulation and testing services, automation and robotics engineering, multidisciplinary project delivery models, and lifecycle engineering support.

Indias engineering goods exports have demonstrated strong and sustained growth momentum. Indias engineering exports reached a record USD 122.43 Billions in FY 2025-26, up 4.86% year-on-year from USD 116.75 Billions in FY 2024-25, according to EEPC India. The record was achieved against a backdrop of geopolitical tensions, supply chain disruptions stemming from the West Asia conflict, shifting trade policies, and elevated freight and energy costs - headwinds that the sector navigated through market diversification, new product lines, and strategic use of free trade agreements.

Engineering exports accounted for 27.71% of Indias total merchandise exports in FY 2025-26, with growth recorded in North America (1.9%) and the European Union (8.6%) year-on-year.

(Source: KNN India, Tennews)

Indian engineering sector drivers

Infrastructure development and construction equipment demand

The Indian engineering sector is gaining momentum from accelerated infrastructure development. The construction equipment market, valued at USD 8.55 Billions in 2025, is projected to reach ~USD 12.76 Billions by 2030, growing at a CAGR of 8.33%. Heavy construction equipment leads with a 64% share, driven by large infrastructure projects, while excavators dominate as the largest segment at 30% due to their versatility. Earthmoving equipment accounted for 57.1% share in 2024, and road construction machinery is expected to grow at a 10.23% CAGR through 2030. Government initiatives such as the National

Infrastructure Pipeline and Gati Shakti are accelerating project execution, boosting demand for equipment and engineering services, while also promoting domestic manufacturing and exports.

Manufacturing expansion and ‘Make in India

Indias manufacturing sector is gaining strong momentum, reinforcing its emergence as a global hub under the Make in India initiative, with mobile imports down

85% and domestic production rising 28x to Rs. 5.45 Lakh Crores by FY 2024-25, alongside sustained FDI inflows. PLI schemes have now catalysed Rs. 2.16 Lakh Crores in investments and driven incremental production of over Rs. 20.41 Lakh Crores up to FY 2025-26, with employment under the schemes rising to 14.39 Lakh direct and indirect jobs.

The Union Budget FY 2026-27 further strengthens this trajectory through focused investments in semiconductors, electronics, biopharma, and industrial infrastructure, supported by Rs. 12.2 Lakh Crores in capital expenditure and a Rs. 1 Lakh Crores R&D fund, with a long-term vision to raise manufacturings GDP share to 25% by 2035, aligned with global supply chain realignments and export-led growth.

Export growth and global competitiveness

Engineering goods exports continue to anchor Indias export performance. Indias engineering exports reached a record USD

122.43 Billions in FY 2025-26, up 4.86% year-on-year from USD 116.75 Billions in FY 2024-25, and accounted for 27.71% of Indias total merchandise exports. Growth was recorded across major markets including Germany, the UK, China, Italy, South Africa, Vietnam, Sri Lanka, and Malaysia, with North America rising 1.9% and the EU rising 8.6%, while the WANA region declined 8% due to geopolitical disruptions stemming from the West Asia conflict. Indias combined merchandise and services exports reached a record USD

860.09 Billions in FY 2025-26, up 4.22% year-on-year, with merchandise exports at

USD 441.78 Billions and services exports growing 7.94% to USD 418.31 Billions.

Technology and digital transformation

Technology adoption and digital transformation are rapidly redefining Indias engineering sector, with rising demand for capabilities in artificial intelligence, cloud computing, cybersecurity, and digital engineering driving both innovation and operational efficiency. The expansion of 5G infrastructure is acting as a catalyst, enabling high-speed connectivity that supports smart manufacturing, IoT integration, and automation across industrial processes. Together, these advancements are allowing engineering firms to improve productivity, optimise costs, and deliver sophisticated, globally competitive solutions aligned with evolving industry standards.

Electric vehicles (EVs) and automotive sector

Indias EV market recorded 24.52 Lakh units in sales in FY 2025-26, marking 24.6% year-on-year growth, with every vehicle category delivering strong double-digit growth. Electric passenger vehicle sales were the star performer, surging 83.63% to 1,99,923 units, with EV penetration in the passenger vehicle category rising to 4.2% from 2.6%. Electric two-wheeler sales stood at 14,01,818 units, up 21.81%, while electric three-wheelers grew 18.97% to 8,30,819 units. Electric commercial vehicle sales more than doubled, rising 120.57% to 19,454 units. The market is projected to reach USD 101.4 Billions by 2030 at a CAGR of 38.8%, supported by PM E-DRIVE and rapid expansion of public charging infrastructure.

Foreign direct investment and policy support

Gross FDI inflows reached USD 88.29 Billions during April-February FY 2025-26, already surpassing the total of USD 80.61

Billions recorded in all of FY 2024-25, with the DPIIT Secretary indicating the full-year figure is likely to cross USD 90 Billions. This would mark a breakout from the USD 70-80 Billions steady-state of the preceding four years and could push FDI to approximately 2% of Indias GDP for the first time. Investment activity continues to deepen in high-value sectors, particularly semiconductors, where 10 projects across six states with investments exceeding Rs. 1.60 Lakh Crores have been approved, cementing Indias position in the global semiconductor ecosystem.

Sectoral contribution to GDP and employment

The engineering sector continues to play a pivotal role in Indias economic and industrial landscape in FY 2025-26. Manufacturing

GVA growth has accelerated to an estimated 11.5%, up from 9.3% in FY 2024-25, while overall GDP growth is projected at 7.4%. PLI schemes across 14 sectors have now generated 14.39 Lakh direct and indirect jobs up to FY 2025-26, supported by investments of Rs. 2.16 Lakh Crores and incremental production of over Rs. 20.41 Lakh Crores Indias engineering R&D sector, valued at USD 56 Billions, is projected to scale to USD 100 Billions by 2030, fuelled by demand across automotive, aerospace, defence, and GenAI-led applications.

Steel

Indias crude steel production surged

10.7% in FY 2025-26, reaching approximately 168.4 Million Tons for the full year. Finished steel exports surged 35.9% to 6.6 Million Tons, while imports declined sharply by 31.7%, enabling India to regain its position as a net exporter of steel. Indias total steelmaking capacity reached approximately 220 Million Tons in FY 2025-26 and is projected to expand to 300 Million Tons by 2030.

Nuclear power

Indias nuclear energy sector is scaling up rapidly in FY 2025-26, strengthening its role in energy security and clean power transition. As of March 31, 2026, nuclear capacity stands at 8.78 GW within Indias 283.46 GW non-fossil base, with total electricity generation at 1,845.9 BU. Capacity is projected to reach 9,480 MW by end-FY 2025-26, rising to 13,480 MW by FY 2029-30 and 21,880 MW by FY 2031-32 as projects are commissioned.

Budget FY 2026-27 reinforces this trajectory with an 88% increase in nuclear R&D outlay to Rs. 2,410 Crores, including Rs. 1,800 Crores for BARC, alongside a 33% rise in project funding to Rs. 7,121 Crores and total allocation of Rs. 24,124 Crores to the Department of Atomic Energy. Policy support through extended customs duty exemptions until 2035 and the

SHANTI Act enabling private participation in SMRs further accelerates progress toward the 100 GW target by 2047.

Marine

Indias maritime sector facilitates nearly 95% of trade by volume and around 70% by value. Indias major ports handled a record 915.17 Million Tons of cargo in FY 2025-26, surpassing the annual target of 904 MT and registering a year-on-year growth of over 7%. Indias combined merchandise and services exports reached a record USD 860.09 Billions in FY 2025-26, up 4.22% year-on-year.

Oil and gas

Indias oil and gas sector, one of the countrys eight core industries, plays a crucial role in supporting economic growth and energy security. According to the

International Energy Agency India Energy

Outlook 2021, Indias primary energy demand is expected to nearly double to

1,123 MTOE by 2040, as GDP expands to around US 8.6 Trillions. India is currently the worlds third largest oil consumer and fourth largest crude oil refiner, hosting the worlds largest refining complex, the Jamnagar Refinery operated by Reliance Industries Limited. The countrys total refining capacity stood at 258.1 MMT in FY 2024-25, expected to increase to 309.5 MMT by 2028 and potentially 450 to 500 MMT by 2030.

Indias petroleum product consumption reached 239.2 MMT in FY 2024-25, while exports stood at 64.7 MMT. Crude oil imports rose 4.2% year on year to

242.4 MT, and LNG imports increased 15.4% to 36,699 mmscm. Domestic crude production grew 3.3% in H1 FY 2025-26 to 15.6 MMT, while natural gas output increased 6.4%. As of January 2025, India held reserves of 651.8 MMT of crude oil and

1,138.6 BCM of natural gas. Looking ahead, natural gas demand is projected to grow nearly 60% to 297 mmscmd by 2030, increasing its share in the energy mix from 6% to 15%. Oil demand is expected to reach 5.74 Million barrels per day in 2025 and 5.99 Million barrels per day in 2026, according to Organisation of the Petroleum Exporting Countries. Infrastructure expansion is also underway, including LNG terminal upgrades such as the Dabhol LNG Terminal, alongside expansion of city gas distribution networks targeting 126.3 Millions PNG connections and 18,336 CNG stations by 2034. The sector is witnessing strong investment momentum, with planned investments of Rs. 30,00,000 to 35,00,000 Crores by 2035 and a Rs. 3,28,227 Crores capex push to strengthen Indias petrochemicals capacity. The Union Budget FY 2025-26 also allocated Rs. 5,597 Crores to expand strategic storage under Indian Strategic

Petroleum Reserves Limited. At the same time, sustainability initiatives are advancing, including 20% ethanol blending by 2025, investments of Rs. 7.5 Lakh Crores in oil and gas infrastructure, and the development of green hydrogen and sustainable aviation fuel projects. Exploration activity continues under policies such as the Open Acreage

Licensing Policy, with new blocks offered for exploration and increased drilling activity led by Oil and Natural Gas Corporation.

(Source: IBEF)

Manufacturing

Indias manufacturing sector is steadily emerging as a central pillar of the countrys economic growth. Currently contributing around 16 to 17% of GDP and employing more than 27 Millions people, the sector derives its strength from diverse industries such as automotive, engineering, chemicals, pharmaceuticals, consumer durables, electronics and textiles. Supported by initiatives like Make in India and the Production Linked Incentive Scheme, the government aims to increase manufacturings contribution to 25% of GDP in the coming years.

Indias manufacturing momentum is strengthening with rising exports and expanding capabilities across sectors such as electronics, pharmaceuticals, automobiles and textiles. These industries are expected to help the country approach an output of nearly Rs. 88,67,000 Crores, approximately US 1 Trillion, by FY 2025-26, reinforcing Indias position as a competitive global manufacturing hub.

Indias e commerce exports are projected to expand significantly from around Rs. 8,757 Crores, about US 1 Billion, to nearly Rs. 35,02,800 Crores, around US 400 Billions annually by 2030. This expansion will contribute meaningfully to the countrys broader target of achieving around Rs. 1,75,14,000 Crores, roughly US 2 Trillions, in total exports. At the same time,

Indias growing consumption base will play a critical role, with the countrys middle class expected to account for the second largest share of global consumption at about 17% by 2030.

The manufacturing sector itself is projected to continue its upward trajectory, potentially reaching about Rs. 87,57,000 Crores by FY 2025-26. If India fully realises its manufacturing potential, it could contribute more than Rs. 43,43,500 Crores annually to the global economy by 2030. Rapid growth is also visible in specific segments such as display panels, where the market is expected to expand from around Rs. 60,809 Crores in 2021 to nearly Rs. 1,30,305 Crores by 2025, reflecting the increasing depth and technological advancement of Indias manufacturing ecosystem.

(Source: IBEF)

Growth drivers

Government expenditure on infrastructure

Infrastructure investment continues to be the largest catalyst for engineering demand.

The Union Budget FY 2026-27 allocated Rs. 12.2 Lakh Crores in capital expenditure, an increase of about 8.8%, with significant allocations for transportation, urban infrastructure, logistics and energy projects.

Rapid growth of engineering R&D services

Indias engineering research and development services market was valued at

USD 133.7 Billions in 2025 and is estimated to expand to USD 147.3 Billions in 2026, with projections reaching USD 238.6 Billions by 2031, reflecting a CAGR of about 10.14%.

Expanding EPC and infrastructure engineering market

The India engineering procurement and construction management market is estimated at USD 75.04 Billions in 2026, up from USD 69.28 Billions in 2025, and is expected to reach USD 111.9 Billions by 2031, growing at a CAGR of 8.32%.

Expansion of construction equipment and capital goods demand

The Indian construction equipment market is expected to grow from USD 8.55 Billions in 2025 to USD 9.24 Billions in 2026 and is estimated to reach USD 13.61 Billions by 2031 at a CAGR of 8.05%, supported by large scale infrastructure projects and urban development programmes.

Increasing investments in manufacturing and technology

Large global companies continue to expand engineering and manufacturing capabilities in India. For instance, global technology firm ABB announced a USD

75 Millions investment in 2026 to expand its manufacturing and R&D footprint in the country.

Growing engineering demand from emerging technologies

Investments in semiconductors, electric vehicles, renewable energy and digital engineering are accelerating engineering services demand, supported by government incentive programmes worth over USD 24 Billions for semiconductor manufacturing and advanced technology development.

(Source: Mordor intelligence, Economics Times, Construction placement)

Indian government initiatives

The Union Budget FY 2026-27 reinforces the governments focus on strengthening the capital goods sector and accelerating infrastructure-led growth.

Public capital expenditure is proposed at Rs. 12.2 Lakh Crores for FY 2026-27, continuing a strong investment cycle, with government capital outlay rising 4.2 times from Rs. 2.63 Lakh Crores in FY 2017-18 to Rs. 11.21 Lakh Crores in FY 2025-26 (BE).

This sustained increase in public investment is expected to drive demand for industrial equipment, engineering services and infrastructure machinery.

The Budget also introduces targeted initiatives to strengthen domestic manufacturing capabilities. These include a Rs. 10,000 Crores scheme for container manufacturing, a Construction and Infrastructure Equipment (CIE) development programme, and the establishment of Hi-Tech Tool Rooms to support precision engineering and component manufacturing. In addition, the government has proposed five-year tax exemptions for toll manufacturing and electronics manufacturing, along with customs duty exemptions on capital goods used in critical sectors such as battery energy storage and critical mineral processing.

Supported by these initiatives and strong industrial activity, the capital goods segment recorded 8.1% year-on-year growth in December 2025, reflecting improving investment momentum across the economy.

(Source: PIB)

Company overview

Lloyds Engineering Works Ltd is a prominent Indian company engaged in delivering end to end solutions for engineering and infrastructure solutions.

The Company provides an integrated suite of services covering design, engineering, manufacturing, fabrication, EPC and installation for a wide spectrum of industrial sectors including oil and gas, steel, power, nuclear energy, and defence and s

The Company operates advanced manufacturing facilities in Murbad, Thane, Ahemdabad, Gujarat, Nagpur, Maharashtra while its corporate headquarters are located in Mumbai. Lloyds Engineering Works has secured approvals from reputed regulatory and certification bodies such as the Industrial Boiler Regulatory Authority, SGS UK, ASME and the Petroleum and Explosives Safety Organisation, reflecting its strong commitment to quality, safety and compliance.

With a diverse portfolio comprising heavy equipment, industrial machinery and complex engineered systems, the Company serves as a comprehensive solution provider to clients across multiple industries. Industry segments served

Hydrocarbon

Manufacture and supply of process equipment including pressure vessels, columns, reactors, heat exchangers, waste heat recovery boilers and air, gas and liquid dryer packages.

Steel

Fabrication and supply of equipment for steel melting shops and rolling mills, including ball mills, rotary dryers and other equipment required in iron and steel production processes.

Nuclear

Registered with BARC and NPCIL for the supply of specialised equipment. While basic design engineering is undertaken by NPCIL, Lloyds Engineering carries out detailed design engineering and manufacturing of the equipment.

Marine and defence

Manufacturing and supply of specialised products such as fin stabilizers for naval vessels and electro hydraulic steering gear systems used in marine ships.

Ports, jetties and refineries

Design, engineering and supply of critical components including swivel joints, seals, couplers and hydraulic valves.

The Company is also among the leading manufacturers of marine and wagon loading arms for handling various industrial products.

Power

Design and manufacture of waste heat recovery systems and equipment used in power plants, including boilers, condensers, heaters and related components.

Our financial overview

Performance of the standalone Profit and Loss statement

Particulars (Rs. in Crores)	FY 26	FY 25	YoY
Total revenue	1,089.42	777.96	40.04%
EBITDA	188.12	145.23	29.53%
EBITDA margin (%)	17.27	18.67	(140) BPS
Interest	10.73	6.72	59.67%
PAT	118.27	99.72	18.60%
PAT margins (%)	10.86	12.82	(196) BPS
Basic EPS(Rs.)	0.91	0.86
Diluted EPS(Rs.)	0.89	0.86
Performance of the consolidated Profit and Loss statement
Particulars (Rs. in Crores)	FY 26	FY 25	YoY
Total revenue	1,350.98	869.90	55.30%
EBITDA	239.07	159.33	50.05%
EBITDA margin (%)	17.70	18.32	(62) BPS
Interest	13.98	8.53	63.89%
PAT	197.57	105.04	88.09%
PAT margins (%)	14.62	12.07	255 BPS
Basic EPS (Rs.)	1.52	0.89
Diluted EPS (Rs.)	1.49	0.89
Details of the performance in FY 2025-26
Particulars (Rs. in Crores)	FY 26 Standalone	FY 26 Consolidated	FY 26 Proforma
Total revenue	1,089.42	1,350.98	3,253.09
EBITDA	188.12	239.07	489.87
EBITDA margin (%)	17.27	17.70	15.09
Interest	10.73	13.98	30.48
PAT	118.27	197.57	330.73
PAT margins (%)	10.86	14.62	10.17
Basic EPS (Rs.)	0.91	1.52	1.82
Diluted EPS (Rs.)	0.89	1.49	-

Key business highlights

Key ratios

In accordance with the SEBI (Listing Obligations and Disclosure Requirements 2018) (Amendment) Regulations, 2018, the Company has identified the following ratios on standalone basis as key financial ratios:

Particulars	As at March 31, 2026	As at March 31, 2025	Reason for variation
Current Ratio	3.82	2.38	Due to higher trade receivable, increase in inventory, faster vendor payments & improved collections.
Debt Equity Ratio	0.05	0.07	Debt has not increased in the same proportion due to the issue of shares at premium during the year, resulting in a strengthened equity base
Interest Coverage Ratio	14.15	17.71	The decrease in the Interest Coverage Ratio was mainly attributable to higher finance costs arising from increased borrowings during the year
Return on Equity Ratio (ROE)	10.56%	18.88%	Due to Significant Increase in Equity, leading to dilution.
Trade Receivable Turnover Ratio	6.29	4.26	Due to improved collection efficiency, faster collection from customer.
Trade Payable Turnover Ratio	8.94	7.15	Due to timely & early payments, lower dependency on trade credit for working capital.
Net Capital Turnover Ratio	0.63	1.14	Due to increase in working capital requirement & Advance procurement of Inventory.
Net Profit Ratio	11.24%	13.20%	The Company continued to maintain healthy profitability levels during the year. The marginal decline in net profit ratio is primarily on account of higher operational and expansion-related expenditure incurred to support long-term business growth.
Return on Capital Employed (ROCE)	10.67%	20.17%	Due to decline in Profit Margin & Capital Enhancement.
Inventory turnover Ratio	6.36	10.60	Due to Procurement of inventory in advance for future orders.

Risk management

Banks have remained cautious in extending credit to the corporate sector, largely due to concerns arising from high levels of non-performing assets. This cautious lending environment has constrained investment activity across both public and private sector enterprises, affecting expansion plans and capital expenditure. At the same time, margins across the engineering industry continue to face pressure amid challenging market conditions.

In response, the Company has focused on strengthening its capabilities through continuous skill enhancement, process modernisation and cost optimisation initiatives. Potential risks and operational challenges are monitored closely and addressed on an ongoing basis.

The business successfully navigated the disruptions caused by the COVID-19 pandemic by implementing safe workplace practices and operational flexibility.

Measures such as work from home arrangements where feasible, increased use of virtual meetings, remote audits and inspections, and digital approval processes helped ensure continuity of operations. The Companys strong financial position and minimal financial leverage provide a distinct advantage, enabling it to remain resilient and better positioned to navigate industry risks faced by many businesses.

Human resources

The human resources department works continuously to foster a positive and collaborative work environment across the organisation. The Company believes that employees at every level play an equally important role in achieving its strategic objectives and long term growth. To strengthen its workforce, the Company regularly undertakes recruitment to support key functions and enhance organisational capabilities. Each year, groups of graduate engineers are inducted into the organisation, and structured training programmes are conducted to help them develop their skills and stay updated with evolving technologies and industry practices.

A consistently low attrition rate reflects the strong relationship between employees and management. The senior leadership team remains approachable and accessible, providing guidance, counselling and timely resolution of employee concerns whenever required.

The HR function actively works to promote cooperation, harmony and effective coordination among workers, staff members and the senior management team. To further motivate employees and encourage higher productivity, the

Company has introduced an Employee

Stock Option Scheme with defined rules and guidelines. Industrial relations across the Companys manufacturing facility in Murbad and various project locations remained cordial during the year. As on March 31, 2026, the Company had a total workforce of 413 employees.

Internal control systems and their adequacy

The Company emphasises disciplined processes and has established appropriate internal control systems to ensure smooth and efficient operations. Regular reviews are conducted by departmental heads and senior management to ensure that these controls and procedures are effectively implemented. These assessments also help identify areas where improvements or modifications may be required. The effectiveness of the internal control ective framework is supported through several mechanisms:

Operational performance is regularly evaluated at both the manufacturing units and the corporate office by senior management through daily monitoring and weekly review meetings.

Functional performance across departments is closely tracked by departmental heads and senior management through periodic daily, weekly and monthly reviews. Independent functions are reviewed regularly, while cross functional activities are assessed at defined intervals.

Policies and guidelines are introduced and updated from time to time to ensure the functioning of key departments such as Business Development, Projects, Procurement, Commercial, Finance and Human Resources.

Particular attention is given during the estimation process to ensure that proposals remain competitive while also contributing positively to the Companys financial growth.

Internal auditors conduct financial, operational and management audits across different functions. Their findings are presented to the Audit Committee and the Board, following which appropriate corrective actions are undertaken.

The Audit Committee and the Board oversee financial systems, procedures and internal controls, and have the authority to seek information or documentation from any department or function whenever required.

Cautionary statement

This statement made in this section describes the Companys objectives, projections, expectation and estimations which may be ‘forward-looking statements within the meaning of applicable securities laws and regulations. Forward looking statements are based on certain assumptions and expectations of future events. The Company cannot guarantee that these assumptions and expectations are accurate or will be realised by the

Company. Actual result could differ materially from those expressed in the statement or implied due to the influence of external factors which are beyond the control of the Company. The Company assumes no responsibility to publicly amend, modify or revise any forward-looking statements on the basis of any subsequent development, information or events.