Madhav Copper Ltd Management Discussions

Description of Business

Madhav Copper Limited is manufacturing in the field of Copper Bus bar, Copper Rod, Copper fabricated products, Enamelled Copper Wire, Paper covered Copper conductor, Poly wrap Submersible winding wire, Fiberglass Copper conductor, Tapped insulated Copper conductors, Bare copper wire and Copper Strips.

1. Industry Structure and Development

The copper manufacturing industry in India plays a pivotal role in supporting the countrys industrial growth, particularly in sectors such as electricals, electronics, construction, transportation, power, renewable energy, and telecom. India is the sixth-largest producer of refined copper globally and has established a strong base in both primary and secondary copper production.

India has three major players in the primary copper segment, with several small and medium enterprises operating in the secondary copper segment. The sector is marked by high capital intensity, stringent environmental regulations, and significant dependency on global commodity prices, especially due to the import of copper concentrates.

In recent years, the Indian copper industry has seen structural changes due to the closure of a major smelting operation, resulting in increased reliance on imports to meet domestic demand.

However, the Government of India s thrust on infrastructure development, electrification, renewable energy, and Make in India initiatives has created sustained demand for copper, especially in the form of rods, wires, tubes, and sheets.

Globally, copper is increasingly recognized as a critical metal in the green transition. The transition towards renewable energy and EVs is expected to drive a structural increase in copper consumption. According to international studies, the demand for copper could double by 2035 due to its critical use in clean energy technologies, battery systems, and electrification projects. This trend is expected to have a significant positive impact on Indian copper manufacturers.

The copper industry is undergoing transformation through the adoption of advanced technologies in manufacturing and processing to improve energy efficiency, reduce carbon emissions, and ensure sustainable production. Circular economy practices such as copper recycling and reprocessing are also gaining momentum.

The outlook for the Indian copper manufacturing sector remains positive, supported by: ?‚? Robust end-user demand, ?‚? Government policy support, ?‚? Technological advancements, and ?‚? Increasing focus on sustainability and domestic value addition.

2. Global Business Scenario

The global demand for copper continues to remain robust, driven by the rapid expansion of clean energy technologies, increased urbanization, and ongoing digital transformation across economies. Coppers unique properties such as high conductivity, durability, and recyclability make it indispensable for power infrastructure, electric vehicles (EVs), renewable energy systems, telecommunications, and electronics. The accelerated global transition towards green and sustainable energy has positioned copper as a strategic metal, with forecasts suggesting a significant supply-demand gap over the coming decades. This rising global consumption trend presents a strong opportunity for copper manufacturing companies to expand their production capacities, diversify product offerings, and integrate with global value chains. The Company is well-aligned to cater to this growing global demand through its emphasis on quality manufacturing, technological advancement, and commitment to sustainable operations.

Additionally, emerging markets in Asia and Africa are seeing rising infrastructure development, which is expected to support long-term consumption growth. Industry reports indicate a potential supply deficit in the global copper market over the next decade, underscoring the strategic importance of copper manufacturing companies in meeting this demand.

In this dynamic global landscape, the Company is strategically positioned to leverage these growth opportunities through its integrated manufacturing operations, export-oriented capabilities, and commitment to producing high-quality, value-added copper products.

The global copper market continues to demonstrate strong and sustained growth, driven by robust demand across power infrastructure, renewable energy, electric mobility, and industrial automation sectors. As of 2025, global refined copper demand is estimated to reach approximately 28.5 million tonnes, reflecting a compound annual growth rate (CAGR) of around 3% over the past five years. This increase is primarily attributed to large-scale investments in clean energy and electric vehicles, particularly in countries such as China, the United States, Germany, and India.

Looking ahead, the global copper market is projected to expand significantly, with estimated demand expected to cross 40 million tonnes by 2036, as per various international industry forecasts. This growth will be propelled by rapid urbanization, transition to net-zero carbon goals, and extensive electrification in transportation, infrastructure, and grid modernization projects.

World copper mine production is estimated at 22.8 to 22.9 million metric tonnes in 2024, up approximately 1.6% over 2023. It is expected to rise further in 2025, with a forecast increase of about 2.2% to around 23.3 million tones.

Global refined copper production has shown a steady upward trend in recent years, supported by growing demand from infrastructure development, renewable energy systems, electric vehicles (EVs), and industrial automation. As of 2024, global refined copper production is estimated to have reached approximately 26.5 million metric tonnes, growing at a compound annual growth rate (CAGR) of 2.5% 3% over the past five years.

India s Position:

India s refined copper production stood at approximately 0.95 million tonnes in FY 2024, with demand outstripping domestic supply due to the shutdown of major refining capacity in past years. Imports have increased, and domestic players are actively exploring capacity expansion. By 2030, Indias refined copper production is expected to reach 1.5 1.7 million tonnes, aligned with infrastructure push and manufacturing growth under the " Atmanirbhar Bharat " initiative.

Copper in India: Present and future outlook

1. Present Scenario of Copper Industry in India

India s copper industry plays a pivotal role in the development of sectors such as power, construction, automotive, telecommunications, and electronics. Despite limited domestic copper ore reserves, India has developed a strong refining and recycling industry.

As of 2025, India contributes about 4% of the global refined copper production. However, India is a net importer of copper concentrate, which is processed domestically into refined copper.

2. Future Outlook: 2025 2036

India s copper demand is expected to grow at a CAGR of 6.5% over the next decade, reaching 2 million tonnes by 2036, driven by the transition to a green economy and technological modernization.

India s copper sector is at a turning point, where demand is outpacing domestic supply. Strategic expansion in mining, refining, and recycling infrastructure backed by policy support will be crucial to meet the growing demand sustainably. The industry is well-positioned to contribute significantly to India s clean energy and industrial future.

Indian Copper Scenario

India s copper industry is a key enabler of infrastructure, energy transition, and industrial growth.

Despite limited natural reserves, the country has developed robust refining capabilities and a growing demand base, making it a significant player in the global copper market.

Annual copper consumption is estimated to reach 1.02 million tonnes by FY 2025, with a projected CAGR of 6.5% till 2036.

Government Initiatives Supporting Growth:

Several government programs are contributing to rising copper demand:

?‚? National Infrastructure Pipeline (NIP) ?‚? Production Linked Incentive (PLI) Schemes

?‚? Push for Renewable Energy (175 GW target achieved; 500 GW target by 2030) ?‚? Scrap Policy & Recycling Industry Boost

A) INDUSTRY STRUCTURE AND DEVELOPMENTS:

Industry Structure:

The copper manufacturing industry in India operates within a structured framework encompassing upstream mining, midstream smelting and refining, and downstream manufacturing of value-added copper products. The industry includes a mix of integrated producers, semi-integrated processors, and specialised manufacturers catering to various end-use sectors such as electrical, construction, transportation, renewable energy, and consumer durables.

Industry Overview:

Copper is one of the most versatile and widely used industrial metals, essential for the global shift toward electrification, infrastructure development, and clean energy. Known for its excellent electrical and thermal conductivity, corrosion resistance, and recyclability, copper plays a critical role in various sectors including power generation and transmission, construction, consumer durables, transportation, and electronics.

Company Performance Comparison with Previous Year

During the Financial Year 2024-25 under review, the Company demonstrated a strong operational and financial performance, registering notable improvements across key metrics compared to the previous fiscal year.

Key Highlights:

?‚? Revenue Growth: The Company reported a year-on-year increase of 8917.25 Lakh in total revenue, driven by higher sales volume, improved product mix, and firm copper price realization in the domestic and export markets.

?‚? Improved Profitability : Profit Before Tax (PBT) grew by 66.55%, supported by better operating leverage, efficient cost management, and strategic procurement of raw materials.

?‚? Export Performance : Export revenues increased by 174.31x as the Company expanded its footprint in high-demand overseas markets, particularly in the Middle East, Europe, and Southeast Asia.

?‚? Working Capital Efficiency : Improved inventory management and streamlined receivables cycle contributed to better cash flows and lower working capital requirements.

?‚? EBITDA Margin Expansion : The Company s EBITDA margin improved from 183.22% as compared to previous year, showcasing higher value addition and tighter cost control.

?‚? Business Strategies

To achieve sustainable growth and enhance long-term stakeholder value, the Company has adopted a focused and forward-looking strategic framework. These strategies are aligned with evolving market dynamics, technological advancements, and government policy thrusts in the infrastructure, energy, and manufacturing sectors.

These strategic initiatives are designed to enhance the Company s competitive advantage, drive operational excellence, and ensure sustainable growth in a dynamic global copper market.

Strategic Initiatives:

The Company has undertaken a series of strategic initiatives to strengthen its position in the domestic and international copper markets. These initiatives are aligned with its vision for sustainable growth, enhanced value creation, and competitiveness across the copper value chain.

To address the financial proficiency during the year 2024-25 Madhav Copper Limited, undertook the following strategic initiatives:

1. Investment in Capacity Expansion:

To meet rising demand and diversify product offerings, the Company is:

?‚? Expanding rolling mill and extrusion line capacities ?‚? Upgrading furnace and casting technology

?‚? Establishing dedicated facilities for high-grade copper foils and rods

2. Strengthening Raw Material Security:

Given the high dependence on imported copper concentrate, the Company has:

?‚? Increased procurement of copper scrap to promote circular usage ?‚? Explored backward integration opportunities for raw material access

3. Export Market Penetration:

As part of its global growth strategy, the Company is:

?‚? Targeting key export markets in the Middle East, Africa, and Southeast Asia

?‚? Enhancing logistics and supply chain networks to ensure faster delivery ?‚? Developing copper solutions aligned with global standards and certifications

5. Digital Transformation and Industry:

To improve operational efficiency and traceability, the Company is:

?‚? Implementing real-time production monitoring and predictive maintenance ?‚? Deploying ERP, MES, and analytics platforms for decision-making ?‚? Enhancing cyber security and data integration across departments

6. ESG and Sustainability Leadership:

The Company is committed to sustainability through:

?‚? Use of renewable energy at select manufacturing units ?‚? Expansion of copper recycling and scrap processing capacity ?‚? Reduction of water usage, effluent discharge, and carbon footprint

7. Human Capital Development:

To support future growth, the Company has:

?‚? Launched skill upgradation programs for workers and engineers ?‚? Strengthened safety, compliance, and employee welfare standards

These strategic initiatives are designed to transform the Company into a globally competitive, future-ready copper manufacturer that delivers value through technology, quality, and responsible growth.

With the government pushing for smart cities, there will be a greater demand for solutions to make homes, commercial complexes, industries and cities smarter. Initiatives by the government like " Make in India and Atmanirbhar Bharat " and " Digital India " , " Renewable Energy and Green Hydrogen Mission " amongst others, will further boost interest in India as it gives a fillip to the manufacturing sector.

Guided by its purpose of building a greener, stronger, smarter world, our company provides innovative solutions for a sustainable planet.

Madhav Copper has taken several cost optimization initiatives across the Country to improve efficiency and reduce the overall cost of production at all its facilities.

In addition, our Company has set up copper Furnace and production through the same is already started. This has resulted into added capacity to our existing manufacturing capacity as well as introduction of new products i.e. Copper Bus Bars, Profile, Copper Stripes, Oxygen Free Copper Rod, Paper Insulated Copper Conductor, Fibber Glass Copper Conductor.

D) SEGMENT WISE PERFORMANCE

The Company has only one segment. Performance of the same is given below in point H.

E) OUTLOOK

Globally, copper is expected to witness sustained consumption growth due to its critical role in the global energy transition and digital economy. According to industry forecasts, copper demand is likely to grow at a CAGR of approximately 5% over the next decade.

For Our Company, the medium to long-term outlook remains promising. With a strategic focus on value-added products, capacity expansion, and operational efficiency, the Company is well-positioned to capitalize on emerging opportunities. Investments in sustainable practices, technological upgrades, and product diversification are expected to enhance competitiveness and strengthen market presence.

Global supply chain dynamics and geopolitical developments may create short-term volatilities in raw material pricing and logistics. However, the Company remains resilient and agile in its supply chain management and sourcing strategies.

Overall, the copper sector s growth potential combined with the Company s strategic initiatives lays a robust foundation for sustainable value creation in the coming years.

F) RISKS AND CONCERNS

The copper industry operates in a dynamic environment influenced by various internal and external factors. The Company acknowledges the following key risks and concerns that may impact its operations, profitability, and long-term sustainability:

?‚? Raw Material Price Volatility ?‚? Foreign Exchange Fluctuation

?‚? Environmental and Regulatory Compliance ?‚? Supply Chain Disruptions ?‚? Technology Obsolescence ?‚? Power and Energy Costs ?‚? Health, Safety, and Labor Risks ?‚? Global Economic Slowdowns

The Company continuously monitors these risks through a comprehensive risk management framework and takes proactive measures including operational flexibility, compliance audits, and investments in sustainable and innovative technologies to mitigate potential impacts.

G) INTERNAL CONTROL SYSTEM

The Company has established a robust internal control system that is commensurate with the size, scale, and complexity of its operations. These systems are designed to ensure orderly and efficient conduct of business, safeguarding of assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records, and timely preparation of reliable financial and operational information.

H) DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

The Company delivered a significantly improved performance during the financial year 2024-25 under review, both operationally and financially, as compared to the previous year. This growth was driven by enhanced capacity utilization, favorable market conditions, improved realizations, and a strong focus on operational efficiency and cost management.

The Company s profit before tax was 345.39 Lakhs during the year as compared to . 115.56 Lakhs in the previous year. The Company has incurred a Profit i.e. net profit after tax of 468.77 lakhs, as against a Profit after tax of 122.72 Lakhs in the previous year

I) HUMAN RESOURCE DEVELOPMENT

The Company recognizes human capital as a critical enabler of its long-term growth and sustainability. As a part of its core strategy, the Company continued to invest in developing a competent, motivated, and future-ready workforce aligned with its business objectives and values.

A strong performance-driven and inclusive work culture remains central to the Company s philosophy. Efforts were made during the year to foster a collaborative environment that encourages innovation, accountability, and continuous learning. The Company promotes transparency, meritocracy, and mutual respect across all levels of the organization.

During the year, the Company conducted regular training programs covering technical skills, safety practices, leadership development, quality systems, and digital competencies.

Employee feedback mechanisms and grievance redressal systems are in place to ensure open communication and satisfaction.

The Company remains committed to building a future-ready organization through strategic talent management, digital transformation of HR processes, and fostering a high-performance culture that empowers employees to contribute effectively toward the Company s goals

Industrial Relations:

The Company maintained healthy and harmonious industrial relations throughout the financial year. A culture of mutual trust, respect, and transparent communication was upheld across all levels of the workforce. Regular interactions with employees and union representatives ensured a collaborative working environment and timely resolution of workplace concerns.

There were no instances of work stoppage, strikes, or lockouts during the year. The Company s proactive approach to employee engagement, grievance redressal, and adherence to fair labor practices contributed to sustaining industrial peace and productivity.

The management recognizes the contribution of its employees and remains committed to nurturing strong industrial relations as a foundation for sustainable growth and operational excellence.

Conclusion:

The financial year under review was marked by notable progress in both operational and financial performance, reflecting the Company s strategic focus, resilience, and commitment to excellence. The improved production output, enhanced capacity utilization, and disciplined cost management have positioned the Company for sustainable long-term growth.

With robust demand drivers in sectors such as power, infrastructure, electric vehicles, and renewable energy, the copper industry offers strong growth potential. The Company is well-positioned to capitalize on these opportunities through continued investment in technology, product innovation, capacity expansion, and customer-centric solutions.

The management remains committed to driving value for all stakeholders through operational excellence, strong governance, responsible environmental practices, and a motivated workforce. With a clear strategic roadmap and focus on sustainable growth, the Company looks forward to delivering consistent performance and enhancing its leadership position in the copper manufacturing sector.