Manaksia Coated Metals & Industries Ltd Management Discussions

Economic Overview

Global Economic Overview 1

The global economy remained resilient in CY 2025 despite elevated geopolitical tensions and evolving trade dynamics. Global GDP grew by 3.4%, driven by technology investments, accommodative financial conditions and sustained growth in trade services. Advanced economies expanded by 1.9%, while emerging market and developing economies (EMDEs) grew by 4.4%. Growth in EMDEs was driven by stronger domestic demand and investment activity.

Inflation moderated from previous years but remained above target levels in several economies. Towards the end of the financial year, the Middle East conflict increased global uncertainty. This disruption affected energy markets, transportation routes and supply chains. Higher commodity and energy prices raised production and logistical costs across manufacturing sectors, including steel.

The global steel industry operated in a mixed environment during CY 2025. Infrastructure spending, manufacturing activity and technology-driven demand supported steel consumption in several regions. However, producers faced challenges from volatile raw material prices, elevated energy costs and changing trade patterns. The focus on value-added products and export diversification remained prominent across global steel markets.

Outlook

Global GDP growth is projected at 3.1% in CY 2026 and 3.2% in CY 2027.

Growth is expected to be influenced by geopolitical uncertainties, supply-side constraints and evolving trade dynamics. Global inflation is projected at 4.4% in CY 2026 before easing to 3.7% in CY 2027. This indicates the persistence of near-term cost pressures across major economies. Amid heightened geopolitical risks, trade uncertainties and ongoing supply chain realignments, the global economy is expected to remain resilient despite a challenging operating environment. Continued investments in manufacturing, industrial infrastructure and production capacity are likely to support economic activity, while evolving supply chains and industrial diversification may create opportunities across manufacturing value chains, including the steel sector.

Global GDP Growth Trend

Global Economy
2027(P)	3.2
2026(P)	3.1
2025	3.4

Advanced Economies
2027(P)	1.7
2026(P)	1.8
2025	1.9

Emerging Market and Developing Economies
2027(P)	1.7
2026(P)	1.8
2025	4.4

Indian Economic Overview

India remained one of the fastest-growing major economies in FY 2025-26. Real GDP growth was estimated at 7.6%, driven by strong domestic demand, sustained public capital expenditure and improving private investment. Economic activity remained resilient despite global uncertainties. This resilience was aided by stable macroeconomic fundamentals, policy continuity and structural reforms. Inflation remained broadly under control during the year. Consumer Price Index (CPI) inflation moderated significantly and stayed below the Reserve Bank of Indias target for a significant period. Easing food prices and prudent monetary management supported this trend. The inflation-targeting framework provided macroeconomic stability, supporting consumption and business sentiment. 2

Investment activity remained strong, led by continued Government spending on infrastructure, logistics and manufacturing. Construction, capital goods and industrial manufacturing recorded healthy growth. Policy measures aimed at strengthening domestic manufacturing further supported the sector. Efforts to improve the ease of doing business and enhance supply chain competitiveness also contributed to growth. These developments supported demand across steel-consuming sectors including infrastructure, construction, engineering and industrial manufacturing.

Outlook 2

Indias economic growth is projected at 6.9% in FY 2026-27. Growth is expected to be driven by resilient domestic demand, continued public investment and a gradual recovery in private capital expenditure. Inflation is expected to remain aligned with the Reserve Bank of Indias target framework, supporting economic stability and investment.

The manufacturing sector outlook remains positive. Infrastructure development, industrial expansion, supply chain diversification and policy support for domestic manufacturing are expected to drive growth. Investments in transportation, urban infrastructure, housing, renewable energy and industrial projects are likely to sustain demand across key steel-consuming sectors. Supported by strong economic fundamentals, ongoing reforms and capital formation, India is expected to remain among the fastest-growing major economies. This is expected to create a favourable environment for the steel and value-added steel industries.

Indian GDP Growth Trend

GDP growth (%)

2027(P)	6.9
2026(P)	7.6
2025	7.1

Industry Overview

Global Steel Industry

Global crude steel production remained under pressure during CY 2025 due to weak demand in several major economies and adjustments in manufacturing activity. According to the World Steel Association, global crude steel production was approximately 1.85 billion tonnes in 2025. This reflects a decline of around 2.0% compared to the previous year. Production trends varied across regions. Lower output in China and certain developed economies was partly offset by growth in countries such as India. Despite the moderation in production, demand from infrastructure, manufacturing and industrial sectors continued to support steel consumption across key markets. 4 The global steel market remained resilient (replace with a different word – being used too frequently), supported by infrastructure investments, industrial expansion and demand from construction, automotive and manufacturing sectors. According to IMARC Group, the global steel market was valued at approximately USD 1.0 trillion in 2025. It is projected to reach USD 1.31 trillion by 2034, growing at a CAGR of 2.98% during 2026-2034. Asia-Pacific remained the largest market, driven by rapid urbanisation, industrialisation and sustained investments in infrastructure and manufacturing activities across emerging economies. 5

Steel Market Growth Factors 6

Infrastructure Development:	Industrialisation and Urbanisation:	Growth in Manufacturing Activity:
Investments in transportation networks, urban infrastructure, housing and public utilities are expected to remain a major driver of steel demand globally.	Rapid urban growth, especially in emerging economies, is increasing demand for steel- intensive construction and industrial applications.	Expansion in manufacturing sectors such as machinery, engineering equipment, consumer durables and industrial products continues to support steel consumption.
Automotive Sector Demand:	Energy Transition Investments:	Technological Advancements and Value-added Products:
Rising vehicle production, increasing adoption of electric vehicles and the need for lightweight, high-strength materials are contributing to demand for specialised steel products.	Growing investments in renewable energy infrastructure, transmission networks and related industrial facilities are creating additional demand for steel products.	Increasing focus on high-performance, coated and specialised steel products is enhancing the industry\u2019s ability to cater to evolving end-user requirements across diverse sectors.

Indian Steel Industry

Production and Export 7

The Indian steel industry delivered a strong performance during FY 2025-26, reinforcing the countrys position as the worlds second-largest steel producer. Strong domestic demand and sustained infrastructure investments drove growth across the sector. Indias crude steel production increased by 10.7% year-on-year to approximately 168.4 million tonnes. Domestic steel consumption remained robust at 164 million tonnes. Demand was driven by higher activity across infrastructure, construction, railways and manufacturing. Continued Government focus on infrastructure development and urbanisation further supported consumption growth. The industrys trade performance improved significantly during the year. Finished steel exports increased by 35.9% to 6.6 million tonnes. Imports declined 31.7%, enabling India to regain its status as a net exporter of steel. Export growth reflected broader market diversification and improved competitiveness of Indian steel products. Capacity expansion remained a key industry focus. Indias total steelmaking capacity reached approximately 220 million tonnes during the year. Ongoing investments in production facilities, technology enhancements and value-added products continued to strengthen the sectors long-term growth prospects.

Production and Consumption

(in Million Tonne)

Crude Steel Production
2025-26(P)	168.4
2024-25	152.2
2023-24	144.3
2022-23	127.2

Source: Ministry of Steel Report

Growth Drivers and Market Restraints 8

Finished Steel Production
2025-26(P)	160.9
2024-25	146.7
2023-24	139.2
2022-23	123.2

Finished Steel Consumption
2025-26(P)	163.7
2024-25	152.1
2023-24	136.3
2022-23	119.9

Growth Drivers

Expansion of manufacturing activity under initiatives aimed at strengthening domestic industrial production and supply chains.

Strong growth in the automotive sector, supporting demand for flat steel and specialised value-added steel products.

Continued Government investment in infrastructure, transportation networks, railways, housing and industrial corridors.

Rising urbanisation and increasing construction activity across residential, commercial and industrial segments.

Increasing demand for coated, high-strength and value-added steel products across construction, engineering and automotive applications.

Market Restraints

Exposure to fluctuations in global steel prices and international trade dynamics.

Increasing environmental compliance requirements and decarbonisation-related investments across the steel value chain.

Volatility in raw material prices, particularly iron ore, coking coal and energy inputs, affecting production costs and profitability.

High logistics and transportation costs impacting supply chain efficiency.

Global economic uncertainty and geopolitical disruptions affecting demand patterns, trade flows and input availability.

Government Initiatives Supporting Steel Sector 9

The Government implemented measures to strengthen the steel sector. These initiatives focused on raw material security, export competitiveness, domestic manufacturing and infrastructure development. These measures improved cost efficiencies, supported capacity expansion and enhanced the competitiveness of MSMEs and small steel producers.

Production Linked Incentive (PLI) for Specialty Steel

The Government continued to promote value-added steel manufacturing through the PLI Scheme for Specialty Steel. Under PLI 1.0 and PLI 1.1, investment commitments of Rs.44,106 crore were secured, targeting incremental production of 14.34 million tonnes and creation of 33,460 direct jobs. As of FY 2025-26, the scheme facilitated investments of Rs.23,022 crore. It enabled production of 2.4 million tonnes of specialty steel and created 13,264 direct jobs. The scheme also enabled import substitution worth approximately Rs.6,000 crore. Under PLI 1.2, launched in November 2025, MoUs were signed for 85 specialty steel projects across 55 companies. The proposed investments aggregate Rs.11,887 crore, with committed capacity addition of approximately 8.29 million tonnes. These investments are expected to accelerate the development of advanced and high-value steel products.

Domestically Manufactured Iron & Steel Products (DMI&SP) Policy

The Government strengthened domestic steel manufacturing through the revised Domestically Manufactured Iron & Steel Products (DMI&SP) Policy issued in May 2025. The policy provides preference for domestically manufactured steel products in Government procurement. It also prescribes minimum domestic content requirements for notified products, supporting local value addition and domestic production.

National Steel Policy, 2017

The National Steel Policy, 2017 provides a long-term roadmap for the sectors development. The policy targets crude steel capacity of 300 million tonnes, production of 255 million tonnes and per capita steel consumption of 158 kg by 2030-31. The policy also focuses on increasing domestic availability of automotive, electrical and specialty steels.

In addition, it seeks to reduce dependence on imported coking coal. With Indias crude steel production reaching 168.4 million tonnes in FY 2025-26, the industry has already achieved approximately 66% of the production target, reflecting steady progress towards the policys long-term objectives.

Infrastructure Development and Logistics Enhancement

The Government continues to strengthen the steel ecosystem through infrastructure and logistic initiatives. These measures are aimed at improving connectivity across major steel-producing regions and enhancing supply chain efficiency. Under the PM GatiShakti National Master Plan, geolocation data of over 2,100 operational steel units has been integrated into the platform to support coordinated infrastructure planning and efficient logistics management. The Government is also expediting rail, road and port connectivity projects across 12 major steel zones, including Kalinganagar, Angul, Rourkela, Jamshedpur, Bokaro, Durgapur and Visakhapatnam. These initiatives are expected to reduce logistical constraints and support rising steel demand from infrastructure and construction sectors.

International Market Reach

The Governments efforts to reform Foreign Direct Investment (FDI) policies have improved investment inflows into the manufacturing sector. FDI inflows increased by 120% between 2014 and 2024, compared to 2004–2014. FDI equity inflows into the manufacturing also increased by 69% during the same period.

Government supported via provision of 100% FDI under automatic route (This line is unclear please re-frame it). This resulted in attracting Rs.1,60,000 crore (USD 18.67 billion) between April 2000 and June 2025 by metallurgical industries.

Furthermore, Free Trade Agreements with the United Kingdom, the European Union, and others are likely to expand market access for the sector.

Company Overview

Manaksia Coated Metals & Industries Limited (MCMIL) is a leading manufacturer and exporter of value-added coated steel products. The Company specialises in Alu-Zinc coated steel and pre-painted steel coils and sheets. Its manufacturing facility is located in Kutch, Gujarat. MCMIL serves a diverse end-user base across construction, infrastructure, automotive, appliances, FMCG and general engineering sector. The Company maintains a strong domestic presence and continues to expand its footprint across multiple overseas markets.

The Company has established itself in the coated steel industry through its focus on product quality, operational efficiency and customer-centric solutions. The Company continues to enhance its premium product portfolio and strengthen its market presence through value-added offerings and wider market penetration.

180,000 MTPA

Production Capacity Installed for Alu-Zinc coated Steel products as of 2025-26

86,000 MTPA

Production Capacity installed for Pre-Painted Steel products as of 2025-26

The Company serves more than 240 active customers across 20+ states in India and over 22 countries globally. This reflects a strong domestic presence and a growing international footprint. Exports contributed 68.21% of the Companys revenue during the year. Export volumes increased to 69,085 MT, demonstrating sustained demand across global markets.

Strategic Initiatives : Commissioned During FY 2025-26

Alu-Zinc Coating Facility Upgrade

Key Details

Capacity increased from 1,32,000 TPA to 1,80,000 TPA (+36%) and transitioned to 100% Alu-Zinc production. Commissioned in December 2025.

Strategic Benefits

Strengthens the Companys value-added product portfolio, enables entry into premium applications, improves product realizations and expands the addressable customer base.

The successful commissioning of the upgraded Alu-Zinc coating facility marked a significant milestone in MCMILs transformation towards higher-value coated steel products. The transition to 100% Alu-Zinc production enhances product quality and positions the Company to cater to premium end-use industries across domestic and international markets.

Growth Projects Under Implementation

Project	Key Details	Status	Expected Benefits
2 nd Colour Coating Line	Capacity addition of 1,50,000 TPA; total colour coating capacity to increase from 86,000 TPA to 2,36,000 TPA (+174%).	Q2 FY27	Expands capacity for value- added products, broadens premium offerings and supports growth across domestic and export markets.
7 MW Solar Power Project	Captive solar project at Kutch, Gujarat	Q2 FY27	Expected to offset around 50%-55% of grid power dependency, reduce energy costs and strengthen sustainability performance.
Salesforce CRM Implementation	Enterprise-wide customer relationship management platform.	Implementation in Progress	Improves customer engagement, demand forecasting, order visibility and sales productivity across channels.

Project Significance

2 nd Colour Coating Line

The second colour coating line will enable the Company to maximise production of its highest value-added product offering, namely pre-painted Alu-Zinc steel coils. The project is expected to broaden the Companys premium product portfolio, strengthen its ability to serve higher-value customer segments and increase its share of customers coated steel requirements. It will also enhance manufacturing efficiency and support the development of advanced paint finishes.

7 MW Solar Power Project

The captive solar power project will enable the Company to transition towards renewable energy and meet up to 55% of its power requirements through green energy sources. The project is expected to generate annual savings of approximately Rs.7 crore in power costs, reduce the Companys carbon footprint and support the production of lower-CBAM-impact products for export markets, particularly in Europe.

Salesforce CRM Implementation

The Salesforce CRM platform will strengthen the Companys customer engagement capabilities by providing improved demand forecasting, enhanced order visibility and better customer insights. The initiative is expected to improve sales productivity and support a more structured, integrated and data-driven approach across all sales channels.

The Company continues to invest in strategic growth initiatives aimed at expanding value-added capacities, improving cost efficiencies and strengthening digital capabilities. These projects are expected to enhance operational resilience, support sustainable growth and further reinforce the Companys competitive positioning over the long term.

Our Solutions

Alu-Zinc Coated Steel Products

Manaksia Coated Metals & Industries Limited manufactures premium Alu-Zinc coated steel coils and sheets using an advanced Aluminium-Zinc alloy coating that offers superior corrosion resistance and durability compared with conventional galvanised steel. The products provide extended service life, lower maintenance requirements and reliable performance across diverse applications.

FY26 marked a significant milestone for the Company with the successful upgradation of its galvanising line from producing conventional pure zinc-coated steel to premium Alu-Zinc coated steel products. This strategic transition has strengthened MCMILs value-added product portfolio, enabling it to address higher-value applications and cater to a more premium customer base across domestic and international markets. The initiative also enhances the Companys competitive positioning and supports its long-term strategy of driving product premiumisation and expanding its presence in value-added coated steel segments.

The Companys Alu-Zinc coated steel products cater to a wide range of applications, including roofing and cladding, pre-engineered buildings, warehouses, industrial structures and infrastructure projects. Owing to their superior corrosion resistance, heat reflectivity and formability, these products are also extensively used in white goods and appliances, metal false ceilings, HVAC systems, dry wall systems and general engineering applications. Their versatility and durability make them a preferred choice for customers seeking high-performance and cost-effective steel solutions.

71.55 %

Capacity Utilisation

103,036 MT

Production Volume

The Company continues to strengthen its position in the Alu-Zinc segment through continuous product innovation, quality enhancement and capacity expansion. The upgraded Alu-Zinc coating facility commissioned during FY 2025-26 has enhanced production capabilities. This positions the Company to meet rising domestic and export demand while expanding its portfolio of value-added coated steel solutions.

Pre-Painted Steel Products

MCMIL manufactures premium pre-painted steel coils and sheets designed to deliver superior aesthetics, durability and corrosion protection. Manufactured using advanced coating systems and stringent quality controls, these products offer excellent colour retention, weather resistance and surface finish. They are well suited for architectural and industrial applications.

The Companys pre-painted steel products cater to construction, infrastructure, home appliances, HVAC, automotive components and general engineering. Available in a wide range of colours, finishes and specifications, these products offer great design flexibility, reduced maintenance requirements and longer service life.

97.20 %

Capacity Utilisation

83,594 MT

Production Volume

~80 %

Shares in Total Sales Volume

Pre-painted steel remains the Companys largest value-added product category and a key pillar of its premiumisation strategy. MCMIL continues to expand its presence in this segment through product innovation, customer-centric solutions and capacity augmentation initiatives. These efforts aim to address growing demand across domestic and export markets.

SWOT Analysis

S	W	O	T
Strengths	Weakness	Opportunities	Threats
Leading manufacturer and exporter of value-added coated steel products with a strong presence across domestic and international markets.	Dependence on external suppliers for key raw materials, resulting in exposure to fluctuations in steel coil and metal prices.	Growing demand for niche coated steel products driven by infrastructure development, housing, industrial construction and renewable energy investments.	Volatility in raw material prices, freight rates, energy costs and foreign exchange movements impacting profitability.
Diversified product portfolio comprising Alu-Zinc coated steel and pre-painted steel products catering to construction, infrastructure, appliances, automotive and engineering sectors.	Current limited backward integration compared to integrated steel manufacturers, resulting in dependence on external raw material supply chains.	Expansion of export markets supported by increasing global acceptance of the Company\u2019s products and long-term customer relationships.	Global economic slowdowns, geopolitical uncertainties and trade restrictions affecting export demand and international market conditions.
Strategically located manufacturing facility in Kutch, Gujarat, offering proximity to key ports for efficient procurement and seamless exports.		Cost optimisation opportunities through renewable energy initiatives and operational efficiency improvements.	Changes in environmental regulations, sustainability requirements and compliance costs across the steel value chain.
Established export franchise across 22+ countries, with exports contributing a significant share of revenue.		Increasing Government focus on domestic manufacturing, infrastructure development and industrial growth supporting long- term steel demand.	Supply chain disruptions and commodity market fluctuations affecting production planning and cost structures.
Flexible operating model enabling a timely response to evolving market conditions and customer requirements.

SWOT Analysis

Financial Performance

The Company delivered a strong financial performance during FY26, with revenue from operations increasing by 13.16% to Rs.884.48 crore and total income rising by 14% to Rs.896.27 crore, supported by higher sales volumes, healthy export demand and an improving product mix. Export volumes increased to 69,065 MT during the year, reflecting robust demand across international markets.

EBITDA increased significantly by 49% to Rs.92.21 crore, with EBITDA margin improving to 10.29% from 7.83% in FY25. The margin expansion was primarily driven by increased sales of the Companys highest value-added products, particularly pre-painted steel coils, higher utilization of the colour coating line, which operated at approximately 97% capacity, and a growing contribution from premium customer segments and exports.

Price realisation per tonne also improved, rising to Rs.82,193 in FY26 from Rs.73,622 in FY25, with EBITDA per tonne increasing by 43.54% to Rs.8,838, reflecting the combined benefit of premiumisation, higher exports and a growing base of premium customer accounts.

Profit After Tax increased by 164.00% to Rs.40.69 crore, while

Earnings Per Share rose by 109% to Rs.4.32 per share. This strong bottom-line performance was reinforced by continued deleveraging: the debt-equity ratio improved to 1.13x from 1.81x and the interest coverage ratio strengthened to 2.85x from 1.63x. While Net Debt / EBIDTA is 1.06 from 1.93x — reaching the Companys targeted level of close to 1x — reducing the interest burden on earnings. The Companys external credit rating was also upgraded during the year, with the long-term rating raised to A from A- and the short-term rating raised to A1 from A2

Particulars	FY25	FY26	YoY Change (%)
Revenue from Operations (Rs. Cr)	781.63	884.48	13.16
Total Income (Rs. Cr)	789.66	896.27	13.50
EBITDA (Rs. Cr)	61.80	92.21	49.21
PAT (Rs. Cr)	15.39	40.69	164.39
PAT Margin (%)	1.95	4.54	132.82
EPS (Rs.)	2.07	4.32	108.69

Ratio Analysis

Ratio	FY25	FY26
EBITDA Margin (%)	7.83	10.29
PAT Margin (%)	1.95	4.54
Return on Capital Employed (%)	17.61	18.98
Debt-Equity Ratio (x)	1.81	1.13
Interest Coverage Ratio (x)	1.63	2.85
Current Ratio (x)	1.35	1.75
Net Debt / EBITDA (x)	1.93	1.06
Earnings Per Share (Rs.)	2.07	4.32

Human Resources

At Manaksia Coated Metals & Industries Limited, human capital remains central to operational excellence, innovation and sustainable growth. The Company focuses on building a high-performance and inclusive workplace through employee development, workshops and promoting a culture of accountability, collaboration and continuous improvement. As the Company progresses through its growth and expansion phase, it remains committed to attracting, developing and retaining skilled talent across the organisation. The Company places strong emphasis on employee learning, skill enhancement and leadership building. Regular training programmes enhance technical competencies, operational efficiency, safety practices and managerial capabilities. It helps the employees to deploy the latest technologies to ensure smooth working and reduce time wastage on regularised tasks.

During FY 2025-26, the Company continued its focus on shop-floor capability enhancement and workforce readiness to support expanded production capacities and evolving customer requirements. The Company also promotes employee engagement through transparent communication, performance-driven work practices and a collaborative work environment.

Employee health, safety and well-being remain integral to the Companys operational philosophy. The Company maintains stringent safety standards across its manufacturing operations and regularly conducts awareness programmes, safety audits and preventive initiatives. These measures aim to promote a safe and healthy workplace. Backed by an experienced leadership team and a dedicated workforce, MCMIL remains focused on strengthening organisational capabilities and fostering a culture that supports long-term business growth and value creation.

289

Total Employees

Internal Control Systems and their Adequacy

The Company has established a robust internal control framework to commensurate with the scale and complexity of its operations. The Board of Directors oversees the effectiveness of the internal control system and periodically reviews its adequacy to ensure efficient business operations, reliable financial reporting and compliance with applicable laws and regulations. Supported by SAP-enabled processes, the framework facilitates accurate accounting, timely management reporting and effective monitoring of operational performance. The internal control system is designed to safeguard the Companys assets, promote operational efficiency and enable the timely identification, assessment and mitigation of strategic, operational, financial and compliance-related risks.

Cautionary Statement

This statement made in this section describes your 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. Your Company cannot guarantee that these assumptions and expectations are accurate or will be realised by your 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 your Company. Your Company assumes no responsibility to publicly amend, modify or revise any forward-looking statements on the basis of any subsequent development.