Mason Infratech Ltd Management Discussions

Annexure B

INDUSTRY STRUCTURE AND DEVELOPMENTS.

Global Economy1

The global economy is projected to sustain moderate growth over the coming years, with a five-year ahead forecast of 3.2%. In the near term, growth is expected at 2.8% in 2025 and 3.0% in 2026, reflecting a cautious yet steady recovery amid shifting macroeconomic conditions.

Global inflation is anticipated to remain on a downward path, easing to 4.3% in 2025 and further to 3.6% in 2026. This disinflationary trend, supported by more accommodative monetary policies in advanced economies, is likely to provide a measure of support to global growth.

However, global trade is expected to encounter headwinds. Trade growth is projected to slow to 1.7% in 2025, weighed down by rising tariff barriers and the waning momentum of cyclical factors that had recently buoyed goods trade.

Indian Economy

India delivered a resilient economic performance in FY 2024 25, sustaining stable growth despite a challenging and dynamic global landscape. The economy recorded a GDP growth rate of 6.5%2, supported by robust domestic demand, continued infrastructure spending, and the steady expansion of the urban middle class.

Inflationary pressures moderated during the year, with consumer price inflation easing to 3.34% in March 2025. This favourable trend enabled the Reserve Bank of India (RBI) to pursue a more accommodative monetary stance, including a reduction in the repo rate to 6.00%, with the objective of improving liquidity, stimulating consumption, and encouraging private investment.

The Government of India further reinforced its commitment to long-term growth by sustaining high levels of public investment. In the Union Budget for FY 2024 25, 11.11 lakh crore was allocated towards capital expenditure, underscoring a sharper emphasis on infrastructure development and capacity building across the economy.

Industry Overview

The infrastructure sector remains a cornerstone of Indias economic development, serving as a key driver of GDP growth, regional progress, and employment generation. Recognised as a critical catalyst for national advancement, the sector has consistently received strong policy backing, increased public investment, and encouragement for private sector participation from the Government of India.

In the Union Budget for FY 2025 26, the government earmarked 11.21 lakh crore for capital expenditure, reinforcing its sustained commitment after the previous years allocation of 11.11 lakh crore. This continued thrust is directed towards strengthening Indias physical infrastructure across core segments, including power, roads, bridges, urban development, and water resources.3

1. https://www.imf.org/en/Publications/WEO/Issues/2025/04/22/world-economic-outlook-april-2025 2. https://pib.gov.in/PressReleasePage.aspx?PRID=2113316 3. https://www.ey.com/content/dam/ey-unified-site/ey-com/en-in/technical/alerts-hub/documents/2025/ey-union-budget-2025-alert-infra-sector.pdf

Company Overview

Mason Infratech Limited was originally established on February 6, 2020, as a partnership firm under the name M/s. Mason Infrastructure. The firm was subsequently converted into a private limited company under the Companies Act, 2013 on April 24, 2023, and later reconstituted as a public limited company on September 20, 2023.

Pursuant to resolutions passed by the Members at the Extra-Ordinary General Meeting held on January 13, 2024, the Company resolved to approach the capital market with an Initial Public Offering (IPO) of 47,60,000 (Forty-Seven Lakh Sixty Thousand) equity shares of face value 10 each.

The IPO was conducted through the Book Building Process, in compliance with applicable laws, for the purpose of offering the said shares to the public.

The public issue opened for subscription from June 24, 2024, to June 26, 2024, and the allotment of shares was finalized on June 27, 2024, in consultation with the Designated Stock Exchange, i.e., the National Stock Exchange of India Limited (NSE), in accordance with regulatory requirements.

Subsequent to the allotment, the Companys equity shares were listed and admitted for trading on the

NSE Emerge platform with effect from July 1, 2024, under the scrip code ‘MASON, following the final approval granted by NSE.

Our Company is engaged in the business of construction services for residential and commercial buildings, with a focus on civil contracts and high-value infrastructure projects. We operate primarily in the Mumbai Metropolitan Region (MMR), where we leverage our technical expertise, commitment to quality standards, and adoption of advanced construction technologies to deliver efficient and sustainable infrastructure solutions.

Mason Infratech Limited has demonstrated robust financial growth, with revenue increasing from Rs. 9,379.46 lakhs in FY 2024 to Rs. 11,210.48 lakhs in FY 2025, and net profit rising from Rs. 1,165.23 lakhs to Rs. 1,708.58 lakhs over the same period.

Indian Construction Service Market

The Indian construction service market is characterized by its rapid growth and increasing demand for quality and timely project execution. Our company is positioned to capitalize on these trends. We emphasize using modern equipment and formwork technologies to enhance construction efficiency and quality. The market is witnessing rising investment levels, with a notable shift towards incorporating advanced technologies and sustainable practices in construction. Our strategic focus on the Mumbai Metropolitan Region allows us to establish long-term client partnerships and stay aligned with industry trends and best practices.

Opportunities in the construction industry are notably shaped by several key factors. Emerging market trends present a dynamic environment where innovation and new technologies are continually reshaping the industry. The increasing demand for quality construction reflects a growing emphasis on high standards and durability, further fueled by rapid urbanization. As cities expand and develop, the need for infrastructure and residential projects surges, creating substantial opportunities for construction firms. Additionally, government infrastructure initiatives are likely to drive substantial investment into public projects, fostering growth. Emphasizing sustainable construction practices aligns with global trends towards environmental responsibility, providing a competitive edge for companies that prioritize eco-friendly building methods.

However, the construction industry also faces several threats that could impact its stability and growth. Economic recessions can lead to reduced investment and lower demand for construction services, while client bankruptcy can directly affect project financing and completion. Changing government policies and regulations can introduce uncertainty and increase compliance costs, potentially disrupting business operations. Pandemics or similar scenarios could cause project delays and impact labor availability. Labor shortages pose a persistent challenge, potentially slowing project progress and increasing costs. Additionally, rising material costs can strain budgets and affect project feasibility. Lastly, stringent environmental regulations may necessitate costly adjustments in building practices and materials, impacting profitability.

SEGMENT WISE OR PRODUCT WISE PERFORMANCE:

The company operates within the construction contracting sector, maintaining a diversified project portfolio that primarily consists of Full Labour Oriented Projects ("FLO Projects"), which constitute approximately seventy-five percent (75%) of the Contractors total project engagements. In FLO Projects, the Contractor is responsible solely for the provision of labor, with all materials supplied by the client or third parties as designated by the client. Additionally, the Company engages in Part Material Full Labor Projects ("PMFL Projects"), representing approximately ten percent (10%) of its portfolio, wherein the company provides both labor and a portion of the required materials, with the remainder of the materials supplied by the client or as otherwise agreed between the parties. The remaining fifteen percent (15%) of the Contractors project portfolio consists of Lock & Key Projects ("L&K Projects"), in which the company assumes full responsibility for the project, including the provision of all labor and materials, delivering a completed project to the client.

FUTURE OUTLOOK

Mason Infratech Limited is poised for reliable and steady growth. Our strong foundation in the construction contracting sector, combined with our focus on quality and client satisfaction, positions us well for continual expansion in the coming years. As we continue to execute assorted projects, we are confident in our ability to capitalize on market opportunities and drive growth vertically and horizontally.

RISKS AND CONCERNS

Mason Infratech navigates various considerations, including project dependence on 7 ongoing projects from 4 developers, which could influence cash flow if any client faces challenges. As a growing company, solidifying our market position is a priority. With around 176 employees, maintaining a motivated and skilled workforce is key. Leadership continuity is important, as our experienced CFO and Directors are crucial to our operations. Additionally, we are mindful of typical industry dynamics such as fluctuating material costs, labor availability, and regulatory changes, making effective financial management and compliance essential to our continued success.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY

The Companys internal control systems are commensurate with the nature of its business and the size and complexity of operations. These systems are routinely tested and certified by Statutory as well as Internal Auditor and cover all offices, factories and key business areas. Periodical reports and significant audit observations and follow up actions thereon are reported to the Audit Committee. The Audit Committee is headed by an Independent Director, and this ensures independence of function and transparency of the process of supervision and oversight. The Audit Committee reviews adequacy and effectiveness of the Companys internal control environment and monitors the implementation of audit recommendations, including those relating to strengthening of the Companys risk management policies and systems. The Company conducts its business with integrity and high standard of ethical behavior and in compliance with the laws and regulations that govern its business.

DISCLOSURE ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

Please refer to the Boards Report.

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

The Company continues to lay emphasis on developing and facilitating optimum human performance. Performance management was the key word for the Company this year. The Company has always strived to be a Progressive Employer by continuously focusing on creating an engaging atmosphere for our Employees to learn, contribute and grow. There is an active FUN team that creates opportunities for enjoyment even while working. We believe in timely compliance of all statutory payments especially related to employees. Our POSH Committee ensures a safe environment, dignity and respect for all our employees irrespective of gender, religion, caste etc.

SIGNIFICANT CHANGES IN KEY FINANCIAL RATIOS COMPARED TO PREVIOUS YEAR

FORWARD-LOOKING STATEMENT

Certain statements made in the Management Discussion and Analysis Report relating to the

Companys objectives, projections, outlook, expectations, estimates, and others may constitute forward-looking statements within the meaning of applicable laws and regulations. Actual results may differ from such expectations, whether expressed or implied. Several factors could make a significant difference to our operations. These include climatic and economic conditions affecting demand and supply, government regulations and taxation, any epidemic or pandemic, and natural calamities over which we do not have any direct/indirect control.