Mittal Sections Ltd Management Discussions

The Management of Mittal Sections Limited presents the Management Discussion and Analysis Report for the nancial year ended 31st March 2026. This report gives an overview of the Companys performance, key business developments, and outlook for the future.

Industry Overview:

Our Company was originally formed as Partnership Firm under the name and style of "Mittal Steel Industries" in 2006. Subsequently, the name of partnership rm was changed from "M/s. Mittal Steel Industries" to "M/s. Mittal Sections" in 2008. "M/s. Mittal Sections" was converted from a partnership rm to a joint stock company with name "M/s. Mittal Sections Limited" in 2009.

Our Company is a leading manufacturer of an extensive range of Mild Steel sections and structural steel products, including MS Flat Bars, MS Round Bars, MS Angles, and Channels. These products are produced in compliance with various BIS standards, primarily IS 2062:2011, ensuring consistent quality and high performance across all applications.

Industry Structure and Developments:

The steel industry plays a vital role in the growth of the infrastructure, construction and manufacturing sectors. Mild Steel structural products such as MS Flat Bars, MS Round Bars, MS Angles and Channels are widely used in construction, fabrication, industrial structures, warehouses, transmission towers and engineering applications.

The demand for structural steel products in India continues to be supported by government initiatives focused on infrastructure development, including highways, railways, urban infrastructure, logistics parks and industrial corridors. Increasing investments in manufacturing, warehousing and pre-engineered buildings have also contributed to the steady growth of the structural steel segment.

The industry remains fragmented with the presence of large integrated steel producers as well as numerous small and medium rolling mills and traders. Competition in the sector is primarily driven by pricing, quality, delivery capabilities and customer relationships.

Segment-wise Performance:

The Company is engaged in the business of trading and/or manufacturing of Iron & Mild Steel structural products, including MS Flat Bars, MS Round Bars, MS Angles and Channels, which are widely used in construction, fabrication, infrastructure and engineering applications.

During the year under review, the Company continued to focus on strengthening its market presence in both the private and institutional segments. The trading operations of the Company remained focused on e cient sourcing, maintaining optimal inventory levels and timely supply of quality steel products to customers across various sectors.

The Company also continued to explore opportunities in institutional sales and government procurement, including participation in tenders oated by government utilities and public sector entities. The demand for structural steel products remained supported by infrastructure development activities, fabrication requirements and industrial projects.

The Company remains committed to improving operational e ciencies, expanding its customer base and strengthening relationships with key institutional and industrial customers to enhance its overall business performance.

Opportunities:

The demand for Mild Steel structural products such as MS Flat Bars, MS Round Bars, MS Angles and Channels continues to be supported by the steady growth of the infrastructure, construction and engineering sectors. Government initiatives focusing on infrastructure development, industrial corridors, logistics parks and a ordable housing are expected to create sustained demand for structural steel products in the coming years.

Rapid urbanization, expansion of manufacturing activities and increasing investments in industrial buildings, warehouses and pre-engineered structures are also expected to drive the consumption of structural steel sections. In addition, the growth of renewable energy projects and transmission infrastructure o ers new avenues for demand for Mild Steel structural products.

The Company continues to focus on strengthening its market presence, improving operational e ciency and expanding its customer base to capitalize on these emerging opportunities.

Threats:

The Mild Steel structural products industry remains highly competitive with the presence of numerous organized and unorganized players, which exerts pressure on margins. The industry is also exposed to volatility in raw material prices such as iron ore, scrap and coal, which may impact production costs and pro tability.

Demand for structural steel products is closely linked to the performance of the construction and infrastructure sectors and may be a ected by economic slowdowns or uctuations in investment cycles. Additionally, evolving environmental regulations and increasing compliance requirements may result in higher operational costs for industry participants.

The Company continuously monitors these external risks and adopts appropriate strategies to mitigate their potential impact on its operations and nancial performance.

Exploration / Expansion:

The Company continues to explore opportunities to expand its presence in both private sector and institutional markets for Iron & Mild Steel structural products. With increasing infrastructure development and expansion of power transmission and distribution networks, the Company aims to strengthen its participation in government and utility tenders.

The Company is also focusing on expanding its vendor registrations and enhancing its eligibility to participate in procurement processes of government utilities and public sector undertakings. This strategy is expected to provide additional avenues for business growth and diversi cation of revenue sources.

Further, the Company intends to strengthen its distribution network, expand its customer base and explore new markets to improve its business scale and operational e ciency. Continuous e orts are being made to enhance supply chain capabilities and strengthen long-term relationships with customers and suppliers.

Strengths:

The promoters and management team of the Company possess strong technical knowledge and experience in the Iron & Steel industry. Their leadership has helped the Company navigate challenges.

Their continued commitment and industry expertise are expected to play a key role in driving growth and pro tability in the years ahead. The Company has developed and maintains strong relationships with suppliers, enabling it to ensure consistent availability of quality products and timely deliveries to customers.

The Company also bene ts from its growing presence in institutional and government procurement markets through vendor registrations with various power utilities and participation in tender-based procurement processes. This provides access to structured demand from infrastructure and power sector projects.

In addition, the Company focuses on maintaining e cient inventory management, competitive pricing and strong customer relationships across trading and industrial segments. The managements industry experience and market understanding further support the Companys ability to respond e ectively to changing market conditions and customer requirements.

Outlook:

The Company continues to focus on strengthening its presence in institutional and government procurement markets. In line with this strategy, the Company actively participates in government tenders and procurement processes for supply of structural steel products and related materials.

The Company has undertaken vendor registration with various government power utilities under Gujarat Urja Vikas Nigam Limited and its subsidiary companies, including Gujarat State Electricity Corporation Limited, Gujarat Energy Transmission Corporation Limited, Madhya Gujarat Vij Company Limited, Dakshin Gujarat Vij Company Limited, Uttar Gujarat Vij Company Limited and Paschim Gujarat Vij Company Limited, etc.

These vendor registrations enable the Company to participate in tender opportunities related to power generation, transmission and distribution infrastructure projects. The Company believes that continued engagement with government utilities and institutional customers will support long-term growth and diversi cation of its customer base.

Going forward, the Company intends to further expand its participation in government and institutional tenders, strengthen its market presence and leverage emerging opportunities in infrastructure and power sector development to enhance its operational performance and shareholder value.

Risks and Concerns:

Your Company continuously monitors and revisits the risks associated with its business. It has institutionalized the procedure for identifying, minimizing and mitigating risks and the same are reviewed periodically. The Companys Structured Risk Management Process attempts to provide con dence to the stakeholders that the Companys risks are known and well managed. The company management has a Risk Management Team comprising of Functional heads as Champions and accountable for risks associated in their areas. The company has review mechanism of risks at regular intervals. The management of the Company has identi ed some of the major areas of concern having inherent risk, viz. Foreign Currency Fluctuation, Client Concentration, Technology Risks and Credit Control. The processes relating to minimizing the above risks have already been put in place at di erent levels of management. The management of the Company reviews the risk management processes and implementation of risk mitigation plans. The processes are continuously improved.

Risk Management comprises three key components which are as below: i. Risk identi cation ii. Risk assessment and mitigation iii. Risk monitoring and assurance

Your Company has identi ed the following aspects as the major risks for its operations: i. Market Risk in terms of Price increase of Raw Material ii. Foreign Exchange Risk

The risk mitigation plans are reviewed regularly by the Management and Audit Committee of your Company.

Financial and Operational Performance:

The nancial performance of the Company for the year 2025-26 is described in the Directors Report under the head Review of Operations.

The Company will envisage its growth in future because of continuous hardcore e orts put by your Companys management to achieve the pace of development, towards which your Company marches.

Internal Control Systems and Their Adequacy:

Company has in place internal control systems and procedures commensurate with the size and nature of its operations. Internal control processes which consist of adopting appropriate management systems and implementing them are followed. These are aimed at giving the Audit Committee a reasonable assurance on the reliability of nancial reporting and statutory & regulatory compliances, e ectiveness and e ciency of your Companys operations. The Internal Control Systems are reviewed periodically and revised to keep in tune with the changing business environment.

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

The human resource philosophy and strategy of your Company have been designed to attract and retain the best talent, creating a workplace environment that keeps employees engaged, motivated and encourages innovation. Your Company has fostered a culture that rewards continuous learning, collaboration and development, making it future ready with respect to the challenges posed by ever- changing market realities. Employees are your Companys most valuable asset and your Companys processes are designed to empower employees and support creative approaches in order to create enduring value. Your Company maintains a cordial relationship with its employees. Its emphasis on safe work practices and productivity improvement is unrelenting. Your Company has 40 employees on its permanent rolls as on 31st March, 2026.

Key Financial Ratios:

Ratios	Numerator	Denominator	31-Mar- 2026	31-Mar- 2025	Change in %	Explanation for any change in the ratio by more than 25% as compared to the preceding year
Current ratio (in times)	Current assets	Current liabilities	2.80	1.85	51.41%	Due to increase in current assets
Debt-equity ratio (in times)	Total debt	Shareholders equity	0.43	2.07	-79.39%	Due to increase in equity during the year
Debt-service coverage ratio (in times)	Earnings available for debt service	Debt service	0.27	0.29	-6.78%	-None-
Return on Equity ratio (in percentage)	Net pro t after taxes	Average shareholders equity	5.95%	33.81%	-82.39%	Due to increase in equity during the year
Inventory turnover ratio (in times)	Sales	Average inventory	16.46	21.82	-24.58%	Due to increase in sales during the year
Trade receivables turnover ratio (in times)	Net credit sales	Average trade receivables	10.26	17.53	-41.48%	Due to increase in trade receivables during the year
Trade payables turnover ratio (in times)	Net credit purchases	Average trade payables	10.78	15.84	-31.94%	Due to increase in trade payables during the year
Net capital turnover ratio (in times)	Net sales	Average working capital	6.18	14.44	-57.23%	Due to increase in working capital during the year
Net pro t ratio (in percentage)	Net pro t after taxes	Net sales	2.33%	2.51%	-7.43%	-None- Due to increase in capital
Return on capital employed (in percentage)	Earning before interest and taxes	Capital employed	8.60%	19.69%	-56.34%	employed during the year
Return on investment (in percentage)	Income from investments	Cost of investment	-	-	-	N.A.