ECONOMIC OVERVIEW AND OUTLOOK

Global Economy

As we progress through FY 2025-26, the global economy is navigating a complex and rapidly evolving landscape, shaped by the interplay of rising protectionism, technological transformation, and lingering geopolitical tensions. After a period of postpandemic recovery, the world now faces a new round of structural headwinds, most prominently the imposition of sweeping US tariffs during 2025 described as the disruption to the multilateral trading system in decades alongside the escalation of conflicts in the Middle East that has added fresh pressure on energy and commodity markets.

According to the IMFs latest World Economic Outlook (January 2026 Update), global growth has been revised upward to 3.3% for 2026 and 3.2% for 2027, reflecting modest improvements since the October 2025 forecast. This resilience has been supported by particularly the AI infrastructure boom fiscal and monetary stimulus in select jurisdictions, accommodating financial conditions, and the adaptability of the private sector. However, growth remains below the historical (2000-19) average of 3.7%, underscoring that the global economy has not yet achieved a return to full-trend performance.

Advanced economies are projected to grow at around 1.5%-1.6% in 2025-26, weighed down by sluggish momentum in the Euro Area (approximately 1.1%-1.2%) and Japan (below 1%), while the United States has shown greater resilience, with growth anticipated around 2.0%-2.1% buoyed by fiscal expansion under the One Big Beautiful Bill Act (OBBBA) and technology-led investment. Emerging markets and developing economies are expected to maintain growth of around 4.0%-4.2%, serving as the primary engine of global output.

Inflation globally continues its downward trajectory. The IMF projects global headline inflation at 4.2% in 2025, moderating further to 3.6% in 2026, a broadly positive trend reflecting the cumulative effects of monetary tightening over the past three years. However, the path is uneven: inflation in the United States remains above target owing to tariff-related cost pass through, while inflation in other large economies remains more subdued, enabling a gradual easing of monetary policy.

Trade dynamics have been profoundly reshaped by the tariff environment of 2025. The US imposed broad-based tariffs on trading partners, triggering retaliatory measures and accelerating trade fragmentation. Despite these headwinds, global merchandise trade grew faster than expected, with merchandise volumes expanding nearly 5% in the first half of 2025, partly aided by front-loading ahead of tariffs. AI-related goods semiconductors, data-centre equipment emerged as a structural new engine of trade, accounting for roughly one-third of global trade growth. Asian manufacturing hubs, Southeast Asia, and India gained ground in selected sectors, while global value chains underwent significant rerouting.

On the fiscal front, global public debt levels remain elevated, particularly in advanced economies and low-income countries. Rising interest payments are constraining fiscal space, forcing many governments to pursue consolidation strategies even as growth remains below trend. Financial sector vulnerabilities associated with the prolonged period of high interest rates also persist, and central banks in most jurisdictions are pursuing a cautious, data-dependent approach to monetary easing.

As the global economy moves deeper into FY 2025-26, the central challenge for policymakers remains balancing the management of inflation and fiscal sustainability with the imperative of sustaining growth, private investment, and structural reform. Countries that can leverage technology, maintain open trade relationships, and invest in productive infrastructure are best positioned to weather the ongoing uncertainty.

Indian Economy

Against a challenging and uncertain global backdrop, India continues to stand out as the worlds fastest-growing major economy, reinforcing its position as a beacon of macroeconomic stability and structural dynamism. FY 2025-26 has emerged as a year of broad-based acceleration, with the economy delivering robust performance across sectors despite external headwinds from global trade realignment and geopolitical volatility.

Indias real GDP expanded by 7.8% in Q1 FY 2025-26 and accelerated further to 8.2% in Q2 the highest in six quarters driven by resilient domestic demand, income tax and GST rationalisation, softer crude oil prices, front-loading of Government capital expenditure, and supportive monetary and financial conditions. The RBI has revised its GDP growth forecast for FY 2025-26 upward to 7.3% from an earlier estimate of 6.8%, while the IMF projects growth of 6.6% for FY2025/26 before a moderate softening to 6.2% in FY2026/27 as cyclical and temporary tailwinds ease.

Multiple international institutions have echoed optimism about Indias trajectory:

The IMF (Article IV Consultation, November 2025) raised its FY 2025-26 forecast to 6.6%, citing GST reforms and robust domestic demand.- The OECD projects 6.7% growth in 2025 and 6.2% in 2026.- S&P raised Indias long-term sovereign credit rating to BBB from BBB-, recognising Indias growing financial resilience.- Fitch raised its FY26 projection to 7.4% on stronger consumer demand, while the Asian Development Bank lifted its 2025 forecast to 7.2%.- India is currently the worlds fourth-largest economy and is on track to become the third-largest by 2030, with a projected GDP of USD 7.3 trillion.

Inflation has been a standout positive story in FY 2025-26. CPI inflation, which stood at 4.26% in January 2025, softened significantly through the year, reaching 2.10% in June 2025 and touching multi-year lows of around 0.25% in October 2025, well within the RBIs target band of 4% (±2%). This disinflationary trend, driven primarily by a correction in food prices, has supported real incomes, improved household purchasing power, and enabled the RBI to adopt accommodating monetary conditions. The RBI has lowered its CPI inflation forecast for FY 2025-26 to 2.0%, with a normalisation towards the 4% target expected in FY 2026-27.

Indias industrial sector has shown strengthening momentum in FY 2025-26. The Index of Industrial Production (IIP) registered strong growth of 7.8% in December 2025, supported by broad-based expansion in manufacturing (8.1%) and continued growth in mining (6.8%). This represents the strongest industrial expansion in over two years and marks a significant recovery compared to the four-year low of 4.0% IIP growth recorded in FY 2024-25. Manufacturing GVA accelerated, reaching 7.72% in Q1 and 9.13% in Q2 FY 2025-26, underscoring the economys increasingly broad-based industrial revival.

Infrastructure development remains a central pillar of Indias growth strategy. The Union Budget 2025-26 earmarked capital expenditure of 11.21 lakh crore (approximately 3.1% of GDP) for infrastructure-led development, with 5.24 lakh crore specifically allocated to roads and railways. This commitment to public investment continues to crowd in private capital and drive activity in construction, logistics, and allied industries. Additionally, the Union Budget 2026-27 further raised public capital expenditure by approximately 9% to 12.2 lakh crore, reflecting an unwavering emphasis on infrastructure-driven growth.

Key flagship schemes continue to propel Indias structural transformation:

? Bharatmala Pariyojana: Development of 34,800 km of national highways, advancing connectivity and freight movement.- Sagarmala Programme: Over 800 port and logistics infrastructure projects strengthening maritime trade.- PM Gati Shakti: Integrated multi- modal infrastructure planning to accelerate project execution.- Production-Linked Incentive (PLI) Schemes: Cumulative investments of over 2 lakh crore realised till September 2025, with significant gains in automotive, advanced chemistry cells, and electronics manufacturing.- National Manufacturing Mission: A dedicated focus on clean-tech manufacturing and EV ecosystem development, including battery localisation under the PLI-ACC scheme (40 GWh capacity awarded).

India is also poised to benefit from global trade realignment. As US-China trade tensions have accelerated the diversification of supply chains, India has emerged as an attractive destination for manufacturing investments, particularly in electronics, textiles, pharmaceuticals, and specialty chemicals. Indias proactive trade diplomacy — with a trade agreement signed with the United Kingdom and negotiations with the European Union at an advanced stage, as well as expectations of an India-US trade deal — further enhances its positioning in the evolving global trade order.

While the outlook remains positive, risks to Indias growth trajectory include potential escalation of geopolitical conflicts leading to energy price spikes, volatility in global commodity and currency markets, the impact of erratic monsoon seasons on agricultural output, and the gradual normalisation of inflation back towards the 4% target, which could tighten monetary conditions in FY 2026-27. Nonetheless, with healthy GDP growth, a stable external sector, a supportive fiscal and monetary policy framework, and rising global investor confidence, Indias economic fundamentals remain among the strongest of any major economy in the world.

Aluminium Industry

A significant development for the domestic aluminium foil industry has been the imposition of anti-dumping duty on aluminium foil imports from China. The measure is expected to promote fair competition, improve capacity utilisation for domestic manufacturers and encourage investments in technology, quality enhancement and value-added products, thereby strengthening Indias aluminium manufacturing ecosystem.

Looking ahead, the long-term outlook for the aluminium industry remains positive. Increasing investments in infrastructure, renewable energy, defence, transportation and electrical transmission, coupled with favourable government policies and the growing global preference for sustainable materials, are expected to create significant opportunities for value-added aluminium manufacturers. Companies with diversified product portfolios, strong technological capabilities, operational efficiencies and a focus on innovation will be well positioned to capitalise on these emerging opportunities.

Construction, Infrastructure & Mining

Indias construction and infrastructure sector continues to remain one of the primary engines of economic growth, supported by sustained Government expenditure, increasing private investments and large-scale urbanisation. Continued investments in highways, railways, metro rail projects, airports, industrial corridors, smart cities and renewable energy infrastructure are expected to drive long-term demand for construction materials and allied industrial products.

The Governments continued emphasis on infrastructure development through initiatives such as PM Gati Shakti, Bharatmala Pariyojana, Smart Cities Mission, affordable housing programmes and expansion of logistics infrastructure is expected to strengthen demand across the construction value chain. Simultaneously, increasing investments in renewable energy, transmission networks and industrial manufacturing are creating new opportunities for manufacturers supplying specialised materials and engineering products.

The housing sector also continues to witness healthy growth, supported by rapid urbanisation, rising disposable incomes and increasing demand for affordable and sustainable construction solutions. Autoclaved Aerated Concrete (AAC) blocks have gained widespread acceptance owing to their lightweight properties, superior thermal insulation, fire resistance and ease of construction. Aluminium powder, being an essential foaming agent in AAC block manufacturing, is expected to witness sustained demand as the adoption of modern construction technologies continues to increase.

Mining remains another important growth driver for aluminium powder. India continues to increase production of coal, iron ore and other minerals to support industrial development, power generation and infrastructure projects. Rising mining activities, together with increasing investments in tunnelling, road construction, rail connectivity and underground infrastructure, continue to drive demand for industrial explosives.

Aluminium powder is a critical raw material in slurry explosives and other industrial explosive formulations owing to its high energy content and combustion efficiency. These explosives are extensively used in mining, quarrying, infrastructure development and large-scale engineering projects. Growing investments in mineral exploration, commercial mining and infrastructure expansion are therefore expected to support long-term demand for aluminium powder used in explosive applications.

The explosives industry is also witnessing increasing emphasis on safety, regulatory compliance and environmentally responsible handling practices. Manufacturers are adopting advanced production technologies, automated handling systems and stringent quality controls to improve operational safety while meeting evolving regulatory requirements.

Looking ahead, continued Government focus on infrastructure creation, mining reforms, urban development and industrial expansion is expected to provide sustained growth opportunities for industries catering to the construction and mining sectors. Companies with diversified product offerings, consistent product quality and strong customer relationships are well positioned to benefit from these long-term structural growth drivers.

Aluminium Foil

The aluminium foil industry continued to demonstrate resilient growth during FY 2025-26, driven by increasing demand from the pharmaceutical, food packaging, consumer goods and industrial sectors. Aluminium foil remains one of the most preferred packaging materials owing to its superior barrier properties, light weight, corrosion resistance, hygiene, recyclability and ability to preserve product quality by protecting against moisture, oxygen, light and contaminants.

The pharmaceutical industry continues to be one of the largest consumers of aluminium foil, where it is extensively used in blister packs, strip packs and other specialised packaging applications. Rising healthcare awareness, expanding pharmaceutical manufacturing capacity and increasing exports from India are expected to sustain long-term demand for high-quality aluminium foil.

The food and beverage industry is another significant growth driver. Changing consumer lifestyles, increasing urbanisation, growth in organised retail, expansion of e-commerce and food delivery services, and rising demand for ready-to-eat and convenience foods have accelerated the adoption of aluminium foil packaging. Its excellent barrier properties and recyclability make it an ideal packaging solution for maintaining product safety, extending shelf life and meeting evolving sustainability expectations.

Beyond packaging, aluminium foil also finds increasing application in insulation, electronics, electrical equipment, heat exchangers and energy storage systems. Growing investments in renewable energy, electric mobility and advanced industrial applications are expected to create additional opportunities for specialised aluminium foil products in the coming years.

A significant development for the domestic aluminium foil industry has been the imposition of anti-dumping duty on aluminium foil imports from China. The measure is expected to promote fair competition, improve capacity utilisation for domestic manufacturers and encourage investments in technology, product quality and value-added manufacturing. The policy is also expected to strengthen the competitiveness of Indian manufacturers by reducing the impact of unfairly priced imports and supporting long-term industry growth.

Despite favourable long-term demand prospects, the industry continues to face challenges arising from fluctuations in aluminium prices, energy costs, global supply chain disruptions, evolving environmental regulations and intense market competition. Manufacturers are therefore increasingly focusing on operational efficiency, product innovation, process automation and customer-centric product development to enhance competitiveness and improve profitability.

Looking ahead, the long-term outlook for the aluminium foil industry remains positive. Continued growth in pharmaceutical manufacturing, food processing, organised retail, consumer packaging and industrial applications, coupled with supportive Government policies promoting domestic manufacturing and sustainable packaging, is expected to create significant opportunities for value-added aluminium foil manufacturers.

Aluminium Conductors & Cables

The aluminium conductors and cables industry continued to witness healthy growth during FY 2025-26, supported by sustained investments in power transmission and distribution infrastructure, renewable energy integration, urban electrification and industrial development. Aluminium remains the preferred material for overhead transmission lines owing to its high conductivity-to-weight ratio, corrosion resistance, mechanical strength and cost-effectiveness.

Indias power sector continues to undergo rapid transformation with increasing investments in transmission networks, grid modernisation and renewable energy integration. The Governments continued emphasis on expanding transmission capacity, strengthening distribution infrastructure and improving electricity access is expected to generate sustained demand for aluminium conductors and cables over the long term.

The countrys ambitious renewable energy targets have further accelerated investments in transmission infrastructure required to evacuate power from solar and wind generation projects. The integration of renewable energy into the national grid requires extensive development of transmission corridors, substations and distribution networks, thereby creating significant opportunities for manufacturers of conductors, cables and allied electrical products.

Urbanisation, industrialisation and rising electricity consumption continue to support demand for reliable and energy-efficient power infrastructure. Expansion of industrial corridors, smart cities, metro rail systems, commercial developments and residential projects is driving increased demand for low-voltage and medium-voltage cable solutions, while continuous upgradation of ageing transmission networks is creating replacement demand for advanced conductor technologies.

Aluminium conductors continue to offer significant advantages over conventional alternatives due to their lighter weight, lower installation costs, excellent conductivity and ease of handling. Technological advancements have further improved conductor performance through the development of high-strength, low-sag and high-capacity conductors capable of enhancing transmission efficiency while reducing line losses.

The domestic cables and conductors industry is also witnessing increasing emphasis on product quality, energy efficiency and sustainability. Manufacturers are investing in advanced manufacturing technologies, process automation and quality assurance systems to meet stringent technical specifications prescribed by utilities, EPC contractors and industrial customers.

As part of its long-term growth strategy, MMP Industries Limited has expanded its presence in the power transmission and distribution sector through its wholly owned subsidiaries. The Company is developing manufacturing capabilities for Low Voltage Power Cables (LVPC) and Composite Polymer Insulators, enabling it to offer a broader range of products for transmission and distribution infrastructure. These strategic initiatives are expected to strengthen the Companys position in

the electrical products segment and create opportunities for long-term value creation.

Despite favourable demand fundamentals, the industry continues to face challenges arising from volatility in aluminium prices, competitive market conditions, supply chain disruptions and evolving regulatory standards. Manufacturers are therefore increasingly focusing on operational efficiencies, backward integration, product innovation and sustainable manufacturing practices to enhance competitiveness and improve margins.

Looking ahead, the long-term outlook for the aluminium conductors and cables industry remains highly encouraging. Continued investments in power transmission, renewable energy, smart grids, industrial infrastructure and rural electrification are expected to support sustained demand. Companies with diversified product portfolios, strong manufacturing capabilities, technological expertise and integrated operations will be well positioned to benefit from the significant opportunities emerging across Indias rapidly expanding power sector.

COMPANY OVERVIEW

MMP Industries Limited (MMP or the Company) is a leading manufacturer of aluminium-based value-added products with manufacturing facilities located in and around Nagpur, Maharashtra. The Company has established a diversified product portfolio comprising 1. Aluminium Powders (Pyro, Flake and Atomised), 2. Aluminium Pastes, 3. Aluminium Foils, 4. Aluminium Conductors and Cables, serving domestic as well as international markets.

The Companys aluminium powder products cater to a wide spectrum of industries, including:

Construction industry for manufacturing of AAC (Autoclaved Aerated Concrete) blocks; Mining and infrastructure through aluminised slurry explosives; Agriculture for pesticide formulations; Defence and aerospace applications; Railways for thermite welding; Pyrotechnics and fireworks; Specialised industrial applications requiring high-performance Aluminium Powders.

The Companys Aluminium Foils are primarily used in pharmaceutical and food packaging applications, offering superior barrier properties and product protection. Aluminium conductors and cables manufactured by the Company cater to the power transmission and distribution sector and support Indias expanding power infrastructure.

The Company continues to strengthen its position through technological advancements, product development and expansion into high-growth electrical infrastructure segments while maintaining a strong focus on quality, operational excellence and customer satisfaction.

BUSINESS EXPANSION AND GROWTH INITIATIVES

As part of its long-term growth strategy, the Company continues to invest in expanding its presence across the electrical transmission and distribution value chain through its wholly owned subsidiaries.

MMP Electricals Private Limited

MMP Electricals Private Limited is developing a state-of-the-art manufacturing facility for Composite Polymer Insulators used in transmission and distribution networks. During FY 2025-26, the Company made significant progress in establishing the facility and commenced commercial production of selected products. Product approvals and customer qualification processes with utilities and EPC contractors are underway for higher voltage applications.

Composite insulators offer several advantages over conventional porcelain and glass insulators, including:

Higher mechanical strength; Superior resistance to pollution and environmental degradation; Lower weight resulting in easier installation; Longer service life and reduced maintenance.

The project is expected to strengthen the Companys presence in Indias rapidly growing transmission infrastructure sector.

MMP Cables Private Limited

MMP Cables Private Limited is implementing a Greenfield manufacturing facility for Low Voltage Power Cables (LVPC) and Covered Conductors. The project is being executed in phases to cater to increasing demand from the power distribution, industrial, renewable energy and infrastructure sectors.

The Company has also initiated the establishment of a Wire Rod manufacturing facility under this subsidiary as part of its backward integration strategy. The project is expected to improve operational efficiencies, strengthen supply chain reliability and enhance margins in the conductor and cable business through captive availability of a key raw material.

These investments are aligned with the Companys objective of building an integrated electrical products business and diversifying into high-growth segments supporting Indias energy transition and infrastructure development.

ASSOCIATE COMPANIES/JOINT VENTURE

Toyal MMP India Private Limited

The Company has a Joint Venture with Toyo Aluminium K.K., Japan, namely Toyal MMP India Private Limited, for manufacturing specialised grades of aluminium paste. MMP Industries Limited holds 26% equity in the Joint Venture.

The association enables access to advanced manufacturing technology, product development capabilities and global marketing opportunities, particularly for specialised aluminium paste applications.

Star Circlips & Engineering Limited

Star Circlips & Engineering Limited is an Associate Company in which MMP Industries Limited holds 26.06% equity. The Company is engaged in the manufacture of circlips, retaining rings, washers, shims and formed components used predominantly in the automotive and engineering industries.

EXPORTS

Exports continue to be an important contributor to the Companys business.

The Company exports its products to several international markets, primarily across:

Europe; Africa; Middle East; Select Asian markets.

Through its Joint Venture, Toyal MMP India Private Limited, specialised aluminium paste products are also being supplied to customers in Japan and other global markets, expanding the Companys international footprint.

OPPORTUNITIES

Indias continued investment in power transmission, renewable energy, infrastructure, urbanisation and manufacturing is expected to drive sustained demand for aluminium-based products.

The Company is well positioned to benefit from:

Growing demand for AAC blocks driven by affordable housing and infrastructure development and redevelopment, reconstruction. Expansion of power transmission and distribution networks requiring conductors, cables and composite insulators. Increasing demand from defence, aerospace and specialised industrial applications for high-performance aluminium powders. Export opportunities across Europe, Africa, the Middle East and Asia through long-standing customer relationships and developing new relationships. Access to advanced technologies and global marketing channels through the Joint Venture with Toyo Aluminium K.K. Backward integration through captive wire rod manufacturing, expected to improve margins and supply chain efficiencies for the conductor and cable business.

Government initiatives supporting domestic manufacturing, infrastructure development and renewable energy projects. Further, the imposition of anti-dumping duty on aluminium foil imports from China is expected to provide a favourable operating environment for domestic manufacturers by promoting fair competition, improving capacity utilisation and encouraging investments in technology and quality enhancement.

THREATS

The Company continues to operate in a dynamic business environment and remains exposed to various external risks, including:

Volatility in aluminium prices and other input costs, which can impact profitability and working capital requirements. Global geopolitical developments, trade policies and fluctuations in international demand affecting export markets. Increasing competitive intensity from domestic and international manufacturers. Delays in infrastructure and capital expenditure projects that may affect demand from end-user industries. Foreign exchange fluctuations impacting export realisations and import costs. Manufacturing of aluminium powder involves inherently hazardous processes. The Company places the highest priority on safety through robust process controls, regular safety audits, employee training and continuous improvement of safety systems. Following the unfortunate industrial accident during FY 2025-26, the Company has further strengthened its safety framework, process controls and operational monitoring to enhance workplace safety and minimise operational risks.

CAUTIONARYSTATEMENT

The statements in this Management Discussion and Analysis describing the Companys objectives, projections, estimates, and expectations may be forward-looking statements within the meaning applicable to securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Companys operations include economic conditions affecting demand or supply and price conditions in domestic and overseas markets, changes in government regulations, tax laws and other statutes, and other incidental factors.