Orient Electric Ltd Management Discussions

Economic environment global economic overview

During cy 2024, global economic growth moderated at 3.3% amid prevailing uncertainties. The us remained a major driver of global expansion supported by a strong labour market, resilient consumer demand and expansionary monetary policy.

European economy stagnated amid political and economic uncertainties in germany and france, coupled with broader regional geopolitical upheavals. Chinas domestic demand slump and aggressive export focus further undermined european competitiveness in global markets. Emerging markets and developing economies (emdes) displayed steady growth driven by disinflationary trends and growing manufacturing industries.

Global inflation declined from 6.6% in cy 2023 to 5.7% in cy 2024 due to a combination of factors, including a decrease in demand, stabilization of oil prices, and the unwinding of supply chain disruptions that initially fuelled inflation. Governments around the world implemented targeted measures to stimulate activity and support the

Global gdp forecast (cy 2025, in %)

Global economic outlook remains tentatively optimistic with projections for cy 2025 and cy 2026 highlighting a modest growth of 2.8% and 3% respectively. Domestic economy infrastructure investments, social welfare programmes and corporate incentivisation, to support the domestic economy and mitigate the impact of geopolitical risks.

Outlook

Global economic outlook remains tentatively optimistic with projections for cy 2025 and cy 2026 highlighting a modest growth of 2.8% and 3% respectively. This sustained growth combined with disinflation will offer the central banks more headroom for conducive policies.

Despite the forecasts, the impact of reciprocal tariffs imposed by the us on its imports pose severe threat of inflationary pressures in the economy. Additionally, other countries might retaliate with tariffs of their own thereby leading to a global escalation. Amid these tensions, global trade volumes have been revised downwards for cy 2025 and cy 2026.

Geo-economic fragmentation, however, provides an opportunity for many countries to strengthen their bilateral economic relations, focus on domestic consumption and reduce their reliance on us consumption. Depreciation of us dollar will shift global investment and trade, increasing the competitiveness of europe and the global south.

Driven by rapid industrialisation and a growing labour force, emdes are expected to maintain their robust growth trajectories. European economies are expected to recover spearheaded by germany undertaking historic public spending reforms. Further, government policies and budgetary consolidation can further enhance investor confidence and support growth in the medium term.

India n economic overview

The economy of India achieved an estimated 6.5% growth in gdp during fy 2025. This robust performance was the result of a thriving services sector, expedited urbanisation, clean energy transition and moderate domestic consumption. The governments strategic initiatives, particularly the production

Linked incentive (pli) scheme and substantial infrastructure investment budget of h10.2 trillion, continue to serve as key economic catalysts.

India demonstrated effective fiscal management by containing its deficit at 4.8% of gdp, creating additional fiscal space for the government to enhance public expenditure and stimulate economic growth. Additionally, the reserve bank of India shifted to an accommodative monetary stance. In february, the rbi reduced the repo rate from 6.5% to 6.25%, further reducing it to 5.5% in june, injecting liquidity, enhancing credit accessibility and augmenting consumer spending.

The consumption patterns witnessed divergence during the year under review, with urban spending stabilising while rural consumption demonstrated significant resilience, supported by favourable agricultural output and targeted rural welfare programmes. Inflationary pressures remained largely contained, with headline cpi registering 4.6% increase during fy 2025, predominantly within the central banks tolerance band of 2-6%, reinforcing macroeconomic stability and supporting continued growth momentum. Private final consumption expenditure (pfce) grew at an estimated 7.6% during fy 2025, up from 5.6% in fy 2024.

Outlook

Factors such as a downward trend in inflation and the rbis consequent implementation of steps to enhance liquidity is anticipated to lower interest rates and encourage credit flow. Further, the tax benefits announced in the union budget 2025 are foreseen to act as economic catalysts. Additionally, expedited urbanisation is creating new centres of demand and opportunities for manufacturing expansion in tier ii and tier iii cities.

The government is focused on export growth through strengthening bilateral relations and is maintaining a vigilant stance on the shifting global tariff scenario to craft a calibrated response, And growing global geo-economic fragmentation. Further, it is committed to achieving domestic manufacturing excellence through initiatives like make in India . overall, these initiatives by the government create a balanced growth model.

Looking ahead, outlook appears positive as India treads the path towards achieving a developed nation status by 2047 supported by structural economic reforms, rising affluent class and favourable demographic conditions.

India s real gdp growth (in %)

Industry overview infrastructure development India witnessed considerable amplification in the total infrastructure investment during the year, driven by public and private sector contributions. The country now has the second largest road network in the world which has further expanded owing to the overall growth in capital expenditure ~5.7 times in the past decade including public and private investment. Under the pradhan mantri grameen sadak yojna, 7,71,950 km of roadways have been constructed, with a total expenditure of h 3,31,584 crores.

However, private investment moderated during the year as witnessed by a softer growth in factory orders and production expansion. Fit the end of 2024, manufacturing purchasing managers index (pmi) declined to 56.4%, highlighting investor cautiousness. Moving forward, pmi has shown signs of rebounding leading to a positive outlook for infrastructure.

India n consumer durables sector

From fy 2019 to fy 2024, the domestic consumer durables market grew at 10% compound annual growth rate (crgr) overcoming the pandemic induced supply chain complications. Currently the sector contributes to ~0.6% of India s gdp. Driven by elevated discretionary income, rural penetration, premiumisation and shorter replacement cycles, the consumer durables market is projected to grow at ~11% (crgr), reaching h 3 lakh crore by fy 2029.

Growing consciousness of energy efficiency and connectivity, combined with an expanding e-commerce penetration, is directing the markets rapid growth. India is the fastest growing major market in the world and is expected to become the fourth largest market for consumer durables by fy 2027, supported by favourable demand side and supply side tailwinds. Despite prevailing regulatory and supply chain risks, emerging technologies, such as artificial intelligence (ri) and the internet of things (iot) are expected to drive incremental growth.3

Emerging trends premiumisation

The rising adoption of brushless direct current (bldc) and lot enabled fans reflects a broader trend of premiumisation and technological upgradation in the consumer durables sector. Driven by increased discretionary spending, urban consumers are increasingly prioritising advanced features and convenience in consumer durable products.

Energy efficiency and sustainability

Rising sales of 4 & 5 star bureau of energy efficiency (bee) rated products indicate elevated demand for energy efficient and eco-friendly home appliances. Ln the recent years, awareness of climate change has amplified the demand for energy efficient and sustainable products.

Growing importance of aesthetics beyond functionality

Consumers are especially gravitating towards customisable products that also provide impressive aesthetic value. Innovative designs and aesthetic features are enabling the companies to charge premium prices, thereby boosting their toplines.

Smart and connected appliances

Iot enabled products with features such as voice command application, single point control and smart adjustments are gaining popularity in the India n urban market. Penetration of smart appliances is estimated to reach ~10% by 2028 from 4% in 2023.4

Government initiatives across the electronics value chain

The India n government has launched several strategic initiatives to enhance the electronics manufacturing ecosystem, aimed at positioning India as a global hub for electronics production.

National policy on electronics (npe)

This initiative focuses on promoting India n brands, developing component manufacturing and creating an intellectual property rights (ipr) pool to protect indigenous technologies.

Make in India

Despite the recent challenges in the manufacturing sector, make in India has facilitated the expansion of industrial infrastructure through the development of industrial corridors, special economic zones and industrial parks across the country while promoting the growth of micro, small and medium enterprises (msmes) vital for employment generation.

Digital India

Initially launched in 2015, the government has extended the programme with a budget of approximately ? 14,903 crore, from 2021-22 to 2025-26.5

The programme has played a critical role in strengthening India s digital infrastructure and empowering citizens.

Electronics development fund policy:

The primary objective is to support early stage angel funds and venture funds dedicated to electronics system design and manufacturing, promoting innovation and product development within India .

Skill India

It is a comprehensive government initiative designed to enhance the skillsets of India s youth, particularly focusing on vocational training necessary to secure employment across technical sectors such as electronics.

Unnat jyoti by affordable leds for rll (ujrlfl) scheme

This initiative is aimed at providing affordable energy efficient led bulbs, tube lights and fans to millions of India n homes. Over the past decade, more than 360 million led bulbs have been distributed across the country under this scheme.6

Street lighting national programme (slnp)

Outdated street lamps are replaced with led lights under the slflp to reduce energy consumption and operational costs for public lighting in urban and rural areas. 13.4 million led streetlights were successfully installed across urban local bodies (ulbs) and gram panchayats as of january 6, 2025.7

Scheme for promotion of manufacturing of electronic components semiconductors (specs)

This scheme aims to develop the upstream value chain of electronic products offering a financial incentive on capital expenditure for manufacturing electronic components in India .

Production linked incentive (pli)

The initiative provides financial incentives to enhance domestic manufacturing and attract investments in large scale electronics production, with an overall aim of achieving self reliance in electronics manufacturing. The pli scheme has generated cumulative investments of h 10,213 crore as of december 2024 while creating over 1.37 lakh direct employment opportunities and significantly enhancing the nations export capabilities in the electronics domain.8

India s ceiling fan industry9

The India n ceiling fan market demonstrated steady growth in fy 2025, with sales reaching around 74 million units (grew by 10% vs fy 2024), influenced by climatic conditions, urbanisation and government led infrastructure initiatives. Record high temperatures observed in some places during the year have

Intensified the demand for affordable cooling solutions, particularly in rural and semi urban areas where air conditioning remains inaccessible.

The market is further bolstered by the 56.6% increase in fund allocation for the pradhan mantri awas yojana (pmry) to h 84,700 crore in july 2024, which prioritises affordable housing and

Mandates ceiling fan installations in new residential units. Rural electrification has progressed notably with daily average electricity availability in villages rising from 12.5 hours to 21.9 hours over the past ten years. This progress has also extended the accessibility of basic appliances like fans.

Emerging trends

Energy efficiency

Adoption of brushless direct current (bldc) motor based fans is witnessing an increase owing to its energy efficiency and consumer demand for cost effective solutions. This movement is aligned with the India cooling action plan (icap) launched by the ministry of environment, forest and climate change, with an aim to cut cooling energy demand by 25 to 40% by 2037-38.10

While traditional ceiling fans require 76-85w for a typical 1200mm sweep, bldc models significantly reduce this consumption to just 28-35w.11 this efficiency translates to substantial reductions in electricity bills while reducing carbon emissions. These fans also provide enhanced durability, quieter operation and connectivity features leading to their growing share in the India n ceiling fan market.

E-commerce expansion

Online sales channels have grown rapidly, offering discounts, emi options and fast doorstep delivery. These platforms have bridged accessibility gaps in smaller towns and semi urban areas.

Regional demand

Northern India witnessed an ascending demand for high speed and budget friendly options due to extreme weather, while southern India saw a rising preference for energy efficient and anti dust models, especially in urban areas.

Smart fans

The demand for wi-fi enabled fans with iot integration and features such as voice enabled operation, is witnessing an augmented demand in urban households.

India s led lighting industry

The led lighting market in India exhibited strong volume growth in 2024. Government schemes like ujala and smart cities mission are playing a key role in driving large scale adoption

Through subsidies and infrastructure modernisation. The production linked incentive (pli) scheme for white goods further incentivised domestic manufacturing of led components, reducing dependence on imports.

Emerging trends

The growth in demand for led lighting is concentrated in the north and south regions due to growing urbanization rates and increasing number of government initiatives that encourage the use of led lights. The governments support through various regulations that promote the investments in energy efficient lighting technologies have expanded the applications of led lights across various industrial, commercial and residential sectors.

A rapidly growing automotive industry also provides productive opportunities for the use of leds in head lamps, rear lamps, turn signal and brake lights.

Other important factors such as increasing infrastructural investments, rapid growth of street lighting systems, decline in average prices of leds and various government and upcoming smart building projects are expected to drive the demand of led lights in India .

Company overview

Orient electric limited has established itself as a trusted brand in consumer electrical products with over seven decades of operation. The company has been a part of cka birla group, an India n multinational conglomerate with a multibillion dollar revenue. With over 35,000 employees, the group operates more than 50 manufacturing facilities across the world, with a presence in diverse sectors including technology, automotive, home and building and healthcare. Oels offerings span a diverse range including fans, lighting, wires, switchgear, and home appliances. Supported by state of the art manufacturing facilities and a vibrant supplier ecosystem, oel is transforming the electrical lifestyle solutions space with its innovation driven approach.

With a strong distribution network reaching 125,000 retail outlets and service coverage across 450+ cities in India , the company has also expanded its international footprint to over 30 countries, earning recognition as one of India s largest exporters of fans.

The companys success is driven by its strong r&d capabilities and commitment to developing customer centric electrical solutions that improve everyday experiences.

Electrical consumer durables

The companys ecd segment grew at 9.6% with its focused strategy of increasing premiumisation, expanding its footprint to improve availability to customers and using consumer insights and data for new product development. The companys thrust towards new product launches resulted in consistent growth in the fans segment, with notably rising demand for premium and decorative fans. Bldc fans now contribute ~20% to ceiling fan sales with new product launches across price points, including iot enabled smart fans.

The company also continued to expand its direct-to-market (dtm) footprinthaving successfully implemented dtm in 11 states.

Lighting and switchgear

Lighting and switchgear segment maintained strong growth at 11%, despite headwinds of continued price erosion through the year. The company strengthened its consumer lighting portfolio with a focus on developing new products in the premium segment. The company also expanded its presence to over 11,000 retailers across the country. B2b growth momentum was maintained, with execution of key projects in street lighting & facade lighting, and a growing number of project enquiries.

Switchgear and wires growth was driven by a focus on expansion of reach, continued electrician & retailer meets and launch of new products in switches.

Consumer centricity

Fit orient electric, we begin every journey with the customer at the core. Whether its designing new products, enhancing service experiences, or shaping strategic priorities, our approach is rooted in understanding evolving consumer needs. This customer first mindset reinforced through digital first engagement and real time, data driven insights-is enabling us to stay agile, relevant, and ahead of expectations in an ever changing landscape.

Data driven marketing

Orient electric has tailored its marketing strategy to prioritise consumer centricity, digital first engagement and data driven decision making. The initiatives undertaken during the reporting year reflect a transformative approach to align with evolving consumer behaviours and market dynamics.

Oel has enhanced its focus on marketing across digital platforms, including online retail media for targeted ads, to reach consumers during leisure or commute times and collaborations with home decor and lifestyle influencers to engage younger demographics, particularly first time homebuyers.

Direct to consumer (d2c) expansion

Orients d2c website, operational for 18 months, has become a critical hub for real time consumer insights. It serves as a testing ground for new products, with regional sales data directly informing design and feature updates. For instance, colour preferences from e-commerce platforms and the d2c site have driven product customisation, particularly in fans and other appliances.

Presence across emerging channels

E-commerce: orient augmented its presence on major e-commerce platforms and quickly ramped up presence on quick commerce platforms, such as zepto and blinkit.

Large format retail (lfr): focused partnerships with major retail players ensure deep product visibility in key states, emphasising premium appliances like water heaters, lights and coolers, alongside fans.

Ai integration

The company has implemented ai tools to optimise productivity across various functions. Ai generated designs helped oel to reduce time to market for marketing collaterals by 30%. Real time scraping of online chatter allows the company to identify trends and cater to customer needs effectively.

Customer centric product innovation

The companys emphasis on premium, technology driven products has significantly contributed to its recent growth trajectory, with new product development in fans accounting for ~20% of the fans sales. With emphasis on iot and bldc technology, the new bldc fans range offers customers up to 50% energy savings compared to conventional fans, whisper quiet operation, smart connectivity and consistent performance even at lower voltages. Premium offerings by the company feature sophisticated designs with fresh colour options that complement modern interiors. Regional customisations such as, rust resistant coastal fans for the western coastal regions and new high speed models for northern India have also been implemented by the company.

In the lighting segment, orient has been shifting its focus towards value added products, steadily improving the share of luminaries to lamps within its lighting portfolio. This strategic transition is aimed at catering to the growing consumer demand for lighting solutions that serve both functional and aesthetic purposes. The companys focus on technology is evident in its connected lighting products that leverage iot capabilities, offering customers greater control and customisation options.

The company has also expanded its appliances portfolio with the introduction of new air coolers and water heaters. Orients product innovation strategy is aligned with broader market trends towards premiumisation and smart home integration.

Customer relationship management

Oel is prioritising digital first engagement and pan India accessibility to enhance customer service. The company transitioned from 95% voice based interactions to 70%, while non voice channels (whatsapp bots, website and emails) increased from 5% to 30%, reducing average resolution time considerably.

Key initiatives include differentiated service programs like 8-3-24, resolving customer issues within 8 hours across various locations.

Key developments include:

Service network expansion

Orient electric increased its service partners by establishing >1,000+ service centres, achieving coverage across 19,000 pin codes. The one orient framework ensured uniform and consistent service quality across channels, including modern retail partners.

Direct to consumer (d2c) integration

The d2c portal enabled end to end tracking of customer journeys, spanning purchase to post service support. ~85% of d2c cases were resolved within 24 hours, with e-warranty and auto registration processes set to eliminate manual processes.

Ai driven service optimisation

Early adoption of generative ai tools automated routine enquiries and enhanced the handling of social media grievances through sentiment analysis of over 650,000 online mentions, contributing directly to product improvements. Additionally, oel partnered with the national consumer helpline to address consumer grievances and initiated on call resolution services.

Brand strengthening

Fit orient electric, strengthening our brand is not just about visibility-its about building lasting relevance in the lives of our consumers. Rs we evolve from a product led to a lifestyle led brand, we are investing in sharper positioning, modern storytelling, and channel diversification to reflect the aspirations of a new India . Whether its through enhanced digital engagement, presence on new age contextual platforms, or expanding availability across e-commerce and quick commerce, our brand strategy is focused on being where our consumers are.

Digital-first rudience

Orient electric is evolving its brand narrative to engage meaningfully with todays digital first audience. The approach is anchored in storytelling that is authentic, visually rich, and insight driven-positioning orient as a contemporary and aspirational brand. From influencer collaborations and social media led campaigns to immersive brand content, we are creating high impact engagement that resonates with young millennials and builds long term affinity.

Channel choices - new rge, contextual platforms

In todays fragmented media landscape, reaching the right audience at the right moment is critical. Orient electric has strategically expanded its media mix to include new age contextual platforms such as uber, spotify, zomato, backed by presence on ott platforms, connected tv, influencer networks, and moment marketing integrations.

This agile approach allows us to build contextual relevance and brand salience in high engagement environments, especially during key seasons and cultural moments-driving both visibility and consideration.

E-commerce and quick commerce

Orient electric continues to strengthen its presence across leading e-commerce marketplaces, ensuring that our products are easily discoverable and accessible to consumers across geographies. Recognizing the growing demand for convenience, we also scaled our presence on quick commerce platforms such as zepto and blinkit. This omnichannel readiness is a critical step in meeting the evolving expectations of modern shoppers while reinforcing brand trust through availability and speed.

Manufacturing and innovation

Orient electric focused on capability and capacity expansion in fy 2025.

The year marked the operationalisation of India s first industry 4.0-compliant manufacturing facility in hyderabad, designed as a blueprint for smart and automated production. The plant integrates manufacturing execution systems (mes) for real time monitoring, enabling a notable improvement in overall equipment efficiency by eliminating manual data interventions. Robotic autonomous guided vehicles (rgvs) and autonomous mobile robots (rmrs) streamline material handling, while cloud based analytics optimise production planning.

Rt its other plants, the company revitalised its legacy infrastructure through backward integration and process reengineering. R dedicated bldc motor manufacturing line was established, enabling in house production of critical components for energy efficient fans, reducing dependency on external suppliers and improved quality control.

The noida plant expanded capabilities in lighting innovation, pioneering design- on-board (dob) led technology for compact, high performance luminaires. This backward integration allows orient to manufacture 90% of led components in house, reducing costs by 12-15%. Additionally, the plant in noida commenced production of the stella series mcbs on a new automated line, targeting growth in market share in the premium circuit protection segment.

Direct to market

Direct distribution

In alignment with evolving consumer buying behaviour, we are strategically diversifying and expanding our sales channels to enhance market reach, capture greater market share, and build competitive advantage. R key driver of this strategy has been the implementation of the direct- to-market (dtm) distribution model in our fans business across select states. This approach has delivered strong performance along with consistent market share gains in markets of operation.

We are actively leveraging insights from these markets to optimize operations in states where we work with distribution partners. To support this growth, we have strengthened our sales and service teams through focused hiring efforts, enabling us to drive deeper engagement and improve execution on the ground. Rs of fy 2025, our dtm model is now active in 11 states, which is demonstrating strong double digit growth and further expansion in market share. We continue to invest in broadening the breadth and depth of our distribution network, with the goal of solidifying our position in key markets and fostering stronger, long term relationships with our customers.

Direct service model

Orient electrics direct-to-market (dtm) service model has fundamentally reshaped the companys approach to after sales service-placing customer responsiveness, service quality, and operational agility at the forefront. With the dtm model now operating across more than 19k pin codes in India , weve significantly improved our service reach. Key performance indicators such as turnaround time (trt) have seen remarkable progress, with service resolution improving to 85% in most areas. By bypassing intermediaries, weve built direct connections with our customers, enabling faster diagnostics, quicker complaint closures, and deeper trust in our brand.

Portfolio balancing

We are actively expanding our footprint across high growth categories including lighting, appliances, switches, switchgear, and wires. This focused diversification is aligned with our vision to evolve into a complete home electricals and solutions brandmeeting the growing aspirations of India n consumers. By strengthening cross category integration and driving innovation across verticals, we are well positioned to unlock new growth opportunities, enhance stakeholder value, and build a more resilient business.

Market leading growth in lighting

Lighting continues to be a key growth driver in our portfolio, demonstrating market leading growth backed by strong sourcing capabilities, strong product portfolio and growing distribution footprint. We are expanding our presence across residential, commercial, and outdoor lighting segments, with a strong focus on premium aesthetics, smart solutions, and sustainable performance.

Strengthening our capabilities in switches, switchgear & wires

In line with our ambition to offer end-to-end electrical solutions, we are significantly scaling our presence in the switches, switchgear, and wires segments. With increased investments in product development, channel expansion, and specifier outreach, we continue to build capabilities for future growth.

Localized job creation and entrepreneurial growth

The shift to a dtm model has also served as a catalyst for employment and local entrepreneurship. Over 200 new technicians and 16 master technicians

Have been deployed, while more than 50 new authorized service centers (rscs) have been established-many of which represent first time business ventures.

Premiumisation technology rdvancements

To cater to the growing trend of premiumisation among the urban population, the company has developed lot integrated fans, water heaters and lighting products. New innovations suitable for modern homes are fuelling the premiumisation trend.

Aesthetics and consumer experience

Oels new product launches have focused on aesthetic appeal using premium finishes, colours and designs that appeal to modern homeowners. Alongside, the company has ensured that the overall product experience including packaging, marketing communication and digital experiences have been upgraded to provide a superior overall experience.

Cost leadership

Sanchay: driving cost optimization through cross functional initiatives

Sanchay, derived from the hindi word meaning "to conserve" or "to save," is orient electric limiteds (oel) enterprisewide cost optimization and value creation program. Launched to instil a culture of continuous improvement, frugality, and ownership, sanchay underscores oels commitment to operational excellence, sustainable profitability, and strategic reinvestment in growth opportunities. The program permeates all functions, fostering disciplined execution and cross functional collaboration to unlock significant cost efficiencies.

Rt its core, sanchay is grounded in the principle that impactful savings stem from structured ideation, rigorous implementation, and collaborative synergy. By empowering teams to challenge conventional practices and adopt an ownership mindset, sanchay drives measurable business outcomes in a transparent and systematic manner.

Some key initiatives during the year include:

Commercial efficiency projects

* strategic negotiations for key raw material procurement.

* clean sheet based cost reduction for raw materials.

* optimized cost negotiations for traded goods.

Supply chain optimization

* warehouse consolidation to reduce operational costs.

* reduction in fuel surcharges through optimized logistics.

* introduction of partial truckload (ptl) and full truckload (ftl) transporters at key depots.

Value analysis/value engineering initiatives

* value engineering optimizations for key products.

* weight reduction to lower material costs.

* design enhancements in existing products for improved cost efficiency.

Operational excellence

* reduced field failure rates through integrated in-house manufacturing processes.

* enhanced units-per-hour (uph) output for fans.

Talent

Diversity

Oels commitment to gender diversity has resulted in women comprising a growing proportion of its workforce. The company has undertaken initiatives like sherise and empowher which focus on womens professional development, leadership growth, wellness and establishing platforms for connection and communication. In its hyderabad facility, the company has increased womens representation to ~60% of the production workforce. Rs of 31st march 2025, the companys employee count stands at 1,217 with diversity at 7.4%.

Culture

Orient electric was recognised as one of the top 50 great places to work in manufacturing (large companies) in 2024-25, highlighting a significant achievement in the companys journey towards excellence. Additionally, the company achieved the distinction of being acknowledged as a great place to work for the sixth consecutive year, demonstrating its consistent efforts to create an exceptional work environment. The company has implemented policies and programmes focused on employee health and safety and mental well being in the workplace.

Further, orient electric places considerable importance on rewarding exceptional performance across the organisation through diverse rewards and recognition programmes, nurturing an environment of appreciation and excellence. The organisation continuously seeks innovative ways to enhance employee satisfaction, engagement and holistic wellbeing, ensuring that oel continues to be a genuinely outstanding workplace. This commitment to improving employee engagement reinforces the companys people centric culture, which values individual contributions while promoting collective success.

Employee engagement and wellbeing oels engagement strategy includes

Leadership connect

Regular ceo and chro connect sessions that provide forums for open dialogue.

Amber

A virtual employee engagement chatbot that connects with employees multiple times a year, providing valuable insights and allowing the company to proactively address concerns.

Onboarding enhancements

Skip level interactions and buddy systems to help new employees navigate and integrate seamlessly into the organisation.

Hi flyer

Oels reward and recognition programme that promotes transparency and acknowledges exceptional performance.

Talent acquisition and development

Oel continues to invest in young talent, having recruited fresh graduates from management and engineering institutions during the reporting year. This investment in fresh perspectives keeps the organisation dynamic and forward thinking.

The company has also revolutionised its approach towards learning through various initiatives. One such initiative, named saksham, is oels digital learning platform, launched in early 2024, garnering significant adoption and engagement among employees. Nalanda

Is the companys specialised programme focused on manufacturing skill development and product knowledge. Oel has also established dedicated training programmes for sales, service and product knowledge.

Leadership development initiatives

The company actively focuses on internal development of managerial capabilities through structured development programmes.

These programmes successfully cover most of the companys managers across different levels, creating a strong leadership pipeline across the organisation.

Financial strength and stability ebitda

Ebitda during the fy 2024-25 stood at h 204 crores, demonstrating a growth of 41% from fy 2023-24.

Ebitda margin

Ebitda margin improved to 6.6% (+145bps yoy) as a result of spark sanchay and other cost optimisation initiatives. The company expects its operating leverage to improve further leading to better margins.

Gross margin

Gross margin expanded by 172bps yoy with improvement in product mix, channel optimisation with dtm, and thrust towards premiumisation.

Working capital cycle

Working capital cycle remained healthy at 26 days in fy 2024-25.

Financial performance

		(h in cr ores)
Key finanaial metric	Fy2024-25	Fy2024-24
Revenue from operations	3,094	2,812
Ebitdr	204	144
Prt (p rofit after tax)	84-	77
Eps (e arnings per share)	3.90 [rupees	3.53 [rupees
Expensns	2,993	2,750
Current ratio	1.33 tirnies	1.28 times
Debt - equity [ratio	0.02 times	0.03 times
Gross margin	32.10%	30.4-0%
Return on equity	11.68%	11.78%
Working capital (in days)	26 days	18 days

Macro-opportunities

Expanding urban population

India s urban population is expected to reach 600 million by 20r112 this accelerated rate of urbanisation is catalysing the demand for premium appliances and connected home solutions. The heightened demographic shift has also reduced product replacement cycles considerably, as consumers increasingly view appliances as lifestyle upgrades rather than utilitarian purchases. This provides an opportunity for orient to cater to an increasingly large number of affluent consumers, thereby boosting revenues.

Premiumisation and energy efficiency

The share of connected appliances is continuously expanding compared to conventional appliances, indicating a market shift towards premiumisation. Further, customers are increasingly gravitating toward energy efficient options to minimise their operational costs. Aligning with these trends, orient electrics premium offerings are set to sustain the companys impressive growth trajectory.

Government initiatives

The impact of pli scheme and the second phase of make in India initiative is expected to reduce the nations reliance on imports and strengthen the domestic manufacturing sector. On the demand side, income tax relief announced in the union budget is expected to result in an uptick in the demand for consumer durables. Orient can utilise the policy tailwinds to drive growth in an expanding market.

Omni-channel growth

With the rise of e-commerce, consumer durables continue to see demand expansion. However, offline channels still retain their dominance especially in rural markets. By leveraging an effective omni-channel strategy, orient expects to maintain strong top-line growth combined with market expansion.

Risk management

	Risk description	Mitigation
A market risk	Potential losses arising from shifts in consumer demand dynamics and competitive landscapes remain a concern. The instability in raw material prices poses a notable threat to production costs, thereby impacting overall profitability of the company.	To safeguard profit margins, the company has implemented various strategies such as establishing alternative sourcing channels, optimizing inventory levels to capitalize on bulk discounts, and adopting consistent long-term pricing policies its r&d division remains focused on developing consumer-centric and cost-effective products that appeal to a larger consumer base.
A,? economic risk	Microeconomic factors like inflation, currency volatility, and overall economic stability, can affect oels operations and financial performance. Geopolitical uncertainties further exacerbate market dynamics, potentially creating imbalances between demand and supply for the companys products.	The company adopts a robust operational strategy, that mitigate possible inflationary pressures. Automation, digitalisation and new technologies ensure costs remain with volume growth across product categories. To limit the risk of currency fluctuation, the company has adopted a hedging policy that minimises exposure.
Environmental risk	Issues surrounding environmental sustainability, regulatory compliance, and the effects of climate change are important for business continuity. Proper disposal of electronic waste poses a significant environmental challenge for the company.	The company prioritises sustainable production methods, invests in eco-friendly technology, research and development and ensures proper e-waste management to minimise its environmental footprint.
Technological risk	Technological risk encompasses threats arising from rapid technological advancements, cybersecurity and data privacy that could result in the loss of confidential company information. In addition, the necessity for continuous innovation to remain competitive and adapt to changing consumer preferences pose a significant risk for the company.	The company has integrated advanced technology into its operational processes and remains committed to staying abreast of the latest technological advancements to enhance its systems continually. Robust cybersecurity protocols, encompassing preventive measures, detection systems, incident response plans, and employee training, are rigorously implemented
Social risk	Navigating social responsibility, fostering positive community relations, ensuring ethical labour practices, and upholding a favourable reputation amidst societal expectations and continuous stakeholder engagement is important for business continuity.	The company spearheads community development endeavours through various projects and initiatives within the area of its operations. A total of rs. 2.55 crore was spent on multiple csr projects during the year under review.

Csr

The companys corporate social responsibility (csr) initiatives are dedicated to a variety of socioeconomic aspects, such as skill development of electricians, health and hygiene for girls and supporting healthcare services.

For more detailed information about oels csr initiatives, please refer to the environmental, social and governance (esg) section and the directors report in this annual report.

Internal control

The company implements internal controls into its daily operations as a vital part of governance. Oel has strengthened its internal control system through targeted audit plans covering several new operational areas through pre audits and interim reviews. The company regularly fine tunes the audit processes to ensure accounting records remain reliable. This approach helps it create timely and accurate financial information that meets compliance standards.

Oels risk management framework includes three key policies - internal financial control, whistle blower and fraud risk framework. These tools help quickly spot various risks and bring them to senior managements attention. An independent internal auditor conducts the comprehensive audit program, presenting critical findings to the audit committee and board every quarter.

The internal audit team acts as the watchdog, making sure all control systems work properly. Their recommendations are implemented in a timely manner by the company. Follow up is conducted after closing each issue to maintain high standards of financial control and governance. Oels quick response approach ensures that it can address potential problems before they can grow into serious concerns.

Cautionary statement

This discussion and analysis, contain what we call forward looking statements. These are the predictions or expectations about the future performance of the company. They are based on the companys current objectives, projections and estimates. However, these statements are not guaranteeing. They are subject to laws and regulations and involve uncertainties and risks. The actual results may be quite different from the predictions. This could be due to various factors that affect the companys operations. These include competition in the industry, the cost of employing staff and significant changes in India s political and economic environment. Other factors include environmental standards, tax laws, legal disputes and labour relations. It is important to remember that these forward looking statements do not guarantee future performance. They should not be relied upon too much. They involve both known and unknown risks and uncertainties. These could cause the actual performance and financial results in the future to be significantly different from the predictions. It is advised not to depend on these forward looking statements. The company will update them as required by securities laws but will not commit to updating them if circumstances change or if the estimates or opinions change. In conclusion, while these statements provide a glimpse into the companys future, they are merely predictions and are subject to change. Therefore, they should be used with caution and not be the sole basis for any decision making.