Presstonic Engineering Ltd Management Discussions

The management of the Company is pleased to present its report on the business environment & industry scenario, industry risks and opportunities and Companys performance during the financial year 2024-25.

The Company is engaged in the business of manufacturing of Metro Rail Rolling Stock Products,

Metro Rail Signalling Products and supplies to renowned Global and Domestic OEMs engaged in the Rail and Metro Rail Rolling stock and manufacturing of Signalling equipments. The manufacturing facility spread over approx. 28,317.50 sq.ft. situated at Sy. No. 2, Khatha No. 145, Hoysala Main Road, Pillappa Industrial Layout, Srigandhadakavalu, Sunkadakatte, Viswaneedam, Bengaluru- 560091 is equipped with latest machineries, equipments and instruments which is capable of manufacturing of diverse products for Railways and Metros and the Company has taken new factory premises on lease basis in Peenya Industrial Area, Bangalore, which is very close to the existing factory, that is spread over approx. 33,162 sq. ft. with 250KVA power- to cater the business/production requirements.

In terms of compliance with the SEBI (Listing Obligations & Disclosure Requirements) (Amendment) Regulations 2018, the following operating and financial review is intended to convey the Managements perspective on the financial and operating performance of the Company at the end of the FY 2024-25. This Report should be read in conjunction with the

Companys financial statements, the schedules and notes thereto and other information included elsewhere in the Integrated Report. The Companys financial statements have been prepared in accordance with the Indian Accounting Standards (‘Ind AS) complying with the requirements of the Companies Act, 2013, as amended and regulations issued by the Securities and Exchange

Board of India (‘SEBI) from time to time.

This report is an integral part of the Boards Report. Aspects on industry structure and developments, outlook, risks, internal control systems and their adequacy, material developments in human resources and industrial relations have been covered in the Boards Report. This section gives significant details on the performance of the Company.

The metro network plays a crucial role in Indias urban infrastructure. Presently, India has the third-largest metro network in the world. Several cities nationwide have been investing in the expansion and modernization of existing metro rail networks. This includes adding new lines, extending existing ones and upgrading technology to enhance efficiency and capacity. As urban areas grow, the demand for efficient and sustainable mass transit solutions such as metro rail is anticipated to evaluate the metro rail infrastructure market growth. The Indian Government is undertaking several initiatives to upgrade its aging railway infrastructure and enhance its quality of service.

The urban rail transit in India is vital for intracity transportation in densely populated major cities. It encompasses various systems, including the Regional Rapid Transit System, suburban rail, monorails, and trams. The modernization of railway infrastructure and the expansion of the metro rail network are crucial for Indias goal of becoming a developed nation by 2047. Construction Times examines the trends and future directions for the growth of Indias railway and metro systems.

The government is expected to unveil a comprehensive five-year plan in the Union Budget 2025 aimed at implementing metro rail projects across the country on a mission basis. This long-term initiative is designed to improve metro and intercity rapid rail connectivity throughout India.

Indian Railways has introduced Vande Bharat trains with modern coaches which has enhanced safety features and amenities. The Vande Bharat Express is a semi-high-speed train service in India, designed to offer a faster and more comfortable travel experience. Hence, strong Government support and the opportunity generated in the current economic scenario, has pushed India to be one of the top leaders in the worlds most attractive rail markets, be it metro or intercity trains.

The details of changes in key financial ratios are given below:

Since incorporation, our Companys vision and focus to manufacture and supply superior quality products to the customers, which has enabled us to expand our business operations and receive certifications from renowned bodies for our products and efficient manufacturing techniques. We ensure adherence to the domestic and international standards laid down for our products. Our Company manufactures products which are compliant with the stringent quality requirements prescribed by our customers.

Additionally, our business model offers tailored solutions to our customers while also manufacturing innovative, solution-oriented products. Our R&D Division is equipped with the necessary facilities to carry out all necessary trials to develop and devise products suitable to the different types of our customers or for catering to the infrastructure needs of our customers. Our R&D Division is located in our manufacturing unit with the objective to implement a performance-oriented approach with the help of technologies developed in-house. With an established R&D division, our Company ensures that we effectively meet the needs and demands of our customers in relation to their final products. The Companys emphasis on improving customer experience through flexible pricing, special discounts, and real-time information will enhance customer retention.

In the Union Budget 2025-26, the Government has allocated Rs. 31,239.28 crore for metro projects across the country. Indian Railways has introduced Vande Bharat trains with modern coaches having more enhanced safety features and amenities. The Union Budget for 2025-26 outlines strategic investments focused on developing railway infrastructure. These initiatives are expected to attract both international and domestic stakeholders, creating significant opportunities to modernize and expand Indias railway industry in the years ahead.

Indian Railways introduced a digital platform for parcel and cargo booking, enabling MSMEs and traders to track and schedule freight seamlessly online. It supports e-commerce growth and makes Railways a stronger logistics partner. In 2025, Indian Railways is focused on significant expansion and modernization, including the introduction of new train sets like the Vande Bharat, Namo Bharat, and Amrit Bharat trains. Highlighting the development in metro rail network in the country, Government are planning to extend Metro rail network/connectivity in the many cities, hence, opportunities are more to get the business in this line of industry. With a strong emphasis on improving the metro rail network and connectivity in India, the Company is expected to benefit by expanding its reach and increasing its revenue streams.

The metro products business in India encounters various challenges and threats, such as intense competition, fluctuating customer demand, and the necessity to adapt to shifting market trends. Furthermore, logistical complexities, infrastructure limitations, and an evolving regulatory landscape present significant obstacle. The customer preferences and buying patterns can change rapidly, making it difficult to predict demand and manage inventory effectively. The external factors such as economic conditions and seasonal variations also impact demand, necessitating that businesses remain agile and adaptable. The attracting and retaining skilled employees, especially in specialized fields, is crucial. The Company must establish contingency plans to manage potential disruptions from pandemics or other unforeseen events.

During the financial year 2024-25 the company added new products Luggage Rack under Metro Segment. The company also diversified into manufacture and supply of Non-Metro Products such as Commercial Kitchen Oven Parts, Support Kit, Support Rack and Shelves, which are developed for Export Market.

We operate in the competitive industry. Our industry has no entry barriers, which exposes us to the threat of competition from new entrants. We may encounter significant competition from both organized and unorganized players in our business. We compete with our rivals on a regional and product line basis. While some competitors possess significantly larger capital and resources, offering a wider range of products, we believe our competitive edge lies in maintaining consistent product quality and timely delivery at competitive prices. This approach has helped us strengthen our brand over the years. The competition may stem from direct rivals, such as other metro rail systems, as well as from competing lines vying for ridership and revenue.

The Company maintains an adequate system of Internal Controls including suitable monitoring procedures to ensure accurate and timely financial reporting of various transactions, efficiency of operations and compliance with statutory laws, regulations and Company policies. Suitable delegation of powers and guidelines for accounting have been issued for uniform compliance and also has in place its ERP operations to ensure IT based operations with minimum manual interventions. In order to ensure that adequate checks and balances are in place and internal control systems are in order, regular and exhaustive internal audits of various divisions are conducted by Internal Auditors or external professionals. The internal audit covers all the major areas of operations of the Company including identified critical/risk areas. The Audit Committee periodically reviews the significant findings of audits, as prescribed in the Companies Act, 2013 and as per the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015.

As on March 31, 2025, the total manpower of the Company was 171, which included 47 employees as on roll basis and 124 employees as contract basis. The Company employees participated in various training programs to enhance their professional skills and the Company also offered external training as needed.

The regular interactions were held with the employees through in-person mode, which helped in building an atmosphere of trust and cooperation and therefore, a motivated workforce.

RISK MANAGEMENT FRAMEWORK:

The Company has a comprehensive Risk Management Policy approved by the Board, covering credit risk, operational risk, liquidity risk and market risk of the organization. The Company also has a Risk Management Committee (RMC) in place. The main functions of RMC are to identify and monitor various risks of the organization and to suggest actions for mitigation of the same. The Company has identified its internal risks and external risks and has taken appropriate steps to mitigate them. The Operational risk arises from inadequate or failed internal processes, people and systems or external events. Liquidity risk is the risk of potential inability to meet the liabilities as they become due; and involves the inability of the Company to fund increase in assets, manage unplanned changes in the funding sources and to meet obligations when required.

Market risk of the Company is defined as the risk to the Companys earnings and capital due to changes in the market interest rate or prices of securities, foreign exchange as well as volatilities of changes. It comprises of interest rate risk, foreign currency risk etc. In order to mitigate such risks, the Company has laid down systematic risk management procedures. The operational risks are measured and categorized as ‘High, ‘Moderate or ‘Low risk categories, through a comprehensive Risk Register covering all functional areas, namely business, compliance, finance, human resource, information technology, legal, operational and strategy. The Company manages its liquidity risk through a mix of strategies, including forward-looking resource mobilization based on projected disbursements and maturing obligations.

VISION AND MISSION:

We will grow our stakeholder focus and bring the interests of our stakeholders to the fore through an empowered, diverse and inclusive Board. We will further strengthen data privacy and information security standards across all operations in the Company.

To be Indias leader in manufacturing metro and rail sub - assemblies by 2030.

To be the first choice for OEMs of diverse sectors to develop newer components.

To be committed in meeting customer requirements and expectations.

To provide the highest quality products at the most reasonable prices.

To set a standard for the manufacturing of components and assemblies in diverse sectors.

The management discussion and analysis report containing the Companys objectives, projections, estimates and expectation may constitute certain statements, which are forward looking within the meaning of applicable laws and regulations. The statements in this management discussion and analysis report could differ materially from those expressed or implied. Important factors that could make a difference to the Companys operation include raw material availability and prices, cyclical demand and pricing in the Companys principal markets, changes in the governmental regulations, tax regimes, forex markets, economic developments within India and the countries with which the Company conducts business and other incidental factors such as changes in the governmental regulations, tax regimes, forex markets, economic developments within India and the countries with which the Company conducts business and other incidental factors.

HERGA POORNACHANDRA KEDILAYA YERMAL GIRIDHAR RAO Managing Director Joint Managing Director & CFO DIN: 09120129 DIN: 09120130

Date: 20.08.2025 Place: Bangalore