Rane Holdings Ltd Management Discussions

1. Company Overview

Founded in 1929, Rane Holdings Limited, through its Group Companies is engaged in the manufacturing and marketing of automotive components for the transportation industry. The Group is a preferred supplier to major OEMs in India and abroad. The Group Companies, manufacture steering and suspension systems, brake components, engine components, occupant safety systems and light metal casting products. The products serve the transportation industry including Passenger Vehicles, Commercial Vehicles, Farm Tractors, Two-wheelers, Railways and Stationary Engines. With modern manufacturing facilities across 30 locations in India and one in the Mexico, business development establishments cater to regions across North America, Europe and Japan. Rane Groups products are marketed across 30+ countries.

2. Economic Review

2.1. Global Economy

During FY 2025-26, the global economy operated against a backdrop of significant trade realignment, as the United States imposed reciprocal tariffs on imports from multiple trading partners. These measures combined with country-specific duties and Section 232 actions on steel, aluminium and select automotive components elevated policy uncertainty, unsettled business sentiment and prompted companies to reassess sourcing strategies and capital allocation decisions. Despite this heightened trade-policy uncertainty, global activity remained resilient for much of 2025, supported by easing financial conditions, robust services demand, continued investment in digitalisation and artificial intelligence, and front- loaded orders ahead of tariff changes. The International Monetary Fund (IMF) estimates that the global economy expanded by 3.4% in 2025.

The operating environment deteriorated materially with the outbreak of war in the Middle East in late February 2026, which led to a large-scale disruption of shipping flows through the Strait of Hormuz. Brent crude prices surged above US$100 per barrel, LNG availability tightened, and flows of other industrial commodities were curtailed. In parallel, longer shipping transit times, higher freight and insurance costs, and sharp currency movements cascaded into elevated input costs across manufacturing, logistics and energy-intensive sectors, forcing companies to recalibrate sourcing, inventory and pricing strategies.

The IMF projects global growth at 3.1% in 2026 and 3.2% in 2027, down from 3.4% in 2025 and well

below the pre-pandemic (2000-19) average of 3.7%. The downward revision for 2026 largely reflects the disruptions from the Middle East conflict, partly offset by the carryover from strong 2025 activity and reduced effective tariff rates following recent US bilateral trade agreements. The reduction in the growth rates is notably more pronounced for commodity-importing emerging market and developing economies, and global headline inflation is expected to tick up in 2026.

The global outlook remains cautious, with downside risks dominating. A longer or broader conflict, renewed trade tensions, or worsening geopolitical fragmentation could significantly weaken growth and destabilise financial markets. Navigating this environment will require policy agility, continued investment in productivity-enhancing technologies, and a sustained focus on supply-chain resilience and energy security.

2.2. Indian Economy

Against a challenging external backdrop, India continued to outperform its peers and remained the fastest-growing major economy during FY 2025-26 with a 7.6% Year-on-Year (YoY). Growth was underpinned by robust domestic consumption, sustained public capital expenditure, easing monetary conditions and broad- based expansion across manufacturing and services.

FY2025-26 marked a notable shift in Indias consumption landscape, supported by the rationalisation of the GST framework. The revised structure with simplified tax slabs and reduced the overall tax incidence on mass- market categories, including reduction in GST on small passenger vehicles and two-wheelers (up to 350cc) from 28% to 18%, while auto component rates were aligned at 18%. The changes also extended to consumption- linked sectors such as consumer durables, cement and construction materials, improving affordability across a broad base of products.

Reinforced by multiple repo rate cuts by the Reserve Bank of India, the personal income tax relief announced in Union Budget 2025, a favourable monsoon, and buoyant rural demand, these measures delivered a substantial fillip to household spending, vehicle sales, housing and discretionary consumption.

Indias economy also proved remarkably resilient to trade headwinds. US tariffs on Indian goods, which escalated from 25% in early August 2025 to 50% later that month (including a 25% penalty linked to Russian oil imports), were substantially unwound following the US-India trade framework announced under which the additional 25% penalty was removed and the reciprocal rate was temporarily set at 10% with effect from February 24, 2026. While specific tariffs on steel, aluminium and select automotive components remain in place, the broader de-escalation has restored export competitiveness for Indian industry.

Looking into FY 2026-27, the outlook is balanced. On the positive side, the carryover from strong FY 2025-26 activity, the lower effective US tariff rate, benign domestic inflation through most of FY 2025-26, a steady investment cycle, and continuing reform momentum provide a firm foundation. However, the war in the Middle East poses clear near-term pressures. As a net energy importer that sources a significant share of crude oil and LNG through the Strait of Hormuz, India is exposed to higher and more volatile oil and gas prices, imported inflation, currency weakness, rising freight and insurance costs, and potential demand moderation in key export markets. The RBI expects domestic inflation to edge higher in the coming quarters as crude price pass-through accumulates, and the pace of further monetary easing is likely to moderate. Even so, Indias diversified growth drivers, strong domestic demand base, healthy corporate and bank balance sheets, and policy buffers position it to absorb these shocks better than most peers and to continue delivering solid growth in FY 2026-27. IMF projects India to remain the worlds fastest-growing major economy, with real GDP growth forecasted at 6.5% for 2026.

3. Automobile Industry Review

3.1. Global Automobile Industry

FY26 witnessed steady but uneven performance for the global automobile industry. Global new vehicle sales rose approximately 3.4%, with production improving as semiconductor constraints eased and OEMs brought supply closer into balance with demand. Emerging markets continued to provide incremental growth, while replacement demand and improved vehicle availability supported developed markets. The industry also witnessed sustained momentum in electrification and technology investments, reflecting a clear, if uneven, shift towards future mobility.

In US, light vehicle sales grew by 2.3% YoY, aided by better inventory and strong demand for hybrids. However, the expiration of federal EV tax credits triggered a sharp moderation in battery electric vehicle demand in the fourth quarter, with consumers gravitating to hybrids as a lower-cost electrification option amid high interest rates and elevated vehicle prices. In Europe, recovery continued at a modest pace, constrained by elevated energy costs, regulatory transitions and subdued demand in core economies. European automakers also face growing competitive pressure from Chinese manufacturers, with China- made vehicles accounting for approximately 7% of EU

car sales in 2025 and that share continuing to rise as Chinese OEMs expand localised production in Europe. In China, volumes reached multi-year highs in 2025, though the halving of New Energy Vechicle (NEV) tax exemptions from January 01, 2026 and the winding down of trade-in subsidies are expected to moderate growth in the current year.

The 2026 operating environment is more challenging. Global light vehicle sales are forecast to remain broadly flat with global production expected to edge down by about 0.4%. The combination of trade realignment, the Middle East conflict, sharply higher energy prices, elevated commodity and freight costs, and currency volatility is exerting further upward pressure on vehicle prices and testing just-in-time production models. In response, OEMs are accelerating the regionalisation of supply chains, prioritising cost optimisation, and adopting flexible powertrain strategies in which hybrids play an important transitional role.

Overall, the global automobile industry in 2026 is characterised by stable but uneven demand, slowing electrification momentum in some mature markets, and heightened strategic complexity. Software capabilities, cost discipline and supply-chain resilience are emerging as the key competitive differentiators. While the long-term transition to electrified, software-defined and autonomous vehicles remains intact, near-term growth is expected to be measured as the industry adapts to a more fragmented and risk-conscious global environment.

3.2. Indian Automobile Industry

I ndias automobile industry witnessed strong demand during FY26, supported by improved affordability and policy support (GST rate reductions). The automotive production across major vehicle segments benefited by steady domestic demand and Indias growing importance as an automotive manufacturing and export hub.

The Passenger Vehicle (PV) segment recorded their highest-ever production in FY26, growing 9% YoY. The growth was largely driven by utility vehicles, which continued to gain share, while passenger cars saw 4% growth. The segment also saw strong export momentum, with overseas shipments rising 17.5%. Electric Passenger Vehicle (EPV) adoption also accelerated sharply, with registrations rising more than 80% during the year, contributing to overall growth.

After two sluggish years, the Commercial Vechicle (CV) sector staged a broad-based recovery in FY 26, driven by policy support and improving demand fundamentals. The Medium and Heavy Commercial Vehicles (M&HCV) segment recorded a robust 16% growth supported by infrastructure-linked goods movement and school bus demand. The Light Commercial Vehicles (LCV) segment grew by 11% driven by demand from last mile delivery uses.

Indias tractor industry posted a record-breaking performance in FY26, with 24% YoY growth, driven by sustained rural demand, a reduction in GST rates, and robust agricultural output. Two-Wheelers reclaimed their pre-COVID peak, with a growth of 12%, driven by the combination of GST-led affordability, improved rural cash flows, and a broadening product portfolio that catered to EV segment.

Overall, the Indian automobile industry in FY26 demonstrated resilience amid transition. While growth was supported by domestic consumption, rural recovery and policy tailwinds, the year also highlighted the increasing complexity of operating in a regulatory intensive and capital heavy environment. The sectors long term trajectory remains positive, anchored by infrastructure development, manufacturing localisation, electrification and sustained domestic demand, albeit with near term performance remaining nuanced and segment specific.

Industry Segment (Production figures)	Growth in % (YoY change)
Vehicles	FY26	1 FY25
Passenger Cars (PC)	4	(12)
Utility Vehicles (UV)	12	14
Multi-Purpose Vans (MPV)	10	8
Passenger Vehicles (PV)	9	3
Light Commercial Vehicles (LCV)	11	(5)
Medium & Heavy Commercial Vehicles (M& HCV)	16	(3)
Commercial Vehicles (CV)	13	(4)
Farm Tractors (FT)	24	6
Two Wheelers (2W)	11	11

Source: Society of Indian Automobile Manufacturers (SIAM)

3.3. Indian Auto Component Industry

The Indian auto component industry continued its strong performance in FY 2025-26. According to the Automotive Component Manufacturers Association of India (ACMA), the industry turnover in the first half of FY26 grew 6.8% YoY supported by stable domestic demand, a resilient aftermarket, and sustained investments in capacity expansion, localisation and technology upgrades. Supplies to Original Equipment Manufacturers (OEMs) rose 7.3%, led primarily by the passenger vehicle and light commercial vehicle segments. Notably, auto component exports grew 9.3% despite tariff-related headwinds, elevated raw material costs and moderating demand in several developed markets, with the United States and Germany remaining among the largest destinations. With the benefit of the GST rate reduction translating into stronger vehicle demand in H2 FY 2025-26, full-year performance is expected to build further on this momentum.

Over the medium term, the industry is undergoing a structural transformation. Growth is being driven by rising vehicle penetration, higher technology content per vehicle, accelerating EV adoption, tightening emission norms, and the gradual mainstreaming of Advanced Driver Assistance Systems (ADAS). These trends are creating meaningful incremental demand for power electronics, sensors, control units, precision-engineered components and software- enabled systems. The Production Linked Incentive (PLI) schemes for automobiles and auto components, coupled with duty exemptions on lithium-ion battery scrap and expanded capital goods exemptions for EV production announced in Union Budget 2025-26, are accelerating localisation and are estimated to attract fresh investments of 25,000 - 30,000 Crores in FY 2025-26 alone. Despite near-term headwinds from input cost volatility, currency movements and Middle East-related logistics pressures, the Indian auto component industry is well positioned to benefit from domestic volume growth, rising technology intensity, and its expanding role in global automotive supply chains.

3.4. Indian Automotive Aftermarket Industry

The Indian automotive aftermarket sustained strong momentum during FY 2025-26, benefiting from a large and rapidly expanding vehicle parc, improving formalisation, and the largely non-discretionary nature of vehicle maintenance and replacement spend. As per ACMA, the aftermarket segment grew approximately 9% year-on-year in H1 FY 2025-26, outpacing overall industry growth and underlining its resilience even in a challenging global environment. India is expected to be the fastest-growing aftermarket in the region over the coming years, supported by favourable domestic demand trends and a rising vehicle parc.

The aftermarket is increasingly evolving towards more organised and technology-enabled operating models. Digital platforms, multi-brand service networks, e-commerce-led distribution and organised retail chains are enhancing product availability, pricing transparency and customer access across the value chain. At the same time, rising vehicle complexity, higher electronics content and the gradual spread of EVs are driving demand for advanced components, diagnostic capabilities and skilled workshop talent. The combination of steady underlying demand, improving industry structure and favourable long-term fundamentals positions the Indian aftermarket as an increasingly important growth engine for the broader component ecosystem.

3.5. Opportunities and Threats

Indias automotive sector stands at a pivotal juncture, offering multiple growth opportunities alongside a more complex risk environment. India has firmly established itself as the worlds third-largest automobile market, supported by a deep domestic consumption base, policy initiatives such as the Production Linked Incentive (PLI) schemes, duty concessions on EV components, and its growing reputation as a manufacturing and export hub. The GST 2.0 reform has meaningfully improved affordability across mass-market segments and is expected to sustain consumption-led growth into FY 2026-27. The auto component industry is poised for significant expansion with potential to nearly double by 2030, supported by rising localisation, technology intensity and exports. The aftermarket is also evolving rapidly as the vehicle parc expands and consumers increasingly embrace organised and digitally-enabled service channels.

Indias strategic position in global supply chains offers a distinct opportunity. As global OEMs diversify sourcing away from traditional markets, Indias cost competitiveness, deep engineering talent pool, improving logistics infrastructure and large skilled workforce position it as a preferred China plus one partner. Ongoing trade realignments and supply-chain diversification by multinational OEMs are opening up further space for Indian manufacturers to integrate into international networks and capture incremental market share.

The industry, however, is exposed to several headwinds. The war in the Middle East has introduced elevated geopolitical risk, with direct implications for energy prices, freight and insurance costs, currency stability, and supply-chain reliability, especially given the exposure of key shipping routes passing through the Strait of Hormuz. Input cost volatility in steel, aluminium, precious and rare-earth metals, and semiconductors remains a concern. Trade protectionism, evolving tariff regimes, and policy uncertainty in key export markets could affect investment flows and export momentum. Domestically, pockets of affordability pressure in the mass vehicle segment, uneven rural income recovery, and the capital-heavy nature of the electrification and ADAS transitions could affect demand patterns and return profiles. Proactive risk management, supply- chain diversification, localisation of critical components, and continued investments in engineering and digital capabilities will be essential to navigate this environment.

3.6. Outlook

The long-term outlook for the Indian automotive and auto component industry remains decisively positive, anchored by a durable set of structural drivers: rising

per capita incomes and urbanisation, sustained infrastructure build-out, deepening manufacturing localisation, the accelerating transition to electrified and software-defined vehicles, and Indias expanding integration into global automotive supply chains. Passenger vehicle demand is expected to remain supported by continued preference for utility vehicles and a gradual rise in alternative power trains such as CNG, hybrid, and electric vehicles. In the two-wheeler segment, growth is likely to be driven by improving rural demand and financing availability, while premiumisation trends are expected to sustain demand in higher-value categories. Commercial vehicle demand is expected to remain linked to economic activity and replacement requirements, with buses expected to outperform within the segment.

I n the near term, however, the industry must navigate several headwinds. While domestic demand remains stable, the industry continues to monitor external risks that could influence the operating environment. Factors such as geopolitical developments, volatility in crude oil and commodity prices, exchange-rate movements, and potential supply-chain disruptions could affect production costs, demand sentiment, and exports. At the same time, ongoing adoption of cleaner technologies, evolving regulatory norms, and increasing focus on safety and technology content per vehicle are expected to influence product mix and investment priorities. Overall, the outlook points to stable volume growth accompanied by structural shifts in technology and demand composition, positioning the industry for sustained development over the medium term.

4. Financial Review

Standalone Financial Highlights

- Total Revenue was 171.45 Crores for FY26 as compared to 143.66 Crores for FY25, increase of 19.34%.

- Operating revenue increased to 165.69 Crores in FY26 from 140.76 Crores in FY25 due to higher Service fee and trademark fee income.

- Other income increased to 5.76 Crores in FY26 from 2.90 Crores in FY25 due to higher interest income during FY26.

- EBITDA stood at 99.73 Crores as compared to 86.80 Crores during FY25, increase of 14.90%.

- Net profit stood at 84.61 Crores for FY26 as compared to 68.11 Crores for FY25.

Consolidated Financial Highlights

- Total revenue was 5,907.16 Crores for FY26 as compared to 4,380.34 Crores for FY25, an increase of 34.86%.

- EBITDA stood at 460.73 Crores for FY26 as compared to at 346.63 Crores for FY25, recording an increase of 32.92%.

- Net profit stood at 136.78 Crores for FY26 as compared to a profit of 220.85 Crores for FY25.

FY25 consolidated financial performance includes line by line consolidation of RSSL as subsidiary effective from September 19,2024.

Standalone

Sl. No	Ratios	Unit of Measurement	March 31,2026	March 31,2025	Significant change (A 25%)	Reason for significant change in FY26
1	Debtors Turnover	Times	8.22	8.39	NA	NA
2	Current Ratio	Times	1.52	2.41	(37)%	*
3	Interest Coverage ratio	Times	19.03	48.11	(60)%	**
4	Debt Equity Ratio	Times	0.03	0.10	(74)%	***
5	Operating Profit Margin		57%	55%	NA	NA
6	Net Profit Margin	0/	51%	48%	NA	NA
7	Return on Net worth	0/	13%	11%	NA	NA
8	Return on Capital Employed	0/ %	15%	12%	NA	NA

*Lower current ratio due to lower short-term investments

** Lower interest coverage due to higher interest payments during the year.

*** Due to prepayment of term loan during FY26

The other ratios as required under Schedule III are disclosed in Note no. 31 to the Financial Statements.

Consolidated

Sl. No	Ratios	Unit of Measurement	March 31,2026	March 31,2025	Significant change (A 25%)	Reason for significant change in FY26
1	Debtors Turnover	Times	5.92	5.72	NA	NA
2	Inventory Turnover	Times	6.53	5.58	NA	NA
3	Current Ratio	Times	0.88	0.93	NA	NA
4	Interest Coverage ratio	Times	3.09	2.49	NA	NA
5	Debt Equity Ratio	Times	0.67	0.74	NA	NA
6	Operating Profit Margin		4%	4%	NA	NA
7	Net Profit Margin	0/	2%	5%	(54)%	*
8	Return on Net worth	0/	10%	18%	(44)%	*
9	Return on Capital Employed	0/ %	10%	9%	NA	NA

* FY25 profit includes exceptional item of 176 crores by RSSL towards settlement amount received from NSK Limited, Japan. FY26 profit includes RHL share of warranty provision of 85 Crores (net of tax) provided by ZRAI.

5. Business Review

5.1. Rane Holdings Limited (RHL)

- The Group aggregate sale for FY26 was

8,414 Crores.

- Group continued to engage in various lean

measures to improve productivity.

- Implemented strategic savings initiatives on power, sourcing etc., at the group level.

5.2. Subsidiaries

5.2.1. Rane (Madras) Limited (RML)

On April 07, 2025, Rane Brake Lining Ltd. and

Rane Engine Valve Ltd. were amalgamated with and into RML.

The amalgamation has resulted in synergies and new growth prospects for RML besides simplification of the group structure, aligning shareholder interests, enhancing operational efficiency, and achieve diversification in product offerings.

On consolidated basis, total revenue from sale of products increased to 3,816.63 crores in FY26 from 3,364.28 crores in FY25. Net profit stood at 107.48 crores in FY26 against a net profit of 37.65 crores in FY25.

5.2.2. Rane Steering Systems Private Limited (RSSL)

RSSL registered a total revenue of 2,018.20 crores for FY26 as compared to 1,708.05 crores for FY25. RSSL earned Net profit of 34.76 crores in FY26 against 71.29 crores earned during FY25.

¦ CORPORATE OVERVIEW

¦ MANAGEMENT REPORTS

¦ FINANCIAL STATEMENTS

5.3. Joint Ventures / Associate Companies

5.3.1. ZF Rane Automotive India Private Limited (ZRAI)

Effective from February 01, 2026, the Occupant Safety Division along with related investments were transferred to ZF Lifetec Rane Automotive India Private Limited (ZLRAI), on a going concern basis.

In ZRAI, total revenue of the continuing operations was 1,014.15 crores for FY26 as compared to 899.86 crores for FY25, recording an increase of 13.32%. ZRAI earned a net profit of 65.44 crores in FY26 as compared to 60.24 crores earned during FY25.

5.3.2. ZF Lifetec Rane Automotive India Private Limited (ZLRAI)

ZLRAI became a Joint Venture / Associate Company with effect from February 01,2026.

On consolidated basis, total revenue stood at 1,767.08 crores in FY26. Net loss stood at 99.43 crores in FY26. This includes exceptional expenses towards warranty provision amounting to 181 crores (net of tax).

Pursuant to the Scheme of Demerger, ZLRAI holds 100% equity in TRW Sun Steering Wheels Private Limited and ZF Rane Occupant Safety Systems Private Limited.

5.4. Overseas Subsidiaries

The Company operates two overseas subsidiaries viz., (i) Rane Holdings America Inc., USA, to cater to the business development in North America region and (ii) Rane Holdings Europe GmbH, Germany, to cater to the business development in the European region, for Rane group companies.

6. Risk Management

The Company has laid down well-structured procedures for monitoring the risk management plan and implementing risk mitigation measures. The risks are broadly classified into strategic risks, operational risks, financial risks and statutory compliance risks. These risks are rated based on factors such as past year experience, probability of occurrence, probability of non-detection and their impact on the business. The top management reviews the strategic risks, and the risks with high probability and high impact every quarter and presents its report along with a risk mitigation plan to the Board of Directors on a half-yearly basis. The strategic risks are taken into consideration in the annual planning process with their mitigation plan. Other risks are covered as part of the internal audit process and presented to the Audit Committee every quarter. The business process risks and the related controls are subjected to internal audit and reviewed on a quarterly basis. The risk ratings are revalidated with the top management as part of the internal audit process every quarter. The overall re-assessment of risks at the Company level is carried out and presented to the Board of Directors once in two years for their review.

Risk	Nature of Risk	Risk Mitigation Strategies
	Industry / Market risk	70% of revenue is derived from the Indian automotive sector. Hence, any drop in vehicle production will have a significant impact on the Companys business.	The Company constantly strives to:
			(a) Increase revenue from international markets (outside of India).
			(b) Add new products to increase organic revenue and diversify customers across vehicle segments.
Strategic			(c) 1 mprove presence in the Aftermarket segment, which presents an opportunity to compensate for any drop in the OE segment.
	Technology Obsolescence Risk	Auto industry and customer preference undergo changes, resulting in technology obsolescence.	The Company has consistently delivered cutting-edge technology products with enhanced R&D capabilities, localisation of testing and validation capabilities.
	Competition	Maintaining market share in the competitive market and availability of unorganised players pose further challenges.	The Companys long-standing relationship with OEMs, state-of-the-art facilities and best-in-class processes help deliver superior value to the customers. The Company periodically conducts customer surveys to understand customer feedback and work in furthering its relationship with the customers.

7. Human Resource Development and Industrial relations

At the heart of the Rane Groups enduring success is a profound gratitude for its people, who are embraced not merely as resources, but as critical partners in growth and excellence, driving initiatives across talent development, digital transformation, wellness, and diversity.

7.1. Talent Development Initiatives

In FY26, the Company focused heavily on building leadership capacity and enhancing manufacturing capabilities through the following programs:

Leadership Development

7.1.1 Leadership Boot Camp (LBC) & Ranvocation

To seamlessly transition entry-level graduates from academia to the corporate environment, Rane Group implemented an intensive LBC featuring plant visits, cross-functional collaboration, and mentorship by senior leaders. This year, 2 high-potential individuals were selected to embark on this journey, which notably included an outbound collaboration and communication workshop. 1 Management Trainee completed the year-long development journey, celebrated at the annual Ranvocation event.

7.1.2. Young Leadership Development (YLD)

This flagship program enables individual contributors to successfully transition into first-time managers. The 9 th batch commenced in partnership with KREA University, featuring gamified learning tools, interactive webinars, and outbound experiential learning at the Pegasus Institute in Pondicherry and 1 participant from the company was part of the program. Furthermore, participants from earlier batches underwent a specialized workshop to enhance business acumen, culminating in case study presentations to business leaders and 1 participant from the company was part of this workshop.

7.1.3. High Potential Leadership Development (HPLD)

Aimed at building leadership competencies for department heads transitioning to broader functional and operational roles, the 10 th batch of HPLD was launched and there were 2 participants from the company. The cohort utilized interactive development centers, case studies, and business simulations, and successfully completed the TOP GEAR residential program at the Great Lakes Institute of Management to enhance strategic thinking and execution excellence.

Risk	Nature of Risk	Risk Mitigation Strategies
Operational	Quality / Processes	Quality and delivery are sacrosanct for the safety- critical products supplied by the Group	Skilled workforce, imparting job skill enhancement training, enhancing supplier capabilities and robust manufacturing processes help the Company mitigate quality and delivery risks.
	People Risk	Attrition of key personnel could impact business operations and growth.	The Companys HR processes are constantly upgraded to attract, retain and develop talent. The policies are people-centric and industry accolades on HR practices help attract talent. The dedicated training centre supports in building functional capabilities and developing a strong leadership pipeline.
	Raw Material (Input) Price Risk	Material cost is a significant part of the cost and volatility in the price of raw material costs will erode margin.	The Company constantly strives to mitigate the input cost increases by:
			(a) Implementing a procurement function that will work on cost- reduction initiatives through alternate sourcing, localisation, etc.
			(b) Negotiating and passing through input cost, which increases suitably to the customers.
			(c) Working on process improvements, yield improvements, etc.
	Currency Risk	The Company is exposed to foreign currency exchange risk as it exports our products to various countries and import raw materials.	The Company uses a multi-pronged approach as suitable to the scenarios. This approach includes:
Financial			(a) Optimally balancing the import and export to create natural hedge.
			(b) Working with customer-to-index prices to mitigate currency fluctuations.
			(c) Taking simple forwards on a rolling basis to protect its export realisation.
	Interest Rate Risk	Use of borrowings to fund expansion exposes the Company to interest rate risk.	The Company manages interest rate risk on the following basis:
			(a) Maintaining optimal debt-equity levels.
			(b) Using internal accruals to fund expansion.
			(c) Constantly optimizing working capital to reduce interest costs.

7.1.4. Supervisory Development Program (SDP)

Designed to enhance shop floor efficiency, SDP equipped participants with essential supervisory skills such as team motivation, performance management, and safety protocols. The program covered multiple batches across Chennai, Trichy, and Hyderabad.

7.1.5. Rane Manufacturing Systems Professionals (RMSP)

Focused on enhancing plant performance and technical expertise, the refreshed RMSP 4.0 framework facilitated 102 successful Productivity, Quality, Cost, Delivery and Safety (PQCDS) improvement projects this year. To deepen specialized technical proficiency, Rane partnered with premier institutions to launch programs in Vehicle Dynamics (SASTRA University) and Tribology (PSG College of Technology). The annual RMSP Technology Day was also hosted at ZF Rane Automotive India to showcase the latest manufacturing advancements and foster cross-functional knowledge sharing.

7.2 Cultivating Excellence

7.2.1. High-Performance Culture (ACE Awards)

Ranes organizational resilience is rooted in the cultural philosophy of Maithri (goodwill, friendship, and bonding). To translate these values into tangible performance, the Achieving and Celebrating Excellence (ACE) Awards drive annual business goals by evaluating units across four strategic pillars: Plant Operations (benchmarked on QCDPSM parameters), High-Impact Initiatives, HR Practices, and overall Business Performance. Through ACE, the organization fosters a high-performance culture that aligns the spirit of Maithri with sustainable stakeholder value.

7.2.2. Plant, Functional Heads Meeting

The Rane Group Senior Management Meet brought together Plant and Function Heads to align business objectives with stakeholders demands, focusing on sustainable growth and operational efficiency. Leaders reviewed cost-transformation projects to embed a lasting mindset of cost excellence and cross-functional collaboration. Additionally, industry experts highlighted how to navigate global supply chain shifts and build a competitive Right to Win through technological differentiation and operational excellence. The event included strategic briefings on new labour codes to ensure proactive workforce management.

7.3. HR Tech Transformation & Digital Learning Journey

Recognizing that organizational expansion adds complexity, Rane evolved its digital HR ecosystem to build a connected, future-ready workforce.

7.3.1. HR Hub Unified Platform The Group transitioned to a cloud-based HR system powered by PeopleStrong, consolidating fragmented

and distributed systems to manage the entire employee lifecycle-from recruitment and onboarding to learning and payroll-into a seamless, mobile-first experience. This transformation empowers employees with independent access to HR services, minimizes administrative bottlenecks, and provides managers with real-time workforce visibility.

7.3.2. Digital Human Resource Management (DHRM):

The company rolled out a comprehensive DHRM application to modernize workforce management and ensure a seamless transition from legacy system. Specifically tailored for Trainees and Contract Labor, DHRM standardizes HR processes across the Group through end-to-end lifecycle management, featuring 100% digital onboarding, biometric- integrated attendance, and statutory-compliant payroll processing. The system further enhances shop floor capabilities by integrating with the Bodhi training platform for real-time skill mapping and evaluations, while simultaneously strengthening governance through automated manpower planning, standardized shift configurations, and systemic safeguards such as mandatory rest periods to ensure regulatory compliance and operational transparency.

7.3.3 Digital Learning Hub

Rane successfully migrated its learning platform, delivering weekly microlearning content on leadership, functional competencies, and wellness. Learner engagement was significantly boosted through gamification elements like weekly quizzes, cohort challenges, and an L&D leaderboard, while partnerships with NPTEL and The Hindu Group expanded access to short-term certifications and language skills development.

7.4. Employee Experience & Work Culture (The Rane Pulse)

To measure employee experience and drive actionable workplace improvements, the company utilizes The Rane Pulse framework in partnership with W.E. Matters. This comprehensive model evaluates the organization to build a stronger workplace across the following pillars:

- Guiding Success (Leadership & Management): Focuses on building trust through leadership and business confidence, enhancing manager effectiveness via goal-setting and coaching, and fostering a culture of belonging, diversity of thought, and teamwork.

- Supporting Growth (Organization & Well-being): Tracks organizational performance (such as career opportunities and pay-performance linkage), monitors employee care, work-life harmony, and workplace safety, and evaluates the effectiveness of HR practices and benefits.

7.5. Wellness at Rane

Holistic employee well-being remains a top priority, supported by robust Health, Safety, and Environment (HSE) practices and thorough ergonomic workplace assessments. The Group promoted healthy habits through the Wellness Corner app, mental health support, and financial wellness programs. Fostering camaraderie and active living, the Rane Premier League inter-group cricket tournament brought together top talent across entities, while employees showed massive enthusiasm for community fitness, with over 190 employees participating in the Freshworks Chennai Marathon 2026. Showcasing strong team spirit and endurance, employees successfully completed various distances, including the 10 km, Half Marathon, 20 Miler, and Full Marathon.

7.6. DEI at Rane

The Group strengthened its commitment to diversity through the Women at Work (W@W) initiative, which aims to cultivate an Engaged, Enthused, and Empowered community. By offering dedicated mentorship with executive coaches and collaborative group sessions, the program provides female employees with the crucial networking platforms and resources required to support their career ambitions and professional advancement.

Further, to further foster a high-performance and equitable culture, an Inclusive Leadership in Action

workshop was organized for 9 senior leaders, focusing on addressing biases and building diverse workplaces.

7.7. Industrial Relations

Industrial relations remained highly cordial across all group plants. The Group-level Industrial Relations Council continues to promote harmony and a healthy working environment by focusing on the seamless implementation of labor legislation, sharing best practices, and executing workforce mix planning for optimal deployment. Furthermore, Ranes digital-first approach to the new Labour Codes ensures modernized compliance and trust across the workforce.

8. Corporate Social Responsibility (CSR)

Rane Foundation, a public charitable trust founded in the year 1967, is the leading partner for implementing Rane Groups CSR initiatives. The Companys CSR vision is To be a socially and environmentally responsible corporate citizen. The Company continues to focus on four thrust areas for its CSR activities - Education, Healthcare, Environment and Community Development. The Company has implemented several projects in the field of Education, Healthcare and Community Development.

8.1. Education:

The Rane Vidyalaya, established at Manachanallur, Trichy in the year 2018 under the aegis of Rane Foundation has stepped into its seventh academic year. Rane Vidyalaya was recognized by Directorate of School Education, Tamil Nadu in 2018 and is affiliated to the Central Board of Secondary Education, New Delhi. In the academic year 2025-26, it reached a student strength of 1048 in its Eighth year of operations, operating from LKG to XI. The school has achieved 100% pass percentage in the X standard board examination in the academic year

2025- 26. The first batch of XII students will write the public exam in the academic year 2026-27.

The Rane Polytechnic, established at Trichy in the year 2011 under the aegis of Rane Foundation has stepped into its fifteenth academic year. The institution is accredited by the National Board of Accreditation (NBA) for its Diploma in Mechanical Engineering program. So far 2120 students have completed their diploma program as on May 2025, 88 students will complete by 30 th June 2026, of which 25 students opted for campus placements, 40 will be absorbed after internship and 23 are going in for higher studies.

Considering the declining demand and enrolment for the polytechnic courses at the national and state level, it has been decided by the Rane Foundation to progressively close the polytechnic institution by the end of academic year 2025-26. The application for Progressive closure has recently been approved by AICTE and closure formalities will be initiated with DoTE after completion of the internship by the students.

Rane Foundation also embarked on its next major project in 2025 to establish one more CBSE school in the name Rane Vidyalaya - Sethurapatti. This school aims to provide quality education to rural children in and around Sethurapatti village. The school started its operations for the primary classes from the academic session 2025-26, and approval has been received from the Tamil Nadu Government. The CBSE application process is in progress and will be completed in

2026- 27.

Rane Foundation has carried out the following CSR initiatives:

- Extended support to the Gopalapuram Educational Society towards maintenance and operations of Boys & Girls Schools.

- Supported 20 Single Teacher Schools in association with Swami Vivekananda Development Society.

- Provided computer monitors towards upgradation of computer laboratories to Ramakrishna Mission Students Home.

8.2. Healthcare:

Rane Foundation through strategic partnerships with established organisations contributed medical equipment to not for profit hospitals of repute, making a significant impact on society across various specialties such as Ophthalmology, Dialysis, and Public Health Care at an affordable cost, as outlined below:

- Procured Myopia master to Sankara Nethralaya to enhance the ophthalmic care.

- Contributed IT servers to the Child Trust Hospital.

- Supported Voluntary Health Services, a

multi-speciality hospital with a modern high end upgradeable ventilator.

- Supported Sringeri Sharada Dhanvantari

Charitable Hospital with hemodialysis machine.

- Supported Apollo Hospitals Enterprise Limited in conducting Tele-Ophthalmology Camp at Trichy including delivery of spectacles.

- Supported Tamilnadu Kidney Research Foundation (TANKER Foundation), a non-profit charitable trust with Hemodialyisis machine with blood pressure monitor.

9. Health, Safety & Environment (HSE)

Health, Safety, and Environment (HSE) is a core element of its governance approach and a key driver of groupwide excellence. As the apex entity of the Rane Group, RHL actively leads the HSE agenda by setting strategic direction, promoting a culture of shared responsibility, and enabling structured governance. Through regular reviews, capability building, and cross-functional collaboration, RHL influences all group companies to embed HSE & sustainability into their operations, reinforcing a strong commitment to prevention, continuous learning, and employee well-being.

RHL has established a robust HSE & Sustainability governance framework that enables the identification and mitigation of risks through structured processes, supported by sub-committees that enforce well- defined policies, standards, and procedures, which promotes sustainable operational discipline across all entities.

RHL plays a vital role in shaping a culture where safety, environmental responsibility, and excellence go hand in hand across the Rane Group.

10. Information Technology

The Company provides ERP support, IT infrastructure management, application development and information security services across Business Units. Over the past year, we implemented several strategic

initiatives to strengthen IT infrastructure, enhance data protection, and improve operational efficiency.

We enhanced remote connectivity and user experience by implementing Zero Trust Network Access (ZTNA). To ensure business continuity, we upgraded our backup solutions by enabling cloud backup as a secondary backup and established a disaster recovery site for critical ERP systems. Furthermore, we introduced lightweight office productivity tools for non-power users and in the process of deploying Virtual Desktop Infrastructure (VDI) to replace traditional desktops for improved manageability and security.

We provided critical IT support during business mergers and de-mergers and redesigned workfl ow solutions with user-friendly interfaces. As part of our digitization efforts, we introduced a Document Management Solution (DMS) with cloud storage and a centralized digital signing solution for commercial documents to improve monitoring, compliance and cost-effectiveness. The group has migrated from on- prem to cloud based HR system and a cloud-based CRM system is implemented for aftermarket division.

Supporting Industry 4.0 initiatives, A centralized software is deployed and implemented to improve Overall Equipment Efficiency (OEE) and Smart Utility Management for power optimization. The Rane Data Centre (RDC) has taken up the OT cybersecurity assessment across select locations to identify the risk and are working towards ensuring the continuous and safe operation of machinery and industrial control systems.

I nformation security has been bolstered by achieving Level 3 TISAX (Trusted Information Security Assessment Exchange) compliance at selected sites. We continue to support businesses through customer cybersecurity assessments, aligning our posture with automotive industry standards. Additionally, an assessment for the Digital Personal Data Protection Act (DPDPA) is currently under progress.

11. Internal Control Systems

The Company has put in place a robust internal control system to prevent operational risks through a framework of internal controls and processes. These controls ensure that the business transactions are recorded in a timely and complete manner in the financial records, resources are utilised effectively and the assets are safeguarded.

The internal audit function is outsourced to a professional firm of independent assurance service providers. The Audit Committee and the Board in consultation with the internal auditors, statutory auditors and operating management approve the annual

internal audit plan. The scope also covers the internal financial controls and internal controls over financial reporting. The internal audit findings are placed before the Audit Committee at each of its quarterly meetings for review. The managements responses and counter measures are discussed in the Audit Committee meetings. This process ensures robustness of the internal control system and compliance with laws and regulations including resource utilization and system efficacy.

12. Cautionary statement

The information and opinion expressed in this Report may contain certain forward-looking statements, which the management believe are true to the best of its knowledge at the time of its preparation. Actual results may differ materially from those either expressed or implied in this report.

For and on behalf of the Board

Harish Lakshman	Ganesh Lakshminarayan
Vice-Chairman & Joint	Chairman &
Managing Director	Managing Director
DIN:00012602	DIN:00012583
Place: Chennai	Place: Coonoor
Date: May 15, 2026	Date: May 15, 2026