Your Directors have pleasure in presenting the management discussion and analysis report for the year ended on March 31, 2026.
1. GLOBAL ECONOMIC OVERVIEW:
The global economy remained resilient during FY 2025-26 despite continued geopolitical tensions, trade policy uncertainty, tariff-related disruptions and financial market volatility. Global economic activity demonstrated greater-than-anticipated adaptability, supported by private-sector adjustment, technology-led investment, improving financial conditions in several markets and fiscal support in certain major economies.
According to the International Monetary Fund (IMF), global growth was projected at 3.0% for 2026 and 3.4% for 2027 in its July 2026 outlook. At the same time, global headline inflation was projected at 4.7% in 2026, indicating that the disinflation process has slowed amid renewed geopolitical and energy-related pressures. The IMF has highlighted geopolitical tensions, trade fragmentation, elevated public debt, financial market vulnerabilities and commodity-price volatility as important downside risks to the global economic outlook.
The global economic environment has also been affected by developments in the Middle East and disruptions to energy and trade routes. Higher energy prices, if sustained, may increase input costs and inflationary pressures across economies, particularly in energy-intensive industries such as steel. Nevertheless, the global economy has demonstrated resilience, and easing financial conditions, technological investment and infrastructure expenditure are expected to provide support to economic activity.
For the steel industry, the global environment remains mixed. Manufacturing activity in several developed economies continues to face affordability and financing pressures, while geopolitical developments and trade restrictions have resulted in greater uncertainty in international steel trade. At the same time, infrastructure expenditure and investment in developing economies are expected to support steel consumption.
Overall, the global economic outlook remains cautiously positive, although the business environment continues to be exposed to geopolitical developments, tariff measures, commodity-price fluctuations, interest rates and changes in global trade policies.
2. INDIAN ECONOMY:
India continued to demonstrate strong economic resilience during FY 2025-26 despite a challenging global environment. According to the Provisional Estimates released by the Ministry of Statistics and Programme Implementation (MoSPI), Indias real GDP grew by 7.7% in FY 2025-26, compared with 6.5% in FY 2024-25. Real GVA growth was estimated at 7.6%, reflecting broad-based economic activity.
Domestic demand continued to be a key driver of growth. Private consumption remained strong, supported by improving purchasing power, moderating inflation and resilient employment conditions. Investment activity also remained supportive of economic growth.
The Economic Survey 2025-26 had earlier estimated real GDP growth at 7.4% for FY26, with manufacturing showing significant improvement. Manufacturing GVA was estimated to grow by 8.4% during the first half of FY26, while services GVA increased by 9.3% during the same period. Construction activity also remained strong, supported by continued infrastructure and capital expenditure.
Indias services sector continued to remain a major contributor to economic activity. Indias services exports reached an all-time high of approximately USD 387.6 billion during FY25, reflecting the continued competitiveness of Indias services sector. Indias merchandise and services exports also reached a record level during FY25.
The Indian economy continues to benefit from structural factors including infrastructure development, domestic consumption, formalisation of economic activity, digitalisation, manufacturing investment and government-led capital expenditure.
The medium-to-long-term outlook for India remains favourable, supported by a large domestic market, increasing infrastructure investment, manufacturing expansion and continued policy support. However, global trade disruptions, geopolitical tensions, commodity prices, exchange-rate volatility and international financial conditions remain important risks for Indian businesses.
The global steel industry continued to operate in a challenging environment during FY 2025-26. Steel demand was affected by weak construction activity in some developed markets, subdued industrial investment, elevated production costs, trade restrictions and continuing uncertainty in global trade.
According to the World Steel Association (worldsteel), global steel demand was expected to remain broadly flat in 2025 at approximately 1,749 million tonnes, followed by growth of around 1.3% in 2026 to approximately 1,772 million tonnes. The forecast indicates that the global steel market is gradually moving towards stabilisation after a prolonged period of weak demand.
China continued to remain the largest steel-consuming market, although its steel demand has been under pressure due to the prolonged adjustment in the property and construction sectors. worldsteel projected Chinese steel demand to decline by approximately 1% in 2026.
In contrast, developing economies excluding China continued to provide important support to global steel demand. Steel demand in these economies was projected to grow by approximately 3.0% in 2026, with India remaining the principal growth market.
Developed economies were expected to witness a gradual recovery in steel demand as inflation moderated and financing conditions improved. However, trade barriers, geopolitical tensions and uncertainty surrounding industrial activity continued to pose risks to the recovery.
The global steel industry is also undergoing structural changes driven by decarbonisation, technological development, energy efficiency requirements and increasing emphasis on domestic supply chains. These developments are expected to influence investment decisions and product demand across the steel value chain.
For steel pipe and tube manufacturers, demand from infrastructure, water supply, oil and gas, power, renewable energy, construction, agriculture, transportation and industrial applications remains important. However, raw material prices, steel-price volatility, freight costs, foreign exchange movements and competition from imported products continue to affect margins.
Accordingly, the global steel industrys outlook remains cautiously positive, with a gradual recovery in demand expected, but with significant exposure to geopolitical and trade-related risks.
India continued to remain one of the fastest-growing major steel markets globally during FY 2025-26. Strong domestic demand from infrastructure, construction, automotive, railways, renewable energy, capital goods and consumer durables continued to support steel consumption.
According to worldsteels April 2026 Short Range Outlook, India is expected to remain the worlds fastest-growing major steel market, with steel demand projected to increase by approximately 7.4% in 2026 and 9.2% in 2027. The growth is expected to be supported by infrastructure-led construction, automotive demand, freight activity, capital expenditure, railway expansion and consumer durables.
The Government of India continues to support the development of the domestic steel industry through infrastructure investment, manufacturing initiatives, quality standards, import monitoring and policy measures aimed at strengthening domestic production.
The Production Linked Incentive (PLI) Scheme for Specialty Steel is intended to promote domestic manufacturing, attract investment and reduce dependence on imports. The Ministry of Steel launched the second round of the Specialty Steel PLI Scheme, known as PLI Scheme 1.1, in January 2025, with 42 MoUs signed with 25 companies across various categories.
The Government has also taken measures to monitor and regulate steel imports. A provisional safeguard duty of 12% for 200 days was imposed on certain non-alloy and alloy steel flat products, while anti-dumping and countervailing measures continue to apply to specified steel products from certain countries. The Steel Import Monitoring System (SIMS) has also been strengthened to improve monitoring of steel imports.
The National Steel Policy, 2017 continues to provide the broader policy framework for development of the Indian steel sector, including objectives relating to domestic capacity creation, higher steel consumption, raw material security, technological development and environmental sustainability.
For manufacturers of steel pipes and tubes, Indias infrastructure and industrial expansion presents attractive long-term opportunities. Demand from construction, water supply, irrigation, agriculture, solar power, transmission infrastructure, railways, roads, oil and gas, petrochemicals and other industrial applications is expected to remain supportive.
However, the sector remains exposed to fluctuations in steel and other raw material prices, imported steel products, freight costs, interest rates, energy costs and changes in government trade policies.
Overall, the long-term outlook for the Indian steel industry remains positive, supported by Indias economic growth, infrastructure development, manufacturing expansion and increasing steel intensity of economic activity.
We believe that our growth in other states in the country can fetch us new business expansion and opportunities. Our emphasis is on scaling up of our operations in other markets which will provide us with attractive opportunities to grow our client base and revenue.
Rise in cost of material and cost of transportation may affect the margin Changes in Government Policies Intense competition may reduce profitability Act of God Client Dissatisfaction Customers inability to pay
6. SEGMENT-WISE PERFORMANCE:
The Companys main business activity is Manufacturing of Steel Pipe.
The Company continues to explore the possibilities of expansion and will make the necessary investments when attractive opportunities arise.
The Company has in place a mechanism to identify, assess, monitor and mitigate various risks to key business objectives. Key business risks and mitigation strategy are highlighted below:
To mitigate the risk of high dependence on any one business for revenues, the Company has adopted a strategy of launching new products/services, globalizing its operations and diversifying into different business segments. The strategy has yielded good results and the Company therefore has a diversified stream of revenues. To address the risk of dependence on a few large clients, the Company has also actively sought to diversify its client base.
The Company has no material litigation in relation to contractual obligations pending against it in any court in India or abroad. The Company Secretary, compliance and legal functions advice the Company on issues relating to compliance with law and to pre-empt violations of the same. The Company Secretary submits a quarterly report to the Board on the Companys initiatives to comply with the laws of various jurisdictions. The Company also seeks independent legal advice wherever necessary.
Riddhi Steel and Tube Limited key assets are its employees. In a highly competitive market, it is a challenge to address the attrition. Riddhi Steel and Tube Limited continues to accord top priority to manage employee attrition by talent retention efforts and offering a competitive salary and growth path for talented individuals.
Companys business may be affected by changes in Government policy, taxation, intensifying competition and uncertainty around economic developments in Indian and overseas market in which the Company operates.
The Company has well defined conservative internal norms for its Business. The Company ensures a favourable debt/equity ratio, moderate liquidity, strong clientele with timely payment track record, appropriate due diligence before bidding and focus on expanding presence in newer markets to minimize the impact in adverse conditions. The Company has geographically and operationally diversified into multiple countries and business segments thereby reducing its dependency on one country or market.
The Companys operations and financial condition could be adversely affected if it is unable to successfully implement its growth strategies. Competition from others, or changes in the products or processes of the Companys customers, should reduce market prices and demanding for the Companys products, thereby reducing its cash flow and profitability. Product liabilities claims may adversely affect the Companys operations and finance.
The Company does strict monitoring of prices and adopts appropriate strategies to tackle such adverse situations. The Company also adopts technological innovations to bring about operational efficiency in continuous basis to remain competitive.
The Company is exposed to risks & fluctuations of foreign exchange rates, raw-material prices and overseas investments exposures.
One of the key requirements of the Companies Act, 2013 is that companies should have adequate Internal Financial Controls (IFC) and that such controls should operate effectively. Internal Financial Controls means the policies and procedures adopted by the Company for ensuring orderly and efficient conduct of its business, including adherence to Companys policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records, and timely preparation of reliable financial information. Your Company process of assessment ensures that not only does adequate controls exist, but it can also be evidenced by unambiguous documentation. The process involves scoping and planning to identify and map significant accounts and processes based on materiality. Thereafter, risk is identified and their associated controls are mapped, else remediation is implemented. These controls are tested to assess operating effectiveness. The auditor performs independent testing of controls. The Auditors Report is required to comment on whether the Company has adequate IFC system in place and such controls are operating effectively. Your Companys Internal Control System is robust and well established. It includes documented rules and guidelines for conducting business. The environment and controls are periodically monitored through procedures/ processes set by the management, covering critical and important areas. These controls are periodically reviewed and updated to reflect the changes in the business and environment.
The Audit Committee periodically reviews the internal controls systems and reports their observations to the Board of Directors.
The Directors have appointed M/s. C. P. Shah & Associates, Chartered Accountants as the Internal Auditors of the Company for the FY 2025-26 on 30/05/2026.
During the year, the Company has generated turnover of Rs. 45,788.34/- Lakhs as compared to Rs. 39,113.34/- Lakhs in the previous year. The net profit before exceptional items and taxes is Rs. 1,581.75/- Lakhs as compared to Rs. 1,019.99/- Lakhs in the previous year. The Company has made net profit after taxes of Rs. 1,145.37/- Lakhs as compared to Rs. 758.65/- Lakhs of the previous year for the year ended 31st March, 2026.
Our Company believes that the human capital is key to bring in progress. The Company believes in maintaining cordial relation with its employees, which is one of the key pillars of the Companys business. The Companys HR policies and practices are built on core values of Integrity, Passion, Speed, and Commitment. The Companys focus is on recruitment of good talent and retention of the talent pool. The Company is hopeful and confident of achieving the same to be able to deliver results and value for our shareholders. As on 31st March, 2026, the total employees on the Companys rolls stood at 82.
The Company continues to run an in-house training programmer held at regular intervals and aimed at updating their knowledge about issues.
The accounting policies have been consistently applied by the Company and are consistent with those used in the previous year. The financial statements have been prepared under the historical cost convention on an accrual basis. The management accepts responsibility for the integrity and objectivity of the financial statements, as well as for the various estimates and judgment used therein.
13. DISCLOSURE OF ACCOUNTING TREATMENT IN PREPARATION OF FINANCIAL STATEMENT:
The Company has followed all relevant Accounting Standards laid down by the Institute of Chartered Accountants of India (ICAI) while preparing Financial Statements.
There has identified the following ratios as key financial ratios:
| Sr. No. | Particulars | 2025-26 | 2024-25 | Changes | Reason |
| 1. | Inventory Turnover Ratio | 0.26 | 0.20 | 28.00 % | Improvement in inventory turnover is mainly due to better utilisation and management of inventory during the year. The firm has maintained more efficient inventory levels in relation to its business operations, resulting in an improvement in the ratio. |
| 2. | Trade Payables Turnover Ratio | 669.06 | 46.28 | 1364.00 % | Decrease in outstanding trade payables has resulted in increase in this ratio. |
| 3. | Net Profit Ratio | 2.98 | 2.31 | 29.00 % | There is improvement in overall the margin hence increase in this ratio. |
| 4. | Return on investment | 132.83 | 94.27 | 41.00 % | The improvement in Return on Investment is mainly attributable to improvement in profitability and better utilisation of the funds/investment employed in the business. The increase in operational efficiency and earnings has resulted in a higher return on the investment during the year. |
15. DETAILS OF ANY CHANGE IN RETURN ON NET WORTH AS COMPARED TO THE IMMEDIATELY PREVIOUS FINANCIAL YEAR ALONG WITH A DETAILED EXPLANATION THEREOF:
| Sr. No. | Particulars | 2025-26 | 2024-25 | Changes | Reason |
| 1. | Return on Net Worth (%) | 15.57 | 12.22 | 27.46 % | There is an improvement in overall profitability during the year, resulting in higher returns generated on the net worth employed in the business. Accordingly, Return on Net Worth has increased from 12.22% in FY 2024-25 to 15.57% in FY 2025-26, reflecting better profitability and utilisation of the firms net worth. |
There is an improvement in overall profitability during the year, resulting in higher returns generated on the net worth employed in the business. Accordingly, Return on Net Worth has increased from 12.22% in FY 2024-25 to 15.57% in FY 2025-26, reflecting better profitability and utilisation of the firms net worth.
Statements in this report on Management Discussion and Analysis describing the Companys objectives, projections, estimates, expectations or predictions may be forward-looking statements within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied.
PLACE: AHMEDABAD DATE: 07.09.2026
By Order of the Board For, RIDDHI STEEL AND TUBE LIMITED
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Rajeshkumar R Mittal Managing Director DIN: 00878934
Preeti Rajeshkumar Mittal Director & CFO DIN: 01594555
Registered Office: 83/84, Village - Kamod, Piplaj Pirana Road, Post - Aslali, Ahmedabad 382427 Tel: (079)- 29700922 Website: www.riddhtubes.com CIN: L27106GJ2001PLC039978
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