RIR Power Electronics Ltd Management Discussions

INDUSTRY OVERVIEW

RIR Power Electronics Limited, operating since last five decades has identified its core strength in niche Power Electronics Industry with focus on two segments i.e. manufacturing low and high power semiconductor devices like diodes, thyristors modules and bridge rectifiers by processing chips from 28mm to 125 mm diameter in the state of the art facility and also manufacturing of Power Equipments like Rectifiers, Battery Chargers, High Power Stacks, Rectifier Panels used in diverse industrial sectors.

With global demand shift from conventional fuels to alternative energy such as EVs and other ecofriendly electric applications, has resulted in new demand for semiconductors which forms a core for all electric run applications. Your company continues to monitor these positive shifts in demand and technology and is constantly working towards exploring new business avenues in this sector. Various government policies such as Atma Nirbhar Bharat, launching of Semiconductor policy, PLI schemes and curb on imports; are all positive developments would benefit the small businesses in the organized sector to grow & show better performance in the near future.

Indian semiconductor industry -

Indias semiconductor market, valued at approximately US$38 billion in 2023, is on a strong growth path, with projections indicating expansion to US$45-50 billion by 2025 and US$100-110 billion by 2030, according to recent government reports. This trajectory reflects the countrys focused efforts to position itself as a vital player in the global semiconductor value chain.

As the global semiconductor industry moves toward the US$1 trillion milestone by 2030, India is well-positioned to secure a meaningful share. The government continues to drive progress through strategic policy interventions aimed at scaling domestic capabilities across design, fabrication, and advanced packaging.

Indias approach has evolved from policy formulation to execution. We are witnessing the rollout of fabrication facilities, design hubs, and assembly units across key regions, laying a strong foundation for large-scale, end- to-end production capacity.

The announcement of several high-impact semiconductor projects in recent years highlights growing confidence among investors and stakeholders. These developments align with Indias broader ambition to become a globally competitive manufacturing and innovation hub in this critical sector.

This momentum is underpinned by a clear strategic focus: to localize semiconductor manufacturing,

diversify global supply chains, and attract cutting-edge

technology partners—all within a supportive ecosystem of targeted incentives, skilled workforce initiatives, and robust policy frameworks.

Importantly, Indias semiconductor strategy is designed to build resilience and depth across the entire value chain—from equipment and raw materials to services and engineering expertise. This integrated approach ensures that India not only assembles chips but also delivers critical inputs and know-how, strengthening its role as a full-spectrum contributor to the global semiconductor ecosystem.

As management, we view this evolving landscape as a transformative opportunity—both for the sector and for Indias broader industrial growth. We remain committed to engaging with stakeholders, leveraging strategic partnerships, and aligning our efforts with the national vision to drive long-term value creation.

BUSINESS REVIEW

(a) Company Outlook:

During the year 2024-25, your Company experienced improved demand in all the three segments i.e. Semiconductor Devices, High Power Equipments and Exports, and registered an overall total revenue growth of around 27%. The positive trend experienced in the previous year is expected to continue during F.Y.25-26. The Company remains committed to expanding its presence in the high- power semiconductor devices sector, with a strong emphasis on growth in international markets.

(b) Opportunities and Threats:

The company is setting up a 6,186 Million Silicon Carbide (SiC) plant in Odisha, a first of its kind in India, through the help of central government incentive schemes and also Odisha State Government incentives. The plant will create an ecosystem by leveraging vertical integration, securing the supply chain and significantly reducing the dependency of imports of SiC components in India.

Amidst persistent trade tensions between the US and China, ongoing conflicts in Ukraine and the Middle East, and increasing national control over critical technologies, semiconductor firms prioritize the resilience of their supply chains.

SEGMENTWISE PERFORMANCE

The Company continues to operate in one segment i.e. Power Electronics thus segment-wise reporting as per the requirements of Ind AS 108 is not applicable to the Company.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY

The Company has an adequate system of internal controls to ensure that the transactions are properly authorised, recorded and reported, apart from safeguarding its assets. The internal control system is supplemented by well-documented policies, guidelines and procedures and reviews carried out by the Companys internal audit function. The Company continues to obtain the services of M/s. Bhandarkar & Kale, Chartered Accountants, to oversee and carry out internal audit of the companys activities and submit their reports periodically to the Management and the Audit Committee of the Board.

The Audit Committee, Statutory Auditors and the business heads are periodically apprised of the Internal audit findings and corrective actions taken.

FINANCIAL PERFORMANCE

(i) Profits and Earnings: During the year, the Companys Total Revenue increased by 26.88% to 8825 Lakhs as compared to 6,955 Lakhs in 202324. Earnings before Interest, Tax and Depreciation and Amortisation (EBITDA) for the year increased by 14.39 % to 1,139.43 Lakhs as compared to 996.13 Lakhs in the previous year. Net Profits of the Company increased by 4.02% during the year to 828 Lakhs as against 796 Lakhs last year.

(ii) Capital Expenditure: A capex of 650 Mn was

incurred at the new Odisha plant to manufacture SiC wafers and devices.

(iii) Finance Costs: The finance costs has increased by 16.06% to 144 Lakhs for the year, up from 125 Lakhs in the previous year.

HUMAN RESOURCES

During the year, there has been no material development in Human Resources / Industrial relations. Your Company has a favourable work environment that motivates performance, customer focus and innovation while adhering to the highest degree of quality and integrity.

Your Company takes pride in the commitment, competence and dedication shown by its employees in all areas of business. Various HR initiatives are taken to align the HR policies to the growing requirements of the business.

CAUTIONARY NOTE

The statement in the Management Discussion and Analysis describing the Companys objectives, projections and estimates may be forward looking within the meaning of applicable laws and regulations. Actual results may differ from those expressed. Important factors affecting the Companys operation include global and domestic supply and demand conditions, input availability and production costs, currency fluctuations, changes in Government regulations, tax laws, economic developments within the country and other factors such as litigation and industrial relations.