RMC Switchgears Ltd Management Discussions

1. Economic and Industry Environment

1.1 Global economic overview

A resilient but pressured world economy: growth slows, and energy costs climb after a mid-year shock, even as electricity outpaces overall energy demand.

Global economic conditions shaped the demand and cost environment for electrical infrastructure throughout the year.

The year opened on a steady footing. In its March assessment, the OECD found global growth resilient and expected it to ease to about 2.9% in 2026. It noted that trade policy stayed uncertain, with the effective United States tariff rate still well above its level before 2025.

A mid-year conflict and the related energy shock then weighed on the outlook. By June, the OECD projected global growth to slow from 3.4% in 2025 to 2.8% in 2026, before recovering to 3.1% in 2027. It is expected that consumer price inflation across the G20 will rise to 4.0% in 2026, from 3.4% a year earlier.

Global trade growth was set to moderate from 5.0% in 2025 to about 3.1% in 2026. In a more severe case, with the disruption persisting, global growth could fall to 2.1% in 2026.

The cost of key inputs rose throughout this period. The World Bank expected average commodity prices to increase by 16% in 2026, the first annual rise since 2022. It forecast energy prices to rise by 24%, with Brent crude averaging about $86 per barrel, up from $69 in 2025. Metal prices stayed high and volatile. Copper rose by 15% in the first quarter of 2026, aluminium prices climbed, and silver and gold reached record levels amid sharp swings.

Energy use kept shifting toward electricity. The International Energy Agency reported global energy demand growth of 1.3% in 2025. Electricity demand grew by nearly 3%, well over twice that pace, confirming what the agency calls the "Age of Electricity". Low-emissions sources met close to 60% of the years energy demand growth, and solar alone met about 70% of the growth in electricity generation. Renewable capacity additions reached a record 800 gigawatts. These conditions shaped the input costs and currency environment in which we operated during the year. They also reaffirm the long-term demand for grid and distribution infrastructure that our business serves.

1.2 Indian economic overview

A standout in a subdued world: India stays the fastest- growing major economy, with benign inflation, a consolidating fiscal position and supportive monetary policy.

India stayed among the faster-growing large economies throughout the year. The OECD estimated Indias growth at 7.6% in FY2025-26, easing to 6.3% in 2026-27 and 6.4% in 2027-28 as higher energy prices weigh on activity.

Domestic conditions held firm. The Reserve Bank of India reported that economic activity stayed largely steady after the mid-year conflict. Manufacturing and services both continued to expand, and business expectations remained positive. Private consumption held up, and fixed investment kept its momentum despite cost pressures.

Public finances and industry stayed strong. The Union Governments fiscal deficit moderated to 4.4% of GDP in 2025-26, its lowest since 2018-19, while capital spending stayed a priority. Growth in the Index of Eight Core Industries eased to 0.5% year-on-year in May 2026, though steel, cement, and electricity stayed strong. Retail inflation rose to 3.93% in May 2026 but held below the 4% target. Foreign exchange reserves stood at about $689 billion at the end of March 2026. Merchandise exports reached a record $45.2 billion in May 2026. The Monetary Policy Committee held the repo rate at 5.25% in June 2026 and kept a neutral, data- dependent stance.

The Reserve Bank supported growth through the year. In June 2025, it cut the repo rate to 5.50% and moved its stance from accommodative to neutral, part of 100 basis points of easing since February 2025. A sustained government push on capital spending, steady demand for power and construction, and lower policy rates support continued investment in grid and distribution infrastructure. That is the market our business serves.

1.3 Indias power sector structure and developments

A sector transformed: near-universal supply, record capacity build, a tilt toward renewables, and distribution and transmission upgrades for our products & services, with EPC serving directly.

Indias power sector has moved from shortage to adequacy. Installed capacity reached 520.51 GW in January 2026, and the peak power shortage fell from 4.2% in FY2014 to 0.03% by December 2025. In FY2025-26, to 31 January 2026, the sector added a record 52,537 MW of capacity, of which 39,657 MW was renewable. This was the highest annual addition on record.

The generation mix is tilting toward clean energy. Total installed capacity has grown from 305 GW in 2015-16 to 533 GW in 2025-26. Non-fossil sources reached 266.79 GW by December 2025, close to half of all capacity, with solar at about 150 GW and wind at about 56 GW. India is working toward 500 GW of non-fossil capacity by 2030.

The grid is being built out to match. The National Electricity Plan for 2023-2032 targets a peak demand of 458 GW by 2032 and an estimated 9.15 lakh crore of transmission investment. The transmission network will expand from about 5 lakh circuit kilometres in January 2026 to 6.48 lakh circuit kilometres by 2032. Inter-regional transfer capacity will rise from 120 GW to 168 GW, and a 335 GW network is planned to carry 280 GW of variable renewable energy.

Distribution reform is the other half of the story. The Revamped Distribution Sector Scheme carries an outlay of about 3.03 lakh crore, and 5.72 crore smart meters have been installed, including 4.05 crore under the scheme. Aggregate technical and commercial losses fell from 22.62% in FY2014 to 15.04% in FY2025, and DISCOMs recorded a profit of 2,701 crore in FY2025. An independent assessment by Macquarie notes an improvement in DISCOMs financial health, supported by reforms and smart metering, with AT&C losses targeted at 12-15%.

1.4 Policy and programme drivers

Two programmes anchor the demand ahead: a national smart-metering rollout still in its early years, and a transmission build-out scaled to a renewable-heavy grid.

The Revamped Distribution Sector Scheme anchors distribution reform. It has sanctioned smart metering for 45 utilities across 28 states and union territories, covering 19.79 crore consumers, 52.53 lakh distribution transformers, and 2.05 lakh feeders. As of December 2025, 3.90 crore smart meters had been installed under the scheme.

The national rollout is scaling, but it is still early. Across the scheme and state programmes, about 20.34 crore smart meters have been sanctioned, and 5.72 crore have been installed by mid-2026. Of these, about 5.60 crore are communicating, and 1.52 crore are prepaid.

Smart metering is a structural reform, not only a technology upgrade. Prepaid metering forms the core of the scheme, improving billing and revenue realisation for utilities. With a scheme size of about 3.03 lakh crore, the rollout has moved from pilots to national infrastructure, delivered largely through Advanced Metering Infrastructure Service Providers, which bring private capital and long-term operations.

Transmission is the second driver. Indias transmission and distribution sector is set for a capital expenditure programme of about $94.32 billion (close to 9 lakh crore) through 2032, driven by the integration of renewables. Ordering was softer in FY2026, with 16 schemes awarded against 45 the year before, which the analysis attributes to temporary manufacturing and execution constraints rather than weaker demand. A high-voltage direct current pipeline of about 32.3 GW is being built, with around 14.5 GW already tendered or awarded.

1.5 Opportunities and threats

The same forces cut both ways: Indias grid build-out and loss-reduction drive open a large market, while cost, currency and supply-chain volatility test margins and timing.

The environment cuts both ways. The structural build-out of Indias grid is a multi-year, policy-backed demand cycle for the products and EPC we supply, while cost, currency and timing volatility test margins and execution. The main opportunities and threats are set out below, with the drivers evidenced in the sections above.

a) Opportunities

Four themes define the opportunity, and each maps to what we make and build.

• Electrification. Indias installed capacity reached 520.51 GW in January 2026, and the peak power shortage fell to 0.03%. Rising demand across households, industry, and agriculture continues to expand the distribution network that carries it.

• Loss reduction. Cutting electrical loss is now a policy priority. Aggregate technical and commercial losses fell from 22.62% in FY2014 to 15.04% in FY2025, but remain high. Theft and technical loss at the transformer node are exactly what certified that intelligent products could address.

• Grid modernisation. Two programmes drive it. A smart-metering rollout has about 14.6 crore of the 20.34 crore sanctioned meters still to be installed, and a transmission build-out is estimated at 9.15 lakh crore to 2032.

• Safety. Electrical safety is rising on the utility agenda, from fire-resistant FRP enclosures and transformer fencing to certified LT distribution boxes. Our IS 14772-certified box is built for this shift.

• Distribution modernisation and underground cabling. Distribution modernisation and underground cabling. The draft National Electricity Plan 2026 prioritises modernising distribution infrastructure and transformers, where our PulseBox operates, and scaling underground cabling, a natural fit for our Electrical EPC. This is the next leg of the opportunity.

b) Threats

The threats are real and mostly external, and we manage them directly.

• Input-cost and currency volatility. The World Bank expected average commodity prices to rise about 16% in 2026 and energy prices about 24%. A weaker rupee raised import-linked costs for copper, aluminium, steel and solar inputs.

• Supply chain. Conflict and shipping disruption kept supply chains exposed. This lengthened procurement cycles and increased reliance on premium and emergency sourcing.

• Competition and execution capacity. Transmission ordering slowed in FY2026, with 16 schemes awarded against 45 the year before, due to manufacturing and execution constraints rather than weaker demand. Higher-voltage equipment carries longer manufacturing and testing cycles.

• Policy and tender timing. Utility projects can take from six months to over a year to convert from pipeline to order, through survey, problem statement and regulatory approvals. This lengthens the pipeline-to- revenue path

2. Company Snapshot

RMC Switchgears Limited is an electrical infrastructure company evolving into a technology-led provider for Indias power distribution network. Founded in 1994 and based in Jaipur, it manufactures, distributes, and sells safety products and executes turnkey projects for Solar, Electrical Distribution and Transmission, and has now built an IP-led IoT-based platform led by PulseBox offering both hardware

and software, along with end-to-end installation and management services. The company is building solutions around safety and protection from theft, electrocution and equipment protection from electrical faults and theft..

2.1 Identity and heritage

A three-decade franchise: from a 5,000 sq. ft. meter-box unit in 1994 to a Main Board-listed, multi-vertical infrastructure company.

RMC began in 1994 as a 5,000 sq. ft. unit making meter boxes for Indias meter manufacturers. Incorporated as RFH Metal Castings Private Limited, it built an early lead in power-distribution enclosures and compounded it over three decades into a broad product and EPC franchise. It remains headquartered in Jaipur, Rajasthan, and stays founder-led.

The Company was renamed RMC Switchgears Limited in 2008. It was listed on the BSE SME platform in 2017 and migrated to the Main Board of the NSE and BSE in April 2026. In 2025, Forbes Asia named it to its Best Under a Billion list. These steps mark its move from a small-cap manufacturer to a Main Board infrastructure franchise.

2.2 Business model and verticals

One franchise, four engines: three operating verticals plus an emerging technology platform, bound by an integrated product-plus-EPC model.

RMC operates across three verticals and is building a fourth. Electrical Products covers smart-meter enclosures, feeder pillars, distribution and junction boxes, FRP safety products, panels and bus bars. Electrical EPC delivers turnkey transmission, distribution, and underground cabling projects. Solar EPC executes turnkey solar work. The emerging platform is PulseBox, the Companys certified smart LT distribution box.

The model is integrated by design. Products give RMC a manufacturing base, deep utility pre-qualifications and margin, while EPC turns those products into turnkey delivery and larger, bundled wins. This product-plus-EPC combination, built on three decades of utility relationships, is the platform from which RMC is moving into higher-value, certified, intelligent products.

2.3 FY2026 KPI strip and footprint

A record year on the top line: consolidated revenue near 402 crore, roughly ten times its FY2022 level, delivered from a single anchor plant

On a consolidated basis, FY2026 revenue reached 401.59 crore, up 26.4%, with EBITDA of 47.10 crore at an 11.73% margin and profit after tax of 22.45 crore. On a standalone basis, revenue was 303.47 crore and profit after tax was 15.85 crore. Consolidated revenue is roughly ten times the 41.6 crore of FY2022.

The Chaksu plant near Jaipur anchors manufacturing. The footprint has grown from the first 5,000 sq. ft. unit to roughly 8,00,000 sq. ft., with capacity scaled to about 3 lakh smart- meter enclosures a year. The Company is ISO 9001:2015 certified.

RMC supplies state utilities, DISCOMs, PSUs and EPC majors. MSEDCL is a marquee reference with distribution infrastructure work in its Jalna and Satara circles. Recognition includes Forbes Asias Best Under a Billion 2025. On certification, PulseBox is Indias first IS 14772-certified smart LT distribution box, the credential that anchors the move into intelligent products.

3. Strategic Review

RMCs strategy is to run a proven, cash-generative infrastructure business with discipline, and to build a second, IP-led platform on top of it. The Company calls this its two-platform strategy. It runs alongside a deliberate choice for quality over turnover, and a utility-by-utility expansion anchored by proof of delivery.

3.1 The two-platform strategy

One company, two platforms: a selective, cash-generative core, and an IP-led technology platform built on top of it.

RMC runs a single franchise on two platforms. The first is its established products-and-EPC business, run selectively for quality and cash. The second is an IP-led technology and manufacturing platform, still early, led by PulseBox. The two share the same plant, utility relationships and engineering base.

a) Platform 1: the selective, quality-led foundation

Platform 1 is the operating core: Electrical Products, Electrical EPC and Solar EPC. It carries three decades of utility pre-qualifications, a single high-capacity plant and an integrated product-plus-EPC model. The Company runs it selectively, favouring projects and customers that convert into cash and return rather than chasing volume. This is the base that funds the second platform.

b) Platform 2: the IP-led technology and manufacturing platform

Platform 2 is RMCs move from manufacturing into power technology, led by PulseBox, its IS14772-certified smart LT distribution box. PulseBox is designed to cut electrical loss and theft and to give utilities better visibility of distribution infrastructure. It is at the pilot stage, with proof of concept completed across five- plus states and a dedicated manufacturing line being set up. Management sizes the addressable problem at about 50,000 crore of total addressable market, as a measure of the opportunity PulseBox targets, not as a revenue forecast or an order book. The TAM is calculated based on the number of transformers installed in India in urban areas. The total number of transformers in India is around 2.5 crores, out of which around 40% are in urban areas.

3.2 Selectivity and capital allocation

Quality of business over turnover: RMC is prioritising cash flow, returns and a stronger balance sheet over top-line growth.

a) Quality of business over turnover, cash flow, and returns

RMC has been explicit that it will prioritise the bottom line and cash flows over top-line growth. Management describes FY2026 as a learning year, in which operating cash flow turned negative under pressure from debtors and retention, and has set out a clear aim: tighter working-capital discipline, prudent capital allocation, improved return on investment, and a return to positive operating cash flow and a stronger balance sheet in FY2027.

b) Centrally funded project focus and utility selectivity

The Company is selective about where it competes. It favours centrally funded and centrally sponsored work, such as RDSS distribution projects, where funding and payment discipline are stronger, and it is deliberate about which state utilities it takes on. This selectivity is the operating expression of quality over turnover: fewer, better-funded projects that convert to cash.

c) MOAT-focused project selection

Beyond payment discipline, RMC is choosing projects that build qualifying credentials for the larger contracts ahead. Executing work in transmission lines, substations and underground cabling, alongside smart-grid modernisation and SCADA-based substation monitoring and automation, earns the pre-qualifications that gate entry to bigger tenders.

Each selective win is therefore also an investment in eligibility for the next, larger one.

d) Product-range transition

To meet the demand building in underground cabling, transmission lines, data centres, EV charging, solar parks, thermal plants and battery storage, RMC is moving its Electrical Products division up the voltage curve, from low-voltage toward medium- and high-voltage panels.

The transition is expected to take about 18 to 24 months, positioning the Company to serve higher-value demand as capacity in these segments tightens.

3.3 Utility focus and expansion

Prove the model with one utility, then extend it: MSEDCL is the reference, and the pipeline is widening to other states.

a) MSEDCL as proof of model

MSEDCL is RMCs proof of model. The Company is executing distribution infrastructure work in the Jalna and Satara circles of MSEDCL, in close coordination with utility officers and in accordance with MSEDCL standards. Management frames Maharashtra as its first such project, and the template for solving a utilitys problem end-to-end.

b) Extension to other state utilities

The model is designed to travel. RMC is in active discussions with five utilities and has deployed a PulseBox proof of concept across five-plus states. Its customer base already spans DISCOMs in Rajasthan, Uttar Pradesh, Assam, Madhya Pradesh, Uttarakhand, Chhattisgarh and Kerala. Each new utility that adopts the model widens the base for both platforms.

4. Segment Performance

RMC reports a single statutory segment under Ind AS 108. Alongside this, management discloses a vertical view of the business, which is the basis for the analysis below. FY2026 saw a marked shift in the mix: Solar EPC became the largest vertical, Electrical EPC declined after a year of delayed execution, and Electrical Products grew strongly

4.1 Electrical Products

The manufacturing core: smart-meter enclosures, feeder pillars, distribution boxes and panels, growing and feeding the EPC business.

Description. Electrical Products makes smart-meter enclosures, feeder pillars, distribution and junction boxes, and electrical panels. It is the franchises manufacturing base and the source of captive demand for the EPC verticals.

Performance. Revenue rose to 96.48 crore in FY2026, about 24% of the total, up from 60.84 crore in FY2025, a gain of roughly 59%.

Highlights. The vertically scaled smart-meter enclosure outputs about 3 lakh units a year and continues to supply the RDSS-driven metering rollout, where certified, intelligent products lift blended margins.

Outlook. Smart metering, distribution upgrades, and RDSS incentives, with a path into MV and HV panels, LV retail, and smart-meter-enclosure scale-up anchoring demand.

4.2 Electrical EPC

The turnkey engine: transmission, distribution, and substation projects, delayed in FY2026, but opening a new transmission-line of business.

Description. Electrical EPC delivers turnkey transmission and distribution infrastructure, smart grid and substation automation, and specialised electrical projects, integrating RMCs own products for end-to-end delivery.

Performance. Revenue was 96.13 crore in FY2026, about 24% of the total, down from 253.72 crore in FY2025.

Extended rainfall in Maharashtra delayed site-level activity and shifted part of the execution cycle into the second half, alongside execution and procurement challenges.

Highlights. RMC won its first Transmission EPC order, in Rajasthan, worth about 70 crore, with billing starting in Q2 FY2027. This opens transmission as a new line within the vertical.

Outlook. The pipeline is supported by the national transmission build-out and smart-grid investment, with a focus on centrally funded, payment-disciplined projects and stronger execution oversight.

4.3 Solar EPC

The FY2026 growth driver: ground-mounted and rooftop solar scaled from a low base to become the largest vertical.

Description. Solar EPC executes ground-mounted solar, solar pumps and rooftop solar installations, drawing on RMCs own electrical products for integrated delivery.

Performance. Revenue reached 208.99 crore in FY2026, about 52% of the total and the largest vertical, up from 1.74 crore in FY2025 as large solar orders moved into execution. During the year, China-linked supply chain disruptions, safeguard duty cost movements, and higher solar input costs affected earlier project assumptions, and some older orders were reworked or deferred.

Highlights. The Solar EPC order book stood at about 125 crore, with roughly 400 crore in active tenders at year-end.

Outlook. Demand is supported by the 280 GW solar target by 2030 and domestic solar manufacturing, with pricing discipline and escalation cover applied to new bids.

4.4 Emerging technology platform (PulseBox)

The IP-led platform: a certified smart LT distribution box, at pilot stage, with early field validation.

Description. PulseBox is RMCs IS 14772-certified smart LT distribution box, an indigenous IoT platform for monitoring, verification, and fault protection, designed to reduce electrical losses and theft and provide utilities with better visibility into distribution infrastructure.

Pilot-stage status. PulseBox is in the pilot stage, with a proof of concept deployed across five-plus states, demonstrating cross-geographical applicability and robustness under diverse field conditions.

Field results. In field pilots, real-time busbar temperature and overload monitoring detected thermal stress before burnout, including a sustained overload detected in the Nashik pilot, while current differential monitoring between incoming feeders and outgoing lines flagged bypass and theft.

Outlook. Management sizes the addressable problem at about 50,000 crore in distribution losses, based on the scale of the opportunity PulseBox targets, not a forecast or an order book. A dedicated manufacturing line is being set up as the platform moves from pilot toward commercial scale.

5. Financial Performance

This section covers the FY2026 results on a labelled basis, the five-year record, the standalone-to-consolidated bridge, the margin-variance explanation for the year, the significant changes in key ratios, and the change in Return on Net Worth.

5.1 Results overview

A record top line with a compressed margin: revenue up 26.4% to 401.59 crore, and a return to profit in Q4 after a loss in Q3.

On a consolidated basis, FY2026 revenue rose 26.4% to 401.59 crore, EBITDA was 47.10 crore at an 11.73% margin, and profit after tax was 22.45 crore at a 5.59% margin. On a standalone basis, revenue was 303.47 crore and profit after tax was 15.85 crore, with earnings per share of 15.01. The years profit was second-half weighted: the Company moved from a loss of 7.07 crore in Q3 to a profit of 9.30 crore in Q4.

5.2 Five-year consolidated summary

Roughly ten times larger in four years: consolidated revenue has compounded from 41.6 crore in FY2022 to 401.6 crore in FY2026

Consolidated revenue moved from 41.6 crore in FY2022 to 125.3 crore, 172.6 crore, 317.7 crore and 401.6 crore in the years to FY2026. Profit after tax was 22.45 crore in FY2026, down from 30.89 crore in FY2025, EBITDA was 47.10 crore in FY2026, compared with 40.38 crore in earlier years. The four-year record is one of rapid top-line compounding, with FY2026 the first year in which margins compressed.

5.3 Standalone-to-consolidated bridge

The consolidated accounts add the solar and green-energy subsidiaries to the standalone base.

Standalone revenue of 303.47 crore translates to consolidated revenue of 401.59 crore, a difference of about 98.12 crore attributable to subsidiaries, chiefly the solar and green-energy entities. Standalone profit after tax of 15.85 crore bridges to consolidated profit after tax of 22.45 crore, a difference of about 6.60 crore. The subsidiary contribution reflects the scale-up of Solar EPC during the year. A line-byline reconciliation is set out in the financial statements.

5.4 Margin-variance explanation

Margins compressed in a hard cost-and-execution year, concentrated in the second half, and are being addressed structurally.

FY2026 revenue grew, but margins compressed. The pressure was concentrated in the second half and stemmed from a combination of cost, execution, and product-development factors, as described below.

• Input-cost inflation. Prices of steel, copper, aluminium and silver stayed high and volatile through the year, moving sharply around year-end, with Wholesale Price Index inflation at 3.88% in March 2026, raising the cost of both products and EPC inputs.

• Year-end input and logistics pressure. Around year-end, fuel, freight, logistics and procurement lines tightened, with sharp increases in crude, natural gas and fuel-and- power costs adding to margin pressure.

• Solar cost movements. China-linked supply-chain disruptions, safeguard duty cost movements, and higher solar input costs exceeded the assumptions in some earlier Solar EPC orders, which were cancelled, reworked or deferred, with some procurement cycles extended by nearly two months.

• Execution delays. Extended rainfall in Maharashtra delayed site-level activity and shifted part of the execution cycle into the second half.

• Cost absorption on existing orders. Older orders absorbed cost increases directly, as input prices moved beyond their original cost structure; the response is tighter project selection and procurement discipline

• PulseBox investment. Continued investment in the design and development of PulseBox was expensed during the year as an investment in future differentiation.

Taken together, these factors resulted in a loss of 7.07 crore in Q3, followed by a profit of 9.30 crore in Q4, supported by better execution, improved material availability, project catch-up, a stronger project mix and tighter operating discipline. Management asks that the second half be read as a whole rather than Q3 in isolation, and frames the response as better project selection, stronger procurement discipline, improved execution oversight and prudent capital allocation, rather than as ongoing conditions..

5.5 Significant changes in key financial ratios

Under SEBI rules, ratios that moved by 25% or more are set out below with explanations.

a) Profit margins and interest-coverage ratio. The net profit margin fell from about 9.7% in FY2025 to about 5.6% in FY2026, a decline of roughly 42.72%, driven by the years margin compression. The EBITDA margin was 11.73% in FY2026, down from 16.48% in FY2025. The interest coverage ratio decreased from 3.74 in FY2025 to 2.32 in FY2026, a change of (37.94%).

b) Debt-equity ratio. The debt-to-equity ratio was 0.79 in FY2026, compared with 0.53 in FY2025, a change of (49.49%).

c) Debtors and inventory turnover, current ratio. Debtors turnover was 160.62 in FY2026, compared with 137.71

in FY2025, a change of 16.64%; inventory turnover was 15.88 in FY2026, compared with 14.70 in FY2025, a change of 8.04%; and the current ratio was 1.32 in FY2026, compared with 1.55 in FY2025, a change of (15.12%). Movements here reflect the working-capital build and receivable pressure during the year.

5.6 Change in Return on Net Worth

Return on Net Worth fell in line with the lower profit for the year.

Return on Net Worth was 22.04% in FY2026, down from 36.26% in FY2025, a change of (39.21%). The decline follows directly from a lower after-tax profit of 22.45 crore, down from 30.89 crore in FY2025, on a net-worth base of 130.46 crore. As margins recover and cash conversion improves, management expects the return to rebuild. The detailed computation is set out in the financial statements.

6. Operational Performance

6.1 Order book and tenders

A record book of confirmed work, backed by a much larger tender pipeline.

a) Confirmed order book. The confirmed order book exceeded 800 crore at year-end, providing visibility into execution in FY2027.

b) Active tenders. Active tenders exceeded 1,500 crore. These are opportunities in the Companys pipeline that the Company is bidding for, not confirmed orders, and should be read as such.

c) Component reconciliation. Within the confirmed book, disclosed components include the Solar EPC order book of about 125 crore, the first Transmission EPC order of about 70 crore, and Electrical Products execution of about 35 crore, with the remaining spread across Electrical EPC and other work. Within tenders, disclosed components include about 400 crore in Solar EPC and an 89 crore Electrical Products pipeline, with the balance spread across other verticals.

6.2 Execution and procurement discipline

Escalation-linked pricing and a centrally funded focus, to protect margin and convert work to cash.

a) Escalation clauses and procurement cycles. From Q3 FY2026, RMC introduced price-escalation clauses in EPC bids, so that input-cost movements are passed through rather than absorbed. Procurement cycles lengthened during the year for higher-voltage equipment and imported inputs, which the Company is managing through earlier ordering and tighter oversight of execution.

b) EPC cash flow, receivables and the centrally funded focus. Operating cash flow turned negative in FY2026 under debtor and retention pressure, a pattern management attributes to a learning year. The response focuses on centrally funded, payment-disciplined projects, tighter working-capital management, and a stated aim of positive operating cash flow and a stronger balance sheet in FY2027.

6.3 Capacity and the shift to higher-value products

A single high-capacity plant, tilting its output toward higher- value, certified products.

Manufacturing is anchored by the roughly 8,00,000 sq. ft. Chaksu plant, with smart-meter-enclosure capacity scaled toward about 3 lakh units a year. The strategic shift is toward higher-value output: entry into medium- and high-voltage panels, an LV retail push, and certified, intelligent products led by PulseBox, which management expects to lift blended margins over time. Capacity is being aligned to this mix rather than to volume alone.

7 Risk Management and Internal Controls

7.1 Key risks and mitigation

The main risks are cost, currency, cash conversion, execution timing and technology adoption, each with a defined response.

• Input-cost and forex risk. Volatile commodity prices and a weaker rupee raise input costs. Mitigation: price- escalation clauses in EPC bids, selective bidding, and disciplined procurement.

• Fixed-price-contract exposure. Older fixed-price orders carry cost increases directly. Mitigation: escalation-linked pricing starting in Q3 FY2026 and tighter bid discipline for new work.

• EPC cash-flow and receivables risk. EPC work ties up working capital in receivables and retention. Mitigation: a focus on centrally funded, payment-disciplined utilities and tighter working capital management.

• Execution and conversion-cycle risk. Site conditions, weather and long pipeline-to-order cycles can delay revenue. Mitigation: stronger execution oversight, selective project intake, and seasonality planning.

• Technology and adoption risk. PulseBox is early, and utility adoption is unproven at scale. Mitigation: pilot-led validation, national certification, and a phased transition from proof of concept to commercial scale.

7.2 Internal control systems and their adequacy

Controls are commensurate with the size and nature of the business and were reported as adequate.

RMC maintains an internal control framework commensurate with the size, scale and complexity of its operations, covering financial reporting, authorisation, and compliance. The framework is overseen by the Board and its Audit Committee, with periodic review of controls and processes. The statutory audit for FY2026 carried an unmodified opinion, and the Company also undertakes a cost audit. Management considers the internal financial controls to be adequate and operating effectively.

8 Human Capital

RMC treats its people as its most valuable resource and aligns its human-resource practices with business priorities, investing in people and processes to improve delivery. As the Company shifts toward certified, intelligent products, building engineering and technology capability is central to the plan.

8.1 Workforce

A workforce of 557 across the head office and the Chaksu plant, with women making up more than a fifth of the team.

a) Headcount. RMC employed 557 people as of the reporting date, across its head office and Chaksu manufacturing facilities, spanning manufacturing, EPC execution, engineering and corporate functions.

b) Women’s participation. Women make up 21.9% of the total workforce, 122 of 557. The Company provides equal opportunity in recruitment, training and career progression, reflecting a stated commitment to womens empowerment and an inclusive workplace.

8.2 Capability building and safety

Developing the team for the next phase and holding health and safety as a first principle.

RMCs working culture rests on four practices, spanning development, performance, conduct and safety.

• Employee development. The Company works to attract, develop and retain talent in a competitive environment, with regular training and skill-development initiatives that keep employees current with industry trends and build the engineering and technology capability the next phase requires.

• Performance management. A performance- management system balances business needs with individual aspirations through key result areas and performance indicators, while employee engagement surveys and feedback align strategy with employee expectations.

• Ethics and compliance. RMC follows a strict code of ethics and fair corporate practices, ensuring a workplace where privacy and personal dignity are respected and protected.

• Safety and well-being. Employee health and safety are treated as paramount. The Company maintains stringent safety protocols and provides protective equipment and training across the plant and project sites.

9 Sustainability and ESG

RMCs core markets, solar EPC, smart metering and loss reduction, are themselves part of Indias clean-energy and efficiency agenda. Alongside that, the Company runs its own environmental, governance, and community programmes, integrating sustainability into its core operations.

9.1 Environment

Cleaner power at the core of the business, and a growing set of environmental initiatives around it.

• Renewable energy integration. RMC has invested in renewable energy at its own operations, including a new 249 kW solar plant at its manufacturing facility. This reduces the Companys carbon emissions and supports Indias target of 450 GW of renewable energy by 2030.

• Environment and Resource Protection programme.

The Companys environmental programme covers solar energy generation, water conservation drives, and plantation initiatives to keep emissions and waste within regulatory limits.

• Greener manufacturing. Operations are run in accordance with ISO 9001:2015, with a focus on safe, clean processes and a lower environmental footprint.

9.2 Governance and BRSR linkage

A governance framework that prioritises sustainability, ethics and stakeholder responsibility.

RMCs corporate governance framework prioritises sustainability, ethical practices and stakeholder responsibility, and integrates sustainability into core operations. Following its migration to the Main Board, the Company operates Board committees covering audit, nomination and remuneration, stakeholder relationships and corporate social responsibility. Business Responsibility and Sustainability Reporting is being addressed in line with applicable SEBI requirements and the Companys reporting stage.

9.3 Community and CSR

Community investment is governed by the Boards CSR framework, with local, practical programmes.

The Companys community work is governed by its Boards CSR framework and policy and focuses on health and local infrastructure in the vicinity of its operations.

• Blood donation. RMC organised a blood-donation camp that collected about 400 units of blood. With each unit able to benefit up to three patients, the drive can potentially support up to 1,200 individuals, from accident and surgical patients to those with cancer and blood disorders.

• Solar street lighting. In partnership with the Anushree Foundation, RMC installed solar-powered streetlights along the previously unlit Chaksu Road leading

to its facility, improving road safety and security for surrounding villages while advancing green infrastructure.

CSR spending for FY2026 was about 0.55 crore. Programme details are set out in the CSR report.

10 Strategic Outlook and Cautionary Statement

10.1 FY2027 priorities

Fix the core and ramp the platform: margin and cash recovery first, then PulseBox to market.

a) Selective core growth and margin recovery. The priority is to rebuild margin and cash. That means escalation- linked pricing, tighter execution oversight, a selective, centrally funded project focus, and a return to positive operating cash flow and a stronger balance sheet in FY2027.

b) The technology-platform ramp and PulseBox go-to- market. The second priority is to take PulseBox from pilot toward commercial scale, supported by a dedicated manufacturing line and utility adoption, while continuing to invest in the platform as the Companys longer-term differentiator.

10.2 The long-term aspiration

A long-term ambition, stated as an aspiration rather than a forecast.

Over the longer term, management has spoken of an aspiration to achieve revenue growth of more than 30% per year over the next three to five years, and of evolving from an electrical infrastructure manufacturer into an IP-led power technology provider. This is a long-term aspiration, dependent on execution and market conditions, and is not a forecast, a commitment or guidance for any particular year.

10.3 Cautionary statement

On forward-looking statements.

This Management Discussion and Analysis contains forwardlooking statements about the Companys objectives, strategy, plans and prospects. These statements are based on current expectations and assumptions and are subject to risks and uncertainties, including those affecting its markets, costs and execution. Actual results may differ materially from those expressed or implied. Any opportunity sizing referred to in this report, including the figure discussed for PulseBox, describes the scale of a market problem and is not a revenue projection or an order book. The Company undertakes no obligation to update any forward-looking statement, whether because of new information, future events or otherwise, except as required by law.