RTS Power Corporation Ltd Management Discussions

ANNEXURE - E TO DIRECTORS REPORT

Industry Structure and Developments:

1. Your Company is a manufacturer of Power & Distribution Transformers used in the generation, transmission and distribution of electricity. The product portfolio has been further enhanced with the introduction of Galvanized Steel Wires and Strips by our Wholly-owned Subsidiary, Reengus Wires Private Limited.

2.

3. It is pertinent to mention here that your company primarily operates in the distribution segment of the T&D eco system. This segment is operated by Discoms or Distribution Utilities.

The Power Sector has gone through dynamic changes over the last 4-5 years and Traditional channels of business have undergone a rapid evolution. The companies main segments of business have witnessed a sustained muted business environment whereas areas where the company has been absent such as Renewable Energy and Power Transmission segments have undergone a massive surge in demand. While the company does not intend to re-enter the Discom supply business in a meaningful way, to increase business volumes, the company has planned to prepare prototypes for testing of Inverter Duty Transformers used in Renewable Projects. Also, within the distribution segment the company plans to introduce an entire range of High Energy Efficient product portfolio.

With these remedial measures, the company is confident to increase its volumes and sales in a sustainable and manner in the years to come.

Opportunities and Threats : Opportunities:

Over the years many initiatives were introduced by the Government to strengthen the economy. The outlook for the power sector in India appears to be promising. The Power Sector is slated is slated for sustainable growth and will be a major factor supporting the Country s future development.

4. The transformer industry is experiencing significant growth, driven by increased industrialization, urbanization, and the expansion of renewable energy sources.

Key Trends and Drivers:

?€? Renewable Energy Integration: The increasing adoption of renewable energy sources like solar and wind power is creating a need for transformers to connect these sources to the grid.

?€? Urbanization and Industrialization: As cities and industries expand, the demand for electricity increases, leading to a greater need for transformers to support transmission and distribution.

?€? Smart Grid Development: Smart grids, which use advanced technologies to manage electricity distribution, are driving demand for transformers with enhanced capabilities

?€? Modernization of Existing Infrastructure: Aging power grids require upgrades and replacements, leading to increased demand for new and more efficient transformers.

Threats:

?€? Raw Material Volatility and Availability: Fluctuations in the prices of key raw materials such aluminium and copper, impacts the costing of transformers. Availability of CRGO has been a major problem for the past few years due to the issuing of quality control orders by the Govt of India, and overall high demand in world markets.

?€? Competition: The market is becoming increasingly competitive, with companies quoting very low prices and development of unhealthy competition.

Segment-Wise Performance

Standalone (Rs. in Lakhs)

Particulars	Revenue From Operations
	Financial year ended 31.03.2025	Financial year ended 31.03.2024
Electrical-Equipment-	11,313.79	5,652.47
Transformers
Wind Energy	79.66	93.64
TOTAL INCOME	11,393.45	5746.11

Consolidated (Rs. in Lakhs)

Particulars	Revenue From Operations
	Financial year ended 31.03.2025	Financial year ended 31.03.2024
GI Steel Wires and Strips	8721.41	8300.00
ElectricalEquipment	11313.79	5652.47
-Transformers	79.66	93.64
Wind Energy
TOTAL INCOME	20114.87	14046.40

As can be observed from the above 2 tables, revenue from operations have increased significantly between FY 23-24 and FY 24-25. The standalone sales have doubled primarily due to increase in revenue of Transformers. Wind Energy is a very small part of the sales mix. Although standalone sales have doubled, we are well below our manufacturing capacity. The company has the capacity to further double its sales from hereon without any major additional capex. The company only requires additional working capital for the same.

GI Wires has stabilized and with the additional capacity increase ongoing since last year, the sales in this segment should increase as well.

Operational Performance

Consolidated (Rs. in Lakhs)

PARTICULARS	Year Ended 31.03.202	Year Ended 31.03.202
Total Income	20472.21	14584.89
EBITDA	1110.05	1,277.98
Profit Before Tax	332.61	558.23
(PBT)
Profit After Tax (PAT)	351.41	413.30

Standalone (Rs. in Lakhs)

PARTICULARS	Year Ended 31.03.2025	Year Ended 31.03.2024
Total Income	11,848	6,393
EBITDA	888	1,053
Profit Before Tax (PBT)	412	622
Profit After Tax (PAT)	457	443

There has been a significant increase in the revenue from operations at both the standalone as well as the consolidated level, however, due to various cost pressures, this has not lead to a significant increase in the profitability levels. We are hopeful that current year onwards there will be a better fixed cost absorption and therefore better margins and profitability.

KeyFinancial

Please refer to the Directors Report.

Future Outlook

Overall, the transformer industry is poised for continued growth, with a strong focus on renewable energy integration, smart grid development, and modernization of existing infrastructure. Companies that can offer cost-effective, efficient, and sustainable solutions will be well-positioned to capitalize on the opportunities in this dynamic market.

Risks and concerns

Due to rise in the price of Raw Materials, the Company faced margin pressure. Competition from unorganized and semi-organized sector continues to depress prices.

However, the Management is fully aware of the risks and threats and actively works towards mitigating the same.

Internal Control Systems and their adequacy

The philosophy being followed with regard to Internal Control Systems and their adequacy has been formulation of effective systems, commensurate with the Company s size and nature of its operations and their strict implementation to ensure that assets and interests of the Company are safeguarded and checks and balances are in place to determine the accuracy and reliability of the accounting data. The Company has a well-established and comprehensive Internal Control structure to ensure that all assets are safeguarded and protected against loss from unauthorized use or disposition, that transactions are properly authorized recorded and reported correctly and that operations are conducted in an efficient and cost effective manner and that all applicable laws and regulations are complied with. Your Company has proper and adequate system of Internal Control in all areas of its operations. This Internal Control System is regularly reviewed and monitored. The Audit Committee of the Board of Directors supervises the functioning and effectiveness of Internal Controls.

Material developments in Human Resources / Industrial Relations front

Employee Relations scenario of your Company continues to be excellent.

Your Company would like to record its appreciation of the whole hearted support and dedication from employees at all levels numbering 47 permanent employees and 3 Executive Directors (including Managing Director) and two Key Managerial Personnel (KMPs) as on March 31, 2025 in sustaining its operations and functioning during the period under review.

	For and on behalf of the Board of Directors
Registered Office:
Directors
56, Netaji Subhas Road
2nd Floor,	JAGABANDHU BISWAS
Kolkata 700001.	CHAIRMAN
Dated : 14.08.2025	DIN 10274176