Rulka Electricals Ltd Management Discussions

Global Economic Overview - FY 2025-26

During FY 2025-26, the global economy continued to navigate a complex environment marked by divergent growth trajectories and elevated policy uncertainty, as highlighted in the IMFs January 2025 World Economic Outlook. Despite ongoing geopolitical tensions and persistent inflationary pressures, global output expanded at 3.3%, broadly in line with the previous year and marginally below the long-term historical average of 3.7%. The resilience of advanced economies, coupled with steady momentum in select emerging markets, helped offset headwinds from energy price volatility and tighter financial conditions, thereby sustaining overall stability in global growth.

Advanced economies, particularly the United States, outperformed expectations due to strong domestic demand, prompting an upward revision in growth forecasts. In contrast, several major economies, including parts of Europe and East Asia, faced downward revisions amid weak manufacturing activity, subdued consumer confidence, and lingering energy cost burdens.

Global headline inflation showed signs of moderation, projected to decline to 4.2% in 2025 and further to 3.5% in 2026, with advanced economies expected to return to target levels earlier than emerging markets. However, renewed inflationary pressures and policy-generated disruptions remain key risks that could interrupt the disinflation process and delay monetary easing.

For emerging markets such as India, these dynamics imply both opportunities from resilient global demand and challenges from elevated financing costs and commodity price volatility, which remain relevant for SMEs in the infrastructure and EPC sector. Financial markets during FY 2025-26 responded positively to the anticipated pivot in central bank policies, resulting in eased financial conditions, rising equity valuations, buoyant capital flows to emerging markets (excluding China), and restored market access for several low-income and frontier economies.

At the same time, the IMF cautioned that medium-term risks remain tilted to the downside, underscoring the importance of prudent fiscal management, structural reforms, and stronger multilateral cooperation to sustain growth and stability. Global growth is projected at 3.0% in 2025 and 3.1% in 2026, with headline inflation expected to moderate to 4.2% in 2025 and 3.6% in 2026, though renewed price pressures and policy-related disruptions could delay monetary easing.

Against this backdrop, cautious optimism prevailed for infrastructure and industrial sectors, particularly in India, where your Company continues to expand its footprint in electrical contracting and fire-fighting installations.

(Based on IMF World Economic Outlook - January 2025 and July 2025 Update)

India-Specific Economic Overview - FY 2025-26

Indias economy in FY 2025-26 continued to assert its position as the worlds fastest-growing major economy, demonstrating resilience amid global headwinds and domestic structural shifts. According to the National Statistical Office (NSO), real GDP growth is estimated at 6.4%, moderating from 8.2% in the previous fiscal year, reflecting a normalization of post-pandemic momentum and sectoral rebalancing.

Major Sectoral Trends

• Agriculture and Allied Sectors : Real GVA growth improved to 3.8% , supported by favorable monsoon patterns and stronger rural demand.

• Construction and Infrastructure : A standout performer, with real GVA growth of 8.6% , driven by sustained public investment and rising private sector participation in urban development projects.

• Financial, Real Estate & Professional Services : Expanded at 7.3% , reflecting robust credit demand and accelerated digital transformation across service platforms.

• Manufacturing : Faced headwinds from weak global demand and supply chain disruptions, leading to moderation in overall growth contribution.

Against this backdrop, Indias infrastructure and industrial sectors remain a key growth driver. Your Company continues to align with these national priorities by expanding its footprint in electrical contracting and fire-fighting installations, positioning itself to benefit from sustained investment in urban infrastructure and industrial modernization.

Inflation and Fiscal Management

Retail inflation during FY 2025-26 moderated further to 4.2%, reflecting the combined impact of easing food and fuel prices, improved supply chain conditions, and calibrated monetary policy actions. The government continued to maintain fiscal discipline while supporting growth through targeted initiatives, including sustained infrastructure expansion, credit facilitation for MSMEs, and sector-specific schemes under the Production-Linked Incentive (PLI) framework. These measures helped balance the twin objectives of macroeconomic stability and growth momentum, positioning India to navigate global uncertainties with resilience.

Geopolitical and Strategic Positioning

India consolidated its position as the fourth largest global economy in 2025 , with projections indicating a GDP of USD 7.3 trillion by 2030 , underpinned by the vision of Aatmanirbhar Bharat and proactive global engagement. During FY 2025-26, Indias influence in multilateral forums, trade negotiations, and strategic partnerships continued to expand, reflecting its growing role in shaping global economic and security frameworks. The Ministry of External Affairs highlighted Indias active participation in initiatives aimed at strengthening supply chain resilience, advancing climate commitments, and deepening regional connectivity.

This evolving geopolitical landscape reinforces Indias strategic positioning as a trusted partner in global commerce and infrastructure development, creating opportunities for SMEs like your Company to align with national priorities and benefit from enhanced industrial and infrastructure demand.

Industry Overview - Electrical & Fire Fighting Turnkey Projects

Indias infrastructure and industrial services sector in FY 2025-26 continued its transformative trajectory, supported by ambitious public investment programs, private sector innovation, and evolving safety and sustainability standards. The governments sustained focus on urban infrastructure, smart cities, and industrial modernization has created strong demand for integrated electrical contracting and fire-fighting turnkey solutions.

Heightened emphasis on energy efficiency, renewable integration, and compliance with advanced safety codes has further expanded opportunities for specialized EPC players. Private sector participation, particularly in warehousing, retail, and healthcare facilities, has reinforced the need for reliable electrical and fire-safety systems, while public investment in transport and logistics hubs has accelerated project pipelines.

Your Company remains well-positioned to leverage these trends, with its proven expertise in electrical contracting, fire-fighting installations, and solar EPC projects, aligning with national priorities for sustainable infrastructure and industrial resilience.

Electrical Contracting & EPC Services

According to IBEFs Engineering Industry Analysis, the Indian electrical equipment market is projected to grow at a CAGR of 14.3% from FY24 to FY28, with an incremental value of ^6.44 Lacs crore (US$ 76.24 billion). FY 2025-26 reinforced this trajectory, supported by a combination of government capex, policy incentives, and private sector participation.

• Government Capex Push : The Union Budget FY26 announced a record ^11.21 Lacs crore in capital expenditure , with sustained allocations for urban infrastructure, smart cities, industrial corridors, and logistics hubs , creating strong demand for turnkey electrical contracting and EPC services.

• FDI & Policy Support : With 100% FDI permitted in the engineering sector, and schemes such as the Capital Goods Competitiveness Enhancement Program (^1,207 crore outlay) , domestic manufacturing capacity continued to strengthen, enabling EPC players to scale operations and integrate advanced technologies.

• Urban Infrastructure Development Fund (UIDF) : Targeting Tier-2 and Tier-3 cities, UIDF facilitated bankable projects in warehousing, commercial complexes, and industrial parks — domains where turnkey electrical contractors are increasingly critical for reliable and compliant installations.

• Sustainability & Safety Standards : FY 2025-26 also saw heightened emphasis on energy efficiency, renewable integration, and advanced fire-safety compliance, further expanding opportunities for specialized EPC contractors.

Your Company remains strategically positioned to leverage these growth drivers, with its expertise in electrical contracting, fire-fighting turnkey projects, and solar EPC solutions , aligning with Indias infrastructure modernization and sustainability agenda.

Fire-Fighting Installation & Safety Systems

Indias fire protection systems market is projected to expand by US$ 1.81 billion at a CAGR of 5.8% between 2024 and 2029, according to Technavios 2025 report. FY 2025-26 reinforced this growth trajectory, with demand driven by stricter compliance requirements, sustainability imperatives, and technology integration.

Key Trends

• AI & IoT Integration : Smart sensors, predictive analytics, and cloud-based platforms continued to redefine fire safety management, enabling real-time monitoring and proactive risk mitigation.

• Remote Monitoring & Management : Mobile-enabled systems gained wider adoption, allowing stakeholders to oversee fire safety infrastructure remotely, improving response times and resource allocation.

• Sustainability & Compliance : Eco-friendly suppression materials, green building certifications, and enhanced regulatory mandates accelerated the shift toward advanced fire protection solutions.

• Training & Certification : Industry players invested in simulation-based training, certification programs, and awareness campaigns to strengthen a culture of proactive fire prevention.

Your Company remains aligned with these evolving trends, leveraging its expertise in turnkey fire-fighting installations and integrated safety systems to deliver compliant, sustainable, and technology-enabled solutions across industrial, commercial, and infrastructure projects.

Strategic Sectoral Alignment

FY 2025-26 underscored the convergence of electrical contracting, fire-safety systems, solar EPC, and structured data cabling , reflecting the integrated demands of Indias modern infrastructure landscape. Rising investments in smart buildings, logistics hubs, industrial automation, and renewable energy integration have positioned turnkey contractors not merely as service providers but as strategic partners in national development .

This alignment highlights the growing importance of multi-disciplinary expertise, where contractors capable of delivering end-to-end solutions across electrical, safety, and sustainability domains are increasingly preferred in both public and private sector projects. Your Company continues to strengthen its role in this ecosystem, leveraging its capabilities in electrical contracting, fire-fighting installations, and solar EPC solutions to contribute to Indias infrastructure modernization agenda.

Industry Growth Drivers - Electrical & Fire-Fighting Turnkey Projects

The Indian electrical and fire safety contracting industry in FY 2025-26 remained poised for sustained growth, supported by macroeconomic momentum, demographic shifts, policy reforms, and technological advancement. The following key drivers shaped the industry landscape during the year:

1. Economic Growth & Infrastructure Investment Indias GDP growth moderated to 6.4% , yet infrastructure spending remained at record levels. The Union Budget FY26 allocated ^11.21 Lacs crore in capital expenditure, with significant

outlays for industrial corridors, smart cities, and logistics hubs — all requiring integrated electrical and fire safety systems.

2. Urbanisation & Non-Metro Expansion Rapid urbanisation and the rise of Tier-2 and Tier-3 cities continued to fuel demand for turnkey contracting services. The Urban Infrastructure Development Fund (UIDF) enabled bankable projects in warehousing, commercial complexes, and public infrastructure , expanding opportunities beyond metro regions.

3. Millennial Consumption & Smart Infrastructure Millennials, now the dominant workforce and consumer segment, drove demand for digitally enabled, energy-efficient, and safety-compliant infrastructure . Smart buildings, co-working spaces, and tech-integrated retail environments increasingly required advanced electrical and fire-fighting installations.

4. Rural Advancement & Electrification Universal electrification and improved rural power availability created new opportunities in industrial clusters, agro-processing units, and public facilities , strengthening the role of turnkey contractors in rural development.

5. Government Commitment to Renewable Energy Indias renewable energy capacity additions continued, with emphasis on solar EPC contracts, battery storage integration, and decentralized energy systems. These initiatives directly benefited electrical contractors with renewable capabilities.

6. Atma Nirbhar Bharat & Local Manufacturing The Atma Nirbhar Bharat initiative boosted domestic manufacturing of electrical panels, fire safety components, and smart cabling systems. With 100% FDI permitted in the engineering sector and PLI schemes supporting local production, turnkey contractors gained access to cost-effective, high-quality inputs.

7. Safety Compliance & Regulatory Push Stricter fire safety norms across commercial, industrial, and public buildings drove demand for certified fire-fighting systems. The rise of AI-based detection, remote monitoring, and cloud-integrated suppression technologies reshaped the fire safety landscape, creating opportunities for tech-savvy turnkey providers.

Additional Growth Drivers for the Industry

FY 2025-26 highlighted several emerging drivers that reinforced the sustained expansion of Indias electrical contracting and fire-safety industry:

1. Digital Infrastructure & Smart Cities Push • The Smart Cities Mission advanced into its implementation phase, with over ^1.8 Lacs crore sanctioned across 100 cities . • Demand for intelligent electrical systems, IoT-enabled fire safety, and structured data cabling surged in urban redevelopment and smart building projects.

2. Data Center & Warehousing Boom • Indias data center capacity is expected to double by 2027 , driven by AI, 5G, and cloud adoption. • Warehousing and logistics parks required high-load electrical contracting, fire suppression systems, and maintenance services — all core to turnkey EPC offerings.

3. Green Building Certifications & ESG Compliance • Corporates and developers increasingly pursued LEED, IGBC, and GRIHA certifications, mandating advanced electrical and fire-safety integration. • ESG mandates pushed investment in energy-efficient panels, solar EPC, and sustainable cabling systems .

4. Skill Development & Workforce Formalisation • Government schemes such as PMKVY and Skill India created a more trained and certified workforce, improving execution quality and safety compliance. • This supported contractors in scaling operations without compromising standards.

5. Public-Private Partnerships (PPP) in Infrastructure • PPP models in metro rail, airports, and industrial corridors created long-term opportunities for turnkey contractors. • These projects often required bundled services — electrical, fire safety, solar, and data cabling — which multi-disciplinary players are uniquely positioned to deliver.

6. Insurance & Risk Management Integration • Fire-safety systems became increasingly tied to insurance underwriting and risk audits, especially in industrial and commercial sectors. • This elevated the importance of certified fire-fighting installations and proactive maintenance , creating a growing niche for trusted contractors.

Company Overview - Rulka Electricals Limited

Rulka Electricals Limited is a leading turnkey project contractor, offering comprehensive solutions in electrical contracting, fire-fighting installations, solar EPC, and structured cabling across India. With a commitment to quality, safety, and timely execution, the Company has built a strong reputation for delivering integrated infrastructure services to clients in industrial, commercial, retail, warehousing, healthcare, hospitality, and entertainment sectors.

Originally incorporated on May 30, 2013 as Rulka Electricals Private Limited under the Companies Act, 1956, the Company was subsequently converted into a public limited entity and renamed Rulka Electricals Limited on August 2, 2023, pursuant to a fresh certificate of incorporation issued by the Registrar of Companies, Maharashtra, Mumbai.

o Core Specializations

• Electrical Contracting Services for industrial plants, commercial complexes, and high-load environments.

• Fire-Fighting Installation Projects compliant with national safety standards and advanced regulatory codes.

• Solar EPC Contracts aligned with Indias renewable energy goals and sustainability agenda.

• Electrical Panels & Smart Cabling Systems for modern industrial and commercial facilities.

• Turnkey Warehousing Projects including lighting, automation, and safety systems.

• Maintenance Services ensuring long-term reliability, compliance, and operational efficiency.

• Data & Voice Cabling Installations supporting Indias expanding digital infrastructure.

o Execution Footprint

Rulka operates with integrated capabilities covering design, supply, installation, testing, and commissioning , followed by customized maintenance solutions. The Company has successfully completed warehousing projects nationwide , alongside retail stores, theatres, hospitals, and hospitality facilities , reinforcing its pan-India presence and diversified portfolio.

o Strategic Positioning

With a growing workforce and strategic investments, Rulka continues to expand its operational footprint. Its approach blends technical precision, regulatory compliance, and innovative execution, positioning the Company as a trusted partner in Indias infrastructure growth story.

© Values & Leadership Commitment

The Companys values are rooted in integrity, excellence, and adaptability, with leadership committed to sustainable growth, stakeholder value creation, and nation-building through infrastructure development.

Financial Overview

During the financial year 2025-26, the Company registered a robust growth in standalone revenue, reaching ^ 11,025.78 Lacs as compared to ^ 7,979.63 Lacs in the previous financial year-reflecting a year-on-year increase of approximately 38%. This performance highlights the Companys operational strength and strategic execution across key verticals. The Profit After Tax (PAT) for FY 2025-26 stood at ^ 328.86 Lacs , as against ^ 225.86 Lacs in FY 2024-25.

Key Ratio Outlook for FY 2025-26

Please refer to Note no. 38 of the Financial Statements.

Business Overview

Building on our commitment to lifecycle support and system reliability, Rulka Electricals strategically expanded its Operations & Maintenance (O&M) services into a core pillar of our post-installation value proposition. In FY 2025-26, the Company advanced from reactive maintenance toward predictive and performance-driven service models, ensuring that every client system operates at peak efficiency and compliance.

o Key Initiatives

• Specialized O&M Teams deployed across high-value industrial, warehousing, and infrastructure sites.

• Digital Diagnostics & Remote Monitoring Tools integrated to provide real-time system insights and predictive alerts.

• Enhanced Emergency Response Protocols established for mission-critical installations, reducing downtime and risk.

o AMC Restructuring

Our Annual Maintenance Contracts (AMCs) were restructured to deliver greater flexibility and compliance assurance:

• Tiered Service Levels allowing clients to select packages aligned with operational intensity.

• Dedicated Technical Personnel with domain expertise in electrical and fire-safety systems.

• Compliance-Focused Documentation & Audit Support reinforcing regulatory alignment and stakeholder confidence.

These initiatives not only improved system uptime, safety, and reliability, but also generated recurring revenue streams and strengthened client retention, positioning O&M as a sustainable growth driver in the Companys portfolio.

ESG Alignment & Client Satisfaction

In FY 2025-26, Rulka Electricals deepened its commitment to environmental, social, and governance (ESG) principles, embedding sustainability and responsibility into every aspect of service delivery:

• Energy-Efficient Maintenance Practices were scaled across client sites, reducing carbon footprint and aligning with Indias green building and renewable energy agenda.

• Training & Upskilling of Local Technicians expanded under Skill India and PMKVY frameworks, contributing to community development and workforce formalisation.

• Waste Minimization Protocols were strengthened during system servicing and upgrades, ensuring compliance with evolving ESG and circular economy standards.

Client satisfaction remained central to our operational philosophy. In FY 2025-26, the Company enhanced its engagement model through:

• Quarterly Feedback Loops integrated with digital dashboards, capturing client insights and improving responsiveness.

• Performance Dashboards for AMC Clients , offering transparency, measurable benchmarks, and predictive maintenance indicators.

• Net Promoter Score (NPS) Tracking , enabling continuous monitoring of client loyalty and service quality.

These initiatives reinforced our belief that long-term value creation stems from operational excellence, environmental stewardship, and trusted client relationships, positioning Rulka as a responsible and client-centric partner in Indias infrastructure growth story.

Human Resource Development and Industrial Research - FY 2025-26

In FY 2025-26, Rulka Electricals continued to uphold its Human-First philosophy, as envisioned by our Founder and Promoter, placing people at the heart of every strategic and operational decision. We recognize that organizational resilience and innovation stem from a skilled, engaged, and empowered workforce.

o Human Resource Strategy

This year, our HR framework evolved to emphasize:

• Competency-Based Recruitment , targeting high-impact roles in engineering, project management, compliance, and digital infrastructure.

• Structured Onboarding & Mentorship Programs , ensuring seamless cultural and operational integration for new hires.

• Skill Acceleration Tracks , including certifications in fire safety, electrical diagnostics, predictive maintenance, and digital monitoring tools.

o Learning & Development (L&D) Expansion

Our L&D framework was broadened to include:

• Cross-Functional Training Modules , fostering versatility, leadership readiness, and succession planning.

• Collaborations with Technical Institutes & Industry Bodies , enabling access to emerging industrial research, ESG practices, and global best standards.

• Performance-Linked Learning Incentives , encouraging continuous

improvement, innovation, and accountability across teams.

Through these initiatives, Rulka strengthened its talent pipeline, research integration, and execution capability, ensuring that human capital remains the cornerstone of sustainable growth and industrial leadership.

Internal Control and Adequacy - FY 2025-26

In FY 2025-26, Rulka Electricals further reinforced its internal control framework to support operational integrity, regulatory compliance, and strategic decision-making. Our systems are designed to safeguard assets against unauthorized use or disposal, while ensuring that all transactions are subject to rigorous authorization, documentation, and audit trails.

o Key Enhancements

• Digitization of Control Processes : Procurement, inventory tracking, and vendor management were fully digitized, improving transparency and efficiency.

• Compliance Dashboards : Real-time monitoring of statutory obligations and internal KPIs was integrated into operations, strengthening governance oversight.

• Cross-Functional Oversight : Coordination between finance, operations, and compliance teams was enhanced, ensuring holistic risk management.

Our internal control mechanisms were independently reviewed and validated by statutory auditors, affirming their adequacy, reliability, and scalability. In addition, external consultants with domain expertise in finance, governance, and risk management were engaged to benchmark practices against industry standards and evolving regulatory developments.

o Risk Mitigation Framework

• Independent Internal Audit Function reporting directly to the Audit Committee and the Board of Directors.

• Quarterly Review of Audit Findings , with corrective actions tracked through structured follow-up mechanisms.

• Whistleblower & Grievance Redressal Systems strengthened to promote transparency, ethical conduct, and stakeholder confidence.

These initiatives reflect our commitment to maintaining a resilient control environment, capable of adapting to business growth, regulatory changes, and stakeholder expectations.

Workplace Safety and EHS Commitment

In FY 2025-26, Rulka Electricals further strengthened its Environment, Health, and Safety (EHS) framework to meet evolving regulatory, operational, and stakeholder demands. Our initiatives reflect a proactive approach to embedding safety into every project site and office, ensuring employee well-being and compliance with national standards.

o Key Enhancements

• Digitized Safety Audits & Compliance Tracking , improving visibility, accountability, and real-time reporting across operations.

• Behavior-Based Safety (BBS) Programs , fostering a culture of proactive risk identification and employee participation in hazard prevention.

• Quarterly Safety Drills & Refresher Trainings , enhancing emergency preparedness and reinforcing response protocols for mission-critical sites.

• Integration of ESG-Linked Safety Metrics , aligning workplace safety with broader sustainability and governance commitments.

These initiatives underscore our unwavering commitment to a safety-first culture, regulatory compliance, and the protection of our workforce. By combining technology, training, and transparency, Rulka Electricals continues to build a resilient EHS environment capable of adapting to business growth and evolving industry standards.

Industrial Research and Innovation

In FY 2025-26, Rulka Electricals actively advanced its industrial research collaborations to enhance system design, energy efficiency, and lifecycle performance. By integrating human capital development with applied research, the Company strengthened its innovation pipeline and future-readiness.

o Focus Areas

• Smart Diagnostics for Electrical Systems : Expanded deployment of predictive maintenance tools, integrating AI-driven analytics for early fault detection and performance optimization.

• Fire Safety Innovation : Advanced sensor-based alert systems and sustainable suppression technologies, aligned with stricter compliance mandates and ESG standards.

• Process Optimization Studies : Conducted research to reduce installation time, improve cost-efficiency, and enhance scalability across industrial and commercial projects.

• Collaborative Research Partnerships : Strengthened ties with technical institutes and industry bodies, enabling access to emerging technologies and global best practices.

Through these initiatives, Rulka Electricals reinforced its positioning as a future-ready organization, delivering excellence, safety, and innovation at scale while aligning with Indias infrastructure modernization agenda.

Cautionary Statement

This Annual Report contains forward-looking statements concerning anticipated future events, financial outcomes, and operational milestones of Rulka Electricals Limited (REL). These statements are based on assumptions and are subject to various risks and uncertainties. There is a significant risk that such assumptions, projections, and other forward-looking statements may not accurately reflect future outcomes.

o Risks, Concerns & Mitigation

Our Company encounters various regulatory, environmental, and business risks in its operations. We actively work towards prevention and mitigation of these risks to minimize their potential impact on performance. Key measures include:

• Continuous monitoring of evolving regulatory frameworks and proactive compliance alignment.

• Adoption of sustainable practices to mitigate environmental disruptions.

• Diversification of client base and service portfolio to reduce dependency risks.

Readers are urged to exercise caution and avoid placing undue reliance on forward-looking statements, as several factors could result in disparities between assumptions and actual future results and events. Accordingly, this document is subject to the disclaimer and is qualified in its entirety by the assumptions, qualifications, and risk factors outlined in RELs Annual Report for FY 2025-26, as discussed in the Management Discussion and Analysis (MD&A) section.