Rungta Irrigation Ltd Management Discussions

(Forming part of Directors Report for the year ended 31st March 2026)

1. ECONOMIC REVIEW

The economic landscape for the irrigation and micro-irrigation manufacturing sector is currently defined by a critical transition toward sustainable agricultural practices, necessitated by the alarming rate at which unpredictable rainfall patterns and surging population pressures are depleting Indias finite water resources.

This shift has transformed water-use efficiency from an environmental ideal into a national economic priority, placing manufacturers at the heart of Indias agricultural resilience strategy.

The industry is heavily propelled by robust government policy frameworks, most notably the Pradhan Mantri Krishi Sinchayee Yojana (PMKSY), which operates under the dual visions of "Har Khet Ko Pani" (Water for every farm) and "More Crop per Drop" to incentivize the adoption of precision technologies.

During FY 2025-26, the Government of India approved the Modernization of Command Area Development and Water Management (M-CADWM) as a sub-scheme under the Pradhan Mantri Krishi Sinchayee Yojana (PMKSY), with an initial outlay of Rs1,600 crore. The scheme aims to modernize irrigation infrastructure by strengthening irrigation water distribution networks, developing backend infrastructure for micro-irrigation, and leveraging advanced technologies such as IoT and SCADA for efficient water accounting and management, thereby enhancing water-use efficiency and agricultural productivity.

2. ECONOMIC REVIEWS VIS-A-VIS INDUSTRY OUTLOOK

Beyond individual farm-level equipment, the sector is seeing an expansion in the Engineering, Procurement, and Construction (EPC) segment, where increased budgetary allocations for rural water distribution, canal networks, and lift irrigation schemes are driving demand for large-diameter HDPE and PVC piping systems.

However, the economic outlook for manufacturers is tempered by significant operational risks, including a heavy dependency on government subsidy disbursements, which, if delayed, can severely strain working capital cycles and order inflows. Furthermore, profits remain vulnerable to the volatility of global commodity prices for raw plastic resins and PVC, as well as intense competition from a growing unorganized sector. Despite these headwinds, the fundamental necessity of micro-irrigation—capable of reducing water consumption by 30% -70% depending on the crop and agro-climatic conditions while having potential to simultaneously boosting farmer incomes—ensures that the sector remains a high-potential pillar of the Indian industrial economy.

3. COMPANY PROFILE

Rungta Irrigation Limited (RIL), a flagship of the Rungta Group, is an ISO 9001:2015 certified pioneer with over four decades of expertise in manufacturing and executing water management solutions across India. Marketed under the established "RUNGTA" brand, the companys diverse portfolio includes self-fit and elastomeric PVC pipes, HDPE/MDPE pipes, and technologically advanced online and inline drip and sprinkler irrigation systems. RIL operates three state-of-the-art manufacturing facilities located at:

1. Ghaziabad, Uttar Pradesh

2. Yanam, Puducherry

3. Greater Noida, Gautam Buddha Nagar, Uttar Pradesh

These facilities are strategically designed to enhance supply chain efficiency and market penetration across Northern and Central India. Beyond manufacturing, the company provides comprehensive Engineering, Procurement, and Construction (EPC) services for large-scale water infrastructure projects, leveraging a robust PAN-India distribution network.

Rungta Irrigation has established an extensive marketing and distribution network through regional branches and authorized distributors across major Indian states, including: Uttar Pradesh, Madhya Pradesh, Maharashtra, Gujarat, Telangana, Tamil Nadu, Karnataka, Rajasthan, Haryana, Punjab, Himachal Pradesh, Uttarakhand, Jharkhand, Bihar, West Bengal, Odisha, Assam, Chhattisgarh and Andhra Pradesh.

Despite navigating a challenging fiscal year 2025–26 where annual revenue moderated by 17.4% to Rs18,117.63 lakhs, RIL demonstrated significant resilience with a 281.34% rise in net profit for the final quarter ended March 2026. Positioned to capitalize on major government initiatives like the "Jal Jeevan Mission", "Per Drop More Crop" and M-CADWM under PMKSY, management is actively pursuing geographic expansion and capital restructuring—including a proposed rights issue—to reverse revenue declines and drive sustainable shareholder value.

4. GLOBAL ECONOMIC DYNAMICS AND THE UNIVERSAL TRANSITION TO SUSTAINABLE IRRIGATION

The global agricultural landscape is currently navigating a period of significant volatility and transformation, driven by a convergence of geopolitical tensions and macroeconomic headwinds. Factors such as the Ukraine-Russia conflict and the lingering effects of the COVID-19 pandemic have disrupted global demand-supply chains, leading to unprecedented inflation in sourcing costs and commodity price fluctuations. Despite these challenges, the irrigation and micro-irrigation industry is emerging as a critical pillar of global food security.

At a world level, the industry is shaped by several defining trends:

Urgency of Water Conservation: As agriculture moves toward sustainable practices, water availability has emerged as a primary global hurdle. Rising population pressures and unpredictable rainfall patterns are depleting water reservoirs at an alarming rate, making the transition to water-conserving technologies no longer optional but essential for survival.

Adoption of Precision Technology: Innovative micro-irrigation models, specifically drip and sprinkler systems, have proven effective worldwide by enabling real-time monitoring and significantly better control over finite resources. These systems can reduce water consumption by up to 70% and improve water-use efficiency by 30–70%.

Manufacturing Vulnerabilities: The global manufacturing sector for irrigation products remains highly sensitive to the volatility of raw material prices, such as plastic resins, PVC, and steel. Global disruptions frequently impact the "sourcing cost" for these essential materials, requiring manufacturers to maintain robust risk management frameworks.

While the sources emphasize that a significant portion of current growth is driven by domestic consumption in major agricultural nations like India, the broader outlook suggests that sustainable agricultural development and the judicious use of resources have become the most important global factors for industrial growth. Companies are increasingly looking to bridge "last-mile connectivity" gaps and diversify revenue streams to mitigate the effects of these global disruptions.

5. INDUSTRY OVERVIEW: THE INDIAN IRRIGATION AND MICRO IRRIGATION SECTOR

The Indian irrigation and micro-irrigation industry is currently undergoing a transformative phase, driven by the critical necessity of water-use efficiency and the governments push for sustainable agricultural development.

A. Market Size and Growth Potential

India possesses the worlds largest irrigated crop area with over 70 million hectares of net irrigated land, out of which the cumulative area covered under micro irrigation in India is about 9.0 million hectares (approx.) creating a massive foundation for the micro-irrigation market which has continued to expand through sustained government support and increasing farmer adoption.

Market Projections: According to industry estimates, the Indian micro-irrigation systems market is valued at approximately USD 0.71 billion in 2025 and is expected to grow to around USD 1.20 billion by 2030, registering a compound annual growth rate (CAGR) of approximately 11%.

Long-Term Outlook: The markets growth is expected to be driven by increasing adoption of precision irrigation technologies, continued government support under irrigation and water conservation programmes, rising concerns over water scarcity, and growing demand for sustainable agricultural practices.

B. Regional Demand Drivers and Product Adoption

Demand is highest in regions where agricultural activities are most vulnerable to erratic monsoon patterns.

High-Potential States: States like Rajasthan, Maharashtra, Karnataka, Gujarat, Haryana, and Bihar are identified as ideal for micro-irrigation due to acute water scarcity.

Product Performance: Drip irrigation systems dominated the market in 2025, largely due to higher subsidies offered for fruit and plantation crops. While greenhouse cultivation is rising for horticultural production, the majority of micro-irrigation adoption in India remains in open-field cultivation.

C. The Rise of the EPC and Infrastructure Segment

Beyond farm-level equipment, the industry is seeing significant expansion in the Engineering, Procurement, and Construction (EPC) segment. The industry is increasingly adopting IoT-enabled irrigation systems, SCADA based monitoring, automated pumping stations, remote sensing, GIS mapping, smart flow meters, telemetry,

Institutional Projects: Large-scale initiatives like the Jal Jeevan Mission, canal network projects, and lift irrigation schemes have increased the participation of private players in turnkey rural water distribution.

Technological Integration: There is a growing trend toward technology-driven solutions. The industry is increasingly adopting IoT-enabled irrigation systems, SCADA based monitoring, automated pumping stations, remote sensing, GIS mapping, smart flow meters, telemetry, sensor-based irrigation scheduling, precision agriculture platforms, including real-time monitoring of water flow and digital water budgeting tools, to enhance resource management.

D. Socio-Economic Impact and Sectoral Challenges

Micro-irrigation has proven to be a vital relief for drought-prone areas, capable of reducing water consumption by up to 70% while improving water-use efficiency by 30–70%. Furthermore, adoption has been shown to increase farmer incomes by 10–69%, contributing to rural prosperity. However, the industry remains vulnerable to certain structural risks:

Subsidy Dependency: Manufacturers are highly dependent on the timely disbursement of government subsidies, which can impact working capital cycles.

Input Cost Volatility: Profits are sensitive to global price fluctuations in raw materials like plastic resins and PVC.

Environmental Sensitivity: Despite the drought-mitigating nature of the products, seasonal demand is still influenced by the immediate financial health of farmers, which is tied to the success of the monsoon.

6. INDIAN ECONOMY

The Indian economy remained resilient during FY 2025–26, demonstrating robust growth despite a challenging global environment marked by geopolitical tensions, supply chain disruptions, inflationary pressures and volatility in commodity prices. Supported by strong domestic demand, sustained public capital expenditure, prudent fiscal management and continued structural reforms, India reinforced its position as one of the worlds fastest-growing major economies. The First Advance Estimates placed real GDP growth at 7.4% for FY 2025–26, reflecting the strength of the countrys macroeconomic fundamentals and broad-based economic momentum.

Real Gross Value Added (GVA) at constant prices is estimated at Rs294.91 lakh crore in FY 2025–26, as against Rs273.36 lakh crore in FY 2024–25, registering a growth of 7.9%, compared with 7.3% in the previous year. Nominal GVA is estimated at Rs314.87 lakh crore during FY 2025–26, as against Rs288.54 lakh crore in FY 2024–25, reflecting a growth of 9.1%.

The countrys macroeconomic fundamentals remained robust, supported by sustained public investment, resilient financial institutions, improving tax collections, expanding digital infrastructure and continued progress in manufacturing and logistics. Government initiatives aimed at strengthening infrastructure, promoting industrial growth, enhancing ease of doing business and accelerating digital transformation continued to reinforce Indias long-term economic outlook.

According to the Provisional Estimates released by the Ministry of Statistics and Programme Implementation (MoSPI), Real GDP (GDP at Constant Prices) is estimated at Rs323.12 lakh crore in FY 2025–26, as against the First Revised Estimate (FRE) of Rs299.89 lakh crore in FY 2024–25, registering a growth of 7.7%, compared with 7.1% in the previous year. Nominal GDP (GDP at Current Prices) is estimated to attain Rs346.36 lakh crore during FY 2025–26, as against Rs318.07 lakh crore in FY 2024–25, reflecting a growth of 8.9%.

From a sectoral perspective:

- Agriculture and Allied Activities recorded a growth of 4.4%, supported by favourable agricultural output and improved rural demand.

- Construction grew by 7.4%, driven by sustained public capital expenditure and continued investments in transport, urban infrastructure and industrial development.

- Mining and Quarrying registered a growth of 4.6%, supported by higher production of key minerals and continued momentum in infrastructure and manufacturing activities.

Inflation remained broadly within the Reserve Bank of Indias tolerance band during FY 2025-26, supported by prudent monetary policy, improved food supply conditions and moderating fuel prices. The stable inflation environment helped sustain consumer demand while preserving overall macroeconomic stability.

Indias fiscal position remained resilient during FY 2025–26, supported by robust direct and indirect tax collections, disciplined fiscal management and continued emphasis on capital expenditure. Sustained public investment in infrastructure, agriculture, water resources, energy and logistics further strengthened the countrys long-term growth prospects while advancing the Governments fiscal consolidation objectives.

Further, several structural and reform-oriented initiatives undertaken by the Government of India continued to strengthen the countrys long-term economic fundamentals, including:

- Promotion of domestic manufacturing and industrial competitiveness through the Make in India, Atmanirbhar Bharat and Production Linked Incentive (PLI) schemes across key manufacturing sectors.

- Continued digitalisation and formalisation of the economy.

- Business regulatory reforms, simplification of compliance procedures, implementation of the National Logistics Policy, and ongoing labour law reforms aimed at improving the ease of doing business.

- Expansion of Indias Digital Public Infrastructure, including Aadhaar, Unified Payments Interface (UPI), Open Network for Digital Commerce (ONDC) and the Account Aggregator (AA) framework.

India also continued to strengthen its position as a global hub for digital innovation, renewable energy investments and a vibrant start-up ecosystem, while attracting sustained foreign direct investment (FDI) across diverse sectors.

Looking ahead, Indias macroeconomic outlook remains positive, supported by favourable demographics, rapid urbanisation, rising domestic consumption and the Governments continued focus on sustainable development, inclusive growth and infrastructure-led expansion. These factors provide a supportive environment for sectors such as irrigation, agriculture, infrastructure and water management, creating significant opportunities for long-term and sustainable growth.

7. NATIONAL POLICY FRAMEWORK: ADVANCING AGRICULTURAL RESILIENCE THROUGH FLAGSHIP IRRIGATION INITIATIVES

Government initiatives during the 2025–26 period are centred on the extension and robust funding of flagship schemes designed to enhance water-use efficiency and expand irrigation coverage across India. The outlook for government initiatives in the irrigation and micro-irrigation sector is characterized by long-term strategic commitment, massive capital outlays, and a transition toward precision technology to ensure national water security and agricultural resilience.

A. Pradhan Mantri Krishi Sinchayee Yojana (PMKSY)

The PMKSY serves as the primary umbrella scheme for the irrigation sector and has been formally extended for the period 2021–22 to 2025–26.

Total Outlay: The government approved an overall outlay of Rs93,068.56 crore for this mission through 2026.

Funding Structure: This includes Rs37,454 crore in Central Assistance, Rs35,180 crore as the State share, and Rs20,434.56 crore dedicated to debt servicing for NABARD under the Accelerated Irrigation Benefits Programme (AIBP).

Core Visions: The scheme is driven by the dual objectives of "Har Khet Ko Pani" (Water to every field) and "More Crop per Drop".

B. Key Components of PMKSY

The implementation is coordinated across several ministries through the following components:

Per Drop More Crop (PDMC): Implemented by the Department of Agriculture & Farmers Welfare, this sub-scheme focuses specifically on micro-irrigation technologies like drip and sprinkler systems to improve on-farm water efficiency.

Accelerated Irrigation Benefits Programme (AIBP): Focuses on completing long-pending major and medium irrigation projects to provide assured water access.

Har Khet Ko Pani (HKKP): Targets the creation and restoration of water sources through sub-components such as Surface Minor Irrigation (SMI), Command Area Development (CAD&WM), and the Repair, Renovation, and Restoration (RRR) of water bodies.

Watershed Development Component (WDC): Focuses on enhancing water harvesting and groundwater recharge in rain-fed areas.

C. Infrastructure and Digital Initiatives

Jal Jeevan Mission: Along with the interlinking of rivers and lift irrigation schemes, this mission has increased the participation of private players in turnkey rural water distribution and canal network projects.

EPC Sector Growth: There has been a rising allocation for Engineering, Procurement, and Construction (EPC) contracts in water supply, creating opportunities for large-scale rural infrastructure development.

Digital Monitoring and Smart Water Management: The Government has continued to promote the adoption of digital technologies for monitoring irrigation projects and improving water management. Initiatives include the use of GIS-based project monitoring, geo-tagging of irrigation assets, remote sensing and satellite imagery, online project management dashboards, and digital tools for monitoring project progress and water resources. These measures are aimed at improving transparency, enhancing operational efficiency and enabling better planning and utilisation of water resources.

D. Supplementary Support Measures

Financial Assistance: Under the Per Drop More Crop (PDMC) component of the Pradhan Mantri Krishi Sinchayee Yojana (PMKSY), the Government continues to promote the adoption of micro-irrigation by providing financial assistance of up to 55% of the approved unit cost to Small and Marginal Farmers and up to 45% to Other Farmers for the installation of drip and sprinkler irrigation systems. The scheme is implemented through the States and Union Territories in accordance with the prescribed operational guidelines.

Institutional and Financial Support: To accelerate the adoption of micro-irrigation, the Government has strengthened institutional support through State implementing agencies and operationalised the Micro Irrigation Fund (MIF) with NABARD, enabling States to access concessional financing for expanding micro-irrigation infrastructure and increasing irrigation coverage.

Capacity Building and Farmer Awareness: The Government continues to promote efficient irrigation practices and climate-resilient agriculture through farmer training, awareness programmes, field demonstrations and extension services in collaboration with State Agriculture Departments, Krishi Vigyan Kendras (KVKs) and other agricultural extension institutions. These initiatives are aimed at enhancing awareness, encouraging the adoption of modern micro-irrigation technologies and improving water-use efficiency and agricultural productivity.

E. Emphasis on On-Farm Water-Use Efficiency

Through the Per Drop More Crop (PDMC) sub-scheme, the government is intensifying its focus on micro-irrigation technologies like drip and sprinkler systems.

Economic Impact: These technologies are prioritized because they can reduce water consumption by up to 70% and increasing water efficiency be 30-60%, thereby increase farmer incomes.

Adoption Growth: While open-field cultivation currently dominates adoption, there is an increasing inclination toward greenhouse cultivation for year-round horticultural production.

8. RISKS/THREATS

Rungta Irrigation Limited operates in the high-potential yet volatile irrigation and water infrastructure sector, which is subject to several strategic, operational, and financial challenges. The following are the key risks and threats identified for the business:

A. Strategic and Policy Risks

Government Dependency: The business is significantly dependent on central and state government schemes, such as the Pradhan Mantri Krishi Sinchayee Yojana (PMKSY), Accelerated Irrigation Benefit Programme (AIBP), Har Khet Ko Pani (HKKP) and various state-level irrigation initiatives. Any adverse changes in regulatory policies or reductions in budgetary allocations for these flagship missions directly impact order inflows.

Subsidy Disbursements: Delays in the disbursement of government subsidies to farmers can severely strain the companys working capital cycle and hinder immediate demand for micro-irrigation systems.

Regulatory Vulnerability: The global irrigation subsector is characterized by poor regulation and fragmented water institutions, which can lead to inefficient resource allocation and "rent-seeking" procedures.

B. Climatic and Environmental Threats

Monsoon Dependency: Indian agriculture remains heavily reliant on the monsoon, making demand for irrigation products vulnerable to climatic fluctuations.

Climate Change: Unpredictable rainfall patterns, extended droughts, or excessive rainfall can disrupt crop cycles. These inconsistencies often influence farmers purchasing decisions, particularly in rain-fed and marginal regions.

C. Operational and Execution Risks

EPC Project Delays: A substantial portion of revenue is derived from Engineering, Procurement, and Construction (EPC) contracts. Delays due to administrative bottlenecks, land acquisition issues, or delayed clearances can result in cost overruns and pressure on profit margins.

Logistical Challenges: Expanding operations into remote and underserved rural areas presents significant hurdles regarding supply chain management and "last-mile connectivity" for delivery and service.

Technological Obsolescence: The sector is witnessing rapid technological advancements. Failure to invest adequately in Research and Development (R&D) could render existing products less attractive compared to modern precision technologies.

D. Economic and Market Threats

Input Cost Volatility: The company is exposed to fluctuations in the global prices of raw materials, particularly plastic resins, PVC, and steel. Sustained rises in sourcing costs without corresponding increases in product pricing can adversely affect profitability.

Competitive Landscape: There is intense competition from both organized players and the unorganized sector (small-scale manufacturers), which can lead to aggressive pricing and market share dilution.

Agricultural Sector Dependency: Any structural weakness in farm income, volatility in crop prices, or a lack of rural credit availability directly impacts the purchasing power of the companys core customer base.

E. Financial Risks

Credit Risk: This is the risk of financial loss if a customer or counterparty fails to meet their contractual obligations, particularly regarding trade receivables.

Liquidity Risk: The company must ensure it has sufficient liquidity to meet its liabilities as they fall due, especially during economic disruptions like the COVID-19 pandemic and Russo-Ukrainian War.

Market and Interest Rate Risk: The Company is exposed to fluctuations in the prices of key raw materials and changes in interest rates, which may affect its operating costs and finance expenses. The Company manages these risks through prudent procurement, effective cost control measures and disciplined financial management.

Employee Benefit Assumptions: Risks associated with defined benefit plans include investment risk (market yield fluctuations), interest rate risk, and longevity/salary risk, which can increase the companys long-term plan liabilities.

F. Legal and Contingent Threats

Litigation: Several cases under various laws are pending against the company at different judiciaries, which could result in potential losses estimated at approximately Rs.38.94 lakhs as compared to Rs.99.57 lakhs in the previous year.

Taxation Demands: The company faces several income tax demands for various assessment years that are currently pending before appellate authorities (ITAT).

Contingent Liabilities: The company has given counter-guarantee to the bankers against guarantee issued by banks on behalf of the company amounting to 2577.69 lakhs (previous year: 2559.45 lakhs). The liability may arise in case of failure in supply of material or malfunctioning of products supplied by the company.

G. Infrastructure Risks

The global irrigation subsector is characterized as a high-risk infrastructure sector due to its capital intensity, susceptibility to poor regulation, and the challenges of managing water levels influenced by global climate change.

9. SEGMENT-WISE OR PRODUCT-WISE PERFORMANCE

Product Group Details

Name of Product(s) or Service(s)	Net Operational Revenue (in Lakhs) FY 2025-26	Net Operational Revenue (in Lakhs) FY 2024-25
Aluminium & HPDE Pipes Coupled	3439.79	3324.73
PVC Pipes	1411.14	3041.76
HPDE Coils & MDPE Coils	8033.99	9808.43
LLDPE Pipes	3265.64	2910.09
Accessories, Fittings & Others	1967.07	2849.91
TOTAL	18117.63	21934.92

10. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

Rungta Irrigation Limited has established an adequate and effective system of internal financial and operational controls designed to safeguard its assets, ensure the accuracy and reliability of financial and operational information, enhance operational efficiency and ensure compliance with applicable laws, regulations and internal policies. The internal control framework is commensurate with the size, nature and complexity of the Companys operations and is periodically reviewed and strengthened to ensure its continued effectiveness.

The Companys internal control environment comprises well-defined organisational structures, documented policies and standard operating procedures, clearly defined authority levels, robust financial and operational controls, information technology controls and risk identification and mitigation mechanisms. Periodic reviews of business processes are undertaken to enhance operational efficiency, strengthen governance practices and ensure compliance with applicable statutory and regulatory requirements.

The key components of the Companys internal control framework include:

- Internal Audit: The Company has an independent internal audit mechanism to evaluate the adequacy and effectiveness of internal controls across key business processes. The internal audit findings and recommendations are reviewed by the management and are periodically placed before the Audit Committee, which monitors the implementation of corrective actions, wherever necessary.

- Audit Committee Oversight: The Audit Committee of the Board, comprising a majority of Independent Directors, oversees the effectiveness of the Companys internal control framework. The Committee periodically reviews internal audit reports, financial reporting processes, internal control systems and the managements responses to audit observations to ensure timely implementation of corrective measures.

- Compliance Monitoring: The Company has established appropriate processes to ensure timely compliance with all applicable statutory, regulatory and accounting requirements. Robust systems are in place to monitor statutory filings, returns and disclosures under the applicable corporate, taxation, labour and other regulatory laws. The Board and senior management are periodically apprised of significant compliance matters.

Based on the reviews carried out during the year, the Board is of the opinion that the Companys internal control systems are adequate and effective and provide reasonable assurance regarding the orderly and efficient conduct of its business, safeguarding of assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records, and the timely preparation of reliable financial information. The Company remains committed to continuously strengthening its internal control framework in line with evolving business requirements, regulatory expectations and corporate governance best practices.

11. FINANCIAL DISCUSSION AND ANALYSIS

A. Operating Results

Rungta Irrigation Limited provides a comparative analysis of the audited financial results for the fiscal year ended March 31, 2026 (FY 2025–26), as approved by the Board of Directors on May 25, 2026, alongside the figures for the previous fiscal year ended March

31, 2025 (FY 2024–25).

Particulars	FY 2025–26 (Rs in lakh)	% of Total Income	FY 2024–25 (Rs in lakh)	% of Total Income
Revenue from Operations	18,117.63	98.54%	21,934.92	99.09%
Other Income	268.13	1.46%	200.57	0.91%
Total Income	18,385.76	100.00%	22,135.49	100.00%
Total Expenses	17,657.11	96.04%	21,253.52	96.02%
Profit Before Tax (PBT)	728.65	3.96%	881.97	3.98%
Standalone Net Profit	549.28	2.99%	622.38	2.81%
Other Comprehensive Income (OCI)	58.10	0.032%	3.15	0.01%
Total Comprehensive Income	607.38	3.30%	625.53	2.83%

Key Insights:

Revenue Performance: During FY 2025–26, revenue from operations declined by 17.40%, decreasing from Rs21,934.92 lakh in FY 2024–25 to Rs18,117.63 lakh. Although other income increased by Rs67.56 lakh, the overall decline in total income was primarily attributable to the reduction of Rs3,817.29 lakh in revenue from operations.

Profitability Trends: Despite the decline in revenue, the Companys net profit margin improved marginally from 2.81% in FY 2024–25 to 2.99% in FY 2025–26, supported by a reduction in total expenses of Rs3,596.41 lakh. However, the absolute standalone net profit declined by 11.74%, from Rs622.38 lakh to Rs549.28 lakh, representing a decrease of Rs73.10 lakh.

Operational Recovery: The Company witnessed encouraging recovery during the final quarter of FY 2025–26, with standalone net profit increasing by 283.61% over the corresponding quarter of the previous year, reflecting improved operational performance and business momentum.

B. Summary of Balance Sheet

Based on the audited financial data for the fiscal year ended March 31, 2026, the following table presents the Comparative Balance Sheet for Rungta Irrigation Limited. The figures for 2025–26 are presented first, followed by the figures for the base year 2024–25.

Particulars	FY 2025–26	FY 2024–25	% Change
TOTAL ASSETS	15294.67	14980.95	2.09%
Non-Current Assets	5130.42	4058.19	26.42%
Tangible Assets	1965.47	1674.43	17.38%
Intangible Assets	-	39.81	-
Financial Assets	3104.53	2297.93	35.10%
Deferred Tax Assets (Net)	60.42	46.02	31.29%
Current Assets	10164.25	10922.76	-6.94%
Inventories	948.41	1057.38	-10.31%
Financial Assets	8721.55	8626.01	1.11%
Current Tax Assets	92.10	39.21	134.89%
Other Current Assets	402.19	1200.16	-66.49%
TOTAL EQUITY	9921.44	9314.20	6.52%
Equity	1992.18	1992.32	-0.01%
Other Equity	7929.26	7321.88	8.30%
TOTAL LIABILITIES	5373.24	5666.75	-5.18%
Non-Current Liabilities	267.75	220.31	21.53%
Borrowings	203.65	158.24	28.70%
Provisions	64.10	62.07	3.27%
Current Liabilities	5105.49	5446.44	-6.26%
Borrowings and Trade Payables	3126.67	3715.69	-15.85%
Provisions	13.32	10.98	21.31%
Other Financial Liabilities	88.62	73.56	20.48%
Other Current Liabilities	1876.88	1646.21	14.01%

Key Insights:

1. Assets

A. Non-Current Assets

Non- current assets increased to Rs. 5130.42 Lakh in FY 2026 as compared to Rs. 4058.19 lakh in FY 2025, indicating a significant increase of 26.42% reflecting capital investments and asset build-up.

- Property, Plant and Equipment: Increased slightly to Rs. 1845.95 lakh from Rs. 1636.87 lakh, due to additions in Building and Vehicles, indicating ongoing operational expansion.

- Capital Work-in-Progress (CWIP): CWIP of Rs. 119.52 lakh was reported as compared to Rs. 37.56 lakh in previous financial year, reflecting ongoing projects and construction of office building.

- Intangible Assets Under Development: There are no intangible assets under development, while intangible assets worth Rs. 32.35 lakh were under development in the previous financial year reflecting all the intangible assets are properly put to use.

- Investments: Increased from Rs. 1,393.08 lakh to Rs. 1441.45, indicating efficient capital allocation and long-term financial stability.

- Other Financial Assets: Notably rose from Rs. 904.85 lakh to Rs. 1663.08 lakh, primarily due to higher fixed deposits.

- Deferred Tax Assets: Increase from Rs46.02 lakh to Rs. 60.42 lakh reflecting the recognition of future tax benefits.

B. Current Assets

Current assets witnessed a notable decline from Rs. 10922.76 lakh in FY 2025 to Rs. 10164.25 lakh in FY 2026.

- Inventories: Declined to Rs. 948.41 lakh from Rs.1057.38 lakh, indicating better inventory turnover or sales efficiency.

- Trade Receivables: Slightly increased to Rs. 8691.76 lakh from Rs. 8595.54 lakh, reflecting growth in sales also indicating good debtor collection.

- Cash and Cash Equivalents: Stands at Rs. 5.92 lakh as compared to Rs. 8.28 lakh, requiring improvement in liquidity position.

- Other Financial Assets: Other financial assets remained slightly rose to Rs. 23.87 lakh from Rs. 22.19 lakh.

- Current Tax Assets: Increased significantly from Rs. 39.21 lakh to Rs. 92.10 lakh.

- Other Current Assets: significantly decline from Rs. 1,200.16 lakh to Rs. 402.19 lakh, mainly due to changes in balance with government authorities, advances to suppliers, prepaid expenses.

2. Equity and Liabilities

A. Equity

- Equity Share Capital: Remained almost stable at Rs. 1,992.18 lakh.

- Other Equity: Increased from Rs. 7,331.88 lakh to Rs. 7929.26 lakh, reflecting retained profits and stable reserves.

B. Non-Current Liabilities

There is a slight increase from Rs. 220.31 lakh in FY 2024-25 to Rs. 267.75 lakh in FY 2025-26.

- Borrowings: Increased from Rs. 158.24 lakh to Rs. 203.65 lakh, due to long-term loans for capital investments.

- Long-Term Provisions: Rose slightly from Rs. 62.07 lakh Rs. 64.10 lakh, mainly on account of gratuity obligations.

C. Current Liabilities

Current liabilities reduced to Rs. 5105.49 lakh in FY2025-26 as compared to Rs. 5446.44 lakh in FY 2024-25.

- Short-Term Borrowings: Fall from Rs. 2,640.03 lakh to Rs. 2442.68 lakh, indicating reduction in reliance on working capital borrowings.

- Trade Payables and other Financial Liabilities: Trade payables significantly reduced from Rs. 1075.66 lakh to Rs. 683.99 lakh, primarily due to reduction in dues of creditors other than small and micro enterprises. However, there is slight increase in other financial liabilities from Rs. 73.56 lakh to Rs. 88.62 lakh.

- Other Current Liabilities: Increased from Rs. 1646.21 lakh to Rs. 1876.88 lakh.

- Short-Term Provisions: Increased from Rs. 10.98 lakh to Rs. 13.32 lakh.

C. Cash Flow Analysis

Particulars	FY 2025–26 (Rs in lakh)	FY 2024–25 (Rs in lakh)	Remarks
A. Net Cash from Operating Activities	583.96	(1,440.70)	Significant improvement in operating cash flows, driven by stronger operating performance, favourable working capital movements and income tax refunds during the year.
B. Net Cash from Investing Activities	(269.39)	(134.09)	Higher cash outflow primarily on account of increased capital expenditure towards acquisition of Property, Plant and Equipment, partly offset by interest received and proceeds from sale of assets.
C. Net Cash from Financing Activities	(316.93)	1,575.06	Net cash outflow mainly due to repayment of borrowings and payment of finance costs, compared to net inflow in the previous year arising from higher borrowings.
Net Increase/(Decrease) in Cash and Cash Equivalents	(2.36)	0.27	Cash and cash equivalents decreased marginally during the year owing to higher investing and financing outflows, despite positive cash generation from operating activities.
Opening Cash and Cash Equivalents	8.28	8.01	Opening cash balance remained broadly in line with the previous year.
Closing Cash and Cash Equivalents	5.92	8.28	Closing cash balance declined marginally; however, the Company maintained adequate liquidity to support its operational requirements.

Key Insights:

During FY 2025–26, the Company recorded a significant improvement in its cash flow from operating activities, generating a net cash inflow of Rs583.97 lakh as against a net cash outflow of Rs1,440.70 lakh in the previous year. The improvement was primarily driven by healthy operating profitability before working capital changes, reduction in inventories, increase in other liabilities and receipt of income tax refunds, which were partly offset by an increase in trade receivables and a decrease in trade payables.

Net cash used in investing activities amounted to Rs269.39 lakh, compared with Rs134.09 lakh in FY 2024–25. The higher outflow was mainly attributable to capital expenditure on acquisition of Property, Plant and Equipment, partially offset by interest income and proceeds from the sale of fixed assets.

Financing activities resulted in a net cash outflow of Rs316.93 lakh, as against a net cash inflow of Rs1,575.06 lakh in the previous year. The outflow primarily reflected repayment of borrowings and payment of finance costs during the year.

Consequently, cash and cash equivalents decreased marginally by Rs2.36 lakh, from Rs8.28 lakh as at 31 March 2025 to Rs5.92 lakh as at 31 March 2026. Despite the marginal decline in cash balances, the Company maintained positive operating cash generation, demonstrating its ability to support ongoing operations, capital investments and financing commitments through internally generated cash flows.

D. Key financial Ratios

In accordance with the SEBI (Listing Obligations and Disclosure Requirements 2018 (Amendment) Regulations, 2018, the Company is required to give details of significant changes (change of 25% or more as compared to the immediately previous financial year) in key sector-specific financial ratios. The details of Key Financial Ratios for FY 2025-26 and FY 2024-25 are given below:

S. No.	Particulars	Methodology	As at March 31, 2026	As at March 31, 2025	Variance
a)	Current Ratio	Indicates the companys ability to meet short-term obligations using its Current Assets	1.99	2.01	-1%
b)	Debt Equity Ratio	Measures the proportion of debt funding compared to Shareholders Equity	0.27	0.30	-11%
c)	Debt Service Coverage ratio	Reflects the Companys ability to service its debt from operating income	8.11	2.78	202%
d)	Return on Equity (%)	Indicates the Return generated on the Shareholders Equity invested in the business	6.12%	7.06%	-13%
e)	Inventory Turnover Ratio	Shows how efficiently the Company manages its inventory in relation to revenue	18.07	17.18	5%
f)	Trade Receivables Turnover Ratio	Reflects how effectively the Company collects its dues from customers	2.10	3.34	-37%
g)	Trade Payable Turnover Ratio	Indicates the speed at which the Company pays its suppliers	13.52	20.28	-33%
h)	Net Capital Turnover Ratio	Measures the efficiency in utilisation of working capital to generate revenue	3.58	3.98	-10%
i)	Net Profit Margin (%)	Represents the percentage of net profit earned from total revenue	2.99%	2.97%	1%
j)	Return on Capital Employed (%)	Indicates profitability in relation to the capital employed in the business.	9.22%	11.39%	-19%
k)	Return on Investment (%)	Measures the appreciation in the value of non-current quoted investments over the year	6.57%	-9.12%	172%

12. MATERIAL DEVELOPMENT IN HUMAN RESOURCES/INDUSTRIAL RELATIONS

The Companys employees continue to be its most valuable asset and a key contributor to its operational excellence and long-term growth. During FY 2025–26, the Company remained committed to fostering a safe, inclusive and performance-oriented work environment by strengthening organizational capabilities, encouraging employee engagement and promoting a culture of integrity, collaboration and continuous improvement.

As at 31 March 2026, the Company had 195 permanent employees on its rolls as compared to 191 permanent employees as at 31 March 2025. During the year, the Company continued to focus on attracting, retaining and developing skilled professionals across its manufacturing, engineering, project execution, sales and support functions. The Management believes that a competent and committed workforce, supported by harmonious industrial relations, remains fundamental to achieving the Companys long-term strategic objectives.

The Company continued to promote a collaborative, inclusive and safe workplace by encouraging open communication, equal opportunity and merit-based professional growth. It remained committed to maintaining a work environment free from discrimination and harassment while ensuring compliance with applicable labour laws and statutory requirements. The Company also continued its focus on occupational health, safety and employee well-being through established safety practices, periodic awareness programmes and initiatives aimed at promoting a safe working environment across its manufacturing facilities, project sites and offices.

Industrial relations remained cordial and harmonious throughout the year. The Company maintained constructive engagement with its employees and workmen, fostering a culture of mutual trust, transparency and cooperation. There were no significant industrial disputes or work stoppages during the year, and business operations continued without any material disruption arising from labour-related issues.

For and on behalf of the Board

Rungta Irrigation Ltd

Sd/-

Shruti Jain

Whole-Time Director

DIN: 00229045

Sd/-

Mahabir Prasad Rungta

Chairman & Managing Director

DIN: 00235632

Date: 24-08-2026

Place: New Delhi