S & S Power Switchgear Ltd Management Discussions

Group overview:

The S&S Power Group of companies operates in three sectors - HART in non-ferrous (Aluminium), SSPSE in Transmission and Distribution, and Acrastyle in Protection and Control systems. Our operations are spread across Kolkata, Chennai and the UK, and we have a legacy of over five decades overall. Our companies are working towards a 3-Year strategic plan and are investing across products, people and processes to innovate, support, and sustain growth. With record orders and focused execution, S&S Power Group grew revenues by over 40% in FY 26, with strong profitability.

Each of our sectors have unique trends and indicators, and we have analysed a few key aspects below.

Aluminium: The sector is seeing a robust increase in demand, driven by increased usage and adoption by more industries. The prices are at historically higher levels, partially also due to the supply disruptions caused by the situation in the middle east. Foreseeing this demand, and because of a long project gestation cycle, Aluminium companies - both domestic and international - have announced heavy investments in new capacities. But it is not just new capacity that is driving the growth for HART - our technologies help the customer improve their energy efficiencies while also reducing their emissions. As the sector health is largely linked to the commodity prices, our customers, even in-between long capex cycles, engage HART for modernising and improving their performance. So, HART sees demand both ways. We foresee a continuing high demand for the next few years at the very least.

Transmission and Distribution: In India, as in most countries around the world, there is a large investment cycle happening in this sector. Electricity has become a key need, comparable with oil, as the engine of growth. In our own country, we remember how the call for roti- kapda-makan (bread, clothing, and homes) transitioned to sadak- bijli-paani (roads, electricity, and water) over the years. There are three "Ds" driving the growth of T&D - Demographics (urbanisation and electrification), Decentralisation (growth of RE and distributed sources of energy generation, storage and grid integration), and Digitalisation (increased data usage for computing and storage, exponentially rising with the growth of Al, and resulting into building of large-scale data centre infrastructure). Here too, we foresee a steady demand for our products and services, driven largely by network capacity expansion and some upgradation.</p>

Protection and Control: P&C is also an integral part of the electricity sector but differentiated in terms of product and functionality. Acrastyle in the UK has been serving this sector for over 6 decades and is amongthe mosttrusted and reputed manufacturers of control and relay panels in the UK market. Acrastyle also offer engineering

services, apart from manufacturing LNERs (earthing equipment), and integrating portable relay rooms, battery storage systems, etc. P&C standards are mainly driven by the IEC 61850 standards for substation management and control and increasingly involve more of electronic components like advanced numerical relays for protection, and its interface with SCADA systems. In this sector, there is a larger mix of modernisation and upgrades in the market demand, as customers need to upgrade the control systems faster than conventional T&D equipment.

The external environment is challenging on two fronts - volatility of costs and geopolitical risks. In our sectors, contracts tend to be largely on fixed price basis, so we need to be extremely careful in managing the risks and opportunities between award of the order and its completion. While our teams have taken several steps and measures to mitigate these impacts - viz. variation clause in some contracts, firming-up prices for delayed deliveries, costing with forward price trends, adding risk factors, increasing and closer engagement with customers duringthe execution phase, etc., there are still areas beyond our reasonable control, and our Risk and Internal Control will always be an evolvingsubject of discussion.The geopolitical risks have also exacerbated with the recent situation in the middle east, and while we are closely watching and adapting to some extent, these factors are also beyond our direct control.

As we grow and continue to scale, our focus will remain on balancing risk with opportunity and on continuously improving our internal controls.

While we have tried to give a progressive yet balanced picture of the future, kindly notethat ourforward-looking statements are based on available information and the existing situation at this point in time. They are naturally subject to emergent risks, unforeseen events, and uncertainties, and actual outcomes may differ.