Samkrg Pistons & Rings Ltd Management Discussions

(a) INDUSTRY STRUCTURE AND DEVELOPMENTS

Our company specializes in manufacturing auto components such as pistons, gudgeon pins, piston rings and auto shafts for various vehicle segments including commercial vehicles, tractors, heavy duty stationary engines, two wheelers, three wheelers and four wheelers. The market is divided into OEMs, the replacement market, and exports, each offering distinct advantages and challenges.

The Indian auto component industry is evolving, establishing itself as a key global supplier with substantial export potential. Our growth is closely tied to the automobile industrys performance and the broader rural economy. We are actively upgrading our manufacturing technologies to comply with the latest emission standards, such as BS6 and Euro norms. Additionally, we are expanding our product range to include valves and connecting rods, which will enhance our . offeringsinthe domestic and export markets

The Indian auto component industry is evolving rapidly, establishing itself as a dependable global hub. Recovery in domestic demand, along with rising export potential, is fuelling industry growth. Notable trends include:

The two-wheeler segment has bounced back strongly, with sales volumes in the 100cc

150cc category returning to pre-COVID levels.

There is a clear shift from low to higher CC vehicles, driven by rising demand for better performance, durability, and fuel efficiency. This trend is creating more opportunities for premium engine components.

Electric vehicles (EVs) are expanding steadily, particularly in urban areas. While this presents long-term challenges to traditional internal combustion engine (ICE) components, it also encourages product innovation and diversification.

In response, we are modernizing our manufacturing processes and aligning capabilities with BS6, Euro emission standards, and emerging customer requirements across segments.

Strategic Initiatives and Business Focus

To stay future-ready and competitive, we are executing multiple strategic initiatives:

Product Expansion: Introducing engine valves and connecting rods to strengthen our position in the OEM, aftermarket, and export markets.

Export Growth: Increasing our presence in regions where Indian two-wheelers are widely used such as Africa, Latin America, and Southeast Asia while also addressing the needs of global brands.

New Segments: Developing compressor pistons for stationary and industrial use, and exploring supply opportunities for multi-purpose and heavy-duty engines.

Technology Upgradation: Leveraging expertise from Japanese and German consultants to improve product quality, cost efficiency, and production

Operational Excellence: Maintaining a strong focus on zero-defect quality and timely delivery from all plants.

These efforts position us to safeguard our core business while tapping into emerging market opportunities.

(b) OPPORTUNITIES AND THREATS

The rise of electric vehicles presents both opportunities and challenges for our company. While the shift towards electric mobility poses a threat to the traditional I.C. engine market, it also offers opportunities for innovation and diversification. To stay competitive, we are focusing on cost-effective manufacturing processes and adopting sophisticated technologies, supported by technical expertise from Japanese and German consultants. Our plans to introduce new products like valves and connecting rods further diversify our portfolio, catering to evolving market demands.

Our strong relationships with domestic OEMs, agricultural tractor manufacturers, and the replacement market, along with a robust export presence, provide a solid foundation for growth. However, we must navigate risks such as foreign currency fluctuations, raw material price volatility, and intense competition from international players and the unorganized sector.

Key Opportunities:

Continued revival in two-wheeler and tractor demand

Rising preference for higher CC engines

Expansion into new export geographies

Entry into compressor and industrial applications

A broader product portfolio to enhance OEM and distributor engagement

Major Challenges:

Gradual transition to electric mobility

Volatile raw material prices

Foreign exchange fluctuations affecting exports

Competitive pressure from international low-cost manufacturers and the unorganized sector

Increasing compliance costs due to evolving regulations

We are addressing these with cost optimization, process modernization, and forward-looking product planning.

(c) SEGMENT-WISE OR PRODUCT-WISE PERFORMANCE

The company specializes in single segment of manufacturing auto components such as pistons, gudgeon pins, piston rings and auto shafts for various vehicle segments including commercial vehicles, tractors, heavy duty stationary engines, two wheelers, three wheelers and four wheelers.

(d) OUTLOOK

In the face of the challenges, the company is committed to sustainable growth. We are leveraging our strong distribution network and partnerships with OEMs to enhance our market presence. By implementing cost-effective measures and focusing on zero-defect quality and timely delivery, we aim to meet the evolving needs of our customers.

Looking ahead, the company is well-positioned for moderate and consistent growth. Our strategic focus will be on:

Growing demand for higher CC two-wheelers and tractors

Launch and scale-up of valves, connecting rods, and compressor pistons

Expanding exports across markets using both Indian and international brands

Balancing traditional ICE product demand while preparing for the EV transition With continued emphasis on product quality, customer satisfaction, and operational excellence, we remain committed to long-term value creation and market leadership.

We are poised for moderate demand growth across all market segments, driven by continuous product innovation and compliance with stringent environmental standards. Our strategy includes the introduction of new products such as valves and connecting rods, expanding our offerings in the Indian domestic and export aftermarkets. This approach will help us capitalize on existing strengths while exploring new opportunities in emerging markets.

(e) RISK AND CONCERNS

The company continues to operate in a highly competitive environment, facing various risks such as technology obsolescence, regulatory changes, and geopolitical uncertainties. However, we are proactively managing these risks through strategic planning, investments in advanced technologies, and maintaining a flexible business model. Our harmonious industrial relations and comprehensive risk management strategies ensure the resilience and sustainability of our operations.

Overall, the company remains focused on leveraging its strengths and exploring new opportunities to secure long-term growth and profitability.

Risks and Mitigation Measures

Operating in a dynamic global environment brings both internal and external risks:

? Rapid technology changes

? Shifts in emission and safety regulations

? Geopolitical instability in key markets

? Demand uncertainty due to economic fluctuations Our risk mitigation plan includes:

? Agile, flexible manufacturing systems

? Continued investment in R&D and innovation

? Strengthening OEM partnerships

? Close monitoring of macroeconomic and forex trends

? Emphasis on process efficiency and quality systems

(f) INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:

The company maintains and adequate and effective internal control system to commensurate with its size and complexity. An independent internal audit function is an important element of your companys internal control system. The internal control system is supplemented through an extensive internal audit program and periodic review by management and audit committee. The company has a sound and scalable internal control system aligned to its operational complexity. An independent internal audit team, periodic management reviews, and oversight by the Audit Committee ensure compliance with financial, operational, and regulatory standards.

(g) FINANCIAL PERFORMANCE:

The Company earned total revenue operation of

Rs 24388.89 lakhs compared with Rs 24533.22 lakhs in the previous year.

Profit Before Depreciation, interest and tax (PBDIT) at Rs. 3152.32 lakhs. The Profit Before Tax was at Rs 3329 lakhs.

(h) HUMAN RESOURCES AND INDUSTRIAL RELATIONS:

The Company maintains continuously planning to have cordial industrial relations environment and the Company continues to establish its training facilities at all levels of employees for cost reduction programmes.

Industrial relations during the year are little distributed due to high inflations & price rises of all commodities are on very much increasing side. The Company encourages good talent and introduced skill development program in the rapidly challenging business and competitive environment. Adequate safety measures, training and development of the employees continue to receive top priority.

While the year saw pressure from rising inflation and living costs, the company maintained harmonious industrial relations. We remain committed to:

? Recognizing and retaining capable talent

? Conducting skill development and training programs

? Prioritizing employee safety and engagement

This approach supports productivity and a strong organizational culture.

(i) KEY FINANCIAL RATIOS:

Pursuant to the provisions of Regulation 34(3) of SEBI (LODR) Regulations 2015 read with Schedule V part B (1) details of changes in Key Financial Ratios are given as hereunder :

Particulars	2024-25	2023-24
Debtors Turnover	4.93	4.01
Ratio
Inventory Turnover	3.56	3.46
Ratio
Interest Coverage	4.19	8.69
Ratio
Current Ratio	1.66	1.95
Debt Equity Ratio	0.19	0.15
Operating Profit	7.07	8.12
Margin (%)
Net Profit Margin (%)	2.40	5.11

(j) THE DETAILS OF RETURN ON NET WORTH IS AS FOLLOWS:

Particulars	024-25	2023-24
Return on Capital	0.13	0.15
Employed
Return on net	0.03	0.07
worth

OTHER DISCLOSURES STATUTORY COMPLIANCE:

The Chairman & Managing Director and Chief Financial Officer makes a declaration at each

Board Meeting regarding the compliance with provisions of various statutes after obtaining confirmations from all the units

The Company ensures compliance with SEBI regulations and provisions of the listing agreement

CAUTIONARY STATEMENT

Statements in this Management Discussion and

Analysis describing the Companys objective, projections, estimates and expectations may constitute forward looking statements within the meaning of applicable laws and regulations. Actual results might differ marginally or materially from those either expressed or implied.

10 YEARS RECORD

A chart showing 10 Years performance is

appended forming part of this report is attached

at Performance Highlights.

EXPORTS

The Company is focusing exports to developed

Countries like Europe, U.K, France, Germany,

Spain, Brazil and Russia and also to Gulf & Asian

Countries. The Company has plans to reach the

incremental Turnover during the next 2 years.

POLLUTION CONTROL SAFETY &

ENVIRONMENTAL PROTECTION:

We are complying all the norms prescribed by the

the company. statutory authorities i. e. Telangana State & A.

P. Pollution Control Board.

The Company is very much concerned for safety

of men and machines through safety awareness

training programs.

DISCLOSURE OF PARTICULARS

The information required under section 134(3)

(m) of the Companies Act, 2013 is given in

Annexure-1.

BY ORDER OF THE BOARD

For SAMKRG PISTONS AND RINGS LIMITED

	Sd/-	Sd/-
	SARIPALLI KISHORE	SARIPALLI KARUNAKAR
Place: Hyderabad	WHOLETIME DIRECTOR	CHAIRMAN & MANAGING DIRECTOR
Date : August 11, 2025	DIN: 01665768	DIN: 01665760