Samkrg Pistons & Rings Ltd Management Discussions

(a) Industry Structure and Developments

The Company is engaged in the manufacture of precision automotive engine components, primarily Pistons, Piston Rings and Gudgeon Pins, catering to Original Equipment Manufacturers (OEMs), the Replacement Market and Export customers across two-wheelers, three-wheelers, passenger vehicles, commercial vehicles, tractors and stationary engine applications.

The Indian automotive component industry continued to demonstrate steady growth during the year, supported by improving domestic demand, increasing vehicle population and rising replacement requirements. The replacement market remained resilient, while export opportunities continued to expand across several emerging markets.

The Company continued to strengthen its position by focusing on product quality, customer satisfaction, manufacturing efficiency and wider market coverage. Continuous investments in product development, process improvement and manufacturing capabilities have enabled the Company to meet evolving customer requirements and changing emission norms.

During the year, the Company continued expanding its product portfolio with development activities for Engine Valves, Connecting Rods, Compressor Pistons and Aluminium Cylinder Blocks. The Company has also initiated capacity creation for Aluminium High Pressure Die Casting (HPDC), which will support future business opportunities in aluminium automotive components.

In addition, the Company is evaluating opportunities in precision-engineered components through Investment Casting for selected automotive and industrial applications, thereby broadening its future product portfolio.

The Company continues to improve operational efficiency through automation of foundry processes, machining operations, inspection

systems and material handling systems, with emphasis on improving productivity, product quality, cost competitiveness and customer satisfaction.

(b) Opportunities and Threats

The Indian automotive aftermarket continues to offer significant growth opportunities due to the increasing vehicle population, longer vehicle life and rising demand for quality replacement parts. The Company is well positioned to benefit from these opportunities through its established distribution network, strong brand presence and expanding product portfolio.

Key Opportunities:

• Growth in the domestic Replacement Market.

• Expansion of export business across Africa, Latin America, the Middle East and other emerging markets.

• Increasing business opportunities with OEM customers.

• Expansion into new product categories including Engine Valves, Connecting Rods, Compressor Pistons and Aluminium Cylinder Blocks.

• Future opportunities in precision aluminium and Investment Casting automotive components.

Key Challenges:

• Fluctuations in aluminium, steel and other raw material prices.

• Foreign exchange fluctuations.

• Global geopolitical uncertainties.

• Increasing competition from domestic and international manufacturers.

• Changing regulatory and environmental requirements.

• Gradual transition towards electric mobility over the long term.

The Company continues to address these challenges through product diversification, manufacturing excellence, process automation, cost optimisation, quality improvement and customer-focused business strategies.

(c) Segment-wise / Product-wise Performance

The Company manufactures precision automotive engine components, primarily Pistons, Piston Rings and Gudgeon Pins, catering to two- wheelers, three-wheelers, passenger vehicles, commercial vehicles, tractors and stationary engine applications.

The Companys business is well diversified across Original Equipment Manufacturers (OEMs), the domestic Replacement Market and Exports, providing a balanced revenue base. During the year, the Company continued to strengthen its presence in the domestic OEM and Replacement Market by fulfilling growing customer demand, expanding market reach and enhancing customer relationships. The Company also continued to strengthen its export business by serving customers across multiple international markets, thereby enhancing its overall market presence and business stability.

(d) Outlook

The long-term outlook for the automotive component industry remains positive, supported by continued growth in vehicle population, increasing replacement demand and expanding export opportunities.

The Company will continue to strengthen its core business while expanding into new products and technologies. Future growth will be driven through:

• Expansion of the product portfolio.

• Development of Aluminium Cylinder Blocks.

• Expansion of Engine Valve and Connecting Rod businesses.

• Capacity enhancement and automation of manufacturing operations.

• Strengthening OEM partnerships and expanding the Replacement Market.

• Expansion into new export markets.

• Continuous improvement in quality, productivity and customer service.

The Company remains committed to sustainable growth through continuous innovation, operational excellence and prudent business practices, creating long-term value for all stakeholders.

(e) Risks and Concerns

The Companys operations are exposed to risks arising from fluctuations in raw material prices, foreign exchange movements, changes in government regulations, global geopolitical developments and increasing competition within the automotive component industry.

The gradual shift towards electric mobility may impact the demand for conventional engine components over the long term. However, the Company continues to diversify its product portfolio, strengthen manufacturing capabilities, expand into new product segments and increase its presence in domestic and international markets to mitigate these risks.

The Company remains focused on product quality, customer satisfaction, operational excellence and prudent financial management to support sustainable long-term growth.

(f) Internal Control Systems and Their Adequacy

The Company has established an adequate system of internal controls commensurate with the size, nature and complexity of its operations. These systems are designed to ensure efficient business operations, safeguarding of assets, compliance with applicable laws and regulations, accuracy of financial reporting and effective risk management.

The internal control framework is supported by independent internal audits, periodic management reviews and oversight by the Audit Committee of the Board. The Company continues to strengthen its manufacturing processes,

quality systems and operational controls through continuous improvement initiatives, automation and adoption of best manufacturing practices to support efficient operations and sustainable business growth.

(g) FINANCIAL PERFORMANCE:

The Company earned total revenue operation of Rs 28566.35 lakhs compared with Rs 24388.89 lakhs in the previous year.

Profit Before Depreciation, interest and tax (PBDIT) at Rs. 3879.06 lakhs. The Profit Before Tax was at Rs 3152.32 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	2025-26	2024-25
Debtors Turnover Ratio	5.80	4.93
Inventory Turnover Ratio	3.93	3.56
Interest Coverage Ratio	2.63	4.19
Current Ratio	1.73	1.66
Debt Equity Ratio	0.18	0.19
Operating Profit Margin (%)	7.85	7.07
Net Profit Margin (%)	3.41	2.40

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

Particulars	2025-26	2024-25
Return on Capital Employed	0.15	0.13
Return on net worth	0.05	0.03

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 of the company. The Company ensures compliance with SEBI regulations and provisions of the listing agreements.

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 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.

	Sd/-	Sd/-
	SARIPALLI KISHORE	SARIPALLI KARUNAKAR
Date : August 10, 2026	WHOLETIME DIRECTOR	CHAIRMAN & MANAGING DIRECTOR
Place: Hyderabad	DIN: 01665768	DIN: 01665760