Sathlokhar Synergys E&C Global Ltd Management Discussions

Management Discussion And Analysis

1. GLOBAL AND INDIAN ECONOMY OVERVIEW

Global Economic Context

The global economy demonstrated measured resilience during FY 2025:26, navigating a complex environment shaped by moderating inflation, uneven monetary policy normalisation across major economies, and persistent geopolitical uncertainties. The International Monetary Fund projected global growth at approximately 3.2% for 2025, with advanced economies expanding at a more subdued pace while emerging markets continued to drive a disproportionate share of incremental output.

Supply chain realignment, accelerated by the China plus one sourcing strategy adopted by multinational manufacturers, created meaningful capital expenditure flows into alternative manufacturing destinations. This structural shift benefited South and Southeast Asia considerably, with India emerging as one of the principal beneficiaries of manufacturing diversification across electronics, footwear, automotive components, chemicals, and food processing.

Commodity prices, including steel, stabilised through much of the year following the volatility of earlier periods, providing a more predictable cost environment for EPC contractors. Global infrastructure spending, supported by government stimulus programmes and energy transition investments, sustained demand for construction and engineering services.

Indian Economic Context

India remained one of the fastest growing major economies, with GDP growth estimated at approximately 7.4% for FY2025:26. The Government of India continued its sustained push on infrastructure investment, with capital expenditure allocations remaining elevated as a proportion of the Union Budget, The Production Linked Incentive schemes across fourteen sectors have catalysed substantial private capital investment, directly driving demand for industrial EPC contractors.

The manufacturing sectors share in GDP has been a stated policy priority, and the establishment of new industrial corridors, SIPCOT parks, special economic zones, and dedicated freight corridors has created a pipeline of greenfield facility construction across Tamil Nadu, Andhra Pradesh, Karnataka, Telangana, and Maharashtra. These states collectively represent the core of Sathlokhars operational geography.

Domestic consumption growth, particularly in the FMCG, beverage, and food processing segments, has driven clients such as Reliance Consumer Products to aggressively expand manufacturing capacity, creating large, time-bound EPC mandates. Indias formidable demographic dividend, a growing middle class, and the expanding formal economy have underpinned sustained private sector capital formation.

2. INDUSTRY STRUCTURE, DEVELOPMENTS AND GOVERNMENT INITIATIVES

The Indian EPC Industry

The Engineering, Procurement and Construction industry in India operates across a continuum ranging from pure civil contractors to fully integrated EPC players offering design, procurement, construction, commissioning, and handover under a single contract. The industrial EPC segment, where Sathlokhar operates, is characterised by compressed execution timelines, multi-disciplinary integration requirements, and clients who demand accountability across the full project lifecycle rather than managing multiple trade contractors.

The industrial EPC market has been growing rapidly, driven by four principal forces: the PLI-induced manufacturing wave, warehouse and logistics infrastructure expansion supporting e-commerce and organised retail, the energy transition pushing solar and clean energy installations, and the governments accelerating capital expenditure on public infrastructure.

Pre-engineered buildings have emerged as the structural system of choice for industrial facilities, warehouses, and large commercial projects, given their speed advantage (typically 30 to 40 percent faster than conventional construction), structural efficiency, and lower lifecycle maintenance costs. The PEB manufacturing market in India is growing rapidly, with demand significantly outpacing domestic supply capacity, creating both a cost challenge for EPC players reliant on third-party PEB vendors and a significant opportunity for those with in- house manufacturing capabilities.

Key Government Initiatives

The PLI schemes across electronics, pharmaceuticals, food processing, textiles, automobiles, and advanced chemistry cells have directly triggered a wave of greenfield factory construction, precisely the segment Sathlokhar serves. Multinational manufacturers from Taiwan and Vietnam, who awarded orders to Sathlokhar during FY26, are among the companies investing under or in parallel to Indias manufacturing incentive framework.

The Smart Cities Mission, the National Infrastructure Pipeline, and the AMRUT 2.0 programme have expanded the scope of government contracting available to credentialled EPC players Sathlokhars attainment of PWD Class 1A registration during FY26 unlocks this government segment, which was previously inaccessible to the Company. The ESA Grade 635 electrical registration similarly expands the addressable market to EHT and large utility-scale electrical projects.

The Government of Indias renewable energy targets, with 500 GW of non-fossil capacity targeted by 2030, continue to drive demand for solar EPC services. Sathlokhars MNRE-approved vendor status and its position as an authorised channel partner of Tata Power Solar position the Company well to participate in this expanding market.

3. CORPORATE OVERVIEW

Sathlokhar Synergys E&C Global Limited is an integrated Engineering, Procurement and Construction turnkey contractor headquartered in Chennai, Tamil Nadu. Incorporated in 2013 by Mr. G. Thiyagu and Mrs. T. Sangeethaa, the Company has grown from a regional civil contractor into a pan-India EPC enterprise with its first international project now underway in Sri Lanka.

The Companys equity shares are listed on NSE Emerge, the SME platform of the National Stock Exchange of India, since August 6, 2024, marking a defining milestone in its journey toward institutional credibility and public accountability.

Sathlokhar operates across six integrated service verticals: Civil and Multi-Storeyed RCC Construction, Pre-Engineered Building Construction, MEP Engineering Services, Solar EPC Turnkey Solutions, Office Interior Works and Finishes, and Statutory Approval Coordination along with Surveillance, Safety and Security Systems. This breadth of capability, delivered through a unified team rather than a fragmented subcontractor network, constitutes the Companys principal competitive differentiation.

The Company operates primarily in the Engineering, Procurement and Construction (EPC) business, providing integrated services across Civil and RCC Construction, Pre-Engineered Buildings, MEP Engineering Services, Solar EPC Solutions, Interior Works and allied services. The segment/product-wise disclosure and performance of the Company are consistent with the reportable segment information disclosed in the audited financial statements. During FY 2025-26, the overall EPC business recorded substantial growth supported by increased order inflows and execution across multiple projects.

The Company is supported by a workforce exceeding 5,550 site personnel and over 678 qualified professionals spanning architecture, structural engineering, MEP, project management, and procurement. A dedicated steel fabrication and PEB manufacturing facility underpins the Companys backward integration, and a state-of-the-art PEB manufacturing plant, whose foundation stone was laid on January 28, 2026, is scheduled for inauguration on August 30, 2026.

Key credentials as at March 31, 2026 include PWD Class 1A registration, Electrical Super A Grade 635 contractor certification, MNRE approval for solar EPC, and Tata Power Solar channel partner status. These credentials collectively define the universe of projects the Company can legally bid for and execute.

The Companys client portfolio spans global and domestic marquee names, including Reliance Consumer Products, Toyota Kirloskar, APM Terminals (Maersk Group), the Hong Fu Industrial Group, the Pou Chen Corporation Group, Komatsu, and the Ceylon Beverage Group, reflecting the trust that sophisticated international and domestic industrial clients place in Sathlokhars execution capability.

4. FY26 OVERVIEW

i. Financial Performance Review

FY26 was the strongest year in Sathlokhars operating history across every financial metric. Revenue from operations more than doubled year on year, driven by a record order inflow of f 1,111.02 Cr and strong execution across a concurrent portfolio of 30 projects spanning multiple states.

Profit and Loss Summary

			(in Rs. Lakhs)
Particulars	FY2025:26	FY2024:25	YoY Change
Revenue from Operations	82,027.99	36,968.52	+ 121.9%
Other Income	327.60	246.77	+32.7%
Total Income	82,355.58	37,215.29	+ 121.3%
Purchases of Stock-in-Trade	74,279.63	31,581.71	+ 135.2%
Change in Inventories	(8,701.89)	(1,796.92)
Employee Benefits Expenses	4,024.95	1,785.94	+ 125.4%
Finance Costs	626.31	207.58	+201.8%
Depreciation and Amortisation	96.83	59.85	+61.8%
Other Expenses	964.81	501.67	+92.3%
Total Expenses	71,290.65	32,339.83	+ 120.5%
EBITDA (approx.)	11,788.08	5,142.90	+ 128.7%
Profit Before Exceptional Items and Tax	11,064.94	4,875.46	+ 126.9%
Exceptional Items (Postlisting expenses)	(24.10)
Profit Before Tax	11,040.83	4,875.46	+ 126.4%
Total Tax Expense	2,809.31	1,460.27	+92.4%
Profit After Tax	8,231.52	3,415.20	+ 141.1%
Basic EPS ( Rs.)	33.20	15.58	+ 113.1%
Diluted EPS ( Rs.)	33.08	15.58	+ 112.3%

Balance Sheet Summary

	(In Rs. Lakhs)
Particulars	March 31, 2026	March 31, 2025	YoY Change
Total Assets	67,157.80	27,958.98	+140.2%
Total Non- Current Assets	7,520.91	2,407.78	+212.4%
Total Current Assets	59,636.89	25,551.20	+ 133.5%
Total Equity	35,892.45	18,618.65	+92.8%
Total Non- Current Liabilities	169.76	112.42	+51.0%
Total Current Liabilities	31,095.59	9,227.91	+237.1%
Total Liabilities	31,265.34	9,340.33	+234.8%

Key Margin Metrics

P Metric	FY2025:26	FY2024:25
EBITDA Margin	14.3%	13.9%
PBT Margin	13.5%	13.2%
PAT Margin	10.0%	9.2%
Gross Profit Margin	20.0%	19.4%

ii. Description and Analysis

Revenue growth of 121.9% was driven by a combination of strong order execution across the Reliance Consumer Products Campa project in Andhra Pradesh, multiple footwear manufacturing facilities in Tamil Nadu for Hong Fu and Pou Chen group entities, and the ramp-up of the

Ceylon Beverage Group projects spanning Maharashtra, Karnataka, and Sri Lanka. Contract receipts, which represent EPC execution revenue, grew from Rs.34,209.86 Lakhs in FY25 to Rs.79,747.77 Lakhs in FY26, a growth of 133%, confirming that the Companys core EPC business drove the expansion rather than commodity trade.

EBITDA expanded from Rs.5,142.90 Lakhs to Rs.11,788.08 Lakhs, with margin expanding marginally from 13.9% to approximately 14.3%, demonstrating that scale was achieved without sacrificing profitability. This is a meaningful outcome in an industry where rapid revenue growth often compresses margins through project overruns or under-priced orders Sathlokhars disciplined bid conversion ratio of 10% to 15%, maintained consistently, reflects a deliberate approach to pursuing only executable, margin accretive work.

PAT grew 141.1% to Rs.8,231.52 Lakhs, with PAT margin expanding to approximately 10.0%. The tax outflow of Rs.2,809.31 Lakhs represents an effective tax rate of approximately 25.4%, consistent with the statutory corporate rate.

Employee expenses grew 125.4% to Rs.4,024.95 Lakhs, broadly in line with revenue growth, reflecting the Companys expanding workforce of professionals and site staff required to manage a concurrent portfolio of 30 projects. Finance costs grew 201.8% to Rs.626.31 Lakhs, primarily reflecting an increase in working capital borrowings from Rs.905,06 Lakhs to Rs. 8,974.80 Lakhs as the Company funded the working capital intensity of its rapidly expanding contract portfolio.

Balance sheet growth of 140.2% to Rs.67,157.80 Lakhs was driven by contract assets growing from Rs.2,538.49 Lakhs to Rs.23,447.31 Lakhs, reflecting revenue recognised on contracts not yet billed at year-end. Retention money receivable grew from Rs.1,709.45 Lakhs to Rs.5,286.03 Lakhs, reflecting the size of projects underway. Inventories grew from Rs.5,137.03 Lakhs to Rs.13,838.92 Lakhs, with Contract Work in Progress growing to Rs.11,291.94 Lakhs. Total equity grew 92.8% to Rs.35,892,45 Lakhs, supported by the profit for the year of Rs.8,231.52 Lakhs and fresh equity raised of Rs.184.06 Lakhs through preferential allotment.

Non-current financial assets grew substantially to Rs.5,420.86 Lakhs, principally comprising fixed deposits with banks having maturity periods exceeding twelve months, maintained as margin money against bank guarantees and other performance securities, which is standard practice for EPC companies operating at this scale.

Short-term borrowings of Rs.8,974.80 Lakhs represent cash credit and working capital demand loan facilities secured against book debts and inventories, a normal instrument for construction companies whose revenue recognition precedes cash collection from clients. The net debt to equity ratio stands at a manageable 0.24x as at March 31, 2026.

iii. Ratio Analysis

Ratio	FY2025:26	FY2024:25	Change	Comment
Current Ratio	1.92	2.77	(30.7%)	Decline reflects proportionately higher growth in current liabilities including trade payables, which funded working capital for rapid scale- up
Debt Equity Ratio	0.25	0.05	+414.4%	Increase driven by working capital borrowings to support execution of the largest order book in Company history
Debt Service Coverage Ratio	1.23	4.44	(72.4%)	Significant increase in debt servicing obligations following working capital scale-up outpaced earnings growth in absolute terms
Return on Equity	0.23	0.18	+25.0%	Improvement reflects higher PAT generation on an expanded equity base
Inventory Turnover Ratio	6.91	7.03	(1.6%)	Stable, no material change
Trade Receivables Turnover Ratio	8.42	5.75	+46.4%	Improvement reflects higher revenue and better collection efficiency, with receivables declining from Rs.11,799.46 Lakhs to Rs.7,684.46 Lakhs despite higher revenue
Trade Payable Turnover Ratio	7.46	6.48	+15.1%	Within normal range
Net Profit Margin	10.0%	9.2%	+0.8pp	Modest expansion reflecting operating leverage
Return on Capital Employed	26%	26%	Flat	Consistent returns on capital despite significant scale-up
Gross Profit Margin	20.0%	19.4%	+0.6pp	Marginal improvement
EBITDA Margin	14.3%	13.9%	+0.4pp	Expanding with scale
EBIT Margin	14.2%	13.8%	+0.4pp	Consistent
PBT Margin	13.5%	13.2%	+0.3pp	Stable
PAT Margin	10.0%	9.2%	+0.8pp	Improving
Interest Coverage Ratio	18.78	24.78	(24.2%)	Remains comfortable despite reduction; reflects higher finance costs on working capital facilities
Basic EPS ( Rs.)	33.20	15.58	+113.1%	Significant growth reflecting strong PAT growth
Adjusted Net Debt to Equity	0.25	0.05		Conservative leverage profile maintained

The ratio analysis confirms that FY26 was characterised by rapid, margin-accretive scale-up with broadly stable return metrics. The decline in the current ratio and debt service coverage ratio are explainable by the deliberate use of bank working capital facilities to fund a project portfolio that grew more than threefold. The trade receivables turnover improvement is particularly noteworthy: even as revenue doubled, receivables declined in absolute terms, indicating excellent billing and collection discipline.

iv. Disclosure of Accounting Treatment:

The financial statements of the Company have been prepared in accordance with the applicable Indian Accounting Standards (Ind AS) and the provisions of the Companies Act, 2013. The Company has not followed any accounting treatment different from that prescribed under the applicable Accounting Standards during the financial year 2025-26.

5. EXECUTION EXCELLENCE

Sathlokhars defining operational attribute is the ability to compress project timelines without compromising quality or safety. The Companys typical execution cycle of seven to twelve months for industrial facilities is a direct consequence of its integrated model, which eliminates the coordination lag inherent in multi-contractor project structures.

Integrated Delivery Model: By housing architectural design, structural engineering, PEB design and fabrication, MEP design and installation, solar system design and commissioning, and interior works under one organisational roof, Sathlokhar eliminates the white- space delays that occur when separate contractors interface. A single project manager owns the full scope, the procurement pipeline is unified, and approvals are coordinated through a dedicated in-house regulatory team with established relationships across DTCP, CEIG, TNEB, DISH, PCB, Fire, and Health departments.

Concurrent Multi-State Execution: During FY26, the Company successfully executed 30 concurrent projects spanning Tamil Nadu, Andhra Pradesh, Karnataka, Telangana, Maharashtra, Gujarat, Odisha, Uttar Pradesh, Puducherry, and Sri Lanka. This geographic simultaneity demands robust project management infrastructure, and the Company has invested in ERP-enabled project monitoring and digital reporting systems to maintain visibility across this distributed portfolio.

Backward Integration: The Companys fabrication track record of over 6,900 MT of steel delivered overthe last two years, supported by an in-house monthly manufacturing capacity of 300 MT, has been the foundation of faster PEB execution. The upcoming state-of-the-art PEB manufacturing facility, with an initial monthly capacity of 1,200 to 1,500 MT, will multiply this advantage, giving the Company direct control over the most critical supply chain variable in industrial construction.

Credentials That Enable Scope: The upgrade to ESA Grade 635 during FY26 means Sathlokhar can now execute electrical works of any voltage and capacity, including EHT substations, within Tamil Nadu without external electrical contractors. PWD Class 1A registration enables participation in large government infrastructure tenders. Together, these credentials expand the technical scope the Company can address under a single contract, deepening the value it delivers to clients.

Workforce and Safety:

Human resources continue to be a key enabler of the Companys growth and execution capabilities. During FY 2025-26, the Company strengthened its technical, project management and site execution teams in line with the increased scale of operations. As at March 31, 2026, the Company had over 678 professionals supported by more than 5,550 site personnel. Industrial relations remained cordial during the year and there were no material developments adversely affecting operations.

A workforce of over 5,550 site personnel, supported by 678 professionals, operates under structured safety, health, and environment protocols. The Companys investment in site supervision, technical training, and compliance systems is reflected in its ability to retain and grow relationships with quality-sensitive multinational clients such as Toyota Kirloskar, Komatsu, and the Maersk Group.

6. OPPORTUNITIES AND THREATS Opportunities

Indias industrial capital expenditure cycle is at an early and accelerating stage. The PLI scheme pipeline, ongoing supply chain China plus one relocations, and Indias own domestic consumption story are expected to sustain high volumes of greenfield factory construction through the medium term. Sectors such as semiconductors, data centres, advanced pharmaceuticals, electric vehicle manufacturing, and renewable energy equipment are likely to generate the next wave of EPC mandates.

The government infrastructure segment, unlocked for Sathlokhar through its PWD Class 1A credential, represents a materially larger addressable market than the private industrial sector alone. Government projects typically offer longer contract durations, enabling better resource deployment planning, though they require more intensive statutory navigation.

International expansion represents a significant long-term opportunity. The first Sri Lanka project validates the transportability of Sathlokhars integrated model across geographies. Neighbouring markets, including Sri Lanka, Bangladesh, and the Gulf Cooperation Council, are investing in industrial and commercial infrastructure, and an Indian EPC company with documented execution quality has a distinct advantage over purely local contractors in these markets.

The PEB manufacturing business, currently under development, will generate a second revenue stream from third-party customers once the new facility is commissioned. With five to six plants planned across India, the manufacturing vertical has the potential to become a meaningful contributor to revenue and margin over the next five years.

The Companys proven track record with major FMCG and beverage manufacturers creates cross-selling opportunities into adjacent sectors such as food processing, cold chain logistics, and pharmaceutical manufacturing.

Threats

Working capital intensity is the most significant near- term risk in the Companys operating model. As project scale and concurrency increase, the quantum of unbilled contract assets, retention money, and capital locked in work-in-progress grows proportionally. The Companys ability to maintain adequate bank lines and manage cash collection cycles is critical to sustaining growth without liquidity strain.

Competition in the industrial EPC market is intensifying as larger EPC companies and pan-India contractors seek to capture the PLI-driven investment wave. The Companys mid-sized position means it competes against both larger integrated players and lower-cost regional contractors, requiring continuous differentiation on quality, timeline, and credential strength.

Input costvolatility, particularly in structural steel, cement, and MEP materials, can compress margins on fixed-price contracts if not adequately hedged through procurement timing and contract price escalation clauses. The Companys backward integration into PEB manufacturing will partially mitigate this risk for steel.

Concentration risk exists in the current order book, with the Reliance Consumer Products mandate accounting for approximately 40% of FY26 order inflows. While repeat client relationships are evidence of quality, the Company is actively diversifying its client base across new sectors and geographies to reduce single-client dependence.

Key personnel risk is inherent in a professionally-led EPC company where execution quality depends on experienced engineers and project managers. Talent retention, particularly of site-based project managers, is an ongoing priority.

7. ESG AND SUSTAINABILITY

Environmental Stewardship

Sathlokhars solar EPC vertical directly contributes to Indias clean energy transition. As an MNRE-approved vendor and Tata Power Solar channel partner, the Company has participated in solar installations for industrial and commercial clients, contributing to measurable reductions in grid electricity consumption and associated carbon emissions at client facilities. The solar segment represents both a growth business and a direct ESG contribution.

The Companys stated construction practices prioritise environmental protection, including proper waste management at project sites, soil stabilisation methods that minimise ground disturbance, and water treatment solutions that support clients water recycling obligations. Water treatment capabilities span Sewage Treatment Plants, Effluent Treatment Plants, Water Treatment Plants, and Reverse Osmosis systems, each of which enables client compliance with environmental discharge standards.

Social Responsibility

The Companys CSR expenditure in FY26 was Rs.71.15 Lakhs against a statutory obligation of Rs.66.34 Lakhs, reflecting a surplus spend of Rs.4.81 Lakhs. CSR activities were directed toward public development encompassing education, healthcare, and community welfare. The Company has consistently met and exceeded its CSR obligations since crossing the threshold for mandatory CSR under Section 135 of the Companies Act, 2013.

Employment generation is a direct social contribution. With over 5,550 site workers and 678+ professionals, the Company provides formal employment to a large workforce across project geographies, many of which are in semi-urban and peri-urban locations where formal employment opportunities are limited.

Governance

The Companys Board comprises eight directors, of whom four are Independent Directors, meeting the requirements of corporate governance for a listed entity. The Board includes professionals with expertise spanning civil engineering, IT and cloud computing, legal practice, cost accounting, and electrical engineering, bringing diverse oversight to the Companys management.

Since listing on NSE Emerge in August 2024, the Company has operated under the enhanced disclosure and governance obligations of a public company. The annual report, quarterly results, and exchange filings reflect the Companys commitment to transparency and investor communication.

The promoter holding as at March 31, 2026 stands at 58.27, with T. Sangeethaa holding 54.32% individually, providing stability of ownership while leaving meaningful public float.

Related party transactions, including procurement of goods and /or availing of services from Sathlokhar Industries Private Limited, Sathlokhar Buildsys Private Limited, T S Lokesh Krisna and Archivo Infra Inc, are disclosed in full in Note 38, conducted at arms length terms and subject to Board oversight.

8. INTERNAL CONTROL SYSTEMS

The Company maintains a structured system of internal controls designed to ensure the integrity of financial reporting, safeguard assets, and ensure compliance with applicable laws and accounting standards. The internal control framework encompasses project cost monitoring, procurement authorisation, billing and collection processes, cash management, and statutory compliance tracking.

At the project level, ERP-enabled monitoring systems provide management with real-time visibility into cost- to-complete estimates, billing status, and cash collection across the concurrent project portfolio. Project managers operate within defined authority limits for procurement and subcontract awards, with escalation requirements for commitments above threshold values.

Financial controls are reviewed by the Companys statutory auditors, P P N and Company, Chartered Accountants (ICAI Firm Registration No. 013623S). The statutory audit for FY26 was conducted under Ind AS, this being the Companys first year of Ind AS compliance following the transition from IGAAP as at April 1, 2024.

The Companys audit committee, comprising Independent Directors, meets regularly to review internal audit findings, risk assessments, and financial reporting. The internal audit function provides an independent assessment of control effectiveness across financial, operational, and compliance domains.

No material weaknesses in internal controls over financial reporting were identified during FY26.

9. RISK MANAGEMENT

Working Capital and Liquidity Risk

The most active risk in the Companys operating environment is the management of working capital as project scale increases. Contract assets, retention money, and advances paid to subcontractors and vendors create a significant funding requirement ahead of client billing milestones. The Company manages this through secured bank credit facilities collateralised against book debts and inventories, supplemented by TReDS (Trade Receivables Discounting System) to accelerate collection from larger clients. Finance costs grew to Rs.626.31 Lakhs in FY26, reflecting this increased reliance on working capital financing.

Client Concentration Risk

Approximately 40% of FY26 order inflows were attributable to Reliance Consumer Products, The largest client contributed Rs.300.92 Crores to revenue in FY26, representing over 36% of total revenue. The Company is actively widening its client base across new industrial sectors, new geographies, and the government segment to reduce this concentration over the medium term.

Execution and Cost Risk

Fixed-price EPC contracts expose the Company to the risk of cost overruns arising from input price inflation, unforeseen site conditions, or scope changes. The Company mitigates this through disciplined pre-bid cost estimation, selective bidding, procurement hedging, and contract terms that include escalation clauses where achievable. The consistent maintenance of EBITDA margins at approximately 14% across years of rapid growth reflects effective cost control.

Regulatory and Statutory Risk

The Company operates in a regulatory environment involving GST, income tax, labour laws, environmental clearances, and electrical safety regulations. The Companys legal and compliance team monitors all regulatory developments, and adequate provisions are made where management assesses liability as probable.

Human Capital Risk

The Companys growth trajectory requires continuous recruitment and retention of skilled engineers, project managers, and site supervisors. Attrition of key project management personnel could adversely affect execution quality and client relationships. The Company invests in competitive compensation, career development, and a strong organisational culture to retain talent.

Credit Risk

Trade receivables of Rs.7,684.46 Lakhs as at March 31, 2026 are concentrated among creditworthy institutional and multinational clients. The ageing profile shows Rs.7,177.28 Lakhs within six months, with no credit-impaired receivables. The Company has a limited history of customer defaults, and no provision for expected credit loss has been recognised.

10. OUTLOOK

The outlook for the Company remains positive, supported by continuing investments in manufacturing infrastructure, PLI-led capacity expansion, the China-plus-one strategy, renewable energy investments, government infrastructure expenditure and the Companys expansion into PEB manufacturing and international markets. The Company expects to pursue growth in a calibrated manner while maintaining focus on execution, margins, working capital management and diversification of its customer base.

11. CAUTIONARY STATEMENT

Certain statements in this Management Discussion and Analysis relating to the Companys objectives, projections, estimates, expectations, or predictions may constitute forward-looking statements within the meaning of applicable laws and regulations. These statements are based on certain assumptions and expectations of future events. Actual results could differ materially from those expressed or implied, depending upon global and Indian economic conditions, changes in government regulations, tax laws, and other statutes, and other incidental factors.

The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Readers are cautioned not to place undue reliance on forward-looking statements, which reflect the Companys current views with respect to future events and are subject to uncertainties that could cause actual results to differ materially from those contemplated.

This document should be read in conjunction with the full financial statements and Notes to the Financial Statements forming part of the Annual Report for FY 2025:26. All financial figures are in Indian Rupees and sourced from the audited financial statements unless otherwise indicated.