Shah Metacorp Ltd Management Discussions

MANAGEMENTS DISCUSSION AND ANALYSIS REPORT

Reviewing Performance. Assessing Opportunities. Building a Stronger Future.

FINANCIAL PERFORMANCE

Strong growth in revenue, profitability and returns.

OPERATIONAL EXCELLENCE

Enhanced efficiency, capacity and productivity.

STRATEGIC INITIATIVES

Focused on innovation, expansion and value creation.

SUSTAINABLE GROWTH

Committed to sustainability and responsible growth.

OUTLOOK & FUTURE

Well positioned for long-term value and opportunities.

1. OVERVIEW:

The objective of this report is to convey the Managements perspective on the external environment and steel industry, as well as strategy, operating and financial performance, material developments in human resources and industrial relations, risks and opportunities and internal control systems and their adequacy in the Company during the FY2025-26. This should be read in conjunction with the Companys financial statements, the schedules and notes thereto and other information included elsewhere in this Integrated Report and Annual Accounts of the Company for FY2025-26. The Companys financial statements have been prepared in accordance with Indian Accounting Standards (‘Ind AS) complying with the requirements of the Companies Act, 2013, as amended and regulations issued by the Securities and Exchange Board of India (‘SEBI) from time to time.

1.1 GLOBAL ECONOMIC REVIEW:

International steel market conditions are under renewed pressure. Global steel demand has contracted for four years in a row, with the rate of decline accelerating to an estimated 2.6% in 2025. Projections for 2026 indicate nearly stagnant demand globally, followed by a gradual recovery to 1 885 million tonnes by 2030. While demand in China is expected to continue its long-term decline in the coming years, the OECD area should enjoy modest growth in the near term. India, Southeast Asia, the Middle East and North Africa (MENA) region, and other developing economies continue to show stronger growth prospects. Steel production growth remains concentrated in emerging economies, led by India and parts of the Association of Southeast Asian Nations (ASEAN), supported by infrastructure spending, industrialisation and new steelmaking capacity. Profitability in the steel sector has remained weak, reflecting the pressures of excess capacity and excess production on steel prices. World steel trade is undergoing significant shifts, as China and other regions with excess capacity continue to flood international markets with steel and – while trade actions are increasing – there is increasing evidence they are being circumvented.

Key Data: Global GDP Growth Trend

	2024	2025	2026	2027
WORLD	3.4	3.4	3.1	3.2
ADVANCE ECONOMICS	1.8	1.9	1.8	1.7
US	2.8	2.1	2.3	2.1
EURO AREA	0.9	1.4	1.1	1.2
EMERGING MARKET AND DEVELOPING ECONOMICS	4.5	4.4	3.9	4.2
CHINA	5.0	5.0	4.4	4.0
INDIA	7.1	7.7	6.5	6.5

Global trade continued to undergo structural transformation. Heightened geopolitical tensions, changing tariff regimes and industrial policy interventions accelerated the diversification of global supply chains, encouraging companies to regionalis production networks and reduce dependence on single-country sourcing. At the same time, continued disruptions across the Red Sea shipping corridor and other strategic maritime routes increased freight costs, lengthened transit times and created logistical uncertainties for globally traded commodities. Although businesses adapted through alternative shipping routes and inventory management strategies, supply chain resilience remained a strategic priority for manufacturing sector.

Trade policy also assumed greater strategic significance during the year. Alongside increasing trade fragmentation and localisation of manufacturing, sustainability emerged as an important determinant of global competitiveness. The European Union continued advancing the implementation of the Carbon Border Adjustment Mechanism (CBAM), reinforcing the transition towards carbon-accountable trade for emissions intensive sectors such as steel. The evolving regulatory landscape accelerated investments in cleaner production technologies, energy efficiency and emissions transparency while encouraging manufacturers to strengthen their decarbonization roadmaps. These developments are expected to reshape global trade competitiveness and reinforce the importance of low-carbon manufacturing across industrial value chains.

India stands out for its sustained growth and successful inflation control, while the global economy faces a period of moderate expansion and policy-driven uncertainties. Future economic momentum will depend on both domestic policy responses and the broader international trade and geopolitical landscape.

The economy is expected to be driven by strong domestic consumption, government capital expenditure, and robust expansion in the services and manufacturing sectors.

While there is a reducing intensity in tariffs globally, developments in this area including trade agreement between major blocks like United States of America, United Kingdom, European Union, China among others, and a ceasefire deal between Russia and Ukraine will be key factors impacting the economic activity. India stands out for its sustained growth and successful inflation control, while the global economy faces a period of moderate expansion and policy-driven uncertainties. Future economic momentum will depend on both domestic policy responses and the broader international trade and geopolitical landscape.

1.2 GLOBAL ECONOMIC OUTLOOK:

According to the IMF, global GDP growth is projected to moderate to 3.1% in CY2026 before improving marginally to 3.2% in CY2027, remaining below the historical average. While easing financial conditions and continued investments in infrastructure, technology and industrial capacity are expected to support economic activity, elevated geopolitical tensions, policy uncertainty, trade fragmentation and fiscal pressures are likely to continue influencing the pace of global growth. Regional growth prospects are expected to remain uneven. Advanced Economies are projected to grow by 1.8% in CY2026 and 1.7% in CY2027, reflecting modest domestic demand, demographic challenges and elevated fiscal pressures. In contrast, Emerging Market and Developing Economies (EMDEs) are expected to remain the primary drivers of global growth, with economic expansion projected at 3.9% in CY2026 and 4.2% in CY2027, supported by stronger domestic consumption, infrastructure investments and manufacturing activity. However, external financing conditions, commodity price volatility and geopolitical developments are expected to continue influencing growth trajectories across several emerging economies.

Global inflation is expected to decline to 4.3% in CY2025 and further drop to 3.6% in CY2026. While inflation estimates for advanced economies have been revised upward, there has been a slight downward revision for emerging and developing economies. Additionally, rising trade restrictions may add to inflationary pressures in key economies, which could affect household incomes and limit the flexibility of central banks to ease monetary policy.

Growth in the United States is expected to slow to 1.8% in CY2025, marking a full one percentage point decline from 2024 estimates. IMF has reduced the growth forecast for China for CY2025 to 4% from 5% in CY2024. This is a reduction of one full percentage point; however, this is also down by 0.6% from its Jan 2025 update, marking a persistent downtrend in the Chinese economy largely driven by tariff induced slowdown there. In contrast, Indias outlook remains strong and steady at 6.2%, driven by robust private consumption, particularly in rural areas.

As challenges to global growth persist, positive signs are still visible. With easing trade tensions and continued dialogue between countries to achieve stable policies, global growth is likely to improve. Countries are focusing on keeping inflation in check, supporting financial stability and laying emphasis on stronger reforms to boost growth. Governments are also prioritising growth-friendly investments, especially in infrastructure and digitalisation, to drive long-term growth. With better coordination, clear trade policies and smart investment decisions, the global economy is expected to move toward a more stable and resilient future.

Duration of the Middle East crisis and consequent normalisation of supply chains will be a critical determinant of the economic outlook for 2026. Hardening of inflation risk and upward pressure on interest rates likely due to supply disruptions. Supportive fiscal policies and lagged effects of past rate cuts will help navigate through the crisis.

Global GDP growth trend (% y-o-y)

	2024	2025 (E)	2026 (F)	2027 (F)
World	3.4	3.4	3.1	3.2
Advanced Economies	1.8	1.9	1.8	1.7
- US	2.8	2.1	2.3	2.1
- Euro Area	0.9	1.4	1.1	1.2
Emerging Market and Developing Economies	4.5	4.4	3.9	4.2
- China	5.0	5.0	4.4	4.0
India (FY)	7.1	7.7	6.5	6.5

Source: IMF World Economic Outlook, April 2026, NSO.

Forecasts for 2026 and 2027 pertain to the ‘reference scenario of IMF, which assumes that the Middle East conflict turns out to be short-lived.

E – Estimated, F – Forecasted

1.3 ADVANCED ECONOMIES:

Growth across advanced economies remained modest during CY2025 as heightened geopolitical tensions, evolving trade policies, fiscal pressures and structural demographic challenges continued to weigh on economic activity. According to the IMF, advanced economies expanded by 1.9% in CY2025, supported by resilient labour markets, easing inflation and improving financial conditions, despite subdued industrial activity and softer external demand. Growth is projected to moderate slightly to 1.8% in CY2026 and 1.7% in CY2027, remaining below historical averages as policy uncertainty, weaker productivity growth and elevated public debt continue to constrain the pace of expansion.

The United States remained the strongest-performing major advanced economy, supported by resilient consumer spending, robust business investment and continued technology-led capital expenditure, particularly in artificial intelligence and digital infrastructure. However, growth is expected to moderate over the forecast period as higher trade barriers, fiscal consolidation and slowing domestic demand gradually temper economic activity.

The Euro Area experienced a gradual recovery during CY2025 as easing inflation supported household consumption and improving financial conditions aided investment. Nevertheless, manufacturing activity remained subdued amid weaker external demand, elevated energy costs and structural competitiveness challenges, particularly in Germany. Public investments in infrastructure, clean energy and industrial transformation are expected to provide moderate support to regional growth over the medium term. Across other advanced economies, economic conditions remained mixed. Japan benefited from improving domestic demand and stronger wage growth, although external demand remained relatively subdued, while the United Kingdom continued to record moderate expansion supported by easing inflation and resilient services activity. Overall, monetary policy across advanced economies is expected to remain cautious and data dependent as central banks balance inflation management with supporting sustainable economic growth amid an increasingly uncertain global environment.

1.4 EMERGING MARKET AND DEVELOPING ECONOMIES:

Growth in emerging markets and developing economies is projected to ease, with estimates suggesting a decline from 4.3% in CY2024 to 3.7% in CY2025 and a slight recovery to 3.9% in CY2026. Growth is projected at 3.9% in CY2026 before improving to 4.2% in CY2027, supported by stronger domestic consumption, public investment and favourable demographic trends across several emerging markets.

Emerging and Developing Asia remained the key growth driver, underpinned by robust domestic demand, continued infrastructure spending and expanding manufacturing capacity. Investments in digital infrastructure, renewable energy, industrial modernisation and advanced manufacturing continued to support long-term economic expansion, even as evolving global trade policies created headwinds for export-oriented sectors. Chinas economy continued to transition towards a more consumption- and technology-driven growth model. While weaknesses in the property sector and subdued domestic confidence continued to moderate economic activity, policy support for advanced manufacturing, high-technology industries and infrastructure investment helped sustain growth and strengthen industrial competitiveness. India remained the fastest-growing major economy, supported by strong domestic demand, sustained public capital expenditure, rapid infrastructure development and continued progress in manufacturing, digitalisation and energy transition. Government-led investments, expanding private sector participation and favourable demographics are expected to continue supporting robust mediumterm growth. Growth across other emerging regions remained mixed. Economic activity in Emerging Europe continued to be influenced by geopolitical developments, while Latin America and the Caribbean faced relatively moderate growth amid fiscal constraints and external uncertainties. The Middle East and Central Asia are expected to benefit from continued investments in energy and economic diversification, while Sub- Saharan Africa is projected to witness a gradual recovery supported by infrastructure development, improving commodity demand and structural reforms, although debt sustainability and climate-related risks remain important challenges.

1.5 INDIAN ECONOMIC REVIEW:

India remained one of the fastest-growing major economies, with a growth rate of 7.5% in FY2025-26. For FY2026-27, real GDP is projected to expand by 6.7%. Headline CPI inflation is projected to rise to the RBIs target of 4% in FY2026-27 from a record low of 2.2% in FY2025-26. Despite this rise, the RBI is expected to maintain current policy with the repo rate settling at 5.0%. This suggests that while nominal rates may stay low to support growth, the narrowing gap between inflation and interest rates will require careful management to ensure real interest rates continue to stimulate consumer spending in the auto and housing sectors. Public capex remains high at over 5% of GDP, focusing on infrastructure and defence. The sustained investment in steel-intensive projects, such as those under the National Infrastructure Pipeline (NIP 2.0), ensures positive steel demand. Continued blockades at the Strait of Hormuz, shortages of fuel and elevated energy costs are a key risk to the Indian economy. Given its import reliance, India risks a widening current account deficit, pressure on public finances, consequent tightening in fiscal spend, higher than anticipated consumer inflation and eventual demand erosion, if the blockade continues.

2. INDUSTRY OVERVIEW:

2.1 GLOBAL STEEL INDUSTRY:

Global finished steel consumption declined by 1.9% in 2025 to 1,718 MnT, deepening from a 1.5% decline a year back, triggered by a 7.1% drop in demand from China, following a 5.4% contraction in the previous year. A structural contraction in Chinas realty market has been weighing on the global steel market, though consumption outside China grew, making up 54% of the world demand in 2025, up from 51% a year ago. The consumption share of world ex-China in 2025 was the highest since 2016. A spurt in consumption in India too contributed significantly to this. The incremental consumption in India made up nearly 43% of the growth in finished steel demand from the world outside China in 2025. Steel consumption in the developed economies increased marginally by 0.2% to 360.5 MnT in 2025. Although a modest growth, it was significant as the market showed recovery after three years of decline. Consumption in Europe (EU- 27 and UK) increased 3.8% and, in the US by 2%. In line with the consumption trend, global crude steel production dipped 1.9% in 2025 to 1,850 MnT with production in China going down 4.4%.

The demand-supply dynamics in China has led to the already-elevated exports from the country rising further, impacting prices. Trade actions in the steel industry, on the other hand, continued to deepen and widen. The US raised tariffs on steel under Section 232 to 50% in June 2025 and expanded the scope of Section 232 tariffs to several downstream products. The European Union, on its part, recently announced a 47% cut in steel import quota and doubled the out-of-quota tariff to 50%. According to the Global Forum on Steel Excess Capacity (GFSEC), 64 steel trade remedy measures were initiated across countries in the first three quarters of 2025, including 54 antidumping measures.

The EUs Carbon Border Adjustment Mechanism (CBAM) entered its definitive phase in January 2026, transitioning from a reporting phase to requiring importers to pay for embedded emissions. Plan to expand the scope of CBAM to include specific downstream products, starting January 2028, has also been announced.

Top Global Steel Producers

Rank	Company	Country	Annual Production (Approx. Million Metric Tons)
1	China Baowu Steel Group	China	130
2	ArcelorMittal	Luxembourg	65
3	Ansteel Group	China	55
4	Nippon Steel Corporation	Japan	44
5	HBIS Group	China	41
6	POSCO Holdings	South Korea	37

Leading Steel Producers in India

Company	Primary Focus / Strength	Estimated Capacity (Million Tonnes)
Tata Steel	Global footprint and premium automotive steel	35
JSW Steel	Rapid domestic capacity expansion and market leader	30+
SAIL	State-owned infrastructure supply and rail production	20+
Jindal Steel & Power (JSPL)	Structural steel, long products, and power integration	10+

2.1.1 OUTLOOK

Demand Outlook

Total global crude steel production for 2025 amounted to 1.8 billion tonnes, decreasing by 2.0% year-on-year. Once again, growth in India partially offset losses in other Asian and European countries. Crude steel production in China, the worlds largest steel producing country, declined further by 4.4% to 961 MT. Indias growth in steel production accelerated, with total crude steel production rising by 10.4% to 165 MT; while the EU contracted 2.6% to 126 MT.

Domestic demand in China continued to weaken, evident from the countrys rising finished steel exports which hit an all-time high of 119 MT in 2025 (up 7.5% year-on-year), leading to increased protectionist measures across the globe to protect domestic steelmaking industries.

According to the World Steel Association, global steel demand in 2025 was at around 1,749 MT, reflecting a balance between continuing structural headwinds and supportive demand drivers. A modest recovery of 1.3% is anticipated in 2026, with demand rising to approximately 1,773 MT, supported by easing financing conditions, resilient public infrastructure spending and a gradual improvement in investment sentiment. The outlook remains shaped by divergent regional trends. In China, steel demand is expected to continue declining in 2026, albeit at a slower pace than in recent years, as the downturn in the real estate sector persists. While government support measures may help avoid a sharper contraction, risks remain tilted to the downside given pressures on the manufacturing sector and constraints on local government finances. However, the gradual moderation in the rate of decline suggests that Chinas steel demand may be approaching a cyclical bottom.

Steel demand in developed economies remained under pressure in 2025, marking a fourth consecutive year of muted demand, as high production costs and affordability pressures persist. However, a recovery is anticipated in 2026, supported by infrastructure and defence spending, easing inflation and an improvement in real household incomes. Overall, while the near-term outlook remains cautious, global steel demand is expected to stabilise and gradually improve, underpinned by structural demand growth in emerging economies and a tentative recovery in key developed markets, subject to an early resolution of the US-Iran conflict.

2.2 INDIAN STEEL INDUSTRY

India continues to be a global leader in steel demand growth, with consumption expected to grow at a healthy rate of 7-8% in FY2026-27. Apparent Steel Use is projected to reach 176-178 MT in FY2026-27, driven by the National Infrastructure Pipeline and emerging segments like data centres, defence, and renewable energy. Government commitment remains strong, with public infrastructure spending remaining robust. While production is expected to outpace demand growth due to massive capacity, India is transitioning toward becoming a sizeable net exporter.

In FY 2025-26, crude steel production increased by 11.2% to a record 169.2 million tonnes, while finished steel production grew by over 10% to nearly 162 million tonnes. Domestic finished steel consumption reached an alltime high of slightly over 164 million tonnes, registering 8.0% growth over the previous year, reflecting broadbased demand across user industries.

Indias steel trade dynamics improved significantly during FY 2025-26, supported by a combination of stronger export performance, moderation in imports and timely policy intervention to protect the domestic industry. After remaining a net importer over the previous two financial years, India returned to being a net exporter of finished steel, reflecting improved competitiveness of domestic producers and a more balanced trade environment.

Finished steel exports increased by nearly 36% to 6.6 million tonnes, driven by higher shipments to Europe, the Middle East and neighbouring Asian markets. Improved global demand in select regions, together with competitive Indian steel prices and easing logistics constraints, supported export growth during the year. At the same time, finished steel imports declined sharply by nearly 32% to 6.5 million tonnes. The reduction was aided by improved domestic availability, and the Governments decision to impose a 12% safeguard duty on specified non-alloy and alloy flat steel products with effect from 21 April 2025. The measure was introduced to address the surge in low-priced imports that had affected domestic steel prices during the previous year.

2.2.1 OUTLOOK

India continues to anchor global steel demand and production growth, supported by its demographic advantage, expanding economy and sustained infrastructure momentum. The Government of Indias continued focus on sectors such as railways, housing, renewable energy and logistics is expected to keep steel consumption elevated in the near to medium term.

A double-digit growth in the governments capital expenditure and continuing infrastructure upgrade in FY 2026-27 is likely to support the momentum in the steel industry. The budget allocation for public housing programmes has also been increased significantly. The outlook for private capex too is improving, with strong traction seen in commercial real estate, power generation, transmission capacity additions, data centres, defence, maritime, and so on.

The automobile industry, one of the key consumers of steel, ended FY 2025- 26 with a strong momentum, spurred by lower GST rates which accelerated the improvement in affordability for consumers. This momentum is likely to carry into the initial period of FY 2026-27, with low vehicle inventory being reported by dealers.

Industrial demand is expected to be driven by the overall economic momentum, as well as Indias trade deals with developed countries, which are likely to be operationalised in the coming quarters. The effects of supply chain shock from the Middle East crisis need to be watched, as these could cause some disruptions in the manufacturing sector growth. Despite some of the macro headwinds, Indias finished steel consumption is expected to keep up the last years momentum. While the WSA projected a 7.4% rise in 2026, ICRA Ratings pegged the steel demand growth at 9-10% for FY 2026-27, supported by infrastructure push, and CRISIL estimated the demand growth at 5.5-7.5%. Beyond the macro headwinds in the near-term, Indias steel consumption buoyancy is likely to remain undented into the medium-term as well on the back of various structural tailwinds and the ongoing nation-building phase. Steel exports from India may face some challenges in the near term because of the geopolitical crisis and increasing protectionism in many markets, including the CBAM in Europe. While the Indian steel industry remains in an expansionary phase, aligned to the National Steel Policy target of 300 MnT of crude steel capacity by the end of the decade (from an estimated capacity of 220 MnT as of FY 2025-26), increasing availability of iron ore in a commensurate manner remains a key. Government policies have been supportive in terms of auctioning of more mines and encouraging use of low-grade iron ore.

The Governments continued focus on infrastructure development through programmes such as the National Infrastructure Pipeline (NIP), PM Gati Shakti, Bharatmala, Dedicated Freight Corridors, affordable housing initiatives, renewable energy expansion and railway modernisation is expected to sustain steelintensive investments across key sectors. In parallel, manufacturing-led initiatives, including Make in India, Production Linked Incentive (PLI) schemes and rising investments in defence, engineering, capital goods and industrial infrastructure, are expected to support longterm domestic steel consumption. Policy measures introduced to strengthen the domestic steel ecosystem are expected to provide additional support to the industry. Trade interventions, including the imposition of a 12% safeguard duty on select steel imports, are expected to help address concerns around competitively priced imports, support fair market conditions and provide greater stability to domestic producers.

India continues to possess significant structural growth potential, supported by rising steel intensity across infrastructure, construction, manufacturing and emerging sectors. Per capita steel consumption remains below global levels and developed economy benchmarks, providing substantial headroom for future demand growth as urbanisation, industrialization and income levels expand. The National Steel Policy 2017 continues to provide a long-term framework for the sector, targeting 300 million tonnes of crude steel capacity, 255 million tonnes of steel production and 160 kg per capita steel consumption by 2030. While global uncertainties, geopolitical developments, raw material price volatility and evolving trade policies remain key risks, Indias strong domestic demand fundamentals, expanding manufacturing ecosystem and supportive policy environment are expected to position the steel sector for sustained long-term growth.

3. SEGMENT WISE OR PRODUCT WISE PERFORMANCE

The company is operating in only one segment i.e. S.S. Products. The company mainly manufacture SS Angles, SS Flats & SS Rounds and the % wise breakup of the products of the total turnover of the company is as under: -

Product Name	Qty. MT	Percentage
S.S. INGOT	4500.15	30.63%
S.S. WASTAGE & SLAG	177.98	1.21%
S.S. ANGLE	3543.129	24.12%
S.S. FLAT	1630.411	11.10%
S.S. ROUND BARS	3851.95	26.22%
S.S. BRIGHT BAR	741.295	5.05%
C.I.SCRAP	247.745	1.69%

During the years Job work carried out in for Pickling, Rolling, Rolling & Straitning, Straitning & Cutting.

4. RISK & CONCERNS:

Your Company operates in a dynamic global environment characterised by evolving regulatory and environmental requirements, heightened geopolitical uncertainty, and rapid technological advancements. These factors pose material risks across the organisations value chain.

The Company faces the following types of risks in its business operations:

4.1 MARKET RISK

Market risk is the possibility of losing money due to changes in financial markets. Market risk cant be eliminated, as changes like shifts in stock prices, interest rates, and currency values are often outside an investors control. But it can be managed by diversifying and through risk planning. As an investor, you can make better decisions and prepare for market uncertainty by understanding how market risk works. Keep reading to learn the main factors that influence market risk and how you can use it to reduce the impact on your investments.

4.2 OPERATIONAL RISK

Operational risk focuses on how things are accomplished within an organization, not necessarily what is produced or inherent within an industry. These risks are often associated with active decisions relating to how the organization functions and what it prioritizes. While these risks dont always lead to failure, reduced production, or increased costs, their severity is influenced by internal management decisions.

Operational risk, often called human risk, is the chance of business failures from human mistakes, as it relates to man-made processes and decisions. It changes from industry to industry and is an important consideration when making potential investment decisions. Industries with lower human interaction are likely to have lower operational risk.

Managing these risks is vital for financial institutions because operational losses can be unpredictable and costly. While traditional methods involve internal audits, processes, and insurance, the banking sector has adopted more advanced operational risk management frameworks to address growing complexities.

Company operate in a highly fragmented and competitive industry, and increased competition or concentration of customers and suppliers may lead to a reduction in our revenues, profit margins, or market share. The Company doesnt own the premises where its registered office is situated and leave & license agreement have been executed for the same. Any termination or dispute in relation to this lease/ rental agreement may have an adverse effect on our business operations and results thereof. Business strategies and expansion plans may be subject to various unfamiliar risks and may not be successful.

The steel industry is prone to high proportion of fixed costs and volatility in the prices of raw materials and energy. Limitations or disruptions in the supply of raw materials could adversely affect the Companys profitability. Failure of critical information systems/ servers that control the Companys manufacturing plants may adversely impact business operations. Violation of safety standards, unsafe acts and conditions may lead to Lost Time Injuries (LTIs) or fatalities, resulting in stoppage of operations, loss of personnel, and damage to assets and reputation.

Our manufacturing operations and consequently our business is dependent upon our ability to operate our manufacturing facility at enhanced capacity and manage the manufacturing facility, which is subject to operating risks, including those beyond our control, such as the breakdown and failure of equipment or industrial accidents, localised social unrest and natural disasters. In the event there are any disruptions at our manufacturing facility, due to natural or man-made disasters, workforce disruptions, regulatory approval delays, fire, failure of machinery, lack of access to assured supply of electrical power and water at reasonable costs or any significant social, political or economic disturbances, our ability to manufacture our products may be adversely affected. Key Mitigation Strategies will be Enhancing in-house capability and leveraging from past leanings and expertise and Establishing sources of supplies from alternate geographies. Any contravention of or non-compliance with the terms of various regulatory approvals applicable to the manufacturing facility may also require us to cease or limit production until such non-compliance is remedied to the satisfaction of relevant regulatory authorities. We cannot assure you that we will not experience work disruptions in the future resulting from any dispute with our employees or other problems associated with our employees and the labour involved in our manufacturing facility, which may hinder our regular operating activities and lead to disruptions in our operations, which could adversely affect our business, prospects, financial condition, cash flows and results of operations.

4.3 FINANCIAL RISK

Identifying financial risks involves considering the risk factors that a company faces. This entails reviewing corporate balance sheets and statements of financial positions, understanding weaknesses within the companys operating plan, and comparing metrics to other companies within the same industry. Several statistical analysis techniques are used to identify the risk areas of a company.

Financial risk occurs across businesses, markets, governments, and individual finances. These entities trade the opportunity to make profits and yield gains for the chance that they may lose money or face detrimental circumstances. Fundamental, technical, and quantitative analysis can help forecast risk.

4.4 REGULATORY AND COMPLIANCE RISK

Compliance risk is the risk that a company will have been determined to violate already established laws or regulations. This can have many causes, including inadequate controls, negligence, and human error. Ensuring that a business is capable of maintaining compliance and doing so can be a source of significant expense. As with regulatory risk, managing compliance risk is an essential part of a businesss overall risk management.

Managing regulatory risk involves forward-looking strategic thinking, as well as careful monitoring of public opinion and the regulatory process in a businesss given sector. Compliance risk, on the other hand, involves knowledge of existing laws and regulations and a more systematic approach to verifying that the company is compliant with all of them. Many time due to technical reason and other reason there may be delay in filing and which may attract the additional fees or penalty.

The Equity Shares of our Company are listed on BSE and NSE. We are, therefore, subject to the obligations and reporting requirements prescribed under the SEBI Listing Regulations and we must comply with other SEBI Regulations as may be applicable to us. While our Company endeavours to comply with all such obligations/reporting requirements, in the past, there have been instances of delayed disclosures / inadvertent incorrect / inadvertent incomplete factual disclosures under the SEBI Listing Regulations, such as delayed filings under Regulation 23(9) and Regulation 30 of the SEBI Listing Regulations, incorrect categorization of Promoter and Promoter Group in the shareholding pattern filed with Stock Exchanges under Regulation 31 of the SEBI Listing Regulations, discrepancy or variation in the business updates filed with the Stock Exchanges and other delayed compliance under Regulation 74(5) of the Securities and Exchange Board of India (Depositories and Participants) Regulations, 2018, etc. Such non-compliance is usually subject to penalties, warnings and show cause notices by SEBI and the Stock Exchanges. Any regulatory action or development, which is initiated against us could affect our business reputation, divert management attention, and result in a material adverse effect on our business prospects and financial performance and on the trading price of the Equity Shares.

Non-compliance to increasing stringent regulatory environmental norms may result in liabilities and damage to reputation. This risk can be mitigated by Focus on compliance , Dialogue with regulatory authorities for greater clarity and availing legal consultations for timely clearances.

4.5 ENVIRONMENT, SOCIAL AND GOVERNANCE RISK

Environmental, social, and governance (ESG) investing is sometimes referred to as sustainable investing, responsible investing, impact investing, or socially responsible investing (SRI). To assess a company based on ESG criteria, investors look at a broad range of behaviors and policies. ESG investors seek to ensure the companies they fund are responsible stewards of the environment, good corporate citizens, and are led by accountable managers.

- Environmental: Investors evaluate corporate climate policies, energy use, waste, pollution, natural resource conservation, and animal treatment. Considerations might also include direct and indirect greenhouse gas emissions, management of toxic waste, and compliance with environmental regulations.

- Social: This is how a companys relationships with internal and external stakeholders are evaluated. Does the company donate a percentage of profits to the local community or encourage employees to volunteer? Do workplace conditions reflect a high regard for employees health and safety?

- Governance: This ensures a company uses accurate and transparent accounting methods, pursues integrity and diversity in selecting its leadership, and is accountable to shareholders. ESG investors might require assurances that companies avoid conflicts of interest in their choice of board members and senior executives, in addition to not using political contributions to obtain preferential treatment or engage in illegal conduct.

4.6 TECHNOLOGY AND INNOVATION RISK

Technology and innovation risk refers to the potential adverse outcomes associated with adopting, implementing or depending on technology and innovation. This includes risks such as system failures, cybersecurity breaches, technological obsolescence and the inability to keep pace with rapid advancements, breakdown of machinery etc. All these factors can affect operational efficiency, competitiveness and longterm sustainability.

4.7 REPUTATIONAL RISK

Reputational risk refers to the potential damage to a companys brand, public image and stakeholder trust. Such risk can lead to loss of customers, diminished business opportunities and lasting impact on the organisations market value and credibility.

Reputational risk is anything that can result in people having a negative perception of an organization. The impact of reputational risk is usually immediate; it can also be severe and long-lasting. Protections against reputational risk are implemented to prevent organizations from negative exposure to any constituents, including customers, employees, investors, partners, or vendors.

5. INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:

The Company has a robust internal control system which is supervised periodically by competent professional managers and Directors of the Company. Periodically, the systems are reviewed and aligned with the growing needs of the Company. Both external and internal auditors, who have access to all records and information about the company, regularly inspect the companys internal control systems. Internal Financial Control that encompasses the policies, processes and monitoring systems for assessing and mitigating operational, financial and compliance risks and control over related party transactions, substantially exist. Your Company has appropriate internal control system for business processes, with regards to efficiency of operations, financial reporting, compliance with applicable laws and regulations. In the Company, the Board of Directors is responsible for ensuring the adequacy and effective monitoring of internal financial controls. The Internal Audit Program is designed in consultation with the Statutory Auditors to ensure accuracy and reliability of accounting data and is monitored by the Audit Committee.

Audit observations and recommendations are reported to the Audit Committee, which monitors the implementation of the said recommendations. The Companys internal audit team also carries out extensive audits throughout the year, across all functional areas.

6. SWOT ANALYSIS:

Strengths

- Established Manufacturing Infrastructure: Well-equipped production setup at Kukarwada (Mehsana, Gujarat) capable of manufacturing diverse grades of Stainless Steel (SS) long products ranging across the 200 to 400 series.

- Integrated Group Operations: Synergistic operating structure combining core domestic steel production with global commodity and product trading via international and domestic subsidiaries (such as Metcorp Trading LLC and Shah Agrocrop Private Limited).

- Strengthened Capital Base: Successful infusion of long-term funds through Rights Issues and preferential warrant allotments, reducing leverage and boosting net worth and operational liquidity.

- Experienced Leadership: Decades of industry experience in the steel and alloys domain, ensuring established supplier networks, operational continuity, and technical competence.

Weaknesses

- Single Reportable Segment Concentration: Substantial reliance on Stainless Steel Products as the primary reportable business segment, leaving core revenue exposed to cyclic demand fluctuations in steel.

- Legacy Debt Recovery Exposure: Significant working capital blocked in long-pending overseas trade receivables (Rs 76.26 Crores), necessitating heavy provisioning and ongoing dependency on negotiated settlement recoveries.

- Raw Material Price Vulnerability: Scrap, ferro-alloys, and nickel prices fluctuate significantly, which can exert pressure on gross margins if input cost increases cannot be passed on immediately to buyers.

- Geographical Manufacturing Concentration: Operating facilities concentrated primarily at a single location in Gujarat exposes operations to regional logistics, supply chain, and local labor disruptions.

Opportunities

- Infrastructure & Industrial Spending: Expanding national capital expenditure across railways, infrastructure development, urban construction, and public amenities creates sustained domestic demand for SS flats, angles, and structural products.

- Strategic Diversification into Renewable Energy: Strategic equity induction into Strike Eco Grid Private Limited opens operational opportunities in renewable infrastructure, solar transmission, and clean-energy supply ecosystems.

- Global Supply Chain Realignment: Export demand potential in emerging global markets seeking alternative, cost-competitive stainless steel suppliers outside traditional dominant Asian markets.

- Operational Modernization: Upgrading furnace efficiency and automated rerolling lines to reduce specific power consumption and improve batch yield per ton of steel processed.

4. Threats

- Cyclical Nature of the Steel Industry: Global and domestic steel sectors are prone to cyclical downturns, oversupply situations, and competitive dumping of finished products, which can squeeze realisations.

- Intense Market Competition: Substantial competition from both large primary integrated steel producers and fragmented secondary producers operating in the domestic long-products market.

- Currency & Geopolitical Volatility: Ongoing exposure to foreign exchange fluctuations in international trading arms and export-import settlements, compounded by global trade protectionism and import tariffs.

- Environmental & Regulatory Tightening: Stringent compliance standards regarding industrial emissions, decarbonization pathways, and power consumption regulations requiring continuous capital upgrades.

7. FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

Key Financial Ratio

Particulars	2025-26	2024-25
Return on Net worth (%)	2.22	17.80
Return on Capital Employed (%)	2.77	5.75
Basic EPS (after exceptional items)	0.15	0.61
Debtors Turnover	1.76	1.84
Inventory Turnover	7.52	14.84
Interest coverage ratio	7.15	264.64
Current ratio	20.59	10.04
Debt Equity ratio	0.78	0.11
Operating profit margin (%)	8.46	20.09
Net profit margin (%)	5.84	18.51

DETAILS OF SIGNIFICANT CHANGES IN KEY FINANCIAL RATIOS:

During the financial year 2025–26, The Return on Net Worth stood at 2.22% in FY 2025–26 compared to 17.80% in FY 2024–25. The decline was primarily attributable to a substantial expansion in average capital employed/net worth from Rs 18,314.32 Lakhs to Rs 54,746.73 Lakhs following preferential issues and rights capital mobilization, coupled with lower reported total comprehensive income of Rs 1,212.77 Lakhs (as against Rs 3,259.81 Lakhs in FY 2024–25, which had been elevated by one-time exceptional items of Rs 2,482.20 Lakhs). ROCE stood at 2.77% for FY 2025–26 as against 5.75% in the preceding year. While Profit Before Exceptional Items and Tax improved from Rs 1,053.28 Lakhs to Rs 1,514.15 Lakhs, the capital base grew at a substantially faster pace, resulting in a moderated percentage return on capital employed.

Basic EPS declined to Rs 0.15, mainly due to the reduction in profit for the year from Rs 3,259.81 lakh to Rs 1,212.77 lakh, along with an increase in the weighted average number of shares from 5,316.23 lakh to 8,131.81 lakh. The lower earnings were consequently distributed over a larger weighted average share base.

Debtors turnover remained broadly stable at 1.76 times. Revenue increased to Rs 20,799.29 lakh, while trade receivables also increased to Rs 11,842.36 lakh. The increase in receivables broadly corresponded with the expansion in business, resulting in only a marginal decline in the ratio.

Inventory Turnover stood at 7.52 times in FY 2025–26 compared to 14.84 times in FY 2024–25. The variation was driven by a deliberate increase in closing inventory to Rs 2,767.16 Lakhs (vs. Rs 1,051.35 Lakhs in FY 2024–25) to ensure uninterrupted supply chain availability and support expanding production orders.

The Companys Interest Coverage Ratio remained strong and comfortable at 7.15 times in FY 2025–26. PBIT expanded to Rs 1,760.37 Lakhs against a finance cost of Rs 246.22 Lakhs, underscoring adequate debt servicing capability and sound operational coverage.

Current ratio further improved to 20.59, primarily due to a substantial increase in current assets from Rs 14,891.58 lakh to Rs 37,039.66 lakh, while current liabilities increased only moderately from Rs 1,483.51 lakh to Rs 1,799.34 lakh. The ratio reflects a significantly stronger current asset position relative to short-term obligations.

The Debt-Equity Ratio stood at 0.78 as of March 31, 2026, compared to 0.11 as of March 31, 2025. While shareholders equity grew to Rs 30,838.34 Lakhs, the expansion in short-term operating and trading liabilities to support higher business turnover led to an increase in the ratio.

Operating profit margin declined to 8.46%, despite revenue increasing to Rs 20,799.29 lakh, as EBIT declined substantially from Rs 3,539.46 lakh to Rs 1,760.37 lakh. The decline indicates pressure on operating profitability during FY 2025-26, with operating expenses/costs increasing relative to revenue.

Net profit margin declined to 5.84%, mainly due to a significant reduction in profit for the year from approximately Rs 3,260.00 lakh to Rs 1,213.68 lakh, whereas turnover increased from Rs 17,615.60 lakh to Rs 20,799.29 lakh. Accordingly, profitability did not increase in proportion to the growth in revenue.

FINANCIAL PERFORMANCE OF THE COMPANY:

- Total Revenue & Income:

Standalone: Revenue from Operations amounted to Rs 16,813.81 Lakhs, compared to Rs 17,078.48 Lakhs in the previous financial year. Total Income grew to Rs 18,349.76 Lakhs (vs. Rs 17,380.81 Lakhs in FY 2024–25), supported by higher other income.

Consolidated: Revenue from Operations stood at Rs 20,799.29 Lakhs, reflecting an increase of 18.07% over the previous years Rs 17,615.60 Lakhs. Total Income rose to Rs 22,800.80 Lakhs, marking a 27.25% increase year-on-year. Normalized Profit Before Exceptional Items and Tax grew by 43.76% from Rs 1,053.28 Lakhs in FY 2024–25 to Rs 1,514.15 Lakhs in FY 2025–26, reflecting improved operational efficiency, higher business volumes, and disciplined operational cost control.

- Expenditure:

Total Expenses on a Standalone basis increased marginally from Rs 16,359.06 Lakhs to Rs 16,995.09 Lakhs.

Total Expenses on a Consolidated basis rose from Rs 16,864.65 Lakhs to Rs 21,286.64 Lakhs, driven by operational scaling across newly consolidated entities and increased business activity.

- Employee benefit expenses:

Standalone employee benefit expenses rose from Rs 142.71 Lakhs in FY 2024–25 to Rs 162.87 Lakhs in FY 2025–26.

Consolidated employee benefit expenses stood at Rs 181.61 Lakhs in FY 2025–26 (compared to Rs 149.28 Lakhs in FY 2024–25), consistent with organizational expansion.

- Finance Cost:

Standalone finance costs decreased from Rs 3.59 Lakhs in FY 2024–25 to Rs 1.79 Lakhs in FY 2025–26.

Consolidated finance costs increased to Rs 246.22 Lakhs from Rs 3.98 Lakhs in the previous year, reflecting debt assumed to fund business acquisitions.

- Net Profit & Total Comprehensive Income:

Standalone PAT stood at Rs 1,044.02 Lakhs (compared to Rs 3,236.42 Lakhs in FY 2024–25), and Consolidated PAT stood at Rs 1,213.69 Lakhs (compared to Rs 3,260.00 Lakhs in FY 2024–25). The decrease in reported PAT is attributable to the high base of FY 2024–25, which included a one-time exceptional gain of Rs 2,482.20 Lakhs.

Total Comprehensive Income was Rs 1,040.12 Lakhs on a Standalone basis (vs. Rs 3,235.78 Lakhs in FY 2024–25) and Rs 1,212.77 Lakhs on a Consolidated basis (vs. Rs 3,259.81 Lakhs in FY 2024–25).

- Earnings Per Share:

Standalone Basic and Diluted EPS stood at Rs 0.13 in FY 2025–26 compared to Rs 0.61 in FY 2024–25. Consolidated EPS was Rs 0.15 compared to Rs 0.61 in FY 2024–25. The lower EPS year-on-year reflects the exceptional gain recorded in the previous financial year and equity expansion during the current year.

- Non-Current Assets:

Standalone non-current assets increased by 216.85% from Rs 4,924.20 Lakhs as of March 31, 2025, to Rs 15,602.35 Lakhs as of March 31, 2026, primarily driven by strategic investments in subsidiaries.

Consolidated non-current assets expanded from Rs 4,922.43 Lakhs to Rs 19,526.09 Lakhs over the same period.

- Current Assets:

Standalone current assets grew by 21.60% from Rs 14,363.36 Lakhs as of March 31, 2025, to Rs 17,466.18 Lakhs as of March 31, 2026.

Consolidated current assets increased significantly from Rs 14,891.58 Lakhs to Rs 37,039.66 Lakhs, bolstered by business acquisitions and operational requirements.

- Non-Current Liabilities:

Consolidated non-current liabilities increased from Rs 1,791.01 Lakhs to Rs 23,928.06 Lakhs, driven by long-term borrowing to finance strategic acquisitions.

- Current Liability:

Consolidated current liabilities increased by 21.29% from Rs 1,483.52 Lakhs as of March 31, 2025, to Rs 1,799.34 Lakhs as of March 31, 2026.

The Company demonstrated robust top-line growth, significantly higher profitability, stronger liquidity, and lower leverage during FY 2025–26. The combination of rising revenues, cost discipline, and capital infusion has positioned the Company on a stronger financial footing for sustained future growth.

Financial Performance of the Company:

(Rs in Lakhs)

Particulars	Standalone FY 2025–26	Standalone FY 2024–25	Consolidated FY 2025–26	Consolidated FY 2024–25
Revenue from Operations	16813.81	17,078.48	20799.29	17,615.60
EBITDA	1354.67	3,503.95	1514.16	3,535.48
Total Income	18349.76	17,380.81	22800.80	17,917.93
Total Expenses	16995.09	16,359.06	21286.64	16,864.65
Finance Costs	1.79	3.59	246.22	3.98 (approx.)
Employee Benefit Expenses	162.87	142.71	181.61	–
Net Profit (PAT)	1044.02	3,236.42	1213.69	3,260.00
Total Comprehensive Income	1040.12	3,235.78	1212.77	3,259.81
EPS (Basic & Diluted)	0.13	0.61	0.15	0.61
Non-Current Assets	15602.35	4,924.20	19526.09	4922.43
Current Assets	17466.17	14363.36	37039.67	14891.58
Non-Current Liabilities	1,556.82	3,665.53	23928.06	1791.01
Current Liabilities	1,398.79	3,914.83	1799.37	1483.51

8. INDUSTRIAL RELATIONS & HUMAN RESOURCE MANAGEMENT:

The Company believes that human resource is the most important assets of the organization. It is not shown in the corporate balance sheet, but influences appreciably the growth, progress, profits and the shareholders values. During the year your company continued its efforts aimed at improving the HR policies and processes to enhance its performance. The vision and mission of the company is to create culture and value system and behavioural skills to insure achievement of its short- and long-term objectives. The Company as at year end has 73 employees on its role and continues to attract talent from within India to further its business interests. Industrial relations continue to be cordial. Company takes safety measure for people working on plant. Employees are provided with extensive learning and career development opportunities, while a strong focus on diversity and inclusion fosters an empowering and inclusive culture. The integration of digitalization further enhances workforce capabilities and drives operational efficiency. Backed by robust health and safety practices, the Company prioritizes employee well-being, enabling its workforce to consistently deliver high performance.

9. GOVERNMENT INITIATIVES:

The Government of India has implemented several initiatives to support the steel industry in the FY 2025-2026, including:

Production Linked Incentive (PLI) Scheme: This scheme aims to encourage domestic production of specialty steel and has attracted significant investment and job creation.

Green Steel Initiative: This initiative promotes energy efficiency and aims to reduce carbon emissions by 30% over the next decade, aligning with Indias commitment to achieve net-zero emissions by 2070.

Union Budget 2025: The budget includes a 15% increase in infrastructure spending, with an allocation of INR 5,000 crore under the Green Steel Initiative.

PLI Scheme for Specialty Steel: This third round of the PLI scheme is aimed at attracting fresh investments in advanced and emerging categories such as super alloys, CRGO steel, stainless steel long and flat products, titanium alloys, and coated steels.

The steel industry contributes significantly to Indias manufacturing base and continues to modernise facilities with new and efficient technology. Steel is vital for infrastructure development, including roads, bridges, railways, pipelines and urban facilities, enhancing productivity and economic competitiveness. India is the worlds second-largest crude steel producer as of FY25. The countrys domestic steel demand is projected to increase by 8-9% YoY in 2025, supported by abundant iron ore resources and low-cost labour.

India targets to be a Rs. 4,43,90,000 crore (US$ 5 trillion) economy by 2027 and the steel sector is directly related to national development and initiatives like the Make in India campaign. The National Council of Applied Economic Research (NCAER) indicates that steel is employed in housing, automobiles, power generation, petrochemicals and fertilisers. The employment multiplier of steel is 6.8x and output multiplier is 1.4x. It contributes 2% to Indias GDP and offers over 6,00,000 direct and 2 million indirect jobs, which highlight its strategic contribution to the development of India.

Market outlook

India stood as the worlds second-largest crude steel producer in FY25, producing 151.14 million tonnes (MT), a 4.7% increase over 144.31 MT in FY24. The finished steel production reached 145.31 MT in FY25, and consumption to 150.23MT. The main sources of this high demand are major infrastructure projects, industrial development and city development.

Indias steel industry has demonstrated that it can continue to grow despite global market fluctuations. The crude steel output in India rose by 6.8% YoY in the first two months of 2025, whereas major other producers like Germany and Iran experienced a drop.

The government initiatives (including the National Steel Policy 2017, the Production-Linked Incentive (PLI) Scheme of Specialty Steel and the Steel Import Monitoring System (SIMS)) promote domestic output and reduce dependence on imports.

In the future, Indias steel industry is poised to cater to domestic demand and aid the countrys economic growth.

Policy evolution and strategic support

The steel industry has experienced major policy reforms in recent years to boost production and competitiveness in India. The National Steel Policy (NSP) 2017 established targets of 300 MT per annum (MTPA) of steel manufacturing and 160 kg of steel demand per capita by 2030-31. This policy provided a foundation to subsequent attempts to modernise the industry and reduce the reliance on imports.

In July 2021, the PLI Scheme of Specialty Steel was launched, targeting to increase the local manufacturing of high-value steel and generate employment. The scheme is well supported in the industry, and the second round has attracted more investments, with planned incentives.

The government has also provided mechanisms of monitoring and regulating steel imports, such as the Steel Import Monitoring System (SIMS). These measures cushion the local producers against unfair trade practices and sudden increases in imports.

Government initiatives driving sustainability and growth in Indias steel sector

The Indian government has made efforts to ensure that the steel industry grows faster and becomes more sustainable and relies less on imports. Such attempts are evident in new policies and missions which are meant to modernise the industry and put it at par with global standards.

- PLI Scheme for Specialty Steel

In July 2021, the PLI Scheme of Specialty Steel was launched to attract investment and boost the output of value-added and specialty steel products in the country. The scheme encompasses five broad product lines: coated or plated steel products, high-strength/wear-resistant steel, specialty rails, alloy steel products and steel wires, and electrical steel. It targets to generate 42 MT of specialty steel annually by FY27. Companies committed a total of Rs. 27,106 crore (US$ 3.05 billion) as of March 2025, and about Rs. 20,000 crore (US$ 2.25 billion) of this commitment is already invested. These projects have directly employed 9,000 individuals, and the government intends to pay out Rs. 2,000 crore (US$ 225.28 million) in incentives to the manufacturers by FY30. During the second round in January 2025, 35 companies committed additional Rs. 25,200 crore (US$ 2.84 billion). With Memorandums of Understanding (MoUs) being signed, the government anticipates to offer Rs. 3,600 crore (US$ 405.53 million) in incentives.

- Domestically Manufactured Iron & Steel Products (DMI&SP) policy

The Ministry of Steel revised the DMI&SP policy on July 25, 2025, mandating government procurement of fully Indian-made steel. The update introduces local content norms, revised import lists and relaxed norms for Indian technology suppliers in steel plant tenders to boost self-reliance and domestic manufacturing.

- Greening the Steel Sector: Roadmap and Action Plan

In March 2025, the Ministry of Steel published the Greening the Steel Sector in India: Roadmap and Action Plan, which provides a plan to decarbonise the industry and achieve net-zero emissions by 2070. The plan includes:

- Green steel taxonomy: A taxonomy that categorises steel by its carbon output per tonne, so it is easier to identify which steel is cleaner and promote low-carbon steel.

- Financial incentives: A national mission of approximately Rs. 5,000 crore (US$ 563.19 million) to assist both primary and secondary steel producers to switch to green technologies, with low-interest loans and risk guarantees.

- Technological developments: Green hydrogen, carbon capture, utilisation and storage (CCUS) and renewable energy integration to cut down on emissions in conventional coal-based steel processes.

- Public Procurement Policy: A policy that requires the use of a specified amount of green steel in public infrastructure projects starting FY28, establishing a market for low-emission steel and motivating private sector participation.

- Green hydrogen initiatives

India is driving the adoption of green hydrogen to produce less-emission steel, as it can substitute part of coal in the Direct Reduced Iron (DRI) process and reduce carbon in steel factories. In October 2025, the Punjab Energy Development Agency (PEDA) and the Indian Institute of Science (IISc) in Bengaluru signed an MoU to initiate a pilot project producing green hydrogen using biomass, in particular, paddy straw. The project can prevent stubble burning and enhance air quality besides providing the steel industry with a constant supply of green hydrogen. It endorses the application of green steel technologies and the intention to reduce emissions.

10. DISCLOSURE OF ACCOUNTING TREATMENT

The financial statements are prepared in accordance with an Accounting Standard and details of the same is provided in the notes of financial statements.

11. CAUTIONARY STATEMENT:

Certain statements made in this Report relating to the Companys outlook, estimates, predictions etc. may constitute "forward looking statements" within the meaning of applicable laws and regulations. Actual results may differ from such estimates, whether express or implied. Several factors that could make a difference to Companys operations include climatic conditions and economic conditions affecting demand and supply, changes in Government regulation tax regimes, natural calamities, etc. over which the Company does not have any direct control.

FOR AND ON BEHALF OF THE BOARD OF SHAH METACORP LIMITED

Sd/-

Mona Shah

Chairperson and Director

(DIN: 02343194)

DATE: August 31, 2026

PLACE: Ahmedabad