Tarmat Ltd Management Discussions

1. Industry Structure and Development and Outlook

As per IMFs recent report, India remains the worlds fastest growing major economy. Indias infrastructure sector has seen remarkable progress over the past decade , becoming a crucial driver of economic development . The total investment in the sector has increased significantly with budget allocation rising to 10 lacs crores in 2023-

2024 and projected to reach 11.2 lacs crores in 2025-2026.

The Govt. aims to develop a National Highway network of 2 lacs KM by 2025, which is essential for achieving its economic growth target of us dollar 5 trillion. The development and growth outlook in this sector looks bright looking into India s significant drive for infrastructure by substantial Govt. investments and increased private participation.

2. Opportunities and Threats

Indias infrastructure development has seen significant opportunities, progress and investment in recent years.

Key highlights include:

Major Projects: The inauguration of the Atal Tunnel, the worlds longest highway tunnel, and the Chenab

Bridge, the worlds highest railway bridge, showcase Indias achievements in infrastructure

Investment Plans: The government has planned investments of US$ 1.4 trillion by 2025, focusing on critical areas such as energy, roads, railways, and urban development.

Growth in Investment: Total infrastructure investment is projected to reach Rs 11.2 lakh crore in 2025-26, up from Rs 10 lakh crore in 2023-24, indicating robust growth in the sector.

Tarmat Limited (Tarmat) has been the pioneers in airport runway works and air side works.

Tarmat is in the process of securing a new project in Chennai airport of about 250 crores and there are ongoing projects in Mumbai and Jammu.

However, project implementation is not without threats and limitations. Land acquisition and clearances, project credibility, fund availability and high fund cost, lack of technology, human resources, digital divide, cyber concern,

Regulatory policy, cost inflation are some of factors, which may affect the speed of project implementation.

However, the Board of directors of the company from time to time are reviewing such risks and initiate actions for mitigation of such risks.

3. Internal Control

The Company has a proper and adequate system of internal controls covering all operational and financial functions commensurate with the size of the company. The companys internal control is designed in such a way that it ensures corporate strategy is implemented, achieve effective and efficient corporate processes, safeguard the value of corporate assets, reliability and integrity of accounting and management data, and operations comply with all existing rules and regulations. All the financial and audit control systems are also reviewed by the

Audit Committee of the board of Directors of the company.

4. Operations

The Companys operations are continued in the areas of implementing projects in areas such as airport, roads, bridges, etc. In all the areas, the company continued its focus on cost reduction and cost control at all levels.

5. Human Resources and Industrial Relations

The company understands the value of acquiring the highly intellectual human capital which the company believes is a crucial asset of the company. For this purpose, company follows the strategy "to attract, to retain and to motivate" the personnel through providing the framework for helping employees develop their personal and organizational skills, knowledge, and abilities. We have focused on to build positive attitude in the employees while working with Tarmat Limited. Tarmat Limited follows the principle-"good performance should be appreciated by good rewarding."

6. Risk and Concerns

Each sector has its own risk and concerns. Infrastructure projects are no exception to that. Common risks in the sector are cost inflation, Regulatory and land acquisition risk operating risk, project delays risk, completion risk, demand risk, cost overrun risk, unviable finance risk

During the year, the Board has reviewed the risk and the process that have already been identified for the business and necessary action for mitigation has been initiated.

Risks impacting the Companys overall governance are given below:

Liquidity risk, Interest rate risk, Credit risk, Commodity price risk, foreigncurrencyfluctuationrisk, Market risk,

Salary risk, Interest risk, Investment risk, Health, Safety and Environment Risks, Political, Legal and Regulatory Risks, Fraud and Cyber Security, Other Operational Risks, Counter Party Risks and Working capital challenges. changes in key financial ratios. 7. Detailsof significant

In accordance with the amended SEBI(Listing Obligation and Disclosure Requirements) Regulations,2015,the

Company is required to give detailsofsignificantchanges (i.e. change of 25% or more as compared to the immediately previous financial year) in key financial ratios, along with detailed Company has identified following ratios as key financialratios:

Particulars	F.Y.2024-25	F.Y.2023-24	% Change	Reason for change of 25% or more as compared to the immediately previous financial year
Debtors Turnover	5.75	4.90	17.30
Inventory Turnover	2.30	2.07	11.16
Interest Coverage	5.50	4.32	27.27	Variation is due to increase in Profit before
Ratio				tax and depreciation
Current Ratio	4.97	2.88	72.54	Variation is due to increase in Trade
				Receivables and reduction in Trade Payables
Debt Equity Ratio	0.25	0.38	-33.93	Variation is due to increase in shareholders\u2019
				funds on account of issue of preferential
				shares during the year
Operating Profit	0.46	0.57	-18.72
Margin (%)
Net Profit Margin	1.85	-1.27	-245.30	Variation is due to exceptional items of
				261.37 included in Net Profit of FY 2023-24
Return on Net Worth	1.08	-0.87	-223.99	Variation is due to exceptional items of
				261.37 included in NetProfitof FY 2023-
				24 and increase in shareholders\u2019 funds on
				account of issue of preferential shares during
				the year

	For and on behalf of the board of directors
	Mr. Jerry Verghese
	Chairman
	DIN: 00012905
Date: 14th August, 2025
Place: Mumbai