TD Power Systems Ltd Management Discussions

Steppingstones to a Milestone - 25 Years of excellence

In TDPS, we make generators for the world, catering to both conventional and renewable fuel-based power plants for a diverse range of prime movers. Our output capacities range from 1 MW to 200 MW for steam gas turbine, up to 35 MW for hydro, up to 20 MW for diesel, gas engines and customized ratings for wind turbines.

As we celebrate 25 years, a milestone, TDPS has emerged as a dominant player, highly regarded for delivering robust, reliable, and efficient end-to-end solutions. TDPS is globally recognised as one of the top manufacturers of AC generators. The Companys ability to provide engineered-to-order solutions tailored to meet specific customer requirements has established us as a trusted and reputable name in the industry.

Continuous process automation initiatives, design, manufacturing and quality capabilities honed over the last two decades, enable us to exceed customer expectations across a spectrum of applications - hydro, steam, gas, wind, geothermal and special applications. Our generators cater to different applications, specifications, geographical and climatic challenges, which proves our design, manufacturing and quality capabilities over the years.

With our strong foundation and unwavering commitment to excellence, TDPS continues to drive innovation and deliver exceptional value to our customers. We remain at the forefront of the industry, consistently exceeding expectations and maintaining our position as a reliable partner to our customers.

Our generators are manufacured at our world-class manufacturing facilities in Bengaluru, Karnataka, ensuring the highest standards of quality and precision. Additionally, we have a network of over 57 services centres covering every continent dedicated to assisting our customers with their aftermarket requirements.

World-class manufacturing facilities, continuous process automation initiatives, enhanced design capabilities, innovation, quality, reliability, product offerings catering to diverse applications including marine & Railways, strategic technology partnerships with focus on localized solutions, & expansion of global market reach focused on Europe & North America have been the stepping stones in the our inspiring 25-year journey.

As we celebrate this milestone, we have installed 6,392 generators in 105 countries, reiterating continuing confidence worldwide in our design, reliability and

manufacturing capabilities. This global footprint reflects that an Indian generator manufacturer can deliver a reliable product & compete effectively meeting testing standards and requirements.

The majority of the Installations are in Asia (including Eurasia) & Middle East (4800) followed by Europe (858), Africa (272) North America (253), South America (49) & Oceania (160).

Breakthrough efforts and Opportunities

Some of the important breakthrough orders & qualification from OEMs/Customers during fiscal 2024 are as follows: Generators:

- orders from two leading US companies for supply of 4 units of 1.35MW, 480V gas engine generators and 8MW, 11kV generator for marine engines testing, respectively.

- an order from a leading Italian company for supply of 1 unit of 2.1MW, 3.3kV,375rpm hydro turbine generator for installation in Tanzania.

- Orders from a leading Italian company for refurbishment of existing hydro turbine generator.

- Orders from one of a leading Austrian company for supply of 3.4MW, 6.3kV hydro turbine generators for installation in Indonesia.

- Supplied 2 units of 46.35MW, 13.8kV steam turbine generators for installation in Guyana.

- Supplied 16MW, 13.8kV gas turbine generator and 4 numbers stators for steam turbine generators for installation in USA.

- Supplied 2 units of 16.8MW, 4.16kV gas turbine generators for installation in Mexico.

- Supplied 18.7MW, 11kV gas turbine generator for installation in Italy.

- Achieved a milestone by building a 2-pole rotor in- house for the first time, used in 2 units of 65MW, 11kV, 3000rpm steam turbine generators.

- Supplied 1 unit of 90MW, 10.5kV steam turbine generator as a replacement for installation in Uttar Pradesh, India. This is the biggest generator supplied by TDPS so far.

- Supplied 5 units of 14MVA, 15kV generators for installation in Poland.

Synchronous motors:

- Supplied 3 units of 1.4MW, 4kV Induction motor and 3 units of 5.22MW, 4kV synchronous motors for installation in Saudi Arabia.

- Supplied vertical induction motors of rating 0.55MW- 6.6kV, 0.8MW-6.6kV and 21MW-11kV for installation in India.

- Successfully refurbished and commissioned the first 40MW, 26 Pole synchronous motor at Laxmi Pump House, Kaleshwaram within six months from the date of receipt of order.

- Supplied 5 units of 14MVA, 15kV generators for installation in Poland.

Approvals:

- Listed as an approved supplier for ADNOC (Abu Dhabi National Oil Company) to supply generators for Diesel Engine, Steam Turbine and Gas Turbine applications.

- Secured approval from the Airport Authority of India for the supply of diesel engine generators.

- Listed as approved supplier by Elliot Group for the supply of generator Hazardous area, Zone-2, IIA/IIB, T3 for supply of generator inside the refinery plant.

The above breakthrough orders reflect promising opportunities and are expected to contribute significantly to the order book in the years to follow.

SEGMENT-WISE AND PRODUCT-WISE PERFORMANCE WITH OUTLOOK

Steam Turbine Generators - It continues to be the highest revenue contributor among all other segments. The domestic market continues to see revival in capex in Fiscal 2025 broadly across all sectors. In the export markets, macro factors like the transition towards renewable energy, waste to heat, garbage burning plants etc. continue to drive this market in Fiscal 25. The Increasing demand for electricity from EV sector and later domestic heating will provide long term sustained demand of new power plants in the long term.

Hydro Generators- There is a strong pipeline of orders from OEMs worldwide for Hydro Generators. Vietnam & Nepal are currently the main markets, while India is gradually opening up for small Hydro market.

Motors, wind repair & railways segment - This segment saw significant growth of 96% in order bookings in the fiscal 2024 compared to the previous year. A healthy growth rate is projected in Fiscal 2025.

Gas Turbine & Gas engine Segment -Orders for Gas Turbine generators and Gas engine Segment from over major customers have shown an increasing trend this year, and the outlook remains strong & stable for the next year.

The gas engine generator segment has been seeing steady growth compared to last fiscal year. Forecast from customers in Austria and Germany looks promising for this fiscal year. Notably, major projects are currently under discussion for installations in the UK, Australia, and Argentina. These potential projects are expected to drive our growth in this segment.

In the international market, the order book is driven by substantial orders in the segment of hydro, gas turbines and gas engines. The gas turbine and gas engine business are strongly driven by demand in oil and gas, data centers for artificial intelligence and grid stabilization power plants. We are seeing significant increases in orders received in these three segments and the pipeline is very strong for fiscal 2025 and beyond.

TDPS has achieved significant progress in the motors business, supplying a wide range of motors, including the largest reaching 40 MW. The Company has secured approvals from various government sectors such as NPCIL and state irrigation bodies across multiple states.

TDPS is now exporting 4-pole and 2-pole generators to the Middle Easts oil and gas industry. Also, currently supplying motors to steel, cement and power sectors.

With a healthy pipeline of inquiries and a focus on exports and new markets, we anticipate significant growth in the coming years.

For traction motors, TDPS has been approved as a vendor of Indian Railways and is actively bidding on their regular requirements. We are also exploring export opportunities for traction motors and are currently in discussion with multiple players. The outlook for this segment is also promising.

Turkey Business- The Turkish market has encountered a significant downturn in local manufacturing projects, largely attributable to the prevailing economic slowdown and the incentive policy of the Government towards for made in Turkey power equipment including generators. Currently, only a handful of projects remain active and this trend is anticipated to persist until economic conditions improve and better financing options become available for new projects. Despite these challenges, we have successfully manufactured three generators this year. However, the outlook for the upcoming year appears subdued, with lower expectations compared to the current year. As a result, we are planning to temporarily halt production activities after fulfilling the last of our deliveries. However, our equipment will remain inter key for quick start up in the event some orders materialize. We continue to remain market leaders for made in Turkey generators with over 190 generators already manufactured & installed in Turkey over the last 3 years.

Considering the strong order pipeline & emerging opportunities, we are projecting to achieve revenue of Rs 1,200 Crores on a Consolidated basis in the manufacturing business in Fiscal 2025. This growth is expected to significantly contribute to an improved EBITDA margin by leveraging operational leverage.

Barring unforeseen events, we expect to a have a higher level of profit driven by higher top line & improved contribution in fiscal 2025.

RISK MANAGEMENT AND MITIGATION

The Companys business relates to manufacture and sale of generators, repairs of motors and Generators falling under capital goods sector and is dependent on national & global economic growth, investment climate and business confidence as well as the sectors in which the Companys products are used.

Some of the major risks being faced by the Company are described below:

Economic slowdown and market concentration

A conducive investment climate and interest rate regime, global economic and market conditions drive growth and performance of the industrial sector which forms the Companys customer base. An economic slowdown directly impacts the demand for capital goods, including the products of the Company. Further, over dependence on any market/s may adversely affect the performance of the Company consequent to varying economic or market factor

While a dominant presence has been achieved in the domestic markets our rising market presence in overseas markets and growing relationships with leading global leaders backed by diversified new product verticals has enabled the Company in achieving sustainability & growth. Strategic focus on the global markets has resulted in growing customer references worldwide & we are now a dominant player in certain verticals in the overseas market. We have continued to grow our export base, by adding new global OEMs & increased market share in existing verticals through better pricing, customization & quality acceptable to global OEMs.

Product concentration

During the fiscal 2024, the steam turbine generators has been a major contributor of our standalone net sales year on year. Advanced technology relating to steam turbine generators or the development of steam turbine generators that prove superior in quality or effectiveness to our generator could affect our dominant market position in this segment. However, our R&D and design capabilities support technological & design upgrades to meet customer specifications & requirements.

Even though steam turbine generators accounted for a significant portion of the revenues, the contribution of hydro, gas and other applications is consistently growing de risking the products mix. The continuing efforts to diversify offerings in product verticals catering to horizontal hydro generators, vertical hydro generators, diesel engine generators, wind turbine generators, gas engine generators, gas turbine generators, high voltage motors and generators for Geo thermal and Solar thermal applications enables market presence across the spectrum of generator market in India and overseas, moderates dependence on any particular industry or market segment.

While we grow our generator business across a spectrum of applications globally, our foray into new products in the electric rotating machines as a diversification continues with a view to enlarge our product offerings.

Technology Risk

Response to and adoption of advanced technology and emerging power generation industry standards and practices on a cost-effective and timely basis is critical to sustaining and growing market reach of the Company. The Company operates in the engineered-to-order capital goods industry where product efficiency, critical product features and overall life cycle costs play an important role.

Generators are designed based on industry standards incorporating customer requirements/specifications. It is an ongoing design activity to develop generators for special applications. Technology absorption continues and orders are being received for generators with special applications and varied specifications. The Companys R&D effort focuses on adoption of new technology and development of superior designs enhancing performance, quality and reducing cost. Our generators are approved by reputed and leading engineering consultants, Indian Railways & defence establishments.

Competition Risk

Given the increasing exposure to overseas OEMS, the Company continues to face competition from large overseas corporations both in the domestic & overseas market. These large corporations have access and derive significant benefit of advanced technologies, global presence technology or brand preference and larger financial resources.

With a view to mitigate this risk, the Company continues to provide value proposition to customers with products which meet the benchmark efficiencies at a competitive price and shorter delivery time. Our proven ability to meet customer specifications, quality & performance expectations across a spectrum of applications - Hydro, Steam, Gas, wind, Geo thermal and special applications has enabled us to compete across markets & emerge as a dominant player in certain verticals in the overseas market. A responsive customer support policy with a network of service providers situated in vantage locations across continents has enhanced market acceptance.

The Company continues to upgrade design capabilities by incorporating latest technologies in its products and improvements in the design of generators enabling it to offer more efficient machines meeting customer requirements from time to time. Reduction in production, distribution costs and improvement in operating efficiencies are continuously pursued supported by increased automation of the manufacturing facilities enabling it to offer competitive prices. The Company prioritizes sourcing good quality raw materials and other inputs at competitive prices with high reliability in meeting delivery timelines from its supply chain.

Risk arising from transnational sale of products

In view of exports of product to several countries in various continents, there is a risk of claims from customers & third parties related to performance of product or any events arising out of the use of the product as well as non-compliance of laws in those countries.

The Company follows a strict quality control policy which ensures that products supplied must meet the contractual specifications including applicable laws. It is ensured that the contracts with customers clearly specify the obligations of the Company. In addition, the Company takes appropriate insurance coverage in respect of such risks.

Manufacturing facilities & Manpower

We have two manufacturing units, both located in Bangalore, equipped with advanced automation/ machines that help deliver quality products at competitive prices. One of the facilities is a dedicated large generator manufacturing unit with state-of-the-art machines and equipment. Both units are ISO 9001:2015 compliant. We continuously invest in upgradations, modernization and automation of processes and design to ensure that our facilities remain state of the art, contributing to efficiency, quality and cost effective. Our well trained and experienced manpower focuses on design, planning, manufacturing and quality, enabling production of top-class generators for customers worldwide.

Furthermore, to enhance operational efficiency, during the fiscal 2024, the Company acquired 15 acres of land at the Japanese Industrial Township, Vasanthanarasapura 3rd Phase Industrial Area Tumkur Karnataka, for setting up a facility to manufacture Electrical Generators, Motors, their sub-assemblies and parts. The Company has received possession certificate for this land and entered into a lease cum sale agreement for a period of 10 years. The facility will be used as a feeder shop for manufacturing subassemblies to supply the two main manufacturing units.

FINANCIAL PERFORMANCE

The pending order book as on 1st April 2024 is Rs 1,18,942.03 Lakhs (Rs 1,17,259.52 lakhs for India and Rs 1,682.51 lakhs for Turkey), including traction business of Rs 41,794.24 lakhs. The share of exports and deemed exports is 64% of order book excluding traction business.

During fiscal 2024 the total orders inflows is Rs 1,05,141.50 lakhs including Rs 923.90 lakhs at Turkey. Domestic order inflows stood at 43%, while Export including deemed exports orders stood at 57% of the order inflow.

The total sales is Rs 98,387.90 lakhs in fiscal 2024 as compared to Rs 82,148.42 lakhs in fiscal 2023, an increase of 20%. Exports and deemed exports contributed 43% of total sales and domestic revenues contributed 57% in fiscal 2024.

While top 10 customers contributed 77% of consolidated revenues in fiscal 2024 (80% in fiscal 2023). We continue to undergo audits by OEMs for supply to Defense, nuclear, wind and Diesel applications.

A brief review of the financial results on Standalone & Consolidate basis is covered in the following sections.

Standalone Basis

Total income increased by Rs 16,389.37 lakhs, or 19.43%, to Rs 1,00,738.01 lakhs in Fiscal 2024 from Rs 84,348.64 lakhs in Fiscal 2023, predominantly due to increase in sales volume. Total sales increased by Rs 16,239.48 lakhs, or 19.77%, to Rs 98,387.90 lakhs in Fiscal 2024 from Rs 82,148.42 lakhs in Fiscal 2023, predominantly due to increase in sales volume. Expressed as a percentage of total income, net sales contributes 97.67% in Fiscal 2024versus 97.39% in Fiscal 2023.

Other income contributed 2.33% and 2.61% of our total income in Fiscal 2024 and 2023, respectively. Other income remained flat with a small increase by Rs 149.89 lakhs, or 6.81%, to Rs 2,350.11 lakhs in Fiscal 2024 from Rs 2,200.22 lakhs in Fiscal 2023

The profit after tax and other comprehensive income was Rs 12,225.74 lakhs in fiscal 2024 as compared to Rs 8,841.80 lakhs in fiscal 2023, an increase of38.27%.

Consolidated Basis

Total income increased by Rs 12,467.43 lakhs, or 13.98%, to Rs 1,01,672.60 Lakhs in Fiscal 2024 from Rs 89,205.17 Lakhs in Fiscal 2023, predominantly due to increase in sales volume. Sales increased by Rs 12,822.29 Lakhs, or 14.70%, to Rs 1,00,051.99 Lakhs in Fiscal 2024 from Rs 87,229.70 Lakhs in Fiscal 2023, predominantly due to increased sales volume. Expressed as a percentage of total income, net sales remains flat at 98.41% in Fiscal 2024 from 97.79% in Fiscal 2023.

Other income contributed 1.59% and 2.21% of our total income in Fiscal 2024 and 2023, respectively. Other income decreased by Rs 354.86 Lakhs, or 17.96%, to Rs 1,620.61 Lakhs in Fiscal 2024 from Rs 1,975.47 Lakhs in Fiscal 2023, mainly due to reduction in foreign exchange gain on account of translation balances. The profit after tax and other comprehensive income was Rs 11,564.74 lakhs in fiscal 2024 as compared to Rs 9,453.81 lakhs in fiscal 2023, an increase of22.33%

The performance review of the overseas subsidiaries is covered in the Directors Report to the Members.

Consolidated basis:

The results of operations for the year ended March 31, 2024 and 2023 on a consolidated basis is as follows:

Particulars	Fiscal 2024		Fiscal 2023
	(Rs in Lakhs)	% of Total Income	(Rs in Lakhs)	% of Total Income
Income:
Sales	1,00,051.99	98.41%	87,229.70	97.79%
Other Income	1,620.61	1.59%	1,975.47	2.21%
Total Income	1,01,672.60	100.00%	89,205.17	100.00%
Expenditure:
Consumption of Raw Material, Stores, Spare parts and Components	65,518.70	64.44%	59,036.73	66.18%
Operating and Other Expenses	17,793.87	17.50%	15,171.36	17.01%
Interest and Finance Charges	30.96	0.03%	106.37	0.12%
Depreciation Amortization of Technical Knowhow	2,108.87	2.07%	2,070.48	2.32%
Total Expenditure	85,452.40	84.04%	76,384.94	85.63%
Profit Before Tax & Exceptional item	16,220.20	-	12,820.23	-
Exceptional item	-	-	134.41	-
Profit Before Tax	16,220.20	-	12,954.64	-
Current Tax	4,658.98	-	3,755.76	-
Deferred Tax	(273.70)	-	(482.35)	-
Profit/(Loss) After Tax	11,834.92	-	9,681.23	-
Other Comprehensive Income		-		-
Exchange difference on translation of foreign operations	(166.57)	-	(234.56)	-
Income tax on the above	22.27	-	2.81	-
Re-measurement of defined benefit plans	(168.22)	-	5.78	-
Income tax on the above	42.34	-	(1.45)	-
Total	(270.18)	-	(227.42)	-
Total Comprehensive Income	11,564.74	-	9,453.81	-td>

Fiscal 2024 compared to Fiscal 2023

Income

Total income increased by Rs 12,467.43 lakhs, or 13.98%, to Rs 1,01,672.60 Lakhs in Fiscal 2024 from Rs 89,205.17 Lakhs in Fiscal 2023, predominantly due to increase in sales volume.

Sales

Sales increased by Rs 12,822.29 Lakhs, or 14.70%, to Rs 1,00,051.99 Lakhs in Fiscal 2024 from Rs 87,229.70 Lakhs in Fiscal 2023, predominantly due to increased sales volume.

Expressed as a percentage of total income, net sales remains flat at 98.41% in Fiscal 2024 from 97.79% in Fiscal 2023.

Other Income

Other income contributed 1.59% and 2.21% of our total income in Fiscal 2024 and 2023, respectively. Other income decreased by Rs 354.86 Lakhs, or 17.96%, to Rs 1,620.61 Lakhs in Fiscal 2024 from Rs 1,975.47 Lakhs in Fiscal 2023, mainly due to reduction in foreign exchange gain on account of translation balances.

Expenditure

Total expenditure increased by Rs 9,067.46 Lakhs, or 11.87%, to Rs 85,452.40 lakhs in Fiscal 2024 from Rs 76,384.94 lakhs in Fiscal 2023, primarily due to increased sales volumes.

Consumption of Raw Material, Stores, Spare Parts and Components

Consumption of raw material, stores, spare parts and components expenses increased by Rs 6,481.97 lakhs to Rs 65,518.70 lakhs in Fiscal 2024 from Rs 59,036.73 Lakhs in Fiscal 2023, primarily due to increased sales volume. Expressed as a percentage of total income, raw material consumed contributes 64.44% in Fiscal 2024 compared to 66.18% in Fiscal 2023.

Operating and Other Expenses

Our operating and other expenses increased by Rs 2,622.51 lakhs, or 17.29%, to Rs 17,793.87 lakhs in Fiscal 2024 from Rs 15,171.36 Lakhs in Fiscal 2023.

Power and fuel expenses increased by Rs 205.79 lakhs, or 24.25%, to Rs 1,054.48 lakhs in Fiscal 2024 from Rs 848.69 lakhs in Fiscal 2023 on account increased production.

Personnel expenses through salaries, wages and bonuses increased by Rs 1,191.57 lakhs, or 17.00%, to Rs 8,199.78 lakhs in Fiscal 2024 from Rs 7,008.21 lakhs in Fiscal 2023 on account of salary revision coupled with additional recruitment, f gratuity payments to contract employees/fixed term employee as per the applicable labor law requirements, & a one time voluntary retirement cost of Rs 321.82 lakhs.

Welfare expenses increased by Rs 384.66 lakhs, or 28.56%, to 1,731.49 lakhs in Fiscal 2024 from Rs 1,346.83 lakhs in Fiscal 2023. Rent charges increased by Rs 40.28 lakhs, or 65.22%, to Rs 102.04 lakhs in Fiscal 2024 from Rs 61.76 lakhs in Fiscal 2023.

Repair expenses increased by Rs 178.33 lakhs, or 27.31%, to Rs 831.40 lakhs in Fiscal 2024 from Rs 653.07 lakhs in Fiscal 2023 due to repairs of old machines & factory building.

Carriage, freight and selling expenses decreased by Rs 133.83 lakhs, or 13.18%, to Rs 881.23 lakhs in Fiscal 2024 from Rs 1,015.06 lakhs in Fiscal 2023.

Vehicle Maintenance expenses increased by Rs 39.09 lakhs, or 62.00%, to Rs 102.14 lakhs in Fiscal 2024 from Rs 63.05 lakhs in Fiscal 2023 due to larger fleet of vehicles.

Travelling expenses increased by Rs 221.41 lakhs, or 18.62%, to Rs 1,410.79 lakhs in Fiscal 2024 from Rs 1,189.38 lakhs in Fiscal 2023 due to increase in travelling.

Audit Fee increased by Rs 4.18 lakhs, or 17.13%, to Rs 28.58 lakhs in Fiscal 2024 from Rs 24.40 lakhs in Fiscal 2023.

Legal and Professional charges increased by Rs 127.85 lakhs, or 20.22%, to Rs 760.04 lakhs in Fiscal 2024 from Rs 632.19 lakhs in Fiscal 2023 due to increase in consultancy services & product related certifications.

Royalty charges increased by Rs 164.66 lakhs, or 2643.02%, to Rs 170.89 lakhs in Fiscal 2024 from Rs 6.23 lakhs in Fiscal 2023 due to sales of product under license agreement.

Direction charges including other expenses increased by Rs 156.39 lakhs, or 20.10%, to Rs 934.54 lakhs in Fiscal 2024 from Rs 778.15 lakhs in Fiscal 2023.

Manufacturing expenses increased by Rs 113.78 lakhs, or 42.30%, to Rs 382.75 lakhs in Fiscal 2024 from Rs 268.97 lakhs in Fiscal 2023. Rates and taxes decreased by Rs 36.87 lakhs, or 30.25% to Rs 85.03 lakhs in Fiscal 2024 from Rs 121.90 lakhs in Fiscal 2023.

Software expenses increased by Rs 15.49 lakhs, or 5.31% to Rs 307.19 lakhs in Fiscal 2024 from Rs 291.70 lakhs in Fiscal 2023.

Expressed as a percentage of total income, operating and other expenses is 17.50% in Fiscal 2024 when compared to 17.01% in Fiscal 2023.

Interest and Finance Charges

Our interest and finance charges decreased by Rs 75.41 lakhs, or 70.89%, to Rs 30.96 lakhs in Fiscal 2024 from Rs 106.37 lakhs in Fiscal 2023, due to minimal utilization of working capital & interest cost for fiscal 2024 is primarily for provision towards MSMED vendors.

Depreciation and Amortization of Technical Know-How

Our depreciation and amortization of technical know-how expense remain flat at Rs 2,108.87 lakhs in Fiscal 2024 from Rs 2,070.48 lakhs in Fiscal 2023.

Profit Before Tax And Exceptional Item

Profit before tax and exceptional item increased by Rs 3,399.97 lakhs, or 26.52%, to Rs 16,220.20 lakhs in Fiscal 2024 from Rs 12,820.23 lakhs in Fiscal 2023.

Exceptional Item

Exception item in fiscal 2024 is NIL. Fiscal 2023 includes write back of payable in Indian subsidiary which amounts to Rs 62.78 lakhs and Profit on sale of land by holding company amounts to Rs 71.63 lakhs.

Profit Before Tax

Profit before tax increased by Rs 3,265.56 lakhs, or 25.21%, to Rs 16,220.20 lakhs in Fiscal 2024 from Rs 12,954.64 lakhs in Fiscal 2023.

Taxation

Our tax expense increased by Rs 1,111.87 lakhs, or 33.97%, to Rs 4,385.28 lakhs in Fiscal 2024 from Rs 3,273.41 lakhs in Fiscal 2023 due higher profit.

Profit After Tax

Consequently, our profit after tax increased by Rs 2,153.69 lakhs, to Rs 11,834.92 lakhs in Fiscal 2024 from Rs 9,681.23 lakhs in Fiscal 2023.

The consolidated net worth stands at Rs 70,513.35 lakhs an incre- ase of Rs 10,061.38 lakhs over Fiscal 2023.

Financial Review Stand-alone basis

The results of operations for the year ended March 31, 2024 and 2023 on a standalone basis is as follows:

Particulars	Fiscal 2024		Fiscal 2023
	(Rs in Lakhs)	% of Total Income	(Rs in Lakhs)	% of Total Income
Income:
Sales	98,387.90	97.67%	82,148.42	97.39%
Other Income	2,350.11	2.33%	2,200.22	2.61%
Total Income	1,00,738.01	100.00%	84,348.64	100.00%
Expenditure:
Consumption of Raw Material, Stores, Spare parts and Components	65,804.03	65.32%	56,633.95	67.14%
Operating and Other Expenses	16,225.27	16.11%	13,651.50	16.18%
Interest and Finance Charges	30.96	0.03%	106.37	0.13%
Depreciation and Amortization of Technical Knowhow	2,031.45	2.02%	1,964.46	2.33%
Total Expenditure	84,091.71	83.48%	72,356.28	85.78%
Profit Before Tax and exceptional item	16,646.30	-	11,992.36	-
Exceptional Items	5.67	-	(50.81)	-
Profit Before Tax	16,651.97	-	11,941.55	-
Current Tax	4,507.85	-	3,578.07	-
Deferred Tax	(273.70)	-	(482.35)	-
Profit After Tax	12,417.82	-	8,845.83	-
Other Comprehensive Income		-		-
Exchange difference on translation of foreign operations	(88.47)	-	(11.17)	-
Income Tax on exchange difference on translation of foreign operations	22.27	-	2.81	-
Re-measurement of defined benefit plan	(168.22)	-	5.78	-
Income Tax on re-measurement of defined benefit plan	42.34	-	(1.45)	-
Total	(192.08)	-	(4.03)	-
Total Comprehensive Income	12,225.74	-	8,841.80	-

Fiscal 2024 compared to Fiscal 2023

Income

Total income increased by Rs 16,389.37 lakhs, or 19.43%, to Rs 1,00,738.01 lakhs in Fiscal 2024 from Rs 84,348.64 lakhs in Fiscal 2023, predominantly due to increase in sales volume.

Total Sales

Total sales increased by Rs 16,239.48 lakhs, or 19.77%, to Rs 98,387.90 lakhs in Fiscal 2024 from Rs 82,148.42 lakhs in Fiscal 2023, predominantly due to increase in sales volume.

Expressed as a percentage of total income, net sales contributes 97.67% in Fiscal 2024 versus 97.39% in Fiscal 2023.

Expressed as a percentage of total income, net sales remain flat at 97.79% in Fiscal 2023 from 97.95% in Fiscal 2022.

Other Income

Other income contributed 2.33% and 2.61% of our total income in Fiscal 2024 and 2023, respectively. Other income remained flat with a small increase by Rs 149.89 lakhs, or 6.81%, to Rs 2,350.11 lakhs in Fiscal 2024 from Rs 2,200.22 lakhs in Fiscal 2023.

Expenditure

Total expenditure increased by Rs 11,735.43 lakhs, or 16.22%, to Rs 84,091.71 lakhs in Fiscal 2024 from Rs 72,356.28 lakhs in Fiscal 2023.

Consumption of Raw Material, Stores, Spares Part and Components

Consumption of raw material, stores, spare parts and components expenses increased by Rs 9,170.08 lakhs to Rs 65,804.03 lakhs in Fiscal 2024 from Rs 56,633.95 lakhs in Fiscal 2023, primarily due to increase in sales volume.

Expressed as a percentage of total income, a raw material consumed expense contributes to 65.32% in Fiscal 2024 from 67.14% in Fiscal 2023.

Operating and Other Expenses

Our operating and other expenses increased by Rs 2,573.77 lakhs, or 18.85%, to Rs 16,225.27 lakhs in Fiscal 2024 from Rs 13,651.50 lakhs in Fiscal 2023.

Expressed as a percentage of total income, operating and other expenses is 16.11% in Fiscal 2024 when compared to 16.18% in Fiscal 2023.

Power and fuel expenses has increased by Rs 205.79 lakhs, or 24.25%, to Rs 1,054.48 lakhs in Fiscal 2024 from Rs 848.69 lakhs in Fiscal 2023 on account increased production.

Personnel expenses through salaries, wages and bonuses increased by Rs 1,154.73 lakhs, or 17.95%, to Rs 7,586.26 lakhs in Fiscal 2024 from Rs 6,431.53 lakhs in Fiscal 2023 on account of salary revision to catch-up the inflationary increases coupled with additional recruits, entitlement of gratuity for contract employees/fixed term employee as per new labor code, one time voluntary retirement cost of Rs 321.82 lakhs.

Welfare expenses increased by Rs 360.61 lakhs, or 28.20%, to Rs 1,639.28 lakhs in Fiscal 2024 from Rs 1,278.67 lakhs in Fiscal 2023.

Rent charges remains flat at Rs 33.73 lakhs in Fiscal 2024 from Rs 33.91 Lakhs in Fiscal 2023.

Repair expenses increased by Rs 180.84 lakhs, or 27.89%, to Rs 829.15 lakhs in Fiscal 2024 from Rs 648.31 lakhs in Fiscal 2023 due to repairs of old machines & factory building.

Repair expenses increased by Rs 272.56 lakhs, or 71.63%, to Rs 653.07 lakhs in Fiscal 2023 from Rs 380.51 lakhs in Fiscal 2022 due to refurbishment of factory building and repairs of old machines.

Carriage, freight and selling expenses decreased by Rs 133.83 lakhs, or 13.18%, to Rs 881.23 lakhs in Fiscal 2024 from Rs 1,015.06 lakhs in Fiscal 2023.

Vehicle Maintenance expenses increased by Rs 41.51 lakhs, or 88.68%, to Rs 88.32 lakhs in Fiscal 2024 from Rs 46.81 lakhs in Fiscal 2023 due to larger fleet of vehicles.

Travelling expenses increased by Rs 181.96 lakhs, or 16.90%, to Rs 1,258.66 lakhs in Fiscal 2024 from Rs 1,076.70 lakhs in Fiscal 2023 due to increase in travelling.

Audit Fee increased by Rs 4.18 lakhs, or 17.64%, to Rs 27.88 lakhs in Fiscal 2024 from Rs 23.70 Lakhs in Fiscal 2023.

Consultancy & Professional charges increased by Rs 172.12 lakhs, or 38.81%, to Rs 615.58 lakhs in Fiscal 2024 from Rs 443.46 lakhs in Fiscal 2023 due to increase in consultancy services & product related certifications.

Royalty charges increased by Rs 164.66 lakhs, or 2643.02%, to Rs 170.89 lakhs in Fiscal 2024 from Rs 6.23 lakhs in Fiscal 2023 due to sales of product under license agreement.

Direction charges including other expenses increased by Rs 55.75 lakhs, or 13.39% to Rs 472.07 lakhs in Fiscal 2024 from Rs 416.32 lakhs in Fiscal 2023.

Manufacturing expenses increased by Rs 113.78 lakhs, or 42.30%, to Rs 382.75 lakhs in Fiscal 2024 from Rs 268.97 lakhs in Fiscal 2023.

Software expenses increased by Rs 15.49 lakhs, or 5.31%, to Rs 307.19 lakhs in Fiscal 2024 from Rs 291.70 lakhs in Fiscal 2023.

Rates and taxes decreased by Rs 46.60 lakhs, or 40.44%, to Rs 68.62 lakhs in Fiscal 2024 from Rs 115.22 lakhs in Fiscal 2023.

Interest and Finance Charges

Our interest and finance charges decreased by Rs 75.41 lakhs, or 70.89%, to Rs 30.96 lakhs in Fiscal 2024 from Rs 106.37 lakhs in Fiscal 2023, due to minimal utilization of working capital & interest cost for fiscal 2024 is primarily towards provision towards MSMED vendors.

Depreciation and Amortization of Technical Know-How

Our depreciation and amortization of technical know-how expense remain flat at Rs 2,031.45 lakhs in Fiscal 2024 from Rs 1,964.46 lakhs in Fiscal 2023.

Profit Before Tax and Exception Items

Profit before tax and exceptional items increased by Rs 4,653.94 lakhs, or 38.81%, to Rs 16,646.30 lakhs in Fiscal 2024 from Rs 11,992.36 lakhs in Fiscal 2023.

Exceptional Items

Exceptional items includes amount received from subsidiary towards repayment of Share Capital (held as Investment in the Company) amounting to Rs 5.67 lakhs. Since the Company has made provision for diminution in the value of investment during the financial year ended March 31, 2023, this repayment is reported under "Exceptional Items" in the financial statements.

Profit Before Tax

Profit before tax increased by Rs 4,710.42 lakhs, or 39.45%, to Rs 16,651.97 lakhs in Fiscal 2024 from Rs 11,941.55 lakhs in Fiscal 2023.

Taxation

Our tax expense including deferred tax increased by Rs 1,138.43 lakhs to Rs 4,234.15 lakhs in Fiscal 2024 from Rs 3,095.72 lakhs in Fiscal 2023 due higher profit.

Profit After Tax

Our profit after tax increased by Rs 3,571.99 lakhs to Rs 12,417.82 lakhs in Fiscal 2024 from Rs 8,845.83 lakhs in Fiscal 2023 due higher profit.

Key Financial Ratios: The financial ratios, such as debtor turnover (trade receivables turnover), inventory turnover, current ratio, debt-equity ratio and net profit margin (net profit ratio), have been disclosed in note no.56 of the Standalone financial statements with explanation provided.

However, there were no significant changes in these ratios compared to the previous year. The additional ratios required under listing regulations are stated below on a standalone basis:

Particulars	2024	2023	Change in %
Operating Profit Margin (%)	16.63	14.44	15.17
Return on Net Worth (%)	17.44	14.89	17.13

As the Company does not have any debt on its standalone balance sheet, Debt Equity and Interest Coverage ratios are not applicable and have not been calculated.

The Company continues to remain debt free and maintains a healthy cash position.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has established adequate internal control system, commensurate with the nature of its business and size of its operations in order to ensure quality and reliability of underlying processes focused towards achieving operational efficiency, supported by Management reviews. All audit observations and follow up actions thereon are initiated for resolution by the finance function and Reported to the Audit Committee. Attention is also drawn to the statement on internal financial control in the Directors Report.

Environment, Health and Safety

The Companys environmental, occupational health, operational and safety management systems fulfill ISO 9001- 2015, 14001-2015, ISO 45001-2018 for OH&S Management system, EN ISO 3834-2 and Compliance issued by CSA International. Our operations incorporate due care and responsibility towards environment, health and safety of employees, customers, suppliers and the community in large and is a zero-discharge facility. In fulfilling this commitment, we maintain and continually improve all our process and complying with legal and other requirements, in order to

a. Ensure safety and Health of our employees, associated stakeholders and focus on how to make the world a better place to live.

b. Comply with all applicable legal Safety and Health performance of individuals at different levels while considering their career advancement in the organization.

c. Enhance Safety, Health and Environment (SHE) awareness amongst employees and associated stakeholders through effective communication and training.

d. Ensure SHE responsibility amongst all the employees in their practices, promote and value their involvement in achieving the goals of this policy.

e. Fix responsibility of SHE policy and procedures on the contractors, Sub-Contractors, Transporters and all other agencies operating with the Company.

f. Integrate Health & Safety in all decision-making processes of the company including those dealings with purchase of plant equipment, machinery & materials as well as selection and placement of personnel.

Adopt all the relevant techniques & methods such as risk assessment and safety audits at appropriate intervals of time to assess the status on Quality, Environment and Health & Safety and take relevant remedial measures to overcome problems encountered.

Human Resources

The Company is committed to training, skilling and up skilling it/s work force on an ongoing basis which ensures that its work force is able to adopt evolving technologies, processes and techniques.

Around 125 training / awareness & management development programs were conducted covering various aspects in manufacturing process Safety, quality and statistical analysis, testing & design correlation, basic electrical concepts in generator design, statistical process control & applications, lead management, maintenance of material movement equipment, finance, prevention of sexual harassment (POSH), communication skills, Safety, waste handling and disposal covering the entire spectrum of employees.

The Company believes in equal opportunity in recruitment and in the course of the employment among employees regardless of color, race, gender, social origin, caste or religion. Efforts are continuously made to create an inclusive working environment for women and to integrate them in organizational functions. Women employees are continuously encouraged and supported to take new roles of responsibility ensuring career growth and retention. Recruitment & technical training of women in manufacturing operations is pursued on an ongoing basis.

Crucial functions in the Company like Chief of Finance, Head of Global Supply chain is helmed by women leaders.

The Company firmly believes that every woman employee of the Company has a right to work in an environment free from sexual harassment, intimidation or offensive behavior and in which issues of harassment will be resolved without fear of reprisal. In this direction a Policy on prevention/prohibition of sexual harassment of woman at Companys workplace ("Policy") is in place to take effective measures to avoid and eliminate and if necessary to impose punishment for any sexual harassment in the Companys work place integrated with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The Companys leadership engages affirmatively in employee development and engagement activities such as involvement in the Corporate Responsibility initiatives, active participation of work force in safety initiatives, quality improvement programs, language skills, leadership development programs, training programs and training under license agreements, on an ongoing basis. Employee relations continue to remain peaceful and cordial. At end of fiscal 2024, the total strength of permanent employees, excluding contract basis and trainees stood at 722.

In fiscal 2024, the Company implemented the TD Power Systems Ltd Voluntary Retirement Scheme 2023-24 to provide financial support to workmen. More details on the scheme are provided in note no.58 of Standalone Financial Statements of the Company.

The Company continues to reinforce the Code of Business Conduct across functions/workforce. In order to enhance communications and to create a congenial environment, the organizational leadership and the shop floor employees of the company have invested significant amount of time and effort.

FORWARD-LOOKING STATEMENT

Statements in the Management Discussion and Analysis describing the Companys plans, estimates and projections may be forward looking statements within the meaning of applicable securities laws and regulations. Actual results may materially differ from those expressed or implied in the report. The Company assumes no responsibility to publicly amend, modify or revise any such statements on the basis of subsequent developments, information or events.

	For and on behalf of Board of Directors
	Mohib N. Khericha	Nikhil Kumar
	Chairman	Managing Director
May 23, 2024	Ahmedabad	Frankfurt