Transrail Lighting Ltd Management Discussions

<dhhead-MANAGEMENT DISCUSSION AND ANALYSIS</dhhead-

GLOBAL ECONOMY

The global economy has continued to showcase resilience despite ongoing geopolitical uncertainty, evolving trade relationships and varying monetary policy cycles across region. Economic activity remained supported by improving domestic demand, moderating inflation and infrastructure-led investments, although growth remained uneven across advanced and emerging economies.

According to the International Monetary Funds (IMF) World Economic Outlook, global economic growth is estimated at approximately 3.1% in 2026, reflecting moderate but stable expansion despite heightened global uncertainties. Growth in advanced economies remained relatively subdued while emerging and developing economies continued to contribute significantly to global economic expansion.

During the year global economy continued to navigate challenges arising from geopolitical developments across multiple regions, changing supply chains, energy market volatility and evolving industrial policies. Further, the evolving conflict in the Middle East presents a significant challenge to the resilience of the global economy. At the same time, greater emphasis on supply-chain resilience, energy security and domestic manufacturing is reshaping investment priorities across major economies. IMF has revised its global economic growth recently and now has projected to 3.0% for 2026 and 3.4% for 2027.

Global inflation is projected to decline further to approximately 4.2% in 2026, with advanced economies approaching target inflation levels faster than emerging markets. Central banks across major economies continued to adopt differentiated approaches balancing growth support and inflation management.

Infrastructure investment remains an important driver of global economic activity. Governments and private-sector participants across regions continue to prioritise

investments in energy infrastructure, transmission network expansion and grid modernisation, transportation systems, digital infrastructure and domestic industrial capabilities. Increasing requirements for reliable and resilient power networks, alongside rising electricity demand, are creating sustained investment opportunities across the global infrastructure landscape.

The transition toward electrification, renewable energy and digital infrastructure continued to strengthen investment momentum globally and is expected to remain an important growth driver over the medium term.

Growing renewable energy capacity, rising electricity consumption, expanding data-centre infrastructure and the need to modernise ageing power networks are reinforcing the requirement for substantial investments in transmission and distribution infrastructure.

These structural trends, supported by energy-security priorities and long-term decarbonisation objectives, are expected to remain important drivers of infrastructure investment and economic activity over the medium to long term.

Outlook

The global economy entered 2026 on solid footing, with momentum building across major advanced and emerging markets. Prior to the outbreak of war in the Middle East in late February 2026, forecasts were poised for an upward revision, buoyed by a technology investment boom, an easing of trade policy tensions, supportive fiscal conditions and accommodative financial markets. That trajectory has since been interrupted.

Despite near-term uncertainties, the medium-term outlook for infrastructure investment remains constructive. The growing focus on energy security, grid resilience, renewable energy integration, electrification and digital infrastructure is expected to sustain investments in power transmission and distribution networks globally. Governments and utilities are increasingly prioritising the expansion and modernisation of electricity infrastructure to accommodate rising power demand, strengthen energy systems and support the transition towards cleaner sources of energy.

INDIAN ECONOMIC OVERVIEW

India continued to reinforce its position as one of the fastest-growing major economies globally during FY 2025-26. Economic growth remained supported by resilient domestic demand, strong public infrastructure spending, improving private investments and sustained manufacturing activity. According to the National Statistical Office (NSO) estimates, Indias GDP growth is expected at approximately 7.6% in FY26, supported

by strong macroeconomic fundamentals and continued infrastructure expansion.

India remains among the worlds largest growing economies and continues progressing toward its long-term ambition of becoming a developed economy by 2047.

The Governments sustained focus on infrastructure development, manufacturing competitiveness and economic reforms continued to support investment activity across sectors. India also achieved a significant structural milestone during the year, surpassing Japan to become the worlds fourth-largest economy.

The Union Budget maintained a strong emphasis on capital expenditure and infrastructure-led development of Rs. 17.15 lakh crore, representing approximately 4.4% of GDP and a 9% increase over FY26. Continued investments across transport, logistics, energy digital infrastructure and manufacturing ecosystems are expected to support long-term economic expansion.

Structural growth drivers remain intact and continue to be supported by:

• demographic strength,

• rising domestic consumption,

• expanding manufacturing capability,

• digital transformation, and

• increasing urbanisation.

Programmes focussed on ease of doing business, manufacturing growth and industrial competitiveness continue to strengthen Indias investment attractiveness.

Outlook

India is expected to continue outperforming most major economies. Growth is projected at approximately 6.5%-6.7%, supported by strong domestic demand, improving investment activity and infrastructure creation. India is expected to continue strengthening its position as a global manufacturing and investment destination while maintaining macroeconomic stability. Continued focus on capital formation, infrastructure expansion and industrial development is expected to sustain long-term economic growth.

The country remains on course to become the worlds third-largest economy by 2030, with a GDP target of USD 7.3 trillion. Private consumption is expected to remain the primary growth engine, supported by declining inflation, rising real incomes, strong agricultural output sustaining rural spending, and employment-driven urban demand.

On the investment side, government infrastructure spending across roads, railways, and defence continues to provide a solid industrial foundation, with private sector capital formation picking up in manufacturing, real estate, and digital infrastructure -including data centres.

INDUSTRIAL OVERVIEW

Global Transmission and Distribution (T&D) Sector

The global power sector witnessed meaningful expansion in FY 2025-26, driven by rising electricity demand and a significant renewable energy build-out. Renewable capacity additions rose 16% to 800 GW - the 23rd consecutive record year - with low-emissions sources reaching 43% of the global electricity mix, the highest-ever. Global electricity demand grew 3%, with data centres (+17%) and EV adoption (contributing over 10% of demand growth) emerging as key structural drivers. Notably global

renewable generation virtually matched coal-fired generation for the first time in 2025.

In Africa, energy demand growth continue to accelerate at a higher rate of 3.4% in 2025. However, the continent continues to face a fundamental infrastructure gap with more than 600 million people not connected to reliable electricity supply. The absence of robust transmission networks, cost-reflective tariffs and modern system operations are some of the constraints.

The United States was among the most dynamic electricity markets in 2025, with demand growing 2% -more than three times the prior decades average and the second-highest growth rate since 2000 (excluding post-recession years). Data centres alone accounted for roughly half of total consumption growth, with the buildings sector contributing 80% of overall demand growth. Solar PV generation rose over 20%, while natural gas retained its central role at 40% of generation.

The Middle East remained one of the strongest-performing regions for energy demand and clean energy investment. Electricity demand grew at nearly 4% in 2025, slightly above 2024 levels, supported by economic expansion, rising air conditioning penetration, and accelerating oil-to-gas switching in the power sector. The region is also emerging as a significant player in the global AI and digital economy reinforcing the long-term case for grid expansion and clean energy investment across the Gulf.

The global electric power transmission and distribution equipment market size is valued at USD 256.70 billion in 2025 and is predicted to increase from USD 271.84 billion in 2026 to approximately USD 453.09 billion by 2035, expanding at a CAGR of 5.85% from 2026 to 2035.

Investment in grid infrastructure is increasing due to rising global electricity demand, rapid renewable energy integration, and the modernisation of ageing power

networks. Growing urbanisation, industrialisation, and the accelerating adoption of electric vehicles are further driving the need for efficient and reliable transmission and distribution systems. In addition, governments and utilities are investing heavily in smart grids, digital monitoring systems, substations, transformers, and transmission lines to enhance grid reliability, improve energy efficiency, and support the transition toward cleaner energy sources.

Outlook

The structural shift towards the "Age of Electricity" is accelerating, with electricity demand projected to grow at least 2.5 times faster than overall energy demand through 2030. This is due to growing need between all nations for the energy independence, especially when oil and gas have been used as leverage in various conflicts. Annual grid investment must rise by around 50% by 2030 from roughly USD 400 billion today, with over 2,500 GW of projects currently stalled in connection queues globally - highlighting transmission and grid infrastructure as the defining bottleneck of the energy transition.

Africa represents one of the most compelling long-term infrastructure investment opportunities globally.

Achieving universal electricity access requires USD 15 billion per year in near-term financing, with the IEA projecting total electricity sector investment must scale from USD 30 billion in 2022 to over USD 120 billion by 2030, and overall energy investment reaching USD 240 billion annually creating a substantial and durable pipeline for power transmission and grid infrastructure development. SDG 7 and M300 programs are helping the sovereigns to augment their energy position by investing into energy infrastructure.

US electricity consumption is projected to grow at nearly 2% annually through 2030 - more than twice the pace of the past decade - with data centres and AI infrastructure serving as structural, multi-decade demand drivers.

This sustained growth underpins a strong pipeline of investment in transmission upgrades, grid modernisation, and renewable integration, further supported by federal policy and funding commitments.

The Middle East outlook is underpinned by sustained electricity demand growth of nearly 4% annually, accelerating clean energy diversification, and the regions growing role in the global AI and digital economy.

The continued shift from oil to gas in power generation, rapid scaling of solar PV, and cross-border energy and AI cooperation agreements collectively reinforce a strong long-term case for grid infrastructure and clean energy investment across the Gulf.

INDIAN TRANSMISSION AND DISTRIBUTION (T&D) SECTOR

Indias total power generation in FY26 reached 1,845.921 BU. The share of non-fossil fuels in total generation reached 29.2% in 2025-26 (538.97 BU). India Ranks third globally in Renewable Energy Installed Capacity.

It achieved the milestone of 50% of its cumulative electric power installed capacity from non-fossil fuel sources in June 2025, five years ahead of the 2030 target set under its Nationally Determined Contribution (NDC) to the Paris Agreement. As of March 31, 2026, the high voltage transmission lines totalled over 506,513 circuit kilometres (ckm) during the year

The Government of India has outlined an investment opportunity of approximately Rs. 9.15 lakh crore in the

transmission sector through 2032 to strengthen and expand the countrys power evacuation infrastructure.

The investment programme is expected to support the development of new transmission corridors, augmentation of existing networks and deployment of advanced transmission technologies required to accommodate the countrys rapidly evolving generation mix.

Despite a strong structural outlook, ordering activity witnessed a temporary slowdown in FY26, with fewer schemes awarded compared to the previous year, primarily due to execution constraints rather than any demand weakness.

Emerging segments such as high-voltage direct current (HVDC) projects are also expected to drive future growth, with a steady pipeline of project awards anticipated in the coming years. Significant strides in power transmission & substation capacity in-line with governments efforts seamless transfer of electricity across regions, successfully realising the vision of One Nation-One Grid- One Frequency.

AI is fundamentally transforming the electric power transmission and distribution (T&D) equipment industry by enabling the shift from traditional, one-way systems to intelligent, AI-driven smart grids. The technology enhances grid efficiency, reliability and resilience through applications like predictive maintenance for key assets such as transformers and power lines, which helps prevent failures and extend equipment lifespan.

Furthermore, AI is crucial for seamlessly integrating variable renewable energy sources (like solar and wind) into the grid by providing accurate load forecasting and real-time balancing of supply and demand. As of 31st March 2026, the Inter-State Transmission System (ISTS) operated by Central Transmission Utility of India Limited comprised 2,15,807 ckm of transmission lines, 5,89,580 MVA of transformation capacity and 314 substations. The project pipeline remained robust, with 25 transmission schemes under bidding, 230 under construction and 14 under approval, underscoring the sectors pivotal role in supporting Indias energy transition and future power demand growth.

Indias substation capacity expansion reached new heights in FY 2025-26, with a remarkable addition of 1,13,013 MVA of transformation capacity reflecting an impressive 30.75% year-on-year growth over the 86,433 MVA added in FY 2024-25 - underscoring the countrys accelerating momentum in strengthening its power transmission infrastructure.

Substation capacity increased to 14,50,526 MVA in 2025-26, compared to 13,37,513 MVA in 2024-25, reflecting

continued expansion of Indias power transmission infrastructure. The capacity addition of nearly 1,13,000 MVA YoY highlights strong investments in grid modernisation and rising power demand driven by renewable energy integration and economic growth.

Outlook

Indias power transmission and distribution (T&D) sector is set for a sustained growth trajectory supported by a robust capital expenditure pipeline of about Rs. 9 trillion (USD 96.70 billion) through 2032. The report highlights that the ongoing capex cycle, which began in 2022-23, has already led to a sharp rise in order books, revenues and margin profiles for industry participants.

The Ministry of Power has released the Draft National Electricity Policy (NEP) 2026, outlining a long-term Power Vision 2047 to transform Indias electricity sector. The policy targets a sharp rise in per capita electricity

consumption - from around 1,460 kWh in FY 2024-25 to

2.000 kWh by 2030 and over 4,000 kWh by 2047 - driven by economic growth, industrialisation, and rising living standards.

On the sustainability front, the NEP aligns with Indias climate commitments, targeting a 45% reduction in emissions intensity below 2005 levels by 2030 and net-zero carbon emissions by 2070. To meet growing demand while achieving these goals, the policy proposes large-scale renewable energy integration, widespread deployment of energy storage solutions, and an expansion of nuclear power capacity to 100 GW by 2047 - collectively building a diversified and low-carbon energy mix for the future.

INDIAN CIVIL CONSTRUCTION SECTOR

The India construction market size was valued at USD

685.0 billion in 2025. In CY2025, the construction sector maintained a healthy momentum, even as growth moderated from the previous highs. The construction GVA expanded by 9.4% in FY2025, but activity slowed in early FY2026 (Apr-Sep 2025 with 7.2-7.6% YoY expansion) due to an early onset and prolonged monsoons and softness in State government capital outlay and net lending (especially in Q2 FY2026). Despite the same, the sectors fundamentals remain robust and ICRA expects construction GVA growth of 6.5-7.5% for FY2026 - albeit lower than the 9-11% seen in FY2023-FY2025, yet still comfortably above the countrys long-term trend.

Outlook

The Indian civil construction is projected to reach USD 1,245.7 billion by 2034, growing at a compound annual growth rate of 6.87% from 2026-2034.

The budget places strong emphasis on infrastructure and civil construction through higher public capital expenditure, industrial corridor development, transport connectivity, and urban infrastructure expansion. Key announcements include new Dedicated Freight Corridors, development of 20 National Waterways, high-speed rail corridors, integrated East Coast Industrial Corridor projects, and continued infrastructure development in Tier II and Tier III cities.

INDIAN RAILWAYS SECTOR

Indian Railways, as of 2025, has expanded 35,000 km of track, produces 30,000 wagons and 1,500 locomotives annually, increased freight share to 29% and cut accidents by 80%. Indian Railways gross revenue stood at Rs. 2.79 trillion (USD 31.57 billion) for FY26, reflecting the continued strength of its freight-led earnings model and steady growth in passenger revenues.

The Union Budget 2026-2027 introduced five new reforms. The broader "Reform Express" programme is part of Indian Railways larger modernisation agenda for 2026, which includes technology adoption, AI integration, safety improvements, and better passenger experiences.

Outlook

Indian Railways enters FY 2026-27 with strong momentum, backed by a record capital expenditure allocation of Rs. 2,93,030 crore (USD 32.56 billion) under the Union Budget 2026-27. Rail infrastructure investment is targeted at Rs. 50 lakh crore (USD 715.41 billion) by 2030, underscoring the scale of the governments long-term commitment to the sector Near-term growth is expected to be driven by multitracking projects, station redevelopment under the Amrit Bharat Station Scheme, and the continued build-out of dedicated freight corridors - collectively aimed at reducing logistics costs and strengthening industrial supply chains.

On the passenger front, plans for 1,000 new trains and bullet train operations by 2027, alongside seven newly proposed high-speed corridors and the induction of Vande Bharat Sleeper trainsets, will progressively redefine inter-city connectivity. The government has further announced a 5,000 km Metro rail network across 100 cities by 2047, reinforcing urban mobility as a structural priority. Freight volumes are projected to sustain their upward trajectory, with the wagon market expected to nearly double to Rs. 25,000-30,000 crore by 2031.

With India projected to account for 40% of global rail activity by 2050, Indian Railways is well-positioned to anchor the countrys logistics and mobility transformation.

POLES AND LIGHTING

The street lighting poles and columns market has seen a meaningful upward revision in its market size estimates based on the latest available data. The Street Lighting Poles and Columns market was valued at USD 18,500 million (approximately USD 18.5 billion) in 2025 and is

projected to reach USD 29,500 million (approximately USD 29.5 billion) by 2033, growing at a CAGR of 5.82% during the forecast period 2026-2033.

Asia-Pacific is expected to be the fastest-growing region, capturing a market share of 38.7%, with China dominating the global market with a 22.5% share, driven by strong R&D investment and robust industry infrastructure.

The global smart pole market size was valued at USD 6.07 billion in 2025 and is projected to grow from USD 6.87 billion in 2026 to USD 25.17 billion by 2034, exhibiting a CAGR of 17.60% during the forecast period. Asia Pacific dominated the market with a share of 33.90% in 2025.

Smart Poles represent the next-generation of urban infrastructure, integrating advanced technologies such as IoT, 5G, and sensor-based systems to enhance city management and public services. These poles go beyond traditional lighting functions by incorporating surveillance cameras, environmental sensors, EV charging stations, and communication modules to provide real-time data and connectivity across city networks.

The India solar street lighting market size reached USD 1.2 billion in 2025. Looking forward, IMARC Group expects the market to reach USD 3.8 billion by 2034, exhibiting a growth rate (CAGR) of 13.09% during 2026-2034.

The market is driven by several government initiatives, rural electrification, smart city projects, and declining solar panel costs. Moreover, the growing environmental concerns, energy efficiency policies, advancements in battery storage, and increasing adoption in highways, urban areas, and remote locations further propel the India solar street lighting market share.

COMPANY OVERVIEW

Transrail Lighting Limited is a globally diversified Engineering, Procurement, and Construction (EPC) company with over four decades of expertise, offering end-to-end turnkey solutions to clients across the globe. The Company has carved a distinctive position in the power transmission and distribution space through its vertically integrated manufacturing capabilities — spanning lattice structures, conductors, and monopoles — and a robust execution track record reflected in the cumulative construction of 36,900+ CKM of transmission lines, supply of 1.50 million+ MT of towers, and 2,26,000+ KM of conductors.

The business is structured around five core verticals:

Power Transmission and Distribution, Civil Construction, Poles and Lighting, Railways, and Solar EPC. Across each segment, Transrail oversees the full project lifecycle — from design and engineering through manufacturing, testing, construction, and commissioning — backed by 19,500+ man-months of in-house design and engineering experience and 4 integrated manufacturing facilities.

With a presence spanning 63 countries across the Americas, Europe, Africa, and Asia, and an unexecuted order book and L1 of USD 2 billion, the Company has firmly established itself as a trusted partner for large-scale

infrastructure development globally. Its 2,700+ strong workforce is complemented by a rigorous compliance framework, with certifications including ISO 9001:2015,

ISO 14001:2015, ISO 27001:2013, and ISO 45001:2018, along with CE and NABL external validations - reflecting its commitment to quality environmental stewardship, and occupational safety.

Underpinned by operational excellence and a forward-looking growth strategy Transrail Lighting Limited remains well positioned to build on its legacy as a reliable and capable player in the global EPC landscape.

BUSINESS OVERVIEW

Power Transmission & Distribution (Domestic)

During the year, Domestic Business Revenue continued to show growth trend with 16% increase in revenue from Rs. 1,550 crore in FY 2024-25 to Rs. 2,653 crore in FY 2025-26

The domestic Power T&D segment is the core and largest revenue contributor for Transrail, accounting for the majority of its order book and execution activity.

The Company delivers comprehensive, end-to-end T&D solutions - encompassing in-house design, manufacturing, tower testing, and turnkey EPC installation - backed by a large galvanising facility and a highly skilled technical workforce.

Its domestic capabilities span transmission line EPC up to 1,200 kV, AIS and GIS substation EPC up to 765 kV, underground cabling, HVDC lines up to 800 kV, rural electrification and high-performance HTLS conductors. Self-manufactured components contribute 65-70% of the overall contract value, providing significant cost and quality advantages.

The domestic segment witnessed exceptional execution momentum during FY26. Several large-scale, high-complexity projects were commissioned across the year. Notably, three packages of the 765 kV D/C transmission line project at Khetri Narela for Powergrid were completed - a landmark achievement recognised with felicitation by the Chairperson of CEA and CMD of PGCIL.

Additional domestic project commissionings included the 765 kV D/C Ahmedabad-Lakadia and 765 kV D/C KPS1- KPS2 (Khavda) lines for Powergrid, three lines of 400 kV transmission line projects in Solapur (Maharashtra), the 132 kV Hazipur Chappra Monopole Transmission Line, and cooling towers at Udangudi (Tamil Nadu) and Yadadri (Telangana).

On the manufacturing front, the Deoli Tower Plant was awarded an A Grade rating by POWERGRID for quality, safety, and operations, and received the NSCI Certificate of Merit 2025.

This year has been a defining one for Transrail in terms of strengthening our manufacturing capabilities.

We successfully doubled our tower manufacturing capacity from 84,000 MTPA to 1,72,400 MTPA, with plans to further enhance it to 1,96,000 MTPA in FY27. In parallel, we are

undertaking significant expansions in our conductor manufacturing facilities. Our conductor capacity is being increased from 24,000 KMPA to 49,500 KMPA, a milestone that has progressed well during the year and is expected to be achieved in FY27.

Power Transmission & Distribution (International)

During the year, international business revenue continued to show substantial growth and it increased to Rs. 3,394 crore in FY 2025-26 from Rs. 3,016 crore in FY 2024-25.

This revenue is mainly contributed by SAARC, Southeast Asia and Africa region. This performance was primarily driven by our operations across the SAARC, Southeast Asia and African regions. Our international portfolio comprises EPC projects in power transmission lines, distribution networks, substations and underground cabling, along with the supply of transmission towers and conductors.

Transrail has built a formidable international presence over four decades, operating across 63 countries with active projects in 20+ nations. The Company executes large-scale EPC projects in transmission lines, substations, rural electrification, and supply of towers and conductors across Africa, SAARC, Southeast Asia, GCC, Latin America, and Europe.

International projects are predominantly funded through multilateral agencies such as the World Bank, African Development Bank (AfDB), KfW, EBID, and BOAD, providing payment security and project stability. International tenders are typically quoted in hard currencies (USD, EUR), providing a natural hedge against currency risk.

International operations remained highly active during FY26. Projects commissioned during the year includes 230 kV DC Line Rupoor-Dhamrai in Bangladesh, the 138 kV Substation and Transmission Line project in Nicaragua, the 132 kV Transmission Line project in Eswatini (Africa), and the 400 kV Rupoor-Gopalganj River Crossing Transmission Line. On the order intake front, New order worth Rs. 3,074 crore were added across various countries including Tanzania, Tunisia, Abu Dhabi, Mozambique etc.

The total unexecuted international order book stood at Rs. 6,225 crore as on March 2026.

Backed by a diversified geographical presence, strong execution capabilities and a healthy order pipeline, our international business remains a key growth driver and is well positioned to capitalise on the increasing global investments in power transmission and energy infrastructure.

CIVIL CONSTRUCTION

Revenue from Civil Business achieved a strong performance in FY 2025-26 with revenue of Rs. 412 crore,

The civil business secured 4 projects during the year at a value of more than Rs. 547 crore. This strengthens Civil Businesss position in the bridges and elevated roads sector.

Transrails Civil Construction vertical operates as a turnkey civil construction provider with strong project management depth, skilled human resources, and a commitment to building durable, advanced infrastructure. The segments capabilities span bridges, tunnels, elevated roads, and cooling towers - enabling the Company to participate in large-scale civil infrastructure projects across both domestic and select international markets. The division, established in 2018, leverages the Companys broader EPC execution platform and procurement strength to deliver competitive, integrated civil solutions.

The Civil Construction segment continued to contribute meaningfully to the Companys diversified revenue base during FY26. Cooling towers at Udangudi (Tamil Nadu) and Yadadri (Telangana) were successfully commissioned during the year The landmark 10.2 km long road bridge over the River Kosi in Bihar remains among the most visible ongoing civil projects, reflecting the Companys ability to handle complex, large-span civil infrastructure. The Company continues to target selective growth in this segment, focussing on technically demanding projects where its engineering capabilities provide a competitive edge.

POLES & LIGHTING

Transrail has continued to have a prominent market position as a holistic pole and lighting service provider with a turnover of Rs. 261 crore for the financial year 2025-26.

Transrail has emerged as one of the leading and most recognised names in Indias lighting infrastructure industry. The Poles & Lighting segment operates out of the Companys manufacturing facility in Silvassa and offers a comprehensive product range including high masts, street poles, luminaries, traffic lights, power T&D monopoles, stadium lighting, derrick structures, railway portals, road gantries and signages, flag masts, solar streetlights, and decorative poles. The segment serves both domestic infrastructure clients and select international markets, leveraging the Companys integrated manufacturing and EPC delivery capabilities.

The Poles & Lighting segment delivered steady performance during FY26, contributing to both order inflows and execution revenues. A notable project highlight was the supply of poles for the Bullet Train project in India, reflecting the segments ability to serve premium, technically demanding national infrastructure programmes.

The GG elevated flyover facade lighting project was also successfully completed during FY26. The Hazipur Chappra Monopole Transmission Line project was another significant commissioning during the year. The Company continues to leverage its manufacturing scale and technical expertise to grow this segment selectively particularly in the railways, smart city, and urban infrastructure domains.

RAILWAYS

Transrails Railway business continued its growth momentum during FY 2025-26 with revenue of Rs. 158 crore.

Transrails Railways segment delivers integrated railway infrastructure solutions for large-scale national projects.

Its capabilities span overhead electrification (OHE), signaling and telecommunication services, earthwork,

track linking, and other composite works. The segment benefits from the Companys established relationships with railway sector clients and its experience in managing large, geographically dispersed project sites. The Railways division was first awarded a turnkey electrification project in 2017 and has since steadily grown its presence in this priority sector.

The Railways segment recorded meaningful progress during FY26. The OHE project completed for RNVL was among the key project during the year. The Chennai- Gudur railway electrification project remains one of the significant ongoing assignments, alongside the supply of electric masts for the Bullet Train project - a prestigious, technically demanding engagement that underscores the Companys credibility in high-standard railway infrastructure.

As India accelerates its railway modernisation and electrification programme, including expansion of high-speed corridors and dedicated freight routes, the segment is well-positioned to capture a greater share of this growing opportunity in the coming years.

BUSINESS GROWTH DRIVERS

1. Four-Decade Legacy with Proven Execution Capabilities

Transrails journey which began in 1984 with foundational work on 132 kV lines, has grown into a globally respected EPC powerhouse. With over 36,900 + CKM of transmission lines constructed,

1.50 million MT of towers supplied, and 2,26,000+ KM of conductors delivered, the Companys track record of successful execution across complex, large-scale

projects across 63 countries stands as a formidable competitive advantage.

2. Fully Backward-Integrated Manufacturing Platform

The Company operates five integrated manufacturing facilities - tower factories at Deoli, Butibori and Vadodara, a conductor factory at Silvassa, and a pole factory at Silvassa. It is also supported by a dedicated Tower Testing Facility and R&D Centre. Self-manufactured products typically contribute 65-70% of EPC contract value, significantly reducing third-party dependency, improving margin control, and enabling end-to-end quality assurance from design through despatch.

3. Diversified and Well-Balanced Order Book

With an unexecuted order book of Rs. 16,313 crore as on March 2026, growing at a CAGR of 26% since FY22, the Company maintains a healthy and strategically balanced mix of domestic (61%) and international (39%) orders. The order book spans multiple verticals - Power T&D, Civil Construction, Railways, Poles & Lighting, and Solar EPC - providing revenue visibility and resilience against sector-specific slowdowns.

4. Strong and Consistently Improving Financial Profile

Transrail has delivered robust financial growth across all key metrics. Revenue grew 3 times in last 5 years, reflecting a strong growth trend. EBITDA grew at a CAGR of 41% and PAT at a CAGR of 59% over the same period. The Companys Return on Capital Employed improved from 14.94% in FY22 to 25.79% in FY26, while its credit rating was upgraded to CRISIL AA-/Stable with an change in outlook to and IND A+/

Positive in August 2025. These were reaffirmed in March 2026, reflecting financial discipline and strong cash generation.

5. Strong In-House Design, Engineering & Testing Infrastructure

With over 19,500+ man-months of design and engineering experience, the Company possesses deep in-house capability that reduces reliance on external consultants and accelerates project delivery. Its NABL-accredited Tower Testing Facility R&D Centre, and globally certified quality systems (ISO, CE) enable it to handle technically complex projects up to 1,200 kV, supporting both domestic and international mandates with confidence and precision.

BUSINESS STRATEGIES 1. Significant Capacity Expansion to cater to the Growing Demand

Transrail is executing a significant CAPEX programme to nearly double its manufacturing capacity. Post-CAPEX, tower manufacturing capacity will increase from 84,000 MT per annum to 1,96,000 MT per annum, and conductor capacity will expand from 24,000 KM to 49,500 KM. The Phase 1 brownfield expansion of the existing tower manufacturing facility at Deoli has been completed, along with the commissioning of the greenfield tower manufacturing plant at Butibori in April 2026. The conductor capacity expansion is on track for completion by Q1 FY27, while the Phase 2 brownfield expansions for both towers and conductors are expected to be completed by Q2 FY27.

2. Geographic Diversification and Penetration of New International Markets

The Company is systematically expanding its global footprint, now spanning 63 countries with active operations in 20+ countries. During FY26, Transrail entered four new international markets - Botswana, Abu Dhabi, Tunisia and Djibouti - strengthening its position across Africa, GCC, South Asia and Latin America. This geographic spread helps de-risk revenue concentration and taps into growing infrastructure investment pipelines globally.

3. Business Vertical Diversification Beyond Core T&D

While Power T&D remains the dominant segment, Transrail has strategically diversified into high-growth adjacent verticals. The Company has made a foray into Solar EPC (International), expanded its Civil Construction capabilities to include bridges, tunnels, cooling towers, and elevated roads, and deepened its Railways portfolio covering overhead electrification, signaling and track linking. This multi-vertical approach enables the Company to pursue a broader universe of opportunities and cross-leverage its engineering capabilities.

4. Digital Transformation and Operational Modernisation

The Company has rolled out SAP RISE, an upgrade from SAP HANA, across its operations during 9MFY26. This enterprise-wide digital transformation initiative enhances operational efficiency real-time project monitoring, supply chain visibility and financial reporting accuracy - building a scalable technology backbone to support the Companys growing complexity and global scale.

5. Strengthening the Leadership Pipeline and Talent Base

Transrail has grown its workforce from 2,400+ employees in H1FY26 to 2,700+ employees by Q3 FY26, reflecting deliberate investment in human capital to support accelerating business growth. The Companys leadership team, anchored by a seasoned promoter with five decades of industry experience and a

professional management team with diverse expertise in Power T&D, Solar and international markets, continues to strengthen the bench through focussed hiring, capability building, and internal development initiatives.

FINANCIAL OVERVIEW

The Company achieved a turnover of Rs. 6,880 crore for the year ended March 31, 2026. This is compared to a turnover of Rs. 5,308 crore for the previous year. These figures are reported on both a standalone and consolidated basis. Turnover for the year ended March 31, 2026 increased by 30% on both a standalone and consolidated basis when compared with the previous year. With a promising order book and good market potential across all the business verticals we operate in, your Company is well-positioned for future growth.

KEY FINANCIAL RATIOS

Key Financial Ratios	As at March 2026	As at March 2025
Debtors Turnover	3.96	4.03
Inventory Turnover	9.02	9.85
Interest Service	3.75	3.42
Coverage Ratio
Current Ratio	1.31	1.31
Debt Equity Ratio	0.29	0.34
Operating Profit Margin %	11.92%	12.73%
Net Profit Margin %	5.82%	6.10%
Return on Net Worth %	19.39%	21.63%

Assessment of key ratios have been derived at as follows:

(Debtors Turnover = Revenue from Operations/Trade Receivables! (Inventory Turnover = Revenue from Operations/Inventoriesl

(Interest Service Coverage Ratio = Profit Before Depreciation and Amortisation, Interest and Tax/Interest)

(Current Ratio = Current Assets/Current Liabilities)

(Debt Equity Ratio = Total Debt /Total Equity including all reserves)

(Operating Profit Margin % = EBITDA/Revenue from Operations)

(Net Profit Margin % = Net Profit after Tax/Total Income)

(Return on Net Worth % = Net Profit After Tax/Average Net Worth (Total Equity including all reserves))

Change in debt equity ratio - Change is due to expanded equity base of the company from funds raised through IPO& Pre IPO placement of equity share at a premium and also due to the profit earned during the year.

Change in Return on net worth - Change is due to expanded equity base due to funds raised through IPO, Pre IPO placement and profit earned during the year though it is partly offset by increase in profit compared to last year

RISK MANAGEMENT

Transrail operates primarily in the Engineering, Procurement, and Construction (EPC) space, with a strong emphasis on power transmission and distribution. With projects spanning 20+ countries, the Company is exposed to a range of risks inherent to large-scale turnkey projects. To address this, Transrail has developed a comprehensive risk management framework that functions across multiple levels of the organisation and undergoes periodic reviews to remain aligned with evolving internal and external conditions.

Risk	Description	Mitigation
Geopolitical Risk	Political instability or sudden changes in certain geographies can disrupt project execution and supply chains.	Prior to bidding, a thorough country-level risk assessment is conducted, and bids are submitted only when risk levels are acceptable. Secure funding mechanisms are put in place, and ongoing projects are closely monitored with strategies developed around operational feasibility, strategic sourcing, and disruption management.
Risk of Reduction in Order Intake	A slowdown in infrastructure investment can result in lower order inflows and reduced revenue.	The Company focusses primarily on the Power T&D sector, which remains a high-priority segment across most nations. Its broad global presence, strong foothold in emerging and underdeveloped economies, and diversification into Railways, Civil, Solar EPC, and Pole & Lighting help cushion the impact of regional slowdowns.
Commodity Price Variation Risk	Fluctuations in key commodities such as steel, aluminium, zinc, and cement - driven by supply-demand shifts, competition, and policy changes - can erode profitability, particularly under fixed-price contracts.	A dedicated commodity risk management framework is in place. Price escalation clauses are built into certain contracts to pass input cost variations to clients. For firm-price contracts, Commodity Forward Contracts or back-to-back firm-price vendor agreements are used. Where hedging is not feasible, adequate contingencies are factored in based on market experience.
Execution Risk	Challenges such as manpower shortages, difficult terrain, Right of Way (RoW) dependencies, and delays in regulatory approvals and clearances can hinder project timelines.	Each project is closely monitored with tailored mitigation strategies. Advanced technologies are employed to assess terrain and soil conditions, and proactive coordination with clients ensures timely resolution of on-ground challenges.
Interest Rate Fluctuation Risk	Volatility in interest rates can adversely affect the Companys profitability.	Borrowing levels are regularly reviewed to reduce working capital intensity and strengthen overall cash flows.
Foreign Currency Fluctuation Risk	Operating across multiple countries exposes the Company to exchange rate volatility which can impact financial performance.	A structured framework monitors and manages currency risk in line with the Companys Risk Management Policy. International tenders are typically quoted in hard currencies such as USD or EUR, while onshore contract portions are quoted in local currencies to maintain a natural hedge.
Environment, Health & Safety (EHS) Risk	EHS-related incidents can endanger employees and workers on-site.	EHS responsibilities are embedded in team KRAs. Dedicated onsite safety officers, regular Corporate Safety Audits, monthly EHS Steering Committee reviews, and targeted training programmes collectively promote a proactive safety culture.
Succession Planning Risk	Insufficient planning for leadership transitions at key positions can threaten long-term organisational stability and growth.	Critical roles and high-potential talent are identified annually through organisational management reviews. The leadership pipeline is continuously strengthened through structured hiring, retention initiatives, and periodic succession plan reviews for the senior management team.
Cyber Security Risk	Cyber threats and attacks pose a risk to the Companys IT infrastructure and critical digital assets.	Robust cybersecurity measures, including antivirus protection and firewall systems, are in place. Recommendations from external IT security audits are regularly implemented, and network devices, server operating systems, and hardware are upgraded periodically to maintain a secure IT environment.

HUMAN RESOURCES

Transrail recognises its Human Capital as the driving force behind transforming lives, in direct alignment with the companys vision of creating meaningful, lasting change. People remain at the heart of our growth strategies, with core objectives centred on individual development, continuous learning, and unlocking their fullest potential.

The Human Resource function played a pivotal role this year, actively supporting business operations by building a future-ready talent pipeline and strengthening capabilities through core competencies. A significant area of focus was developing subject matter expertise in emerging business domains such as solar EPC. This was achieved through targeted lateral hiring for critical roles, ensuring the company establishes a robust and sustainable talent pipeline that drives business growth while introducing new capabilities.

Our Graduate Development Program provides young and ambitious individuals across the country with an opportunity to contribute to Transrails nation-building mission. A select group of aspiring Engineers, Chartered Accountants and Cost and Management Accountants - both at graduate and postgraduate levels - were welcomed into the organisation through this initiative. The program strengthens our talent bench by creating a steady pipeline that supports growth across all business verticals, while nurturing Core Competencies and shaping the Leaders of Tomorrow.

As part of our commitment to nurturing future leaders, Transrail partnered with the Institute of Management Technology (IMT), Nagpur to deliver a Leadership Development Programme for its employees. The programme focussed on strengthening leadership capabilities through interactive learning, case studies, and collaborative discussions on strategic thinking, problem-solving, communication and team management.

With our international business expanding at a rapid pace, Internal Job Posting (IJP) processes have opened up exciting new avenues for our existing workforce. This has enabled employees to actively participate in and benefit from the momentum of our growing global footprint.

As of March 31, 2026, our total workforce stands at more than 2,700 employees.

INTERNAL CONTROLS SYSTEMS AND THEIR ADEQUACY

The company has established an Internal Control framework designed to evolve with its growing needs.

This framework is integrated with SAP and other ERP systems, along with various operational procedures, to enforce controls that protect company assets, improve efficiency oversee systems, and ensure legal and regulatory compliance. These controls are customised to suit the organisations scale, structure, and complexity -both at the broader organisational level and within individual processes - while maintaining accurate and dependable financial reporting.

The Internal Audit team regularly conducts audits across multiple locations, examining all key functions with particular attention to operations and control systems. This thorough approach ensures consistent oversight of

all company activities. The team addresses risks across a wide spectrum - including strategic, commercial, safety operational, compliance, and financial risks - across every business segment.

Senior management and the Boards Audit Committee receive regular updates, including recommendations for process improvements and progress reports on their implementation. The Audit Committee routinely assesses the effectiveness of the Internal Control system, offers direction, and where needed, initiates further measures such as benchmarking against industry best practices.

The Internal Control framework also incorporates a whistleblower mechanism, which provides directors, employees and external parties a safe channel to raise concerns, report misconduct, or flag potential fraud - free from the risk of retaliation or unjust treatment.

CAUTIONARY STATEMENT

Within this document are forward-looking statements, which concern the expected future events and financial and operating results of Transrail Lighting Limited.

Such statements naturally depend on assumptions and are subject to inherent risks and uncertainties. There is a notable risk that these assumptions, predictions, and forward-looking statements will not turn out to be accurate. Readers are advised not to place undue reliance on them, as various factors could cause actual future results and events to differ significantly from what is presented. Therefore, this document is governed by its disclaimer and is fully qualified by the assumptions, qualifications, and risk factors detailed in the managements discussion and analysis found in Transrail Lighting Limiteds Annual Report for FY 2025-26.