Ultracab India Ltd Management Discussions

Report

1. ECONOMIC OVERVIEW AND OUTLOOK

The financial year 2025-26 was characterized by a dynamic global economic environment influenced by geopolitical developments, evolving trade patterns, fluctuations in commodity prices and inflationary pressures across several regions. Despite these challenges, the Indian economy remained one of the fastest-growing major economies, supported by robust domestic consumption, continued infrastructure investments, manufacturing growth and government-led development initiatives.

Indias power and infrastructure sectors continued to witness significant investments during the year, driven by expansion of transmission and distribution networks, renewable energy capacity additions, urbanization and industrial development. These factors contributed positively to demand across the wires and cables industry, which remains an integral component of the countrys infrastructure growth story.

Against this backdrop, Ultracab (India) Limited ( Ultracab or the Company ) continued to strengthen its market presence through its established brand, diversified product portfolio and extensive distribution network. During the year, the Company further expanded its market offerings under the Ultracab brand to include products such as Medium Voltage Covered Conductors (MVCC), High Tension (HT) Cables and Power Control Cables (PCC) through strategic commercial arrangements, enabling it to address a broader spectrum of customer requirements in the power and infrastructure sectors.

The Company remains focused on enhancing operational efficiency, strengthening customer relationships, expanding market reach and delivering quality products and services. Supported by favorable industry fundamentals, increasing electrification, renewable energy investments and modernization of power infrastructure, the management remains confident about the long-term growth prospects of the business and its ability to create sustainable value for all stakeholders.

2. INDUSTRY STRUCTURE AND DEVELOPMENTS

Ultracab (India) Limited is engaged in the manufacturing and export of wires and cables and has established a strong presence in both domestic and international markets since its incorporation in 2007. Over the years, the Company has built a reputation for quality, reliability and customer-centric solutions across various segments of the cable industry.

The Indian wires and cables industry continues to benefit from structural growth drivers such as expansion of power transmission and distribution networks, increasing investments in renewable energy projects, industrial development, urban infrastructure creation and growth in the residential and commercial real estate sectors. Rising emphasis on energy efficiency, grid modernization and reliable power connectivity is expected to support sustained industry growth in the coming years.

To remain aligned with evolving market requirements, the Company continues to invest in technology, process improvements and quality enhancement initiatives. Its manufacturing facility located at Shapar (Rajkot), Gujarat, is equipped with modern machinery and integrated production capabilities that support efficient operations and stringent quality standards.

In addition to its manufacturing operations, the Company expanded its product portfolio during the year through strategic brand and marketing arrangements for products such as Medium

Voltage Covered Conductors (MVCC), High Tension (HT) Cables and Power Control Cables (PCC). This initiative enables the Company to offer a wider range of solutions to customers while strengthening its presence in the power and infrastructure segments.

The Company also continues to emphasize research and development activities aimed at improving product performance, enhancing quality standards and developing customized solutions to meet diverse customer requirements. Continuous innovation and technical advancement remain important components of the Companys long-term growth strategy.

With its established brand, strong distribution network, quality-focused approach and expanding market reach, the Company is well positioned to capitalize on emerging opportunities in Indias growing power and infrastructure sectors while further strengthening its footprint in international markets.

3. OPPORTUNITIES

Growing Investments in Power Infrastructure

The Governments continued focus on strengthening power transmission and distribution networks, rural electrification, smart grid development and modernization of existing infrastructure is expected to generate sustained demand for wires and cables. Expansion of power infrastructure across the country presents significant growth opportunities for the Company.

Renewable Energy Expansion

Indias ambitious renewable energy targets, including solar and wind power capacity additions, continue to create substantial demand for specialized cable solutions. Increasing investments in clean energy projects are expected to support long-term industry growth and

Infrastructure and Industrial Development

Large-scale investments in roads, railways, metro networks, airports, industrial corridors, data centres and urban infrastructure projects are driving demand for reliable electrical connectivity solutions. The Companys diversified product portfolio positions it to benefit from these developments.

Real Estate and Housing Growth

Rising urbanization, increasing residential construction activities and government-supported housing initiatives are expected to contribute to sustained demand for building wires and low-voltage cable products.

Export Market Expansion

Growing acceptance of Indian-manufactured products in international markets presents opportunities to strengthen the Companys export presence. The Company continues to explore opportunities in existing and new overseas markets to diversify its revenue base.

Brand Expansion and Product Portfolio Enhancement

The Companys continued efforts to strengthen the Ultracab brand and expand its market offerings, including products marketed under strategic commercial arrangements such as MVCC, HT Cables and PCC, provide opportunities to address a wider customer base and participate in higher-value infrastructure projects.

Adequate Manufacturing Capacity

The Company possesses sufficient manufacturing capacity and modern production facilities to cater to increasing market demand and support future business growth.

Diversified Product Portfolio

With a wide range of wire and cable products catering to residential, commercial, industrial and infrastructure applications, the Company is well-positioned to address evolving customer requirements across multiple sectors.

Government and Institutional Approvals

The Company is an approved supplier to various Government authorities, public sector undertakings and large private sector enterprises, providing access to a broad customer base and recurring business opportunities.

4. THREATS

Volatility in Raw Material Prices

The wire and cables industry is significantly dependent on key raw materials such as copper, aluminium and polymers. Fluctuations in commodity prices and supply chain disruptions may impact on input costs and profitability.

Intense Industry Competition

The industry remains highly competitive with the presence of large, organized players, regional manufacturers and unorganized sector participants. Competitive pricing pressures may affect margins and market share.

Global Economic and Geopolitical Uncertainties

Geopolitical tensions, trade restrictions, currency fluctuations and global economic slowdowns may impact export demand, supply chains and overall business sentiment.

Regulatory and Compliance Changes

Changes in government policies, environmental regulations, quality standards and compliance requirements may result in additional operational and compliance costs.

Project Execution and Demand Cyclicality

Demand from infrastructure, industrial and real estate sectors is influenced by economic conditions, project execution timelines and investment cycles. Delays in major projects may affect short-term demand growth.

Foreign Exchange Risk

As the Company continues to expand its export operations, fluctuations in foreign exchange rates may impact export realizations and profitability.

5. FINANCIAL PERFORMANCE

FY 2025 26 marks another year of sustained business expansion for the Company, with revenue from operations increasing to Rs. 26,010.08 lakh from Rs. 23,943.38 lakh in the previous financial year, reflecting continued demand momentum, stronger market penetration, and scalable operational execution.

Key Financial Highlights:

- Revenue from Operations: Revenue from operations for FY 2025-26 stood at Rs. 26,010.08 Lakhs , as against Rs. 23,943.38 Lakhs in FY 2024-25, registering a growth of 8.64% over the previous year.

- EBITDA : Earnings before interest, depreciation, tax, and amortization (EBITDA) for FY 2025-26 were Rs. 1,174.28 Lakhs, as compared to Rs. 1,944.25 Lakhs in FY 2024-25, reflecting a decrease of 39.61% over the previous year.

- Profit Before Tax (PBT): Profit before tax for FY 2025-26 stood at Rs. 742.27 Lakhs , as against Rs. 1,371.35 Lakhs in FY 2024-25, reflecting a decline of 45.88% over the previous year.

- Net Profit Margin (PAT): Profit after tax (PAT) for FY 2025-26 stood at Rs. 558.81 Lakhs , as compared to Rs. 972.15 Lakhs in FY 2024-25, registering a decline of 42.53% over the previous year.

The moderation in profitability during the year was primarily attributable to margin pressures arising from elevated raw material prices, higher operating expenses, and increased cost structures associated with capacity expansion and business scaling initiatives. These factors are largely cyclical and investment-linked in nature, aligned with the Company s ongoing growth phase.

Importantly, Despite the short-term impact on margins, the Company has continued to strengthen its operational foundation through expanded capacities, improved product mix positioning, and enhanced execution capabilities. The temporary impact on margins reflects the natural dynamics of scaling operations, while the underlying business fundamentals remain robust.

6. RISK & CONCERNS

The Company operates in a dynamic business environment and is exposed to various internal and external risks that may impact its operations and financial performance. Key risks include volatility in raw material prices, changing market demand, competitive intensity, regulatory developments, supply chain disruptions, working capital requirements, technology advancements, and operational risks associated with capacity expansion and business growth.

The prices of key raw materials such as copper, aluminium, and polymers remain subject to fluctuations in domestic and international markets, which may impact margins. Further, demand for the Companys products is closely linked to infrastructure development, industrial investments, power sector growth, and overall economic activity. The Company also faces competition from both organized and unorganized players within the industry.

To address these risks, the Company has established a robust risk management framework encompassing risk identification, assessment, mitigation, monitoring, and periodic review. Through prudent financial management, diversified sourcing strategies, strong customer relationships, continuous technology upgradation, and effective internal controls, the Company seeks to mitigate risks and strengthen its ability to achieve sustainable growth and long-term value creation.

7. INTERNAL CONTROL SYSTEMS

The Companys internal control systems are commensurate with the nature of its business and the size and complexities of its operations. These systems are designed to ensure that all assets of the Company are safeguarded and protected against any loss and that all transactions are properly authorized, recorded and reported. The Company has an adequate system of internal control in place, which assures of:

Authorization, recording, analyzing and reporting of transactions.

Recording and adequate safeguarding of assets.

Upkeep of accounting records and trustworthiness of financial information.

Corporate policies for financial reporting, accounting, information security, investment appraisal and corporate governance.

Audit Committee of the Board which monitors and reviews all risks and control issues and financial matters.

Computerized and integrated financial and accounting functions, information feedback system of process parameters and backtracking from finished products to raw material stage.

Routine evaluation of all financial operating and information technology system.

Laying down risk assessment and minimization procedures and regular review of the same.

8. HUMAN RESOURCES AND EMPLOYEE WELL-BEING

At Ultracab, we believe that our employees are the driving force behind the Companys growth and success. The Company remains committed to fostering a performance-driven, inclusive, and collaborative work culture that encourages innovation, continuous learning, and professional development. Our human resource practices are focused on attracting, developing, and retaining talent while creating opportunities for employees to enhance their skills and contribute meaningfully to the Companys objectives.

The Company continues to invest in employee training and development initiatives aimed at strengthening technical competencies, operational excellence, leadership capabilities, and workplace effectiveness. A culture of meritocracy, teamwork, and accountability is promoted across the organization to support sustainable growth and long-term value creation.

As on March 31, 2026, the Company had 146 permanent employees on its rolls.

The health, safety, and well-being of employees remain a key priority. The Company maintains appropriate safety standards, operational controls, and workplace practices to provide a safe and healthy working environment. The Company also strives to maintain harmonious industrial relations and is pleased to report that relations with employees remained cordial throughout the year.

The Company believes that a motivated, skilled, and engaged workforce is essential for achieving its strategic objectives and sustaining long-term growth.

9. KEY FINANCIAL RATIOS

Ratio	FY 2025-26	FY 2024-25	Change	Explanation for change in the ratio by more than 25% as compared to the previous year
Debtors Turnover Ratio	5.95	5.68	4.73 %	Not Applicable
Inventory Turnover Ratio	2.53	2.56	-1.19 %	Not Applicable
Interest in Coverage Ratio	3.12	3.02	3.31 %	Not applicable
Current Ratio	2.30	2.35	-2.11 %	Not applicable
Debt Equity Ratio	0.70	0.71	-1.61 %	Not applicable
Operating Profit Margin	0.045	0.08	-43.75 %	Due to lower operating margins.
Net Profit Margin	0.02	0.04	-46.45%	Due to reduction in profit
Return on capital employed %	0.11	0.15	-23.45%	Not Applicable
Return on Net Worth	0.06	0.11	-45.90%	Due to reduction in profit

10. CAUTIONARY STATEMENT

Statements made in this Management Discussion and Analysis Report describing the Companys objectives, projections, estimates, expectations, plans, or predictions may constitute forward-looking statements within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed or implied in such statements due to various factors, including changes in economic conditions, market demand, competitive intensity, raw material prices, regulatory and policy changes, taxation laws, technological developments, geopolitical developments, supply chain disruptions, and other risks and uncertainties that may affect the Companys operations and financial performance.

The Company assumes no obligation to publicly update or revise any forward-looking statements on the basis of subsequent developments, information, or events, except as required under applicable laws and regulations.