Uni Abex Alloy Products Ltd Management Discussions

Economic Overview

Global Economy

The global economy has been threatened once again - this time by the outbreak of the war in Middle east region. Over the past year, the headwinds from forced trade barriers and higher uncertainty have been offset

by tailwinds from technology-related investments. The disruptions have been frequent and, given the fluidity of the situation vis - a - vis duration of the war and its intensity, the likelihood of the forecast fluctuating and the related economic impact materializing fully or partially remains.

Source: Caldara and Lacoviello 2026; IMF April 2026

Under the reference forecast, the global economy is projected for 3.1 % growth in 2025-26 and 3.2 % in 2026-27, slower than its recent pace of about 3.4% in 2024 - 25 and, in medium rate, to be slower than its historical average rate of 3.7 % (2000 - 19). Global headline inflation is expected to increase to 4.4% in 2026 and decline to 3.7% in 2027, marking upward revisions for both years (compared to 2026 WEO Update). Further, under an adverse scenario with larger and persistent increase in energy prices, global growth could slow further down to 2.5% in 2026 and, inflation reaching upto 5.4% for the year.

Source: WorldUncertainityindex.com; Matteoiacoviello.com

Global Growth and Inflation Forecast

Prior to the war, the global economy was performing better than expected and, laying foundation for upward forecast revisions. In aggregate, the global economy grew upto 3.9% on annualized basis for the fourth quarter of 2025 fuelled by strong China exports and higher fiscal spending in Europe compensating for the slower growth rate of 0.5% in United States

Overview of the World Economic Forecast at Market Exchange Rate weights

Crucially, there is a high degree of cross - country dispersion in the reference forecast. While the growth and inflation revisions seem relatively modest, at global level, the toll of the conflict region and more vulnerable economies with pre-existing fragilities is much more pronounced. The downward revision to growth in emerging market and developing economies is 0.3% for CY 2025-26.

Overview of World Economic Outlook (Percent Change)

	2025	Projections: 2026	Projections: 2027
World Output	3.4	3.1	3.2
Advanced Economies	1.9	1.8	1.7
United States	2.1	2.3	2.1
Euro Area	1.4	1.1	1.2
Germany	0.2	0.8	1.2
France	0.9	0.9	0.9
Italy	0.5	0.5	0.5
Spain	2.8	2.1	1.8
Japan	1.2	0.7	0.6
United Kingdom	1.3	0.8	1.3
Canada	1.7	1.5	1.9
Other Advanced Economies2	3	2.6	2.2
Emerging Market and Developing Economies	4.4	3.9	4.2
Emerging and Developing Asia	5.5	4.9	4.8
China	5	4.4	4
India3	7.6	6.5	6.5
Emerging and Developing Europe	2	2	2.1
Russia	1	1.1	1.1
Latin America and the Caribbean	2.4	2.3	2.7
Brazil	2.3	1.9	2
Mexico	0.6	1.6	2.2
Middle East and Central Asia	3.6	1.9	4.6
Saudi Arabia	4.5	3.1	4.5
Sub-Saharan Africa	4.5	4.3	4.4
Nigeria	4	4.1	4.3
South Africa	1.1	1	1.3
World Trade Volume (goods and services)	5.1	2.8	3.8
Imports - Advanced Economies	4.7	2.6	3.1
Imports - Emerging Market and Developing Economies	5.7	2.7	4.9
Exports - Advanced Economies	3.7	2.5	2.7
Exports - Emerging Market and Developing Economies	7.4	3.5	5.4
Commodity Prices
Oil5	-14.4	21.4	-7.6
Nonfuel (average based on world commodity import weights)	9.6	21.7	1.9
World Consumer Prices6	4.1	4.4	3.7
Advanced Economies7	2.5	2.8	2.2
Emerging Market and Developing Economies6	5.2	5.5	4.6

Note: The aggregate growth rate calculated as weighted average, in which a moving average of nominal GDP in US dollars for the preceding three years is used as the weight. EMs & LIDCs exclude MENA;

Source: World Economic Outlook update, IMF Staff estimates, April 2026

Risk off sentiment following the outbreak of the Middle East conflict has led to moderate tightening of global financial conditions. Emerging markets especially commodity Importers and those with pre-existing vulnerabilities - have been affected the most. The Middle East conflict is putting additional pressure on public finances owing to direct effect of conflict and address vulnerability in commodity markets through broad based fiscal packages.

Source: World Economic Outlook, April 2025, IMF forecast April 2026

Note: The figure presents Cumulative GDP growth revision for 2026 - 27 relative to January 2026 World Economic Outlook update. EMs & LIDCs exclude MENA;

AE - Advance Economies; EM - Emerging Markets; LIDC - Low Income developing countries

Global Synopsis

The global economy has, to date, withstood a series of shocks until the military conflict engulfing the Middle east region is testing the resilience and reshaping the international relations across all regions. Economies around the world face repercussions through the direct impact of higher commodity prices, indirect second order effects on inflation expectations and amplification effects coming from risk off sentiment in financial markets. The unevenness in global economy raises downside risks to the outlook, adding to the risks posed by intensifying geopolitical tensions. Medium - term growth prospects remain lacklustre, weighed down by geoeconomic fragmentation and structural challenges.

• Commodity price: Prices for energy commodities are expected to rise by 19% in 2026. Oil prices are expected to rise by 21.4% on account of disruptions to production and transportation in Middle east region. Natural gas prices are expected to be affected more than oil prices because of the technical complexity of restarting production and comparatively lower safety

stock levels

• Monetary policy projection: Differentiation of monetary policies is expected to continue. In United states, the federal fund rate is projected to be reduced gradually, reaching its terminal rate of 3.1% by end

of 2027. The policy rate in euro area is expected to increase by 50 basis points

• Fiscal policy projection: Fiscal policy for advance economies, on average, is expected to be neutral in 2026 and tighter in latter years of forecast horizon. In United States & Euro zone , the general government fiscal balance - to - GDP ratio is expected to deteriorate owing to One Big Beautiful Bill act (OBBBA), US public debt (net) and, Germanys widening deficit. The fiscal policy in emerging market and developing economies, on average, is projected to gradually tighten over the forecast horizon.

Indian economy

Indias economy shows strong momentum. Real GDP growth is projected at 7.2 per cent for Q4 FY26. Full-year growth for FY26 is expected at 7.5 per cent. Rural and urban consumption are driving this growth. For FY27, real GDP growth is forecast at 6.6 per cent. This outlook considers global economic challenges and domestic demand strength.

The Reserve Bank of India (RBI) projects real GDP growth at 7.6% for FY26 and 6.9% for FY27, as it observes a broader economic slowdown amid global risks like rising

oil prices and geopolitical tensions. While the economy has expanded robustly, the RBI has paused rate cuts to manage inflationary pressures. [1,2]

India enters FY26 with strong economic momentum supported by stable macroeconomic fundamentals, sustained policy support, and broad-based sectoral performance. Despite a challenging global environment, the economy has remained resilient, with robust growth, historically low inflation, improving labour market indicators, and strengthening external and financial buffers. Coordinated fiscal, monetary, and structural policies have reinforced macroeconomic stability while supporting investment, consumption, and inclusion. The emerging macroeconomic environment reflects an economy that is consolidating its gains while strengthening the foundations for sustained and inclusive growth.

Key 2026 Economic Indicators

• GDP Growth Forecasts: The RBI maintains a 7.6% real GDP growth forecast for FY26, with a projected softening to 6.9% in FY27. The Union Budget and Economic Survey similarly forecast FY27 GDP growth in the range of 6.8% to 7.2%.

• Monetary Policy: Despite a cumulative easing cycle, the RBI has kept its benchmark repo rate steady at 5.25% in its most recent policy announcements to combat mounting inflationary risks linked to global crude oil prices.

• Inflation: CPI projections have been revised upward to 4.6% as external commodity shocks and geopolitical friction potentially influence domestic prices.

Growth Drivers and Risks

Domestic Drivers: Indias economy continues to be supported by solid private consumption (particularly rural demand) and healthy business investments rather than export-heavy performance.

External Risks: The RBI identifies elevated oil prices, ongoing geopolitical disputes, and international trade uncertainties as the primary downside risks to Indias continued economic momentum.

While high-frequency data showed a minor decline in the fourth quarter, overall economic activity remained resilient. Revised GDP projection indicate a 6.4% growth rate in 2026 and 6.6% next year. Inflation for the country is projected to be 4.4% this year and 4.3% in 2027. This is driven by Strength in rural consumption bolstered by both farm and non-farm sectors and urban consumption

demand maintaining a steady upward trajectory bolstered by fiscal stimulus in previous festive season

Among major Emerging Markets & Developing Economies (EMDEs), India has recorded one of the sharpest declines in headline year-to-year inflation in 2025 upto 1.8 %. In December 2025, the RBI lowered its inflation forecast for FY26 from 2.6% to 2.0%, supported by a good kharif harvest and healthy rabi sowing. The IMF projects inflation at 2.8% in FY26 and 4.0% in FY27. The RBIs forecast for headline Inflation on for Q1 and Q2 of FY27 currently stands at 3.9 and 4%. Looking ahead, the inflation outlook remains benign, supported by favourable supply side conditions and the gradual passthrough of GST rate rationalisation.

Agriculture: Stabilising Rural Demand Agriculture and allied activities continue to play in Indias growth cycle with estimated growth rate of 3.1% in FY 26 supported by favourable monsoon, improving crop performance, rural demand and income security. Allied activities particularly livestock and fisheries have exhibited stable growth of around 5-6%, providing resilience and diversification

Industry and Manufacturing: Momentum Builds Industrial activity is expected to gain momentum in FY26, with the industrial sector projected to grow by 6.2%, up from 5.9% in FY25. The sector recorded growth of 7.0% in the first half of FY26, exceeding the growth of 6.1% in H1 of FY25 and the pre-COVID trend of 5.2%. Manufacturing has emerged as a key growth engine, with GVA growth accelerating to 7.72% in Q1 and 9.13% in Q2 of FY26, signalling a structural recovery. Government-led initiatives, particularly the Production Linked Incentive (PLI) schemes across 14 sectors, have played a catalytic role a reaching over 72.0 lakh crore of actual investment, generating incremental production/sales exceeding 718.7 lakh crore, and creating over 12.6 lakh jobs as of September 2025. Indias innovation ecosystem has also strengthened, with the countrys Global Innova on Index rank improving to 38th in 2025, up from 66th in 2019, reinforcing the role of manufacturing-led innovation in long-term growth. • Services: The Dominant Growth Engine Services sector is estimated to have grown by 9.1% in FY26, up from 7.2% in FY25, indica ng a further acceleration in services-led expansion. Services share in GDP rose to 53.6% in H1 FY26, while its share in GVA reached a historic high of 56.4% as per the FY26 First Advance Estimates, reflecting the rising importance of modern, tradable, and digitally delivered services.

India is now the worlds seventh-largest exporter of services, with its share in global services trade more

than doubling from 2% in 2005 to 4.3% in 2024. And the sector remains the largest recipient of foreign direct investment. Implicit estimate for H2 suggests a continuation of the services sectors momentum, supported by resilient domes c demand and steady export activity. Employment and Labour Market Trends Indias labour market continues to demonstrate resilience alongside economic expansion. In Q2 (July to September 2025) FY26, total employment stood at 56.2 crore persons (aged 15 years and above), reflecting the creation of approximately 8.7 lakh new jobs compared to Q1(April to June 2025) FY26. According to the Periodic Labour Force Survey (PLFS), key labour indicators point to strengthening employment conditions. • The Labour Force Participation Rate (LFPR) for persons aged 15 years and above increased to 56.1% in December 2025. • Female LFPR rose to 35.3%, indica ng rising participation and improving inclusion. • The Worker Population Ra o (WPR) increased to 53.4%, reflecting steady employment absorption. • The unemployment rate declined to 4.8% in December 2025, continuing its downward trajectory. The Annual Survey of Industries (ASI) FY24 highlights the strength of organised manufacturing, with employment rising by 6% year-on-year, translating into an addition of over 10 lakh jobs compared to FY23. As of January 2026, the e-Shram portal has registered over 31 crore unorganised workers, with women accounting for more than 54% of total registrants significantly strengthening the outreach of gender-focused welfare initiatives. The National Career Service (NCS) plat form has emerged as a key labour market intermediary, with over 5.9 crore registered job seekers and 53 lakh job providers, and mobilization of approximately 8 crore vacancies across sectors. It recorded over a 200% increase in job vacancies in FY24 compared to FY23. Trade Performance: Export Diversification and Services Strength

Read more at:

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economy/indicators/indias-real-gdp-to-hit-7-

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campaign=cppst¹gh-Performance Alloy

Industry Overview High Performance Alloy

High-performance alloys are engineered using a blend of materials, including non-ferrous metals such as aluminium and nickel, along with composite-

clad, precious and refractory materials. These alloys are known for their superior mechanical strength, exceptional performance, and high resistance to corrosion and heat. Due to these attributes, they are extensively used in sectors such as atomic energy, semiconductors, desalination, and solar and fuel cell technologies.

In CY 2025-26, the global high-performance alloy industry reached a market size of USD 10.99 billion.

The industrys growth during this period was primarily driven by rapid advancements in aircraft technology worldwide. The global industry was also largely led by North America, supported by increased consumption levels in the aerospace sector. The year saw increased collaboration between manufacturers and research organisations, resulting in the development of next- generation alloys and opening up new avenues for growth. The sector continued to evolve in response to emerging technologies, shifting consumer preferences, and regulatory changes. Moreover, the strict environmental regulations encouraged manufacturers to adopt high-performance alloys that are capable of withstanding extreme conditions while also helping to reduce environmental impact.

The global centrifugal casting industry has witnessed consistent growth over the years, reaching a market size of USD 1.5 billion in CY 2025-26. This growth was largely driven by rising demand from key sectors such as automotive, aerospace, defence, and industrial machinery. The industry is further expected to expand, with the global market projected to reach USD 2.2 billion by CY 2033.⁶

In addition to this, the global high-performance alloy market is projected to reach USD 18.52 billion by CY 2034. This anticipated growth is expected to be driven by wider adoption in additive manufacturing, expansion of the renewable energy sector, broader application in emerging technologies, growth in electronics, and rising demand for next-generation aircraft. Key trends likely to shape the industrys trajectory include the development of high-temperature alloys, customised alloy solutions, and a stronger emphasis on sustainable, environmentally conscious manufacturing practices.

Opportunities and Threats

The high-performance alloy sector is expected to witness continued growth, driven by rising demand from industries such as oil and gas extraction, thermal processing and petroleum. Additionally, its expanding application in power generation, particularly in the

manufacturing of industrial gas turbine components, is likely to further support industry growth in the coming years.

However, this progress may be tempered by certain challenges. Increasing environmental concerns and the tightening of related regulations are placing additional pressure on manufacturers, especially in managing emissions and waste. Compliance with these evolving norms could lead to higher operational costs, which may affect the overall performance of the industry.

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Company Overview

Uni Abex Alloy Products Limited (Uni Abex), established in 1972, has built a legacy spanning over five decades.

It is part of the Neterwala Group, a family-owned and professionally managed business enterprise with a longstanding track record of growth. The Neterwala Group has diversified interests across Metallurgy, Software, Speciality Chemicals, Engineering, Geology, Oil & Gas and Environmental solutions.

Over the years, Uni Abex has become a trusted supplier of high-durability components for demanding applications across various industries. The Company specialises in the manufacture of premium alloy steel castings, particularly for decanters and reformer tubes. Its product portfolio includes radiant tubes, retort tubes, air injection tubes, tube support castings, tube sheets, header assemblies and more.

The Company has consistently enhanced its manufacturing processes and broadened its offerings. Strategic investments in modern facilities and equipment have further strengthened its capabilities and competitive position in the industry. Uni Abex remains committed to continuous innovation and a quality-first approach, focusing on timely delivery, sales growth, profitability enhancement, productivity improvement, and the adoption of industry-approved welding procedures.

Core Competencies

Offers deep expertise in resist heat, wear and corrosion-resistant alloy solutions

I Recognised as a leading manufacturer of centrifugal castings in India

Specialises in static castings for high- performance, critical-use environments

Financial Performance

In FY 2026, the Company recorded a total income of 7 22828.14 lakhs, compared to 7 20,006.76 lakhs in the previous financial year. EBITDA stood at 7 6104.55 lakhs, as against 7 5,096.79 lakhs in FY 2025. The Profit After Tax (PAT) amounted to 7 27986.21 lakhs, while in FY 2025, it was 7 3,357.30 lakhs.

Net Working Capital to Sales stood at 141*%, Inventory to Sales stood at 17 %, and Receivables to Sales was 18%, compared to 35%, 16%, and 18 % respectively in the previous year.

The improvement in the ratios is due to better working capital management. Debtors Turnover was 5.48, Inventory Turnover was 3.69, Interest Coverage was 469.15*, Current Ratio was 5.60, Debt Equity was 0.03 as compared to those of the previous year, 6.65, 2.26, 65.86, 2.69, and 0.08, respectively. Further, Improvement in Inventory Turnover Ratio, Current Ratio and Debt Equity Ratio was due to better inventory and current asset management. Operating Profit Margin was 27% and Net Profit Margin was 123*% as against the previous years 25% and 17%. The Return on Net worth was 102% vs 24% in the previous year

(*Variances due to profit on sale of thane land shown under exceptional item)

Corporate Social Responsibility (CSR)

The Companys CSR efforts are guided by a commitment to contributing meaningfully to society. In FY 2026, Uni Abex focused on initiatives such as providing vocational training, education and enhancing access to healthcare within the community.

Human Resources

In FY 2026, the Companys total workforce stood at 103

employees, each playing a vital role in advancing Uni Abexs long-term growth objectives. The Company has implemented robust human resource policies focused on recruiting the right talent, supporting their training and development, and ensuring smooth integration into the organisational culture, all of which contribute to improved employee retention.

Uni Abex fosters a positive and inclusive workplace by promoting employee engagement, embracing diversity, and ensuring equal opportunities for all. The Company also maintains open and transparent communication channels across the organisation, empowering employees to share feedback and voice any concerns.

Outlook

To drive long-term growth, the Company has approved a capital outlay of Rs.121 crore towards strengthening its production and operational capabilities. Reflecting its forward-looking approach, Uni Abex recently expanded its international footprint by participating as a sponsor and exhibitor at CRU Nitrogen + Syngas USA 2025 in Tulsa, Oklahoma. This step highlights the Companys continued emphasis on innovation, precision engineering and sustainable practices in metallurgy.

The global economy faces renewed tests as the war in the Middle East threatens to disrupt growth and disinflation.

Risks and Mitigation

Uni Abex has an established risk management framework that facilitates the early identification of risks and the timely implementation of sustainable mitigation strategies. This proactive approach enables the Company to safeguard its operations and sustain performance over the long term. The Board of Directors also plays a key role in risk governance by setting out principles and policies to guide risk management practices.

Key risks identified include unexpected shifts in the economic environment and volatility in raw material prices. Economic fluctuations can impact the Companys operations and profitability, while foreign exchange rate movements may affect its international business, including material imports and goods exports. To mitigate currency-related risks, the Company uses hedging measures through contractual arrangements. Additionally, to minimise exposure to fluctuations in raw material prices, Uni Abex sources materials from multiple suppliers. This approach ensures supply

continuity, offers flexibility in response to market conditions and enables cost-effective procurement.

Internal Control Adequacy

The Company has established standard operating procedures (SOPs) for its business operations, supported by a robust ERP system with built-in checks and balances. These SOPs are reviewed and updated periodically to ensure continued relevance and effectiveness. They help guarantee that all transactions are properly authorised, verified, and recorded, while also protecting the Companys assets.

Companys policies are clearly documented and internal auditors routinely review the internal control systems to assess their adequacy and effectiveness. Statutory auditors independently verify the adequacy of financial controls and the Companys compliance with applicable laws and regulatory requirements. The Audit Committee, chaired by an independent director, meets quarterly with the management, internal auditors and statutory auditors to review audit findings and address any concerns raised.

Cautionary Statement

This report includes forward-looking statements that reflect the Companys expectations, based on supportive government policies, planned initiatives, and future growth goals. Within the Management Discussion and Analysis, terms such as may, estimate, will, and similar expressions point to the Companys intent and strategic direction. These statements are based on current assumptions and should not be seen as promises or guarantees. The actual results may turn out differently due to various influencing factors. The Company does not take on any responsibility to update or revise these statements, even if new information or future developments arise.