Universal Autofoundry Ltd Management Discussions

MANAGEMENT DISCUSSION AND ANALYSIS REPORT 2025-26 (MD&AR):

The Management of the Company presents its Management Discussion and Analysis Report for the financial year ended March 31, 2026, in compliance with Regulation 34 read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

COMPANY OVERVIEW

The company is a globally recognized manufacturer and exporter specializing in Grey Iron, Ductile Iron, and SG Iron Casting. Our extensive product portfolio serves diverse industries including automotive, agriculture, railways, earthmoving, and international markets. The comprehensive range of components, such as Suspension Brackets, Differential Housings, Hubs, Brake Drums, Flywheels, Adjuster Nuts, Pulleys, and Dampers, play pivotal roles in commercial vehicles and engineering applications. The company has three integrated manufacturing facilities with a combined built-up manufacturing area of around 30000 sq. meters.

The company supplies intricate, cored, and fully machined cast components weighing from 5 to 150 Kgs, with a casting capacity of 42000 metric tons per year.

The company maintains long-standing partnerships with a diverse array of esteemed clients in prominent sectors.

The Companys strategy is centred on:

- Improving operational efficiencies and

productivity;

- Expanding its customer base and strengthening

relationships with existing customers;

- Enhancing product quality and developing value-

added products;

- Optimising cost structures through process

improvements and resource management; and

- Exploring new business opportunities in domestic

and export markets.

While near-term challenges relating to input costs and global economic uncertainties may continue, the management remains optimistic about the medium and long-term growth prospects of the industry and the Company.

UNITWISE OVERVIEW

UNIT I JAIPUR

- Universal Group has installed casting capacity of 42,000 MT/Year

- Three units with combined built-up manufacturing area of around 22,000 Sq. Meter, catering to different sizes of Castings

- Additional 30,000 Sq. Meter of Land area available for further expansion (adjacent to Unit 3)

- Facility located in Jaipur

- State of the art SINTO HPML molding line capable of producing castings weighing between 5 - 25 kg

- Capacity at Unit 1 is 10,000 MT per year

- Fully integrated casting and machining operation in an environmentally friendly foundry

UNIT II REENGUS

- Facility located in Reengus, about 50 kms from Jaipur

- State of the art DISA FLEX 70 HS HPML molding line capable of producing castings weighing between 40 - 150 kgs

- Capacity at Unit 2 is 20,000 MT per year

- Standalone Casting operation

UNIT III REENGUS

- Facility located in Reengus, located about 50 kms from Jaipur

- State of the art RHINO HPML molding line capable of producing castings weighing between 20 - 50 kg

- Capacity at Unit 3 is 12,000 MT per year

- Machines for Aluminum Castings have been installed successfully, an HPDC Line (400 T) & a GDC Line Set Up

The Company remains committed to technological upgradation, process improvements and enhancing manufacturing efficiencies to meet evolving customer requirements and maintain competitiveness in the market.

INDIAN ECONOMIC REVIEW

The iron casting market in India is expected to reach a projected revenue of US$ 28,412.1 million by 2033. A compound annual growth rate of 8.4% is expected of India iron casting market from 2026 to 2033.

Source:https://www. grandviewresearch. com/horizon /featured og regional/iron-casting-market- india.webp

INDIA IRON CASTING MARKET HIGHLIGHTS:

The India iron casting market generated a revenue of USD 15,015.0 million in 2025 and is expected to reach USD 28,412.1 million by 2033.

- The India market is expected to grow at a CAGR of 8.4% from 2026 to 2033.

- In terms of segment, gray was the largest revenue generating product in 2025.

- Ductile is the most lucrative product segment registering the fastest growth during the forecast period.

IRON CASTING MARKET DATA BOOK SUMMARY:

Market revenue in 2025	USD 15,015.0 million
Market revenue in 2033	USD 28,412.1 million
Growth rate	8.4% (CAGR from 2026 to 2033)

Largest segment	Gray
Fastest growing segment	Ductile
Historical data	2021 - 2024
Base year	2025
Forecast period	2026 - 2033
Quantitative units	Revenue in USD million
Market segmentation	Gray, Ductile, Malleable

GLOBAL ECONOMIC REVIEW

Globally, the iron casting market size was valued at USD 127.87 billion in 2025. The market is projected to grow from USD 136.70 billion in 2026 to USD 233.17 billion by 2034, exhibiting a CAGR of 0.06 % during the forecast period.

The iron casting market is expanding steadily due to increasing demand from automotive manufacturing, industrial machinery production, railway infrastructure, and construction equipment industries. Iron castings are widely utilized because of their strength, durability, wear resistance, and cost-effectiveness in heavy-duty industrial applications. The iron casting market Report highlights growing adoption of precision casting technologies, automated foundry systems, and sustainable metal recycling practices across global manufacturing sectors. Manufacturers are increasingly focusing on lightweight cast components, improved metallurgical properties, and energy-efficient production processes. Rising industrialization, infrastructure development, and machinery modernization projects continue to support iron casting market Growth across developed and emerging economies.

The United States iron casting market is witnessing significant demand due to expansion of automotive production, industrial machinery manufacturing, and infrastructure modernization activities. Foundries and casting manufacturers across the USA are increasingly investing in advanced molding systems, automated production technologies, and environmentally sustainable metal processing methods. The iron casting market Analysis for the United States indicates growing demand for high-performance cast iron components

used in heavy machinery, transportation equipment, and industrial automation systems. Increasing replacement of aging infrastructure and rising investments in domestic manufacturing capabilities continue to strengthen market growth throughout the country.

KEY TAKEAWAYS Market Size & Growth

- Global market size 2025: USD 127.88 billion

- Global market size 2034: USD 233.18 billion

- CAGR (2025-2034): 6.90 %

Market Share - Regionals

- North America: 31%

- Europe: 27%

- Asia-Pacific: 35%

- Rest of World: 7%

Country-Level Shares

- Germany: 33% of Europes market

- United Kingdom: 17% of Europes market

- Japan: 18% of Asia-Pacific market

- China: 47% of Asia-Pacific market

IRON CASTING MARKET LATEST TRENDS

The iron casting market Trends reveal increasing adoption of automated foundry technologies, robotics- based molding systems, and advanced simulation software for precision casting operations. Manufacturers are focusing on improving casting quality, reducing material waste, and enhancing production efficiency through digital manufacturing solutions. Demand for lightweight yet durable iron castings is increasing significantly within automotive and industrial equipment sectors. Ductile iron casting technologies are gaining popularity because they provide higher tensile strength and improved flexibility compared to conventional cast iron products.

Global Iron Casting Market Size, 2021 2034 (USD Billion)

OPPORTUNITIES & THREATS

Expansion in energy infrastructure and industrial automation

Demand for ductile iron pipes in water, sewage, and industrial fluid systems is rising across more than 90 countries, with ductile iron pipes holding nearly 61% share of municipal pipe installations globally. Industrial automation upgrades across foundries offer nearly 27% cost optimization, making modernization attractive to over 48% of mid-sized casting facilities. Renewable energy applications present new opportunities, particularly in wind turbine housings, where iron castings account for nearly 23% of tower and nacelle components. The Global Iron Casting Market Opportunities include the integration of 3D sand printing, enabling a tooling reduction of nearly 34% and design cycle acceleration by 29%. Custom casting demand increases by 17% annually in energy systems.

Basically, followings are the opportunities:

- Growing demand for cast components from the automotive, engineering and infrastructure sectors.

- Increased government spending on infrastructure, railways and industrial development.

- Expansion of domestic manufacturing under various Government initiatives.

- Opportunities arising from global supply chain diversification and increasing export potential.

- Rising demand for value-added and precision- engineered castings.

High operational cost structure and technological skill gaps

Foundries face rising production costs, with melting operations consuming nearly 45% of total energy inputs. Skilled labor shortages affect nearly 29% of global casting facilities, where only 8% of workers have advanced metallurgical training. Equipment modernization requires capital investment increases of nearly 32%, restricting adoption of robotic pouring systems among smaller foundries. The Global Iron Casting Market Share distribution is affected as outdated facilities operate 14% below optimal productivity levels. Scrap quality inconsistency influences nearly 21% of production batches, increasing defect rates by 9%. Supply-chain volatility impacts 27% of producers due to fluctuations in raw material availability.

Threats are:

- Volatility in prices of pig iron, scrap, ferro alloys and other raw materials.

- Rising power and fuel costs impacting production economics.

- Intense competition from domestic and

international manufacturers.

- Foreign exchange fluctuations affecting export competitiveness.

- Changes in environmental and regulatory requirements leading to higher compliance costs.

RISKS & CONCERNS

The Companys operations are exposed to various risks, including:

- Raw material price fluctuations;

- Energy cost volatility;

- Changes in customer demand and market

conditions;

- Competitive pressures and pricing challenges;

- Supply chain disruptions;

- Regulatory and environmental compliance

risks;

- Foreign exchange and credit risks; and

- Information technology and cyber security

risks.

The Company has established appropriate risk management mechanisms to identify, assess and mitigate potential risks and periodically reviews the risk management framework to ensure business continuity and sustainable growth.

SEGMENT-WISE AND PRODUCTWISE PERFORMANCE

During the financial year 2025-26, total sales for the Company registered a rise from Rs. 19388.90 Lakh in 2024-25 to Rs. 21349.78 Lakh in 2025-26. Profitability was also impacted during the given period. Profit after Tax (PAT) for the period declined from Rs. 235.36 Lakh in 2024-25 to Rs. (334.39) Lakh in 2025-26. More than two-thirds of the Companys revenues come from the domestic commercial vehicle and tractor industry.

Leveraging the wide product range and customization capabilities, the company has strategically diversified its presence across different industries to mitigate concentration risks. The company currently serves a wide variety of end-user industries. These include tractors, Commercial Vehicles, Heavy Earth Moving, Construction, Industrial Machinery etc. This strategic shift is aimed at ensuring sustainable growth and reducing dependence on any single industry

FINANCIAL PERFORMANCE

(Rs. in Lakhs)

Particulars	2025-26	2024-25
Total income	21349.78	19388.90
Earnings before interest, tax and depreciation	1130.78	1698.27
Depreciation	1152.24	1040.47
Finance Cost	432.44	330.29
Profit/(Loss) before tax	(453.91)	327.51
Tax	119.52	92.14
Profit after tax	(334.39)	235.36
Other comprehensive income	(11.54)	10.71
Total other comprehensive income (including PAT)	(345.93)	246.07

RATIOS

Particulars	31st March 2026	31st March 2025
Current Ratio	1.37	1.37
Debt- Equity Ratio	0.86	0.61
Debt Service Coverage Ratio	1.71	2.48
Return on Equity (ROE)	(0.05)	0.03
Inventory Turnover Ratio	9.23	8.66
T rade Receivables Turnover Ratio	4.89	4.97
Trade Payables Turnover Ratio	11.90	12.47
Net Capital Turnover ratio	10.65	10.56
Net Profit Ratio	(0.02)	0.01
Return on Capital Employed	(0.00)	0.05
Return on Investment	NA	NA

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has in place adequate internal control systems commensurate with the size, scale and nature of its operations. The internal control framework ensures safeguarding of assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records and timely preparation of reliable financial information.

The Company has implemented suitable policies, procedures and controls covering operational, financial and compliance areas. The internal auditors periodically review the effectiveness of internal controls and submit their reports to the Audit Committee, which regularly reviews the findings and monitors implementation of corrective actions.

LOOKING AHEAD & CONCLUSION

With an installed casting capacity of 42,000 MT/Year, the company has recently added a third High-Pressure Molding Line, RHINO, further enhancing its production capabilities. In addition to this the Company has started commercial production of its 3.60 MW AC (5 MWp DC) Captive Solar PV Power Generation Plant located at Bikaner. By commissioning this facility, we not only expand our production capacity but also aim towards greener tomorrow. Further, Company has also another solar project (Capacity 6.5 MV Per year) under pipeline which shall be in operation by this year.

The company has ambitious plans to significantly enhance its machining capacity by the end of FY26, reflecting its growth strategy and dedication to meeting the evolving needs of its customers. The company is well-positioned to improve its capacity utilization, leveraging its state-of-the-art facilities and experienced workforce and thereby improving profitability through operating leverage.

During the year, the Company operated in a challenging and highly competitive business environment. The Company also continued to address matters arising from disputes and litigation initiated by a promoter/promoter group classified individual who is no longer associated with the management or the Board of Directors and who operates an independent foundry business catering to similar customer and product segments.

Although the Company successfully defended certain proceedings during the year, the overall competitive environment remained challenging. Increased competitive intensity, customer retention initiatives, employee attrition, pricing pressures and margin compression adversely impacted the Companys profitability, despite revenue remaining broadly stable during the year. The Company believes these factors were among the contributors to the decline in profitability during the year.

The management has undertaken several strategic initiatives, including cost optimization, operational efficiency improvements, strengthening customer relationships, diversification of the customer base, enhancement of employee retention initiatives and

continued focus on value-added products to improve profitability and create sustainable long-term value for shareholders

CAUTIONARY STATEMENT

Statements in this Management Discussion and Analysis Report describing the Companys objectives, projections, estimates, expectations or predictions may be forward-looking statements within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed or implied due to various factors including changes in economic conditions, government regulations, tax laws, market demand, raw material availability and prices, competitive pressures and other incidental factors beyond the control of the Company.

For & on behalf of the Board

Sd/-

Vimal Chand Jain Chairman DIN: 00295667

Date: 30.06.2026 Place: Jaipur