JBM Auto Ltd

Dear Shareholders,

It gives me immense pleasure to write to you at the end of an exciting year in JBM Auto's journey of innovation and excellence, as manifest in the Company's sustained and sustainable growth across the key metrics of its performance. FY23 was, for us, a year of reinforcing our commitment to clean mobility, in line with the Government of India's stated sustainability development goals. It was a period of enhancing our innovation thrust to deliver more energy-efficient and sustainable solutions to cater to the emerging consumer preference for e-mobility. We proactively partnered with the Government in its ‘Make in India' journey to create a self-sufficient ecosystem for driving India's sustainable growth. Our focus on e-mobility remains central to our growth strategy, and we shall continue to invest in augmenting our EV presence.

The positivity in the organization resonated with the overall resilience in the Indian economy, which remained on the track of growth despite the global headwinds witnessed in FY23. The World Bank estimated India's GDP growth at 6.9% for FY23 and 6.3% in FY24, with inflation likely to moderate in the coming quarters. In line with the macroeconomic environment, the Indian auto industry has also remained on the growth path, clocking its highest-ever annual domestic passenger vehicle sales in 2022, which was a robust 23% growth over the previous year. In January 2023, India has surpassed Japan in terms of auto sales last year to become the third largest Auto market globally for the first time. The industry is expected to grow 10-15% in FY24, led mainly by the momentum in the domestic vehicle market, and further aided by impetus to the Electric Vehicles (EVs) segment as a result of the favorable government policies initiatives and rising pollution concerns. India is on track to become one of the world's major EV markets by 2030, expanding at a 49% CAGR between 2021 and 2030. The Indian EV market is likely to see a total investment opportunity of more than USD 200 billion over the next 8-10 years as the focus towards decarbonization gets further sharpened.

The supportive government policies have emerged as a key propeller of the auto industry's growth in India. The Government encourages foreign investment in the automobile sector, and has allowed 100% FDI under the automatic route. FY23 witnessed a slew of initiatives by the Governments at the Centre and in States, to boost the automobile sector. In Union Budget 2023, the Government announced various measures to strengthen the industry growth. These included a reduction in the basic customs duty rate from 21% to 13%, an increase in rebate on personal income tax from 5 lakh per annum to 7 lakh per annum, focus on greener mobility, and increase in fund allocation towards the Vehicle Scrappage Policy, etc. Several EV targeted initiatives were also taken during the year to promote the adoption of electric vehicles in the country. The Indian government has committed that by 2030, 30% of the new vehicle sales in India would be electric. This effort to make the adoption of electric vehicles (EVs) a strategic goal fits well with India's target of reducing carbon intensity per unit of GDP by 45% by 2030. The Government's National Electric Mobility Mission Plan 2020, which seeks to enhance national energy security, alleviate adverse environmental impacts from road transport vehicles, and boost domestic manufacturing capabilities for

Electric Vehicles, is a significant step in the right direction.

The Government of India's decision, in July 2022, to advance from e10 to e20 and likelihood of moving towards e30 target from 2030 to 2025 was a notable initiative, which is expected to give a big boost to the country's EV industry growth. The government has also introduced a battery-swapping policy, which will allow drained batteries to be swapped with charged ones at designated charging stations, thus making EVs more viable for potential customers. Further, to promote local production in line with its ‘Make in India' focus, the Government has raised the customs duty on fully imported luxury cars and EVs from 60% to 70%. In fact, the ‘Make in India' initiative, along with other government policies like Atmanirbhar Bharat, Fame subsidy, Industry 4.0, PLIs, etc., are all designed to push the auto sector's growth in the coming years.

These policies and measures are aimed at giving a big push to the automobile sector, with special focus on electric vehicles. The Government focus is on boosting local production of EVs and EV components, which will lower costs and consequently encourage EV adoption.

Amid the marked paradigm shift in the Indian automotive industry towards alternative / less energy intensive options, JBM Auto has emerged as a frontrunner in maximizing the opportunity for growth in the EV segment. As an end-to-end well-to-wheel solution-based enterprize in the mobility space, we remain committed to sustainability and green manufacturing. Our complete ecosystem for electric buses stands out as a model of excellence, with a huge potential for scalability for the organization. Our new ultra-modern plant, built around the principles of green manufacturing, will help the Company further push its sustainable growth agenda. With our deep-rooted strengths and expertize in the business, we strongly believe that we are ideally poised to harness the emerging clean mobility opportunity, and will continue to invest in the right levers of EV growth.

Our ability to successfully maximize the growth opportunity depends, in large measure, on the passion, dedication and commitment of our JBM families, who continue to partner us in our sustainability-driven growth journey. At JBM Auto, we are dedicated to strengthening our employee E-Verse through proactive initiatives aimed at providing our people with a dynamic and agile ecosystem to nurture their capabilities. During FY23, we launched several programs to enrich our employee experience, while keeping them motivated to deliver performance excellence. With the launch of the JBM L&OD framework, we took a major step forward towards the capability development of our people. Our newly launched e-learning platform will help empower our employees through skill and knowledge enhancement. The implementation of the HR People Capability Maturity Model (PCMM) has helped us assess the maturity of our HR practices and processes, and identify the areas of improvement. We took several steps during the year to strengthen our HR systems and processes, and also launched a Shared Service Center that provides a single point of contact for the employees. Acknowledging and appreciating employee excellence is integral to our HR philosophy and we further augmented our rewards program during the year.

With the launch of the third leg of our Sankalp Siddhi initiative ‘Sankalp se Siddhi 3.0', we took a significant leap in our journey towards organizational and individual development, with focus on employee health and welfare, education and career, as well as social and cultural development.

Our Skill Development Centers (SDCs) continued to drive our efforts towards skilling and upskilling of youth during the year. More than 2,200 candidates were trained and placed in FY23, taking the total number of youth benefited in the last eight years to over 12,000. We signed an MoU with Andhra Pradesh State Skill Development Corporation to engage and implement apprenticeship-based training programs for freshers, ITIs, as well as Diploma and Graduate candidates. We also signed an MoU with Bihar Skill Development Mission for providing Apprenticeship to 100 candidates. We trained 24 candidates under our MoU with Directorate of Industrial Training, Arunachal Pradesh.

We will continue to scale up this initiative to create a bigger pool of skilled manpower for the country.

I am happy to report that your Company posted a robust growth in a challenging macro environment during FY23. Net revenue from operations increased by 20.81% to Rs3,857.38 crore as compared to Rs3,193.05 crore in FY22. The Company's net worth, as on March 31, 2023, was up by 14.90%, at Rs1,029.76 crore, as against Rs896.21 crore on March 31, 2022. The book value per share correspondingly went up by 14.90% to Rs87.09 per share, from Rs75.79 per share in FY22.

The prospects for sustainable future growth are clearly bright and I am confident that the continued support and contribution of the Company's management team and employees will help us leverage the same effectively, in our collective interest. I would like to thank all of them, and also our esteemed stakeholders, whose sustained confidence continues to motivate and inspire us to deliver consistently to the needs of our expanding customer E-Verse.

Chairman