ABB India Ltd

Dear shareholders,

We are pleased to present first integrated annual report of ABB India Ltd, which demonstrates how your Company's purpose enables it to drive performance and create value for our various stakeholders. It also elaborates on the external environment in which we have been conducting our business. Additionally, the report throws light on our operating model and our strategy - globally aligned and customized locally for market segments. The report also elucidates how our teams in different divisions are delivering profitable growth with the highest standards of safety, integrity, governance, and sustainability for the year gone by.

External environment

In 2022, India remained the fulcrum of stability and growth as compared to the global headwinds of geopolitical tensions, supply chain constraints, volatile trade balance, rising energy prices, among other factors. Amidst such a global business environment compounded by climate challenges, Indian cities and companies showed remarkable resilience by embracing sustainability and resource efficiency to streamline processes and generate better return from the assets. The government's proactive programs on energy transition to cleaner sources, emphasizing on last mile connect for delivery, further improved the quality of living for many more millions. The business potential of tier 3 and 4 cities are getting a boost with the drive to electrify and build smart transportation systems with electric coaches, metros, semi high speed rail, airports and highway corridors. The incentives on infrastructure and the roll out of 5G network is catalyzing a strong backbone for India's digital economy and stepping up growth across multiple sectors.

Electronics, data centers, warehouse and logistics, railways and metro, food and beverage, water and renewables segments witnessed significant traction aided by proactive positive actions.

Megatrends and local impact These shifts of digitalization and e-commerce, electrification, energy efficiency, and sustainability, have helped to demonstrate our Company's purpose as well as our operating model and strategy with our performance. In India more than 124 partners and customers – medium and large entrepreneurs have joined the global energy efficiency movement initiated by ABB thus formalizing their commitment to embark on a journey of energy optimization. ABB India with its experience and expertise will guide them along the journey. Digitalization has also increased focus on data center development with more 27 percent of hyperscale data centers in the country deploying ABB solutions. With the recent efforts to decrease the levels of non-revenue water, more than 15 cities in the country have installed ABB flowmeters with instrumentation and electrification solutions to treat waste-water for clean rivers. From AI enabled city gas distribution solutions in 11 states for last mile connect to ~30 percent of renewable energy projects, ABB offerings are partnering India's transition to a greener economy.

Strategy for consistent performance Our strategy of consistently engaging for new opportunities in the high growth segments, expanding market share in moderate ones, deepening, and retaining our focus on key customer base, along with sharp product focus is helping the Company to steer the course of profitable growth. In this exciting transition journey, team ABB India secured record orders of INR 10,028 crore in CY 2022, a growth of 31 percent, to go back to pre-divestment of Power Grids business and other portfolio realignment levels in less than three years. The revenue for CY 2022 posted an uptrend of 24 percent to INR 8568 crore. The profit after tax was at INR 1026 crore. Your Company's earnings per share almost doubled to INR 47.96 per share as compared to INR 24.53 per share in 2021. This consistent improvement in performance along with a solid balance sheet puts us in a sweet spot to optimize the opportunities which the Indian market puts forth to keep creating value for all our stakeholders.

Sustainability in practice

And while doing all this, our unwavering focus on sustainability, governance, and integrity, was manifested in our operations and offerings to customers. In 2021, ABB India was one of the early adopters of the newly introduced Business Responsibility and Sustainability Report (BRSR), this year too, the BRSR report in the "sustainability in practice" section, details our group aligned and locally adapted initiatives on sustainability.

On an overall basis we reduced greenhouse gas emissions by ~82 percent (scope 1 and scope 2) in 2022 as compared to the 2019 baseline. All our manufacturing campuses were certified as single use plastic free, zero liquid discharge facilities and certified as green buildings leading to a recognition as a pioneer in green factory buildings by the Indian Green Building Council. You will read more about the various initiatives on energy, water, waste, and emissions aligned with the ABB Group targets in the report. The report will also highlight our various community initiatives especially in areas of access to public infrastructure, health and education with a special focus on the multi-faceted program on diversity and inclusion, which brought the overall diversity ratio for ABB in India to 19 percent.

A stable foundation for future growth Looking ahead, your Company has a solid foundation with a team which strives for consistent excellence to deliver solid performance. The spread of the ABB global portfolio across several prioritized segments, access to global and local supply chains, complemented by a deep local manufacturing footprint can be mitigating factors for global macro headwinds. Guided by the wise council of an experienced Board of Directors, we believe we will continue with the growth momentum. With our agile, high-performing divisions, strong focus on diversity and inclusion and engaged teams, we are certain that ABB India will create new milestones and continue to go from strength to strength. As India grows to become one of the best performing economies of the world sustainably, ABB India will be significant technology solutions partner of that growth journey.

On behalf of the Board of Directors, we would like to thank our stakeholders for their continued trust and support. Together with our customers, employees, partners, suppliers, and investors, we will continue to create superior value for all our stakeholders by balancing the needs of society, the economy, and the environment.