Transformers & Rectifiers India Ltd

Dear Shareholders,

I am delighted to share that FY24-25 has arguably been the most successful year in the history of your company. We achieved record highs in revenue, production, EBITDA, and PAT margins. We have not only strengthened our position as a leader in the transformer manufacturing industry but have also significantly enhanced our operational efficiency and financial stability. Our ability to adapt to market dynamics, capitalize on growth opportunities, and execute our strategic vision has been instrumental in our sustained success.

Global electricity demand is projected to increase by approximately 8300 TWh by 2027, with emerging economies contributing the most significantly. India's electricity demand, approximately 1700 TWh, is expected to grow over 20% by 2027, driven by industrialization and the aspirations of a growing middle class. Southeast Asian countries such as Indonesia and Vietnam are witnessing robust growth due to ongoing electrification efforts. Additionally, many African nations are experiencing rising consumption, particularly as demand picks up following a period of stagnation, driven primarily by newly electrified loads. The global generation mix is rapidly shifting, with renewable sources including hydro, wind, solar, and bioenergy anticipated to become collectively the largest electricity source worldwide, primarily due to significant expansions in solar and wind capacities. Global electricity demand is projected to grow at an average of 3% annually through 2027,with China forecasted to expand by 6%, and India by approximately 6.3%. According to the International Energy Agency (IEA),the key findings for electricity in 2025 indicate accelerated demand growth led by Asia, including advanced economies, with renewables rapidly challenging fossil fuel generation.

India's Union Budget 2025 reaffirms the country's commitment to achieving "Viksit Bharat" by 2047,positioning India to dominate the global economic landscape by maintaining its status as the world's fastest-growing major economy. The World Bank's Global Economic Prospects (GEP) report projects India's economy to grow steadily at 6.7%, significantly surpassing global growth expectations of 2.7%. The government's emphasis on infrastructure capital expenditure, particularly in the power sector, opens substantial opportunities for the transformer industry.

The industry in which your company operates continues to expand steadily due to strategic initiatives by the Central Government aimed at achieving the "Viksit Bharat 2047" vision. India's growth trajectory is primarily driven by the Central Government's investments in power infrastructure development, state-level initiatives expanding distribution networks, rapid industrialization nationwide, massive renewable energy expansions to support zero-emission goals, increasing demand from Indian Railways for power-related components, and the Urban Development Ministry's modernization efforts in urban transportation.

India's transformer market is witnessing substantial growth, driven by the rapid expansion and modernization of its electrical grid to support an expanding industrial base and rising electricity demand due to urbanization and economic development. The country is among the most dynamic and rapidly growing transformer markets globally, with growth rates significantly exceeding the global average. India's robust domestic consumption and increasing exports continue to support its growing share of the global transformer market.

In FY24-25,your company took significant strides to establish it self as a key global player in the transformer industry. During this year, we prepared ourselves to effectively meet the increasing global demand, especially from Indian consumers.

Achieving our revenue targets for FY24-25 and advancing heavy backward integration were primary objectives, and I am pleased to report that we successfully met these goals. We have initiated various backward integration projects aimed at making your company fully integrated by the end of the next financial year.

We are well aligned with our strategic growth plans outlined previously, with a favourable external environment and strong demand across our core product offerings. Government demand has notably increased in the current capital expenditure cycle.

A key strategic move during the year was the acquisition of a controlling stake in a Cold-Rolled Grain-Oriented (CRGO) steel processing unit. CRGO electrical steel accounts for

nearly one-third of transformer raw materials, making its quality and consistency crucial for reliable transformer performance. This acquisition will significantly enhance our supply chain management, operational efficiency, and market position.

Another milestone is establishing a fully automated radiator facility. Phase 1 of this advanced facility is already operational, with the entire project expected to be completed within the next year. This facility can manufacture radiators for applications up to 765kV, significantly advancing our backward integration strategy and expanding our capabilities.

We have further strengthened our strategic vision through technological collaborations in three critical component areas. These partnerships will help the company achieve self-sufficiency in key components and contribute significantly to our consolidated revenue within the next few years. The primary goal of these strategic alliances is to substantially reduce lead times and mitigate external dependency risks. Additionally, a state-of-the-art fabrication facility will become operational by the end of the next year, providing us a competitive advantage.

In April 2024, we commenced capacity expansion efforts, adding 15,000 MVA to cater to renewable energy and medium voltage market requirements. Commercial production at this new facility is set to begin in May 2025. Moreover, the company has decided to further increase its Extra High Voltage transformer capacity by an additional 22,000 MVA, with commercial production expected to begin in February 2026. This expansion will raise our total production capacity to over 75,000 MVA.

Once again, I assure you that the industry growth outlook remains robust, and we are fully committed and strategically aligned to contribute effectively to India's "Viksit Bharat 2047" vision.

I take great pride in these results and extend my sincere gratitude to all stakeholders, including our Board, management, staff, customers, and vendor partners, for their invaluable contributions. The company remains con dent, determined, and prudent in delivering continued success. We look forward to the future with renewed enthusiasm and confidence, having laid a solid foundation for sustained growth.

Jai Hind!