Automotive Axles Ltd

It is my privilege to present to you our Annual Report for FY 2024-25. This has been a noteworthy year for us at Automotive Axles, marked by operational excellence, deeper OEM engagement, and a sharp focus on product quality. Our performance in the core axle and braking systems business remained robust, supported by sustained demand in the domestic CV segment and growing traction in exports. What gives me the greatest satisfaction is our progress in building a future-ready organization—with sharper customer focus, greater digitization across operations, and continued investments in people, processes, and planet- responsible practices.

The global economy witnessed moderate growth amid a complex and shifting landscape shaped by geopolitical tensions, policy realignments, and trade disruptions. The introduction of sweeping tariff measures by major economies created ripple effects across global supply chains, amplifying uncertainty and slowing the pace of recovery. Inflationary pressures remain elevated, particularly in advanced economies, with disinflation expected to be more gradual than earlier anticipated. In such a volatile environment, global cooperation, structural reforms, and cohesive policy responses will be essential to restore momentum and build long-term resilience.

Against this challenging global backdrop, India emerged as a bright spot, demonstrating strong economic resilience and maintaining its position as one of the fastest-growing major economies. The country's growth was anchored in structural reforms, digital transformation, and sustained infrastructure development. Supportive monetary policy, robust domestic consumption, and a strong services export base further reinforced economic activity. As global uncertainties persist, India's stable macroeconomic framework, improving rural sentiment, and rising private investments provide a solid foundation for inclusive and sustained growth, reinforcing its readiness to navigate the road ahead with confidence.

We closed FY 2024-25 on a strong operational note despite a relatively soft year marked by subdued demand and an unfavourable product mix. During FY 2024-25, we have introduced MS185 our flagship product to additional customers and able to ramp up the volumes, providing a competitive advantage. Alongside this, cost optimisation and margin improvement initiatives helped sustain performance and build momentum for the future.

In FY 2024-25, our total revenue stood at '21,048 million, compared to '22,449 million in the previous year, a decline primarily driven by commodity price adjustments, unfavorable product mix and lower volume. On a normalised basis, the reduction was around 5.2%. Despite softer topline,

we delivered an EBITDA of '2,472 million, maintaining a healthy margin of 11.9%, slightly above the previous year's 11.8%. This reflects our disciplined cost control and focus on operational efficiency. We also generated '721 million in additional operating cash flow and continued to maintain a debt-free balance sheet. With robust financial ratios and strengthened governance practices, we remain committed to performance, accountability, and long-term value creation for all stakeholders.

During the year, we entered into a new technical and service agreement with Meritor HVS (India) Limited (MHVSIL), enabling us to sell products directly to OEMs. This marks a significant strategic shift, enhancing our market access while continuing to benefit from MHVSIL's support in areas such as market intelligence, customer management, product design, and testing services.

We drive our sustainability agenda through focused action across environmental, social, and governance pillars. In FY 2024-25, ~80% of our energy came from renewable sources, reinforcing our commitment to carbon reduction. We expanded rainwater harvesting, improved waste management, and enhanced biodiversity across locations. Initiatives such as ISO 14001 auditor certification, electromagnetic flow meters, and dual media filters underscore our proactive approach to environmental compliance and long-term ecological stewardship.

Complementing our environmental efforts is a strong focus on social impact. We foster an inclusive, safe, and engaging workplace through structured learning programs, DEI initiatives, digitalised safety systems, and employee recognition frameworks. Equally, we remain committed to uplifting communities around our operations, with preventive healthcare and access to essential services being key areas of intervention.

Tying these efforts together is a governance framework that goes beyond compliance to focus on long-term stakeholder value and ethical business conduct. It encompasses corporate ethics, human rights, social responsibility, and ESG oversight. Our Board committees remain actively involved, ensuring robust governance across all dimensions. Through strategic controls and enhanced Board participation, we continue to uphold our values and drive sustainable, responsible growth.

I extend my sincere gratitude to all our employees, customers, supply chain partners, investors, and the Government of India for their steadfast support. As we look ahead, the opportunities before us are immense. With strong manufacturing capabilities, advanced technologies, operational discipline, and a skilled workforce, Automotive Axles has firmly established itself as a trusted industry player.

Our focus on strategic investments, digitisation, and customercentric innovation positions us well for the next phase of growth. We remain committed to delivering long-term value through quality, reliability, and continuous improvement.

I look forward to our continued collaboration as we build on our legacy and scale new heights together.