Synergy Green Industries Ltd Management Discussions

FORWARD LOOKING STATEMENT

This report contains forward-looking statements, which may be identifiedby words such as "plans," "expects," "will," "anticipates," "believes," "intends," "projects," or "estimates." These relate to the Companys growth strategy, product development, market position, expenditures, financial performance, and other future matters. Such statements are based on assumptions and expectations of future events and are not guarantees of performance. Actual results may differ materially due to risks, uncertainties, and external factors beyond the Companys control. The Company undertakes no obligation to update or revise forward-looking statements, except as required by applicable law.

Global Wind Industry

The global wind industry achieved a historic milestone in 2025, adding a record 165 GW of new capacity—an approximate 40% year-over-year increase. This surge brought total global wind capacity to nearly 1,300 GW, led primarily by robust onshore expansions in China, the United States, and India. This rapid acceleration is a critical step toward the COP28 mandate to triple global renewable capacity to 11,000 GW by 2030. Demand is being heavily stimulated by falling technology costs, the rollout of larger 15+ MW turbine and a maturing offshore sector that has surpassed 75 GW.

Cumulative global wind capacity reached a record 1,300 GW by the end of 2025, with 155 GW from e installations.offshor onshore and 9 GW from

China led with 119.75 GW, followed by the U.S. (6.8 GW), India (6.3 GW), Germany (5.7 GW), and Brazil (2.2 GW). Other major economies also set up ambitious targets – particularly those with strong offshore resources such as Japan, South Korea,

Australia, Vietnam, the Philippines and Kenya.

Challenges such as policy instability, permitting delays, and grid infrastructure issues continue to hinder growth. The Global Wind Energy Council (GWEC) projects a compound annual growth rate (CAGR) of 8-9% through 2030, adding nearly 1 TW of capacity during this period. This alone shows the magnanimous growth runway for the industry that took 40 years to reach the first 1 TW mark in 2024 and is to achieve the same feat within an accelerated timeline of just 7 years to reach 2 TW by 2030.

Indian Wind Industry:

India is one of the worlds leading and fastest-growing wind energy markets. India added approximately 6.34 GW of wind capacity in 2025, marking a 85% increase and reclaiming the third position in the global wind market in 2025. As of end of 2025, India has 54.5 GW of installed onshore wind capacity.

The government is committed to achieve 500 GW of non-fossil fuel energy capacity by 2030, with 100 GW targeted from wind energy. Policy focus areas include stronger Renewable Purchase Obligation (RPO) compliance, improved financial health of DISCOMs, development of a robust Renewable Energy Certificate

(REC) market, and enhanced long-term project pipeline visibility to support sustained sector growth. All-in-all, as the second largest hub of onshore wind turbine assembly and key component manufacturing in the APAC region, India is well placed for capitalizing on the enormous opportunity going ahead.

Customer Overview:

Your Company primarily serves both domestic and international markets for wind turbine castings and has established long-term supply partnerships with six of the top 15 global wind OEMs such as Vestas, Vayona (erstwhile Siemens Gamesa), GE, Nordex, Adani and Envision, as well as key Indian OEM including Senvion. Demand from these OEMs spans domestic installations, turbine assembly exports, and direct casting exports.

Beyond wind OEMs, the Company has secured long-term contracts with major wind gearbox manufacturers such as Flender Drives and ZF Wind. The Company also supplies Tier-1 players across industrial segments, including Terex, Milacron and Wilo, serving sectors like industrial machinery, mining, plastic injection, and pumps.

Current Year Performance:

In FY 2025-26, your Company achieved total income of 376.4 Cr, compared to 363.7 Cr in the previous year, recording a nominal growth of 3.5%. The years growth was muted, largely due to project activities and operational disruptions arising from brownfield expansion initiatives. The Wind Domestic segment was impacted by slower-than-expected offtake from newly acquired OEM customers, while OEM Export revenues declined amid the product transition to higher-MW turbine platforms under development.

However, growth in the Gearbox and Non-Wind segments helped offset the impact.

In FY 2025–26, the Company reported a EBITDA of 49.3 crores (13.1%), compared to 53.70 crores (14.8%) in FY 2024–25, representing a year-on-year decline of 8.1%. Earnings during the year were impacted due to higher outsourcing and operating costs associated with the relocation and stabilization of the new unit, along with increased finance cost and depreciation, and lower export realizations due to discounted pricing during the development phase of the in-house machining facility.

Transformational Year Marked by Capacity Expansion and New Capability Development:

During FY 2025–26, the Company recorded marginal growth in revenue. However, the year was transformational, marked by the successful execution of several strategic initiatives that have strengthened the foundation for future growth and improved operational capabilities.

A major highlight of the year was the successful completion of the Companys 217 crore capex programme spanning foundry expansion, in-house machining, and captive solar power. The investments were executed over the past 12–18 months and funded through the Rights Issue completed in October 2024, internal accruals, and debt financing.

These investments led to several important operational and strategic milestones during the year, including:

» Successful completion of the brownfield foundry expansion, including the enhancement of single product weight from 23 MT to 30 MT and installation of a new production line, increasing overall foundry capacity from 30,000 TPA to 45,000 TPA.

? Establishment of a new fettling and inspection facility designed for 45,000 TPA capacity, along with relocation of activities from existing facilities to the new unit for improved operational efficiency.

? Development of 12 new products across major OEM customers on higher MW turbine of up to 5 MW, enabling effective utilization of the enhanced production capacity.

? Commissioning of state-of-the-art machining and surface treatment facilities with an installed capacity of 20,000 TPA.

? Establishment of machining and coating processes, initiation of machining product development activities, and receipt of customer approvals for the new facilities.

? Expansion of captive solar power capacity from 2 MW to 10 MW, strengthening the Companys commitment towards sustainable and cost-efficient operations.

These strategic investments and capability enhancements have created a strong platform for future revenue growth, improved capacity utilization, and margin expansion.

Performance Outlook for FY 2026-27: Revenue:

New customer additions and product developments broaden the Companys addressable market. Backed by enhanced production capacity, the Company expects to deliver healthy double-digit revenue growth during the year.

The executable order book for FY 2026–27 is projected to grow by over 33% compared to the previous year, surpassing the 500 crore mark.

Export revenues contributed approximately 27% in FY 2025–26 and are expected to remain stable in the range of 25%–30% going forward.

Profitability:

The establishment of the 20,000 TPA in-house machining facility and the 10 MW captive solar power plant provided visibility for healthy margin expansion. Economies of scale also created opportunities for cost optimization.

However, the West Asia conflict input raw material prices. While the Company hedged key commodities through customer contracts, there could be a one-quarter lag in

The Audit Committee has additional passing on changes in input prices to customers. Considering these factors, EBITDA margins are expected to expand by over 300 basis points YoY.

Opportunities And Threats: Opportunities i. The global and Indian wind energy markets remained on a strong growth trajectory. In addition, renewed focus on renewable energy amid the West Asia conflict accelerated installations further. ii. Indias emergence as a manufacturing hub for multinational OEMs unlocked significant global demand for domestic casting manufacturers. iii. Depreciation of the Indian Rupee, particularly against the Chinese Yuan, improved the competitiveness of Indian products in global markets. iv. Geopolitical shifts, including regional tensions and trade wars, increased sourcing from India and strengthened export opportunities for Indian foundries.

Threats i. Heavily dependent on the wind sector, which accounted for over 80% of revenues. Mitigation: The Companys facilities remained versatile and could, with reasonable lead time, cater to other large casting applications and industries. ii. Volatility in commodity prices posed risks to profitability. Mitigation: The Company hedged key commodity prices through quarterly agreements with customers. iii. Availability of skilled manpower, particularly in critical operations such as fettling, remains a challenge. Mitigation: The Company undertook automation initiatives to reduce dependence on manual processes.

Risks And Concerns:

In accordance with the SEBI Listing Regulations, the Board of Directors of the Company is responsible for framing, implementing and monitoring the risk management plans of the Company. The Company does from time to time identify risks associated, assess its impact and take appropriate corrective steps to minimize the risks that may threaten the existence of the Company.

Annual risk assessment exercise is conducted in the line with the framework, existing risks, their mitigation plans are evaluated and new risks, if any, are identified. oversight over financial risks and controls. It also reviewed the mitigating factor and actions initiated by the management to minimize the impact.

Risk Mitigation

To mitigate various risks significant to its business, your Company took several strategic measures during the year, such as: i. Customer concentration risk: The Company has expanded its customer portfolio, adding major clients like Senvion India Pvt. Ltd., GE India, and Adani, with Nordex and Envision currently being onboarded. ii. Foreign exchange risk: The Company has availed Foreign Currency Term Loans (FCTL) andimplementedcurrencyswaparrangements to establish a natural hedge against export earnings. iii. Raw material supply risk: Focused efforts are underway to diversify and secure alternative sources for critical raw materials such as pig iron and CRCA scrap.

These initiatives have strengthened the Companys resilience, helping it achieve its strategic and financial objectives despite external uncertainties.

Segment Wise Or Product Wise Performance:

The Company works only in one segment i.e. manufacturing of SG & CI Castings.

IN ACCORDANCE WITH THE SEBI (LISTING OBLIGATIONS AND DISCLOSURE REQUIREMENTS 2018) (AMENDMENT) REGULATIONS, 2018, THE COMPANY IS REQUIRED TO GIVE DETAILS OF SIGNIFICANT CHANGES (CHANGE OF 25% OR MORE AS COMPARED TO THE IMMEDIATELY PREVIOUS FINANCIAL YEAR) IN

Key Financial Ratios:

Material Developments In Human Resources, Including Number Of People Employed:

The Company believes and recognizes that its employees are important resource in its growth and to give competitive advantage in the present business scenario. Ensuring business operations, employee safety and welfare became the foremost concerns for the Company.

During the year under review, the company ensured to keep the safety and the wellbeing of its employees as its topmost priorities. The Company has total 252 employees as on March 31, 2026. The ntly efficie companycontinuedwithitsfocusonan recruiting employees with the right talent and groom them to build a strong leadership pipeline. The diversity and inclusiveness in the workforce remained a strong fundamental to the company, in line with it the company continued to bring in more women employees.

The Company has well-thought out and employee-friendly HR policies which it has led to a positive working relationship with its employees. The Company has not had any work stoppages or cessations owing to labour disputes. The Company continues to lay great emphasis on Safety and Security. To ensure adherence to safety protocols, the company follows stringent procedures to safeguard and protect its workforce. The company also keeps prescribing policies and procedures while imparting training to its workforce. It has a system in place that promotes a positive work environment free of all forms of harassment.

Internal Control Systems And Their Adequacy

The Company has in place a well-framed internal control system that authorizes, records, and reports transactions to safeguard assets and protect against loss from unauthorized use or disposition. The internal controls ensure the reliability of data and financial information to maintain accountability of assets. These internal controls are supplemented by extensive internal audits, management review, and documented policies, guidelines, and procedures.

Disclosure Of Accounting Treatment

For the first time Indian Accounting Standard was applicable from the F.Y.2021-22 due to migration from BSE-SME Exchange to the Mian Board of BSE & NSE. The Company has adopted and has followed all the treatments in the Financial Statements as per the prescribed Indian Accounting Standards. Note: For sake of brevity the items covered in Boards Report are not repeated in the Management Discussion and Analysis Report.

Cautionary Statement:

Certain Statements in the Management Discussion and Analysis describing the companys objectives, projections, estimates and expectation or predictions may be forward looking statements within the meaning of applicable laws and regulations. It cannot be guaranteed that these assumptions and expectations are accurate or will be realized. Actual results could differ from those expressed or implied. Important factors that could make a difference to the Companys operations include economic conditions affecting demand/ supply and price conditions in the domestic markets, changes in the Government Regulations, tax laws and other statues and incidental factors