Credit Rating

FML: SEC: F-42 (18) 19th October, 2026 To, To, BSE Limited, National Stock Exchange of India Ltd. Phiroze Jeejeebhoy Towers, Exchange Plaza, 5th Floor, Plot No.C-1, G Dalal Street, Mumbai – 400 001. Block Bandra-Kurla Complex, Bandra (East), Mumbai 400 051. Scrip Code: 500033 NSE Symbol: FORCEMOT Sub.: Intimation under Regulation 30 (read with Part A, Para A of Schedule III) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, with regard to Credit Rating. Dear Sir / Madam, Pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015 (‘Listing Regulations’), we wish to inform you that the Company has received communication from CRISIL Ratings Limited (“CRISIL”) dated 19th October, 2026, wherein following rating action has been reaffirmed: Total bank loan facilities rated Rs. 765 Crores Long Term Rating CRISIL AA+/ Stable (Reaffirmed) Short Term Rating CRISIL A1+ (Reaffirmed) The aforesaid communication from CRISIL is attached for reference to this letter. Kindly take the same on your records. Thanking you, Yours faithfully, For Force Motors Limited Rohan Sampat Company Secretary & Compliance Officer M. No.: F14037 Encl: A/a FORCE MOTORS LIMITED CIN L34102PN1958PLC011172 Regd. Office : Mumbai-Pune Road, Akurdi, PUNE – 411 035, INDIA. Tel. : (+91) 20 2747 63 81 Visit us at : www.forcemotors.com Rating Rationale October 19, 2026 | Mumbai Force Motors Limited Ratings reaffirmed at 'Crisil AA+ / Stable / Crisil A1+ ' Rating Action Regulator Of Total Bank Loan Facilities Rated Rs.765 Crore Instrument Long Term Rating Crisil AA+/Stable (Reaffirmed) RBI Short Term Rating Crisil A1+ (Reaffirmed) RBI Note: None of the Directors on Crisil Ratings Limited’s Board are members of rating committee and thus do not participate in discussion or assignment of any ratings. The Board of Directors also does not discuss any ratings at its meetings. 1 crore = 10 million Refer to Annexure for Details of Instruments & Bank Facilities Detailed Rationale Crisil Ratings has reaffirmed its ‘Crisil AA+/Stable/Crisil A1+’ ratings on the bank facilities of Force Motors Limited (FML). The ratings reflect FML’s strong business risk profile, marked by leadership in the domestic light commercial vehicle (CV) passenger segment, healthy operating profitability, debt-free balance sheet and robust liquidity. The ratings also factor in significant financial flexibility arising from the sizeable investment portfolio of its parent, Jaya Hind Industries Private Limited (JHIPL; rated ‘Crisil AA+/Stable/Crisil A1+’). These strengths are partially offset by susceptibility to risks arising from FML’s concentration in select passenger-mobility categories, cyclicality in automotive demand, intense competition in the utility vehicle (UV) segment and fluctuations in raw material prices. Operating revenue increased ~12% on-year to Rs 9,073 crore in fiscal 2026, led by strong demand for commercial vehicles (CVs) –Trax and Urbania van– and higher realisations. This was partially offset by lower revenue from the automotive component division due to the changing product mix. Domestic sales volume increased ~20% on-year to 36,536 units in fiscal 2026. The company maintained a dominant position in the niche domestic Light commercial vehicle (LCV) passenger segment, with market share exceeding 70% in addressable categories. Growth was broad-based, with Urbania volume more than doubling and Trax volume up by over 70%. Urbania benefited from increasing adoption in the premium shared- mobility segment, while goods and services tax rationalisation and deeper penetration in tier-II and tier-III markets supported Trax volume. Revenue grew by 6% on-year to Rs 2,440 crore in the first quarter of fiscal 2027, due to moderate sale volume; albeit strong recovery in the domestic CV segment witnessed in the second quarter, led to 25% on-year growth in volumes for the first half of fiscal 2027. Revenue is likely to grow by 6–8% annually over the near to medium term, supported by calibrated price hikes, premiumisation, new product launches and gradual expansion in export markets. The CV business will remain the principal growth driver, while revenue from the automotive component business should remain broadly stable. Operating profit has increased ~34% on-year to Rs 1,500 crore in fiscal 2026, while operating margin expanded ~270 basis points to 16.5%. The improvement was supported by higher realisations, favourable product mix and operating leverage, though partially offset by higher raw material and employee expenses. Operating margin moderated to 13.4% in the first quarter of fiscal 2027 from 14.5% in the corresponding period of fiscal 2026, owing to increase in material cost following the West Asia crisis. Nevertheless, the margin is expected to remain healthy at 15–16% over the near to medium term, supported by calibrated price increases, increasing premiumisation, favourable product mix and operating leverage. Financial risk profile has strengthened in fiscal 2026 with adjusted networth increasing to Rs 3,461 crore as on March 31, 2026, from Rs 2,402 crore a year earlier while it remains debt free. Total outside liabilities to adjusted networth (TOL/ANW) ratio improved to 0.7 time at March 31, 2026, from 0.9 time at March 31, 2025. Adjusted return on capital employed (RoCE) increased to 40.7% in fiscal 2026, from 34.6% in fiscal 2025, supported by stronger operating profitability and efficient capital utilisation. FML is expected to remain debt-free over the medium term, despite annual capital spend of Rs 600–700 crore over the next 2–3 years, which will be funded by internal accrual. Planned capital expenditure (capex) will be directed largely towards capacity expansion to support higher volume, new product development, expansion of the product portfolio, and creation of in-house electric vehicle manufacturing capabilities. Adjusted RoCE should remain healthy at 25–30%, despite the sizeable, planned capex. Liquidity has been adequate with cash and equivalents of Rs 1,805 crore as on March 31, 2026. Annual net cash accrual of Rs 1,100–1,400 crore expected over fiscals 2027–2029 should comfortably fund annual capex. The unutilised bank limit will also provide a cushion, as utilisation is expected to remain limited. Financial flexibility is further supported by JHI’s sizeable investment portfolio. The market value of JHIPL’s investments was around Rs 40,963 crore as of September 2026, compared with group debt of around Rs 570 crore as on June 30, 2026. JHI has also demonstrated its ability to provide need-based support by extending a loan of Rs 150 crore to FML in fiscal 2022, which has since been fully repaid. Crisil Ratings also takes note of the proposed demerger of JHIPL’s automotive-components business, its investment in FML and Bajaj Auto Ltd (BAL, rated ‘Crisil AAA/Stable/Crisil A1+’) into Jaya Hind Industries Automotive Private Limited (JHIAPL). FML will remain a part of the Abhay Firodia group, and the reorganisation is unlikely to materially affect ownership, operations or financial flexibility. The group’s sizeable investment portfolio will continue to enhance the financial flexibility. Analytical Approach Crisil Ratings has combined the business and financial risk profiles of FML and its subsidiaries, Tempo Finance (West) Pvt Ltd and Force MTU Power Systems Pvt Ltd (Force MTU) as these are strategically important to, and have considerable operational integration with, FML. Crisil Ratings has also revised the analytical approach from parent notch up approach to standalone assessment approach. Please refer Annexure - List of Entities Consolidated, which captures the list of entities considered and their analytical treatment of consolidation. Key Rating Drivers - Strengths Leading position in the domestic LCV passenger segment and diversified revenue streams: FML focuses on the niche LCV passenger segment and maintains a dominant marke [Showing first 8,000 characters — download PDF for full document]