V-MARC India Strengthens Nepal Expansion Through Strategic Joint Venture with Annapurna Rathi Cable Industries

What Happened ?

key details

Joint Venture Overview:

• Joint participation in tenders across Nepal.
• Manufacture and supply Medium Voltage Covered Conductors (MVCC).
• Expand V-MARC’s international footprint.
• Improve access to new markets and technologies.
• Generate long-term business opportunities in Nepal’s power infrastructure sector.

Business Scope:

The joint venture will focus on:

• Manufacturing MVCC products with voltage grades ranging from 10 kV to 36 kV.
• Participating in public and private sector tenders in Nepal.
• Executing projects within Nepal’s power transmission and distribution industry.

Commercial Structure:

• No acquisition of shares or assets.
• No upfront equity investment.
• No cash consideration or share swap.
• No upfront capital contribution by either party.
• Bid Bonds, Performance Bonds, Advance Payment Guarantees and other contractual obligations will be shared on a pro-rata basis under the Joint Venture Agreement.

Participation Structure:

The agreement provides for V-MARC’s participation in the joint venture as follows:

• Up to FY 2026-27: 70%
• FY 2027-28: 60%
• FY 2028-29: 60%
• FY 2029-30: 50%

Regulatory & Timeline:

• No prior regulatory approval was required for executing the Joint Venture Agreement.
• Any approvals required under Nepalese laws or by relevant tendering authorities will be obtained as applicable.
• The agreement became effective on 9 October 2025.
• Unless terminated earlier, the agreement will remain valid until 31 March 2030.

Joint Venture Partner:

Annapurna Rathi Cable Industries Limited is incorporated under the laws of Nepal and is engaged in manufacturing and supplying:

• Electrical cables
• Conductors
• Allied electrical products

The company primarily operates in Nepal. Information regarding its incorporation date and historical turnover has not been disclosed by V-MARC.

Risk Analysis

Summary:

• The joint venture represents a strategic business expansion rather than an acquisition. While it offers access to a new international market, its commercial success will depend on securing projects, executing contracts and sustaining demand in Nepal’s power infrastructure sector.

Key Risks:

• Revenue generation depends on winning competitive tenders.
• Execution risks associated with overseas infrastructure projects.
• Regulatory approvals may be required for individual projects in Nepal.
• The arrangement does not guarantee future contract awards.
• Commercial outcomes depend on successful project execution throughout the agreement period.

Worst Case:

• If the joint venture fails to secure major projects or infrastructure spending slows in Nepal, the expected strategic and commercial benefits may not materialize despite the long-term agreement.

Risk Level: Medium

Company Commentary

V-MARC stated that the joint venture has become materially significant due to its strategic importance and business progress. Management expects the collaboration to:

• Strengthen the company’s international presence.
• Enhance access to new markets and technologies.
• Create long-term business opportunities.
• Support V-MARC’s future growth strategy.

The company has also confirmed that the disclosure has been made in the interest of transparency and good corporate governance.