Aayush Art and Bullion Ltd Management Discussions

Overview

The Directors are pleased to present the Management Discussion and Analysis Report for the year ended 31st March, 2026.

The Company was originally incorporated as AKM Lace and Embrotex Private Limited on 26th November, 2009 under the provisions of the Companies Act, 1956. Subsequently, the Company was converted into a public limited company on 4th May, 2017, and its name was changed to AKM Lace and Embrotex Limited. Thereafter, the Company made its debut on the capital markets through an Initial Public Offering (IPO) and got listed on the BSE SME Platform on 29th September, 2017. Over time, in line with its evolving business objectives and branding strategy, the name of the Company has been changed to Aayush Art and Bullion Limited, under which it presently operates and is listed.

Industry Structure & Development

Global Jewellery Industry The global jewellery market is expected to witness substantial growth. This growth is primarily driven by evolving consumer preferences towards distinctive jewellery styles, including oversized hoops and geometric shapes like rectangles, spheres, and squares. The rising popularity of personalised and environmentally sustainable jewellery further fuels this trend. The global gold jewellery market will grow during the forecasted period due to rising GDP per capita, increasing consumer disposable income, and the appeal of gold as a long-term investment.

Indian Gold Business:

Overview Indias formidable position as the second-largest gold market, where an impressive 70% of the demand is attributed to exquisite Jewellery, underscores the immense growth opportunities awaiting the organized retail segment. It is also the third-highest component of retail consumption in India. Moreover, gold Jewellery demand has experienced a steady and consistent upward trend for several reasons. Firstly, most of the demand can be attributed to weddings, where gold holds great cultural and sentimental value. As weddings remain an integral part of many societies, the demand for gold Jewellery continues to rise. Secondly, gold is considered a reliable store of value, especially in times of economic uncertainty, making it an attractive investment option for individuals. The growth in disposable income across various regions has also played a crucial role in boosting demand, as people have more financial capacity to invest in gold Jewellery. Thirdly, gold Jewellery holds strong linkages to traditions and customs, further driving its popularity. Lastly, evolving fashion trends and styles have increased the demand for gold Jewellery as consumers seek innovative and contemporary designs. The jewellery market in India is a sizeable and attractive industry, propelled by several favourable factors. These include shifting customer behaviours, superior organizational capabilities, and supportive regulatory and legislative changes. These combined elements create significant tailwinds for the growth and prosperity of the Jewellery sector in India.

Opportunities and Threats

The Indian gems and jewellery industry continue to witness strong growth, driven by increasing disposable incomes, rising demand for branded jewellery, changing consumer preferences, and greater penetration of organised retail. The organised jewellery retail segment is expected to continue growing at a healthy pace over the coming years.

Aayush Art and Bullion Limited intends to strengthen its presence across India by expanding into new and

underpenetrated markets through a capital-efficient franchise-led model, while also exploring opportunities in select international markets, including the Middle East.

The Company aims to further enhance its omnichannel retail strategy by integrating its physical stores with digital platforms to provide a seamless customer experience, improve customer acquisition and retention, and drive sustainable revenue growth.

The Company continues to leverage data analytics and technology-driven customer engagement initiatives to increase footfall, strengthen customer relationships, optimize inventory management, and improve overall operational efficiency.

Fluctuations in gold and other precious metal prices, exchange rate volatility, inflationary pressures and changes in consumer purchasing behavior may have a short-term impact on demand and profitability.

The Jewellery industry remains exposed to risks arising from global geopolitical developments, changes in import duties and government policies, supply chain disruptions, and evolving regulatory requirements. The Company continues to monitor these risks and adopt appropriate mitigation measures to ensure business continuity and sustainable growth.

Risk and Concerns

The rapid growth of Indian e-commerce has profoundly impacted various industries, including the gold jewellery sector. Traditionally, Indians have purchased their favourite gold jewellery items, such as necklaces, bangles, earrings, and more, from local jewellery shops. However, the landscape is evolving. This shift reflects the changing preferences and convenience-seeking behaviour of Indian consumers in the digital age.

Adequacy of Internal Control System

To provide reasonable assurance that assets are safeguarded against loss or damage and that accounting records are reliable for preparing financial statements, management maintains a system of accounting and controls including an internal audit process. Internal controls are supported by management reviews.

The Board of Directors have an Audit Committee that is chaired by an Independent Director. The Committee meets periodically with Management, Internal Auditor, Statutory Auditors to review the Companys program of internal controls, audit plans and results, recommendations of the auditors and managements responses to those recommendations.

Human Resources Development/Industrial Relations

Human resources are valuable assets for any organization. The employees of the Company have extended a very productive cooperation in the efforts of the management to carrying the Company to greater heights. The Company is giving emphasis to upgrade the skills of its human resources and continuous training down the line is a normal feature in the Company to upgradethe skills and knowledge of the employees of the Company.

Details of significant changes in key financial ratios, along with detailed explanations therefore

Ratio	Numerator	Denominator	For the year ended 31 March 2026	For the year ended 31 March 2025	Variance %	Reason for changes by more than 25%
Current ratio (in times)	Total current assets	Total current liabilities	1.94	9.55	-80%	Due to increase in current liabilities.
Debt equity ratio (in times)	Total debts	Shareholders Equity	1.06	0.10	1010%	Due to increase in equity
Debt service coverage ratio (in times)	Earnings available for debt service (Net profit before taxes + Noncash operating expenses like depreciation and other amortizations + Interest + other noncash adjustments)	Debt service (Interest & lease payments + principal repayments)		N.A.	N.A.	N.A.
Return on equity ratio (in %)	Profits for the year less preference dividend (if any)	Average shareholders equity	0.20		N.A.	Due to increase in average equity
Inventory turnover ratio (in times)	Revenue from operations	Average inventory	12.41	8.11	50%	Due to increase in revenue and average inventory during the year
Interest Service Coverage ratio (in times)	Earnings before Interest and Taxes (EBIT)	Interest Expense		N.A.	N.A.	N.A.
Current Liability ratio (in times)	Total Current Liabilities	Total Liabilities	1.00	1.00	0%	NA
Trade Payables Turnover ratio (in times)	Revenue from operations	Average trade payables	6.59	35.73	-100%	Due to decrease in Trade Payables
Net Capital Turnover Ratio (in times)	Revenue from operations	Working Capital	3.57	1.71	109%	Due to decrease in revenue during the year
Net Profit Ratio (in times)	Net Profit	Revenue from operations	0.04	0.02	49%	Due to decrease in revenue during the year
Return on capital employed	Profit Before interest, Tax & Exceptional item	Total Equity + Total Debt	0.18	0.05	286%	Due to increase in capital employed