ABS Marine Services Ltd Management Discussions

1. Company overview

1.1 About ABS Marine Services Limited

ABS Marine Services Limited ("ABS", "the Company") was incorporated in 1992 at Chennai and has, over more than three decades, built an integrated marine and offshore services business spanning four verticals — Ship Owning, Ship Management, Marine Services and Port Services. The Companys offerings include offshore vessel chartering, technical and crew management of third-party tonnage, shipbuilding and conversion supervision, port craft operations, marine logistics, and onboard catering and housekeeping.

The Company operates from its Chennai head office with additional locations at Mumbai, Kochi, Kakinada and Singapore. Its client base comprises central government ministries and agencies, public sector undertakings, port authorities, national and international oil and gas companies, marine contractors and private shipping companies. As at March 31,

2026, ten strategic contracts were held directly with government authorities, and the top ten clients accounted for approximately 90% of revenue.

The Company was listed on the SME platform of the National Stock Exchange of India Limited (NSE Emerge) on 21 May

2024, following an initial public offering of 96.25 crore that was oversubscribed approximately 130 times. As at 31 March 2026, the promoter and promoter group held 63.96% of the equity share capital, with the balance held by public shareholders across 4,239 shareholder accounts.

FY26 represented a structural inflection in the Companys business model. The owned fleet expanded from nine vessels to twelve during the year with the induction of AM PASSION, ARTEMIS (ex-Hades) and SERENITY (ex-Mamola Serenity), while vessels under management rose from 36 to 38. The twelve vessels are held across the group and comprise eight offshore and support vessels and four harbour craft. Gross fixed assets increased from 183.37 crore to 503.11 crore. The consequence was visible not only in revenue, which grew 77.4%, but in the margin structure: consolidated EBITDA margin expanded from 29.65% to 47.28% as revenue shifted from fee-based management and sub-chartered deployment towards owned tonnage operated on the Companys own account.

1.2 Business model and revenue streams

• Integrated maritime solutions across vessel ownership, management and port services, enabling the Company to bid for combined scopes that single-service operators cannot.

• A hybrid asset-backed and asset-light structure combining owned, managed and chartered-in vessels, which allows capacity to be scaled without committing capital to every deployment.

• Contract-driven revenue weighted towards multi-year agreements with government and public sector counterparties, supporting visibility and credit quality of receivables.

• In-house technical, operational and manpower capability, reducing reliance on third-party contractors and protecting service quality and margin.

Revenue stream	Nature of income	Capital intensity
Vessel charters	Day-rate income from long and short-term deployment of owned offshore support vessels and harbour craft	High
Ship management	Management fees for technical and crew management of third-party vessels	Low
Marine services	Fees from chartering, inspections, dry docking, SPM operations and conversions	Low
Port services	Contracted service income from mooring, patrolling, firefighting and spill response	Medium
Onboard services	Catering, housekeeping and supply chain provisioning	Low

1.3 Client base and revenue concentration

Revenue by counterparty category, standalone, crore, with percentage share of total in brackets:

Client category	FY24	FY25	FY26
Government	74.49 (54%)	62.16 (36%)	64.46 (20%)
Public sector undertakings	53.46 (39%)	74.15 (43%)	97.29 (30%)
Others — private and international	10.06 (7%)	35.03 (20%)	162.76 (50%)
Total	138.01	171.34	324.51

The shift in mix warrants explanation because the percentage movement overstates the underlying change. Government revenue was broadly stable in absolute terms, at 64.46 crore against 62.16 crore, and public sector revenue grew 31.2% to 97.29 crore. The change in composition is driven almost entirely by growth in the "Others" category from 35.03 crore to 162.76 crore, reflecting the deployment of newly inducted offshore tonnage on commercial charters with marine contractors and international energy service companies. The Company therefore diversified on top of a stable government and PSU base rather than reducing its public sector exposure.

Client concentration remains a feature of the business: the top ten clients contribute approximately 90% of revenue.

Management considers this an acceptable characteristic of a tender-driven offshore and government services market, mitigated by the long tenure of the underlying contracts, the credit quality of the counterparties and the diversification of revenue across four verticals and multiple vessel classes.

2. Economic overview

2.1 Global economy

The global economy in FY26 continued to operate against a backdrop of geopolitical fragmentation, realigned energy trade flows and reconfigured maritime supply chains. Growth remained uneven across regions, with resilience in major Asian and emerging economies offsetting slower momentum in parts of the developed world. For shipping and offshore services, the more relevant variables were not headline growth but the sustained level of energy investment, the durability of tanker and offshore tonne-mile demand created by longer trade routes, and the continued tightness in specialised vessel supply.

2.2 Indian economy

India remained the fastest-growing major economy through the year, supported by public capital expenditure, resilient domestic demand and continued policy focus on infrastructure, energy and logistics. For the marine services sector specifically, three domestic developments mattered more than aggregate growth: the sustained pace of upstream exploration and production activity by national oil companies, the continued programme of port capacity expansion and modernisation, and the widening of policy support for domestic tonnage through the Maritime Development Fund and shipbuilding incentives.

Indias position in global supply chains continued to expand, and merchandise trade volumes moving through Indian ports continued to grow. Approximately 95% of Indias trade by volume and 70% by value moves by sea, across 12 major and more than 200 minor ports along a coastline of 7,516.6 kilometres. This structural dependence on maritime transport underpins demand for the port and marine support services in which the Company operates.

3. Industry structure and developments

3.1 Offshore energy remains structurally central

Notwithstanding the energy transition, offshore hydrocarbon production remains a core component of global supply. Offshore fields account for approximately 28% of global oil production and around 30% of global gas supply. Exploration has moved decisively offshore: roughly 80% of new discoveries are now made at sea, predominantly in deep water, even in years when total discovery volumes are modest by historical standards.

Investment has followed. Approximately $210 billion of global exploration and production spending has been directed to offshore fields since 2023, and greenfield project sanctioning reached approximately $110 billion in 2024, an increase of 6% year on year, with particularly strong growth in South America, Asia and North America. Marketed utilisation of mobile offshore drilling units stood at approximately 88%, with around 550 units on contract. Each drilling and development campaign generates sustained demand for platform supply, anchor handling and multi-purpose support tonnage of the type the Company owns and operates.

3.2 Offshore support vessel supply

The supply side of the offshore support vessel market has been the more important driver of the recent rate environment. A prolonged period of low ordering following the 2015-2020 downturn has left the global fleet materially older than at any point in the past two decades, while newbuild capacity at qualified yards is constrained and competing for slots against other vessel types. Financing for speculative offshore newbuilds remains difficult to obtain. The practical effect is that incremental demand from rising offshore activity cannot be met quickly by new supply, which supports day rates and utilisation for operators holding modern, compliant, dynamically positioned tonnage.

For the Company, this environment favours the strategy pursued during FY25 and FY26 of acquiring proven secondhand and near-new tonnage from the international market against visible deployment, rather than committing to newbuild programmes with long lead times and construction risk.

3.3 Indian maritime sector and policy framework

Amrit Kaal Vision 2047, building on Maritime India Vision 2030, sets out a roadmap for global-standard ports, inland water transport, coastal shipping and sustainable maritime practices, including an ambition to add approximately

1,000 ships over ten years through joint public-private ownership and to reduce foreign freight outgo by at least one-third by 2047.

Maritime Amrit Kaal Vision 2047 (MAKV 2047), building on Maritime India Vision 2030.

• A Maritime Development Fund with a corpus of 25,000 crore has been established to provide long-tenor capital to the sector on September 24, 2025.

• "Make in India" shipbuilding policies and coastal shipping incentives create eligibility advantages and priority status for domestic operators in Indian tenders.

100% foreign direct investment is permitted under the automatic route for port and harbour construction and maintenance, with a ten-year tax holiday available to qualifying enterprises developing, maintaining and operating ports and waterways.

• Port authorities continue to improve productivity through mechanisation, draft deepening and faster cargo evacuation, and are increasingly outsourcing marine support and safety functions to specialist private operators.

These combined changes grow the market for the companys core work—offshore support, port services, marine safety, and vessel management- while improving the financing environment for Indian owners. — While improving the financing environment for Indian owners.

4. Opportunities and threats

4.1 Opportunities

Opportunity	Basis and relevance to ABS
Rising Indian offshore activity	Sustained exploratory and development drilling by national oil companies expands the pool of multi-year charter tenders for platform supply and anchor handling tonnage, a market in which the Company holds established prequalification and performance history.
Tight global OSV supply	An ageing global fleet and constrained newbuild capacity support charter rates and utilisation, benefiting owners of modern DP-2 capable tonnage.
Owned fleet margin capture	Each vessel moved from third-party sub-charter to owned operation retains the charter margin within the group. The twelve-vessel owned fleet gives the Company further scope to substitute owned tonnage for chartered-in capacity.
Port services outsourcing	Indian port authorities are progressively contracting out pilotage support, mooring, firefighting and pollution response. These are multi-year, recurring contracts with modest capital requirements.
Policy and financing support	The Maritime Development Fund, shipbuilding incentives and PPP port programme improve both demand and the cost of capital for Indian owners.
Larger project eligibility	The addition of multi-purpose support tonnage widens the class of offshore project the Company can credibly bid for, moving it up the value chain from supply runs towards project support scopes.
International expansion	The Singapore platform provides a base for selective cross-border charters and access to global tonnage and crewing markets.

5. Vertical-wise performance

The Company operates as a single reportable segment for accounting purposes. The commentary below is provided on a management basis to assist users of the financial statements in understanding the drivers of FY26 performance.

5.1 Ship Owning

Ship Owning was the dominant contributor to FY26 growth. Revenue from owned and deployed vessels rose from 96.42 crore in FY25 to 251.09 crore in FY26, an increase of 160.4%. The following table sets out vessel-wise contribution on a standalone basis.

Vessel	FY24	FY25	FY26	FY26 share
Celestial	17.03	19.26	55.36	22.05%
Erin	30.41	52.01	49.65	19.77%
AM Passion	—	—	43.89	17.48%
Ocean Diamond	—	—	39.47	15.72%
Emerald	—	—	33.72	13.43%
ABS Anokhi	10.77	21.57	24.85	9.90%
Others	3.14	3.58	4.15	1.65%
Total	61.35	96.42	251.09	100.00%

Three observations are material. First, three vessels that generated no revenue in FY25 — AM Passion, Ocean Diamond and Emerald together contributed 117.08 crore, or 46.6% of owned-vessel revenue, in FY26. This is the single clearest evidence that the fleet expansion strategy converted into earnings. Second, Celestials contribution rose 187.4% to 55.36 crore following its deployment under the well stimulation contract, demonstrating that value can be created from existing assets through redeployment as well as through acquisition. Third, Erins contribution declined modestly from 52.01 crore to 49.65 crore, and its share of the total fell from 53.94% to 19.77%, materially reducing single-asset dependence within the owned fleet.

ARTEMIS and SERENITY were acquired towards the close of FY26 and were not in commercial service during the year. Their earnings effect begins in FY27.

5.2 Ship Management

The Company managed 38 vessels at year end, against 36 a year earlier. The managed fleet spans offshore support vessels, oil tankers, bulk carriers, passenger vessels, ocean and coastal research vessels and harbour craft, with mandates ranging from crew management only to total management including technical, crew, scientific complement, catering and housekeeping. The vertical continued to deliver stable fee income and, importantly, remains the source of the operating credibility on which tender prequalification depends.

5.3 Marine Services

Marine Services activity during FY26 comprised vessel chartering and commercial management, ship sale and purchase advisory, dry dock coordination, conversion and new-build supervision, and Single Point Mooring operations for tankers. The vertical supported the Companys own fleet expansion programme, including the sourcing, inspection and induction of ARTEMIS and the multi-purpose support vessel from the international market, in addition to third-party mandates.

5.4 Port Services

The Company continued to serve major port authorities including Chennai, Visakhapatnam and Kamarajar with pilot boat operations, patrolling and security craft, mooring services, firefighting, and oil spill response including maintenance of response equipment. Contracts in this vertical are typically of five to seven years tenure with extension options, and provide recurring revenue that is uncorrelated with offshore charter cycles — an important stabiliser as the Companys offshore exposure has increased.

6. Financial performance and analysis

All figures in this section are consolidated and in crore unless expressly stated otherwise.

6.1 Statement of profit and loss

Particulars	FY24	FY25	FY26	YoY
Revenue from operations	135.16	179.85	319.13	+77.4%
Other income	2.86	4.46	3.52	-21.1%
Total income	138.02	184.31	322.64	+75.1%
Employee costs	6.23	7.70	9.70	+26.0%
Other expenses	87.11	121.97	160.40	+31.5%
Total expenditure	93.35	129.67	170.10	+31.2%
EBITDA	44.67	54.64	152.55	+179.2%
EBITDA margin (%)	32.37	29.65	47.28	+1,763 bps
Finance costs	4.84	5.56	30.86	+455.0%
Depreciation	13.51	12.57	35.33	+181.1%
Profit before tax	26.32	36.52	86.36	+136.5%
Tax expense	0.88	9.26	5.56	-39.9%
Profit after tax	25.44	27.25	80.80	+196.5%
PAT margin (%)	18.43	14.79	25.04	+1,025 bps
Total comprehensive income	27.30	27.14	80.00	+194.8%
Earnings per share ( )	13.09	11.44	32.59	+184.9%

Revenue

Revenue from operations grew 77.4% to 319.13 crore. Growth was almost entirely volume-driven rather than price-driven, arising from the full or partial year contribution of vessels inducted in late FY25 and during FY26, and from the redeployment of Celestial. Revenue from owned and deployed vessels rose from 96.42 crore to 251.09 crore on a standalone basis. Other income declined to 3.52 crore from 4.46 crore, principally reflecting lower average surplus cash balances as IPO proceeds and internal accruals were deployed into vessel acquisition during the year.

Operating costs and margin

Total expenditure rose 31.2% to 170.10 crore against revenue growth of 77.4%, producing substantial operating leverage. The disproportion is structural rather than incidental. Under the previous model, deploying a third-party vessel required the Company to pay charter hire to the vessels owner, which was recorded within other expenses; the Company retained only the spread. Under the owned model, the equivalent cost is replaced by depreciation and interest below the EBITDA line, and the full charter revenue is retained above it. EBITDA consequently rose 179.2% to 152.55 crore, and EBITDA margin expanded by 1,763 basis points to 47.28%.

Employee costs rose 26.0% to 9.70 crore as the shore establishment and management bench were strengthened to support a larger owned fleet. Note that the majority of seafarer costs for managed vessels are borne by vessel owners and are not reflected in this line.

Finance costs and depreciation

Finance costs increased to 30.86 crore from 5.56 crore, and depreciation to 35.33 crore from 12.57 crore. Both increases are the direct and expected consequence of funding a fleet expansion that took gross fixed assets from

183.37 crore to 503.11 crore. Together these two lines absorbed 66.19 crore of the 97.91 crore increase in EBITDA.

Management regards this as the intended economics of the ownership model: the below-EBITDA charge replaces the above-EBITDA charter hire it displaced, with the residual accruing to shareholders.

Profitability

Profit after tax rose 196.5% to 80.80 crore, taking the profit after tax margin to 25.04% from 14.79%. Earnings per share rose to 32.59 from 11.44 on an unchanged share count of 2,45,50,000 shares. Total comprehensive income was 80.00 crore.

6.2 Balance sheet

Particulars	FY24	FY25	FY26
Equity share capital	18.00	24.55	24.55
Reserves	99.33	205.90	286.53
Net worth	117.33	230.45	311.08
Minority interest	9.65	9.77	10.56
Non-current borrowings	26.83	138.70	331.11
Long-term provisions	0.78	1.11	1.28
Current borrowings	18.86	39.71	46.12
Trade payables	5.00	4.41	10.69
Short-term provisions	3.28	1.40	0.15
Other current liabilities	3.23	6.73	30.71
Total equity and liabilities	184.96	432.27	741.70
Fixed assets	81.96	183.37	503.11
Capital work in progress	—	—	1.00
Other non-current financial assets	9.60	10.03	62.16
Deferred tax assets (net)	9.75	7.79	6.53
Other non-current assets	20.69	8.01	1.71
Trade receivables	32.06	55.52	98.44
Cash and bank balances	7.06	121.98	48.34
Other current financial assets	23.85	45.57	21.42
Total assets	184.96	432.27	741.70

Net worth and capital structure

Net worth grew 35.0% to 311.08 crore, entirely through retained earnings, as no equity was issued during the year and no dividend was paid. Book value per share rose from 93.87 to 126.71. Total borrowings increased to 377.23 crore from 178.41 crore, comprising 331.11 crore of non-current and 46.12 crore of current borrowings. Debt to equity moved from 0.77 times to 1.21 times. The Company maintains a target financing structure of approximately 75:25 debt to equity for vessel acquisition, and each acquisition is underwritten against identified or contracted deployment rather than speculative expectation. The increase in borrowings should therefore be read alongside the 319.74 crore increase in fixed assets that it funded.

Fixed assets

Fixed assets rose 174.4% to 503.11 crore following the induction of ARTEMIS, AM PASSION, SERENITY — the multi-purpose support vessel and the full-year capitalisation of vessels acquired late in FY25. Capital work in progress of 1.00 crore was recorded at year end. The asset base is now the principal determinant of the Companys earning capacity, and managements focus shifts accordingly from acquisition to utilisation.

Working capital

Trade receivables rose 77.3% to 98.44 crore, broadly in line with the 77.4% growth in revenue, leaving the collection cycle essentially unchanged at approximately 113 days. Trade payables rose to 10.69 crore and other current liabilities to 30.71 crore. Overall working capital intensity improved, with working capital days reducing to approximately 37 from 73. Cash and bank balances reduced to 48.34 crore from 121.98 crore as the remaining IPO proceeds and internal accruals were deployed into the fleet. Other non-current financial assets rose to 62.16 crore.

6.3 Cash flow

Particulars	FY24	FY25	FY26
Cash flow from operating activities	10.73	44.89	167.62
Cash flow from investing activities	(15.18)	(234.56)	(332.28)
Cash flow from financing activities	(6.99)	192.53	161.56
Net cash flow	(11.44)	2.87	(3.09)

Operating cash flow of 167.62 crore represented 109.9% of EBITDA, an improvement on the 82.2% conversion achieved in FY25, and reflects both the higher proportion of earnings from owned tonnage and the improvement in working capital days. This is the most important single figure in the FY26 accounts from a credit perspective: it is 5.4 times the years finance cost and demonstrates that the enlarged asset base is generating the cash required to service the borrowings raised to acquire it.

Investing outflows of 332.28 crore represent vessel acquisition and related capital expenditure. Financing inflows of 161.56 crore represent net borrowing drawdowns less repayments and finance costs. Net cash flow for the year was an outflow of 3.09 crore, leaving closing cash and bank balances of 48.34 crore.

Free cash flow was negative during FY26, as would be expected in a year of intensive fleet investment. Management expects free cash generation to turn positive as capital expenditure normalises and the newly inducted vessels contribute a full year of earnings.

7. Significant changes in key financial ratios

Disclosure pursuant to Schedule V(B) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations,

2015, of key financial ratios and of changes of 25% or more compared with the immediately preceding financial year, together with explanations.

Ratio	FY26	FY25	Change	Significant
Debtors turnover (times)	4.15	4.11	+1.0%	No
Inventory turnover	Not applicable	Not applicable	—	No
Interest coverage ratio (times)	3.80	7.56	-49.7%	Yes
Current ratio (times)	2.20	5.21	57.70%	Yes
Debt equity ratio (times)	1.11	0.61	82.68%	Yes
Operating profit margin (%)	47.28	29.65	+59.5%	Yes
Net profit margin (%)	25.04	14.79	+69.3%	Yes
Return on equity (%)	28	15	90.92%	Yes
Return on capital employed (%)	18	11	62.34%	Yes
Fixed asset turnover (times)	0.63	0.98	-35.7%	Yes
Earnings per share ( )	32.59	11.44	+184.9%	Yes
Book value per share ( )	126.71	93.87	+35.0%	Yes

7.1 Explanations for significant changes

Interest coverage ratio decreased 49.7%

Finance costs increased from 5.56 crore to 30.86 crore following the drawdown of vessel acquisition facilities.

Although EBIT rose substantially, the proportionately larger increase in interest reduced coverage from 7.56 times to

3.80 times. Coverage remains comfortable in absolute terms and is supported by operating cash flow of 167.62 crore, equivalent to 5.4 times finance costs.

Current ratio decreased 57.70%

The variance is due to decrease in Cash and Bank balances during the current year and increase in the short term borrowings and other current liabilities

Debt equity ratio increased 82.68%

The variance is due to increase in the Long term borrowings in the current year and increase in profits during the year.

Operating profit margin increased 59.5%

EBITDA margin expanded from 29.65% to 47.28% as revenue shifted from sub-chartered third-party tonnage, where charter hire paid to owners is recorded within operating expenses, to owned tonnage, where the corresponding cost is recognised as depreciation and interest below EBITDA. The change is structural rather than a function of charter rate movement.

Net profit margin increased 69.3%

Profit after tax margin rose from 14.79% to 25.04%, driven by the operating leverage described above, partly offset by higher finance costs and depreciation, and assisted by a lower effective tax rate of approximately 6.4% against 25.4% in FY25.

Return on equity increased 90.92%

This variance is mainly due to increase in net profit during the year

Return on capital employed increased 62.34

This is due to increase in the EBIT for the current year

Fixed asset turnover decreased 35.7%

Fixed asset turnover fell from 0.98 times to 0.63 times because assets were capitalised during the year and, in the case of ARTEMIS and the multi-purpose support vessel, contributed only a part-year of revenue. The ratio is expected to recover as these assets contribute a full year of earnings.

Earnings per share and book value per share

Earnings per share rose 184.9% to 32.59 and book value per share rose 35.0% to 126.71, in each case on an unchanged share count of 2,45,50,000 equity shares of 10 each.

8. Operational performance

8.1 Fleet development

The owned fleet expanded from nine vessels to twelve during FY26. Three inductions were material:

Vessel	Particulars	Strategic effect
AM PASSION	Offshore support vessel of 4,424 gross tonnes, acquired and deployed as part of the Companys strategy to expand its owned vessel fleet. The vessel operates under Indian flag and strengthens the Companys direct operational capacity in offshore support services.	Expands the owned offshore asset base, improves service reliability through direct operational control, reduces dependence on third-party vessel deployment, enhances the margin profile and supports asset-backed revenue visibility.
ARTEMIS (ex-Hades)	Offshore support vessel of 1,737 gross tonnes, IMO 9552264, acquired from the international market and registered under Indian flag at Chennai (Official No. 5163) on May 22,2026.	Strengthens the owned offshore asset base, improves service reliability through direct operational control, reduces dependence on third-party
	The vessel is registered under Indian flag as ARTEMIS, IMO 9552264, Official No. 5163, Chennai, 22.05.2026, and was named ARTEMIS in our LODR Regulation 30 intimation.	deployment, enhances the margin profile and supports asset-backed revenue visibility
SERENITY (ex-Mamola Serenity)	Multi-purpose support vessel of 3,891 gross tonnes, IMO 9562647, acquired from the international market and registered under Indian flag at Chennai (Official No. 5184) on June 09,2026	Expands offshore execution capability across a wider range of assignments, enables participation in larger and higher-value projects, adds multi- functional operational flexibility and strengthens growth visibility

Vessels under management increased from 36 to 38. The managed fleet comprises DP anchor handling and platform supply tonnage, ocean and coastal research vessels, a fishery oceanographic research vessel, harbour craft, bulk carriers, oil tankers and passenger vessels.

"Subsequent to the year end, ARTEMIS was fixed with Hardy Exploration & Production (India) Inc. for the PY-3 field for a firm period of 1,825 days at an aggregate charter value of Rs 126 crore including GST. The fixture was intimated to the Stock Exchange under Regulation 30 of the Listing Regulations."

8.2 Technical and quality performance

All vessels and shore teams maintained certification under ISO 9001:2015, ISO 14001:2015 and ISO 45001:2018, together with the Companys RPSL licence under the Maritime Labour Convention and Documents of Compliance issued by DG Shipping, Lloyds Register and Det Norske Veritas across the relevant flag states and vessel categories. Planned maintenance and scheduled dry-docking were carried out to maintain fleet readiness and minimise unscheduled off-hire.

8.3 Digital and systems

The Companys offices are connected through satellite and land-based communication systems supported by specialised software for crew planning and personnel data management, rest hours monitoring, planned maintenance, human resources and procurement. During the year the Company continued its transition towards cloud-based ship management, which is intended to provide real-time fleet-wide visibility, automate routine processes, improve compliance reporting and reduce administrative cost as the fleet scales.

9. Strategic initiatives and outlook

9.1 Strategic priorities

Contract pipeline and revenue visibility

• Complete the statutory certification and clearances required to deploy Serenity, and secure firm employment for tonnage acquired towards the close of FY26.

• Continue active bidding for tenders from national and international oil companies, marine contractors and port authorities.

• Extend and renew existing government and public sector mandates on the strength of performance history.

Fleet and capital strategy

• Continue selective expansion of the owned vessel portfolio, prioritising specialised tonnage with identified deployment over generic capacity.

• Maintain the target 75:25 debt to equity financing structure for vessel acquisition.

• Progressively substitute owned tonnage for chartered-in capacity where economically justified, retaining charter margin within the group.

Margin protection

• Sustain the FY26 margin gain by maintaining high utilisation and minimising reliance on third-party leased vessels.

• Manage operating cost discipline across crewing, maintenance, insurance and procurement as the fleet scales.

Focus areas

• Digitisation of fleet operations, including completion of the transition to cloud-based ship management.

• Compliance-first, safety-led operations across all vessels and shore establishments.

• Sustainability through fuel-efficient and technically compliant tonnage, positioning the fleet for tightening emissions regulation.

• Development of the Port Services vertical as a counter-cyclical, recurring-revenue complement to offshore exposure.

"In July 2026 the Company received a work order from the New Mangalore Port Authority for the hiring of two multipurpose fire tenders together with manpower for a period of five years."

9.2 Outlook

Management enters FY27 with an enlarged and modern asset base, a materially improved margin structure and a demonstrated ability to convert acquired tonnage into earnings. The principal task for the coming year is different in character from the year just ended: FY26 was about acquisition, FY27 is about utilisation, contract conversion and cash generation from assets already on the balance sheet.

The external environment remains supportive. Offshore exploration and development spending continues at elevated levels, global offshore support vessel supply remains constrained by an ageing fleet and limited newbuild capacity, and Indian policy — through the Maritime Development Fund, Sagarmala and public-private port development, coastal shipping incentives and shipbuilding support — continues to favour domestic operators with compliant tonnage and established tender credentials.

Management is mindful that the Company now carries materially higher financial leverage than at any point in its recent history, and that the durability of FY26s margin depends on sustained utilisation of the owned fleet. Capital allocation in FY27 will accordingly prioritise contract conversion and deleveraging capacity alongside selective further acquisition.

Subject to charter market conditions, tender outcomes and the absence of unforeseen operational events, management expects the full-year contribution of vessels inducted during FY26 to support continued growth in revenue and profitability in FY27.

"Subsequent to the year end, ARTEMIS was fixed with Hardy Exploration & Production (India) Inc. for the PY-3 field for a firm period of 1,825 days at an aggregate charter value of Rs 126 crore including GST. The fixture was intimated to the Stock Exchange under Regulation 30 of the Listing Regulations."

10. Risk management and mitigation

The Company has a Board-approved risk management policy and a Risk Management Committee constituted as a matter of good governance, notwithstanding that constitution is mandatory only for the top 1,000 listed entities by market capitalisation. Risks are mapped annually across commercial, operational, financial, legal, compliance, environmental and reputational categories, maintained in risk registers, and reviewed by cross-functional teams and by the Audit Committee and the Board. The Audit Committee has additional oversight of financial risks and controls.

10.1 Principal risks and mitigation

All critical incidents, near misses and global risk advisories are used to update controls, and the Board reviews risk dashboards periodically and mandates corrective action where required.

11. Human resources

The Companys ability to win and retain tender-based mandates rests on the competence and conduct of its people, both ashore and afloat.

11.1 Workforce

The total Shore Staff including Floating staff onboard and Floating staff in pool will be around 2,000 (approx.).

11.2 Talent, learning and development

The Company operates structured recruitment channels for seafarers, technical staff and shore management, supported by its RPSL licence. Succession planning is maintained for senior roles. Continuous learning covers technical, managerial and safety competencies, with leadership pipelines developed through mentoring, rotational assignments and cross-functional project exposure. Employee turnover, both afloat and ashore, has historically been below sector norms, which management attributes to engagement practices, competitive compensation and predictable rotation.

11.3 Diversity, equity and inclusion

The Company maintains a diversity, equity and inclusion policy directed at increasing gender and regional diversity across operations, technical and leadership roles, supported by inclusive hiring practices and sensitivity training.

11.4 Welfare and engagement

Onboard medical check-ups, telemedicine access, wellness campaigns and employee assistance programmes are provided across the fleet and shore establishments. Feedback mechanisms, recognition initiatives, town halls and family engagement events support morale and alignment with the Companys values.

11.5 Statutory disclosures

The Company has in place an anti-sexual harassment policy in line with the Sexual Harassment of Women at Workplace

(Prevention, Prohibition and Redressal) Act, 2013, and an Internal Complaints Committee has been constituted. All employees, whether permanent, contractual, temporary or trainees, are covered by the policy. The Company complies with the Maternity Benefit Act, 1961 in respect of women employees.

12. Health, safety, environment and sustainability

12.1 Safety

Safety performance is the foundation of the Companys operating licence, both regulatory and commercial. Operations are conducted under ISO 45001:2018 certified occupational health and safety management systems, supported by scenario-based drills for fire, collision, pollution and piracy, advanced onboard monitoring for early warning of critical system failure, and rigorous technical audits. The Company has historically operated below sub-sector benchmarks for lost-time injury rates and operational lapses.

12.2 Environment

The Company operates an ISO 14001:2015 certified environmental management system and has a long-standing operating focus on energy conservation onboard and ashore. Fleet renewal towards more fuel-efficient tonnage, planned maintenance to maintain hull and machinery efficiency, and compliance with applicable IMO and flag state emissions requirements form the core of the environmental approach. The Company also maintains oil spill response capability and equipment as part of its port services offering, and is contracted by port authorities for pollution response.

12.3 Sustainability and the energy transition

Management does not view the energy transition as a threat to the offshore support sector in the medium term, given that offshore continues to supply close to 28% of global oil and 30% of global gas and accounts for the majority of new discoveries. It does, however, expect tightening emissions regulation and increasing client scrutiny of vessel efficiency. The Companys response is to prioritise fuel-efficient and technically compliant tonnage in acquisition decisions, to invest in digital monitoring that supports emissions reporting, and to maintain the certifications that clients and regulators increasingly require as a condition of award.

13. Internal control systems and their adequacy

The Company maintains internal control systems commensurate with the nature, size and complexity of its operations, and adequate with reference to the financial statements as envisaged under the Companies Act, 2013. Controls are embedded across procurement, finance, human resources and vessel operations, and operate through dual approvals, automated validations and system-driven reconciliations.

An internal audit function, supported by an external firm of chartered accountants appointed under Section 138 of the Companies Act, 2013, conducts scheduled and surprise audits. Findings and observations are discussed with management and corrective actions are implemented under the direction of the Audit Committee on an ongoing basis. Board-level oversight is exercised through the Audit Committee and other specialised committees.

Automation of processes including e-invoicing, crew attendance and maintenance logging supports efficiency and real-time risk monitoring. The Company maintains a vigil mechanism and whistleblower policy to address instances of fraud or mismanagement, together with fraud prevention procedures and continuously updated compliance workflows. Lessons from control observations and industry benchmarking are incorporated into revised standard operating procedures.

The Chief Financial Officer has provided the certification required under Regulation 17(8) of the Listing Regulations in respect of the financial statements for the year ended 31 March 2026. The statutory auditors have not reported any qualification or adverse remark, and no fraud has been reported under Section 143(12) of the Companies Act, 2013.

14. Corporate social responsibility

The Companys corporate social responsibility policy is framed in line with Section 135 of the Companies Act, 2013 and the Companies (Corporate Social Responsibility Policy) Rules, 2014, and is directed at education, public health, womens empowerment, environmental sustainability, skill development and other areas of social upliftment. A CSR Committee of the Board oversees the programme. The Companys CSR focus has historically included seafarer welfare, child welfare and support for children with learning disabilities.

15. Cautionary statement

Statements in this Management Discussion and Analysis describing the Companys objectives, projections, estimates and expectations may be forward-looking within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could affect the Companys operations include charter market conditions, upstream capital expenditure by oil and gas companies, outcomes of competitive tenders, changes in government regulations and tax regimes, interest rate and exchange rate movements, crew availability and cost, weather and other force majeure events, and other incidental factors.

This report should be read in conjunction with the audited standalone and consolidated financial statements for the year ended March 31, 2026, the notes thereto, the Directors Report and the Independent Auditors Reports, all of which form part of this Annual Report.