Accel Ltd Management Discussions

Business Overview

Accel Limited, since its inception in 1991, has focused on building a business around customer services. Our reputation, built over the years as a reliable service provider of IT infrastructure has helped us to embrace several challenging new opportunities, centered around our core competency of customer service. Over the last few years, we have been investing in building a robust business model around our Accel 2.0 vision. We have embraced new lines of services including Cloud Infrastructure, Cyber Security and Digital transformation services. In line with our vision of leadership through service, we provide customers with predictable outcomes, when it comes to delivering value.

Our Businesses

- IT infrastructure Management services (IMS)

- System Integration Services

- Cyber security Management Services

- Warranty and Logistics Management Services (WLMS)

- Managed Print Services (MPS)

- Realty Services

We have been increasing our focus on marketing and sales by adding Senior Sales professionals and improving our focus on processes to help us achieve a better business outcome.

The year gone by

2024-25 was a satisfying year for us. We have been able to grow our business moderately compared to the previous financial year. Our focused business segments such as Banking, FinanceManagement Discussion and Analysis

Business Overview

Accel Limited, since its inception in 1991, has focused on building a business around customer services. Our reputation, built over the years as a reliable service provider of IT infrastructure has helped us to embrace several challenging new opportunities, centered around our core competency of customer service. Over the last few years, we have been investing in building a robust business model around our Accel 2.0 vision. We have embraced new lines of services including Cloud Infrastructure, Cyber Security and Digital transformation services. In line with our vision of leadership through service, we provide customers with predictable outcomes, when it comes to delivering value.

Our Businesses

IT infrastructure Management services (IMS)

System Integration Services

Cyber security Management Services

Warranty and Logistics Management Services (WLMS)

Managed Print Services (MPS)

Realty Services

We have been increasing our focus on marketing and sales by adding Senior Sales professionals and improving our focus on processes to help us achieve a better business outcome.

The year gone by

2024-25 was a satisfying year for us. We have been able to grow our business moderately compared to the previous financial year. Our focused business segments such as Banking, Finance and manufacturing helped us to win new customers. IT spending in India is continuing to show a robust growth and the company is poised for better days in terms of turnover and profitability. Our niche business segments such as Cyber Security and Managed Print Services growing rapidly in India with the organizations focus on secured infrastructure. Our company is working vigorously to win new projects that shall improve profitability going forward.

Performance Review

The financial year 2024-25 witnessed improvement in the overall business despite being hit by slowdown in software sector which has resulted in slow off take of our realty services at KINFRA IT SEZ, Trivandrum. As an India focused business entity, our IT services division has been helping many organizations in its digital transformation journey and to improve productivity and efficiency. In the IT services business, we have added many new customers for IMS and MPS and Cyber security services. Our strategic investment in Secureinteli Technologies helped us in providing value-added IT security services.

Our performance during the year would have been better if there had been full offtake of the realty rental space, which was affected by the slowdown in the software industry. The company also suffered a setback in the MPS business was affected due to cancellation of certain contracts for our principal. The business teams relentlessly pursued new business opportunities. Over 70% of our revenues are driven by annuity-based services business.

Various divisions performed well in terms of contributing to the increase in Revenue from operations.

• IMS division clocked a turnover of Rs.64.31 crore compared to Rs. 66.61 crore in the previous year.

• WLMS improved its turnover to Rs.44.14 crore from Rs. 38.46 crore in the previous year.

• MPS turnover declined to Rs. 6.34 crore from Rs. 8.33 crore in the previous year.

• The new businesses of Systems Integration did a turnover of Rs. 36.81 crore and Cybersecurity did a business of Rs.4.67 Crores. These two divisions have created a strong footing for the future revenues.

Performance Highlights of Financial year 2024-25

• Revenue declined by 2.11 % to reach Rs 162.82 crore.

• EBITDA declined by 2.67% to reach Rs 18.57 crore.

• Profit before tax declined to Rs 4.98 crore.

FINANCIAL PERFORMANCE:

In accordance with SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended from time to time (SEBI LODR) the Company is required to give details of significant changes (change of 25% or more as compared to the previous financial year) in sector-specific key

Net Decrease in Employee cost benefit - (Rs. 4.89 crores).

Increase in Finance Costs- Rs. 0.59 crores.

Decrease in Depreciation and amortization expense - (Rs. 0.62 crores).

Decrease in Provision for Doubtful Debts and advances- (Rs. 0.84 crores).

Risk Management:

Macro risks such as slow opening of the global market after the Covid 19 Pandemic, geo-political events in eastern Europe continues to challenge businesses around the world.At Accel Limited, we have a risk management system that identifies and monitors the key risks and its impact on the businesses. The uncertainty of these risks can substantially impact, or have the potential to affect the organizations strategy, business model or available resources. These material

risks are evaluated against industry and the global landscape to ensure that relevant emerging and existing factors are considered. We have identified such potential risks and set up mitigation measures to reduce the impact. Besides, the Companys internal auditors regularly assess the adequacy of risk management strategies and report its findings to the Audit Committee and the Board of Directors.

Challenges:

Our Companys businesses evolved through the acquisition of Ensure Support services limited in June 2000, the integration and cultural transformation is an evolving process. Unprecedented demand for skilled manpower in the IT sector and high cost associated with recruitment and induction of new manpower into the Company is posing major challenges.

Outlook:

We have been seeing a slowdown in our service domain in the recent past in the way business is being done in the post-covid period. We are witnessing a continuous shift to cloud and increased enterprise IT spending. The traditional IT infrastructure services business is seeing a declining trend with more opportunities in managed services, cloud infrastructure services and managed security services. We have modeled our business around new emerging opportunities and hence we are confident of growing our business without interruptions barring unforeseen circumstances.

Internal Control Systems:

The Company has an internal control system, commensurate with the size and nature of its operations, which has been designed to provide reasonable assurance of recording the transactions of its operations in all material aspects and providing reliable financial and operational information, complying with applicable laws, and safeguarding the assets of the Company. The Company constantly reviews its processes and the systems to address the changing regulatory and business environments. The Company uses Microsoft Navision as its enterprise resource planning system for recording of accounting data and for management information purposes. The Company has also got an online Operation support software to take care all operations and has aligned the internal financial control system with the requirement of Companies Act, 2013 ("the Act"). The Company has an external audit firm for carrying out the internal audit, based on a plan finalized in consultation with some of the major operational risks recognized and managed by the Company include:

The Internal Auditors directly report to the Audit Committee. The internal audit reports are submitted / presented in the Audit Committee and discussed. The Audit Committee also obtains the views of the internal and statutory auditors to ascertain the adequacy of internal control systems. The statutory auditors have issued a report on the internal control over financial reporting (as defined in Section 143 of the Act). The Company assessed the effectiveness of the internal control over financial reporting (in accordance with Regulation

17(8) of SEBI LODR) as of 31 March 2025. Based on its evaluation (in accordance with

Section 177 of the Act and Regulation 18 of SEBI LODR), our Audit Committee has concluded that, as of 31 March 2025, our internal financial controls were adequate and operating effectively barring a few improvements.

Risk Mitigation:

Talent attrition is a major risk assessed by the Company. Many steps are taken to reduce the attrition including variable pay and incentives. The Company is also working with BOAT to recruit and train manpower on a constant basis. Salary review is being done annually and an Employee Stock Option Plan (ESOP) scheme has been implemented to retain senior managers. We have started creating a buffer of resources to mitigate the manpower risk.

IT infrastructure and software used in the operations are critical for the Company. We have moved all our development servers and operations platform to cloud. We have segmented the network to prevent any cyber-attack on servers that effect on one segment to another. We have also taken up development of a new generation software to manage our critical operations and our ERP system to latest Navision Business Central We also have implemented adequate business continuity plans with adequate back-up and disaster recovery

For and on behalf of the Board of Directors
Sd/-	Sd/-
N R PANICKER	S. V. RAO
MANAGING DIRECTOR	WHOLE-TIME
DIN:00236198	DIRECTOR
	DIN:06600739
PLACE: CHENNAI
DATE: 13.08.2025