Amba Auto Sales and Services Ltd Management Discussions

OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our restated financial statements for the period years ended on March 31, 2025, March 31, 2024 and March 31, 2023 prepared in accordance with the Companies Act and Indian GAAP and restated in accordance with the SEBI (ICDR) Regulations, including the schedules, annexure and notes thereto and the reports thereon, included in "Financial Information" chapter "Restated Financial Statements” beginning on page 257 of this Draft Red Herring Prospectus. The Restated Financial Statements have been prepared on a basis that differs in certain material respects from generally accepted accounting principles in other jurisdictions, including US GAAP and IFRS.

This discussion contains forward-looking statements and reflects our current views with respect to future events and financial performance. Actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors such as those set forth in "Risk Factors" and "Forward-Looking Statements" beginning on pages 26 and 17 respectively, of this Draft Red Herring Prospectus.

Our Financial Year ends on March 31 of each year. Accordingly, all references to a particular Financial Year are to the 12 months ended March 31 of that year

BUSINESS OVERVIEW

Our Company was originally incorporated as a Private limited company under the Companies Act, 2013, with the name “Amba Auto Sales and Services Private Limited” on February 24, 2005 under the provisions of the Companies Act, 1956 and Certificate of Incorporation issued by the Registrar of Companies, Karnataka, Bangalore, vide certificate of incorporation bearing CIN U05101KA2005PTC035690. Pursuant to the special resolution passed on February 08, 2025, our Company was converted from private to public company and, consequently, the name of our Company change to “Amba Auto Sales and Services Limited” and a fresh certificate dated May 14, 2025, was issued to our Company by the Registrar of Companies, Central Processing Centre bearing CIN U05010KA2005PLC035690.

Our Company operates as an authorised dealer of Bajaj Auto Limited (‘Bajaj Auto) under the brand name Amba Bajaj and LG Electronics India Limited (‘LG Electronics) engaged in the business of Consumer Electronics. We have a presence across the automotive retail value chain, including sales of new vehicles, after-sales service and repairs (including sales of spare parts, lubricants and accessories) and facilitation of the sales of third-party financial and insurance products. Additionally, in consumer electronics, we offer a diversified range of products including air conditioners, televisions, washing machines, refrigerators and small appliances

Financial Key Performance Indicators of our Company

Key Financial Indicators

In evaluating our business, we consider and use certain key performance indicators that are presented below as supplemental measures to review and assess our operating performance. The presentation of these key performance indicators is not intended to be considered in isolation or as a substitute for the Restated Financial Information included in this Draft Red Herring Prospectus. We present these key performance indicators because they are used by our management to evaluate our operating performance. Further, these key performance indicators may differ from the similar information used by other companies, including peer companies, and hence their comparability may be limited. Therefore, these matrices should not be considered in isolation or construed as an alternative to AS measures of performance or as an indicator of our operating performance, liquidity, profitability or results of operation. A list of our KPIs for Financial Years ended March 31, 2025, 2024 and 2023 is set out below.

Particulars	FY 2024-25	FY 2023-24	FY 2022-23
1 Revenue from Operations (Rs. in Lakhs)	24236.65	21122.82	11295.45
2 Growth in Revenue from Operations (%)	14.74	87.00	71.72
3 EBITDA (Rs. in Lakhs)	1747.93	840.78	445.05
4 EBITDA Margin (%)	7.21	3.98	3.94
5 Profit After Tax (Rs. in Lakhs)	777.60	288.68	63.83
6 PAT Margin (%)	3.21	1.37	0.57
7 EBIT (Rs. in Lakhs)	1616.10	782.46	391.26
8 EBIT Margin (%)	6.67	3.70	3.46
9 ROAE(%)	69.09	48.74	15.04
10 ROCE(%)	24.31	18.14	12.47
11 Net Worth	1514.24	736.65	447.97

Notes:

1. Revenue from operation means revenue from sale of services and other operating revenues

2. Growth in revenue Operations is calculated by the current periods revenue and subtract the previous periods revenue, and then divide by the previous periods revenue.

3. Total income includes revenue from operation and other income

4. EBITDA is calculated as Profit before tax + Depreciation + Interest Expenses

5. EBITDA Margin is calculated as EBITDA divided by Revenue from Operations

6. PAT is calculated as Profit before tax - Tax Expenses

7. ‘PA T Margin is calculated as PA T for the year divided by revenue from operations.

8. EBIT is calculated as Profit before tax + Interest Expenses

9. ROAE: Return on average equity is calculated as profit after tax divided by Average Equity

10. "ROCE: Return on Capital Employed is calculated as EBIT divided by capital employed, which is defined as shareholders equity plus total borrowings"

11. Net Worth means the aggregate value of the paid-up share capital and reserves and surplus of the company

Statement of Significant Accounting Policies

• The Restated Financial Information or Restated Summary Financial Statement have been made after incorporating adjustments for the changes in accounting policies retrospectively in respective financial period to reflect the same accounting treatment as per the changed accounting policy for all reporting periods, if any;

• The Restated Financial Information or Restated Summary Financial Statement have been made after incorporating adjustments for prior period and other material amounts in the respective financial period to which they relate and there are no qualifications which require adjustments.

For more details kindly refer to Annexure 4 of chapter titled “Restated Financial Statements” beginning on page 257 of this Draft Red Herring Prospectus.

Significant Developments Subsequent to Last Audited Balance Sheet:

Except as stated in Draft Red Herring Prospectus, to our knowledge no circumstances have arisen since March 31, 2025 that could materially and adversely affect or are likely to affect, our operations or profitability, or the value or our ability to pay our material liabilities within the next 12 months.

Factors Affecting our Future Results of Operations

Our business is subjected to various risks and uncertainties, including those discussed in the section titled “Risk Factors” beginning on page 26 of this Draft Red Herring Prospectus. Our results of operations and financial conditions are affected by numerous factors including the following:

• General economic and business conditions in the markets in which we operate and in the local, regional, national economies.

• Any change in government policies resulting in increases in taxes payable by us;

• Changes in laws and regulations that apply to the industries in which we operate;

• Cost of raw material, labour and inputs

• Our failure to keep pace with rapid changes in technology;

• Increased competition in industries/sector in which we operate;

• Any failure to comply with the financial and restrictive covenants under our financing arrangements;

• Failure to obtain any applicable approvals, licenses, registrations and permits in a timely manner;

• General economic, political and other risks that are out of our control;

• Companys ability to successfully implement its growth strategy and expansion plans;

• Global distress due to pandemic, war or by any other reason.

Discussion on Result of Our Operations

The following discussion on results of operations should be read in conjunction with the Restated Financial Statements.

Particulars	FY 2024-25	% of Total Income	FY 2023-24	% of Total Income	FY 2022-23	% of Total Income
Revenue From Operations	24,236.65	99.96%	21,122.82	99.95%	11,295.45	99.91%
Other Income	9.42	0.04%	10.66	0.05%	9.69	0.09%
Total Revenue	24,246.07	100%	21,133.48	100%	11,305.14	100%
Expenses:
Purchase of Stock-inTrade	22,252.34	91.78%	19,788.79	93.64%	10,125.68	89.57%
Change in inventories of Stock-in-Trade	-1,864.75	-7.69%	-895.86	-4.24%	-203.06	-1.80%
Direct Expenses	721.62	2.98%	551.41	2.61%	319.60	2.83%
Employee Benefit Expense	741.90	3.06%	582.07	2.75%	441.02	3.90%
Depreciation and amortization expense	141.24	0.58%	68.98	0.33%	63.48	0.56%
Financial Costs	628.85	2.59%	434.91	2.06%	329.15	2.91%
Other expenses	582.65	2.40%	200.52	0.95%	135.17	1.20%
Total Expenses	23,203.85	95.70%	20,730.82	98.09%	11,211.04	99.17%
Profit before exceptional, extraordinary items and tax	1,042.22	4.30%	402.66	1.91%	94.10	0.83%
Less: Exceptional Items	-	-	-	-	-	-
Profit before extraordinary items and tax (A-B)	1,042.22	4.30%	402.66	1.91%	94.10	0.83%
Prior Period Items	-	-	-	-	-	-
Extra ordinary items	-	-	-	-	-	-
Profit before tax	1,042.22	4.30%	402.66	1.91%	94.10	0.83%
Tax expense:
Current tax	261.04	1.08%	113.76	0.54%	27.71	0.25%
Tax Related to Earlier year	0.00	0.00%	0.00	0.00%	0.00	0.00%
Deferred Tax	3.58	0.01%	0.23	0.00%	2.56	0.02%
Profit/(Loss) for the period After Tax	777.60	3.21%	288.67	1.37%	63.83	0.56%

Main Components of our Profit and Loss Account Total Revenue:

Our total income was Rs.24,246.07 lakhs for the period ended on March 31, 2025 which comprises of revenue from operations and other income.

Revenue from operations:

Our revenue from operations was Rs.24,236.65 lakhs for the period ended on March 31, 2025 constituting 99.96% of our Total Income. Revenue from operations mainly consists of revenue generated from sales of Vehicle was Rs. 20,926.96 lakhs constituting 86.31% of Total Income, Sale of Spare Parts & Other Items was Rs. 776.01 lakhs constituting 3.20% of Total Income, Sale of LG Electronics was Rs. 1,092.26 lakhs constituting 4.50% of Total Income, sale of service was Rs. 1,397.99 lakhs constituting 5.77% of Total Income, Other operating Revenue of Discount Rs. 0.25 lakhs constituting 0.00% and Incentives Rs. 43.18 lakhs constituting 0.18% of Total Income.

Other income:

Our other income was Rs.9.42 lakhs for the period ended on March 31, 2025 constituting 0.04% of our Total Income. Other Income comprises of Interest on FD was Rs. 8.32 lakhs.=and Other income was Rs. 1.10 lakhs..

Total Expenses:

Our Companys Total Expenses for the period ended on March 31, 2025 was Rs.23,203.85 lakhs representing 95.70% of our Total Income. Total Expenses comprise of Purchase of Stock-in-Trade, Change in inventories of Stock-in-Trade, Direct Expenses, Employee benefits expense, Depreciation and Amortization expenses, Finance costs and Other expenses.

Purchase of Stock-in-Trade:

Purchase of Stock-in-Trade of our Company for the period ended on 31^st March, 2025 was Rs.22,252.24 lakhs representing 91.78% of our Total Income. Purchase of Stock-in-Trade consists of purchase of vehicle, spares, electronic goods and other items.

Change in Inventories of Stock-in-Trade:

Change in Inventories of Stock-in-Trade of our Company for the period ended on 31^st March, 2025 was Rs.(1,864.75) lakhs representing (7.69) % of our Total Income.

Direct Expenses:

Our Direct Expenses for the period ended on March 31, 2025 was Rs.721.62 lakhs representing 2.98% of our Total Income lakhs. Direct Expenses primarily comprises of Delivery charges, Workshop expenses, Rent expenses, Power and fuel and Show room expenses.

Employee benefits expense:

Our employee benefits expense for the period ended on March 31, 2025 was Rs.741.90 lakhs representing 3.06% of our Total Income lakhs. Employee benefits expense primarily comprises of directors remuneration, Salaries & Wages, Employer PF Contribution, Employer ESI Contribution, Staff welfare expenses, and gratuity provision.

Depreciation & Amortization expenses:

Depreciation & Amortization expenses for the period ended on March 31, 2025 was Rs.141.24 lakhs representing 0.58 % of our Total Income lakhs. Depreciation & Amortization expense comprises of depreciation expense and Amortization expense.

Finance costs:

Our Finance cost for the period ended on March 31, 2025 was Rs.628.85 lakhs representing 2.59% of our Total Income lakhs. Finance cost comprises of Bank charges, Credit Card Charges (Pine Lab), Interest on Bank Overdraft, Interest on Other than Term Loan and Interest on Bajaj Auto.

Other expenses:

Other expenses for the period ended on March 31, 2025 was Rs.582.65 lakhs representing 2.40% of our Total Income lakhs. Other expenses mainly comprise of Accounting and Consulting Charges (Rs.160.76 lakhs constituting 0.66%), Advertisement Expenses (Rs.8.46 lakhs constituting 0.03%), Audit Fees (Rs.3.00 lakhs constituting 0.01%), Car expenses (Rs.1.26 lakhs constituting 0.01%), CDMS Expense (Rs.25.82 constituting 0.11%), Commission (Rs.89.28 lakhs constituting 0.37%), Computer Maintenance (Rs.0.23 lakhs constituting 0.00%), Digital Activity Expense (Rs.0.34 constituting 0.00%), Discount (Rs.0.75 lakhs constituting 0.00%), Donation (Rs.2.78 lakhs constituting 0.01%), Insurance Expenses (Rs.9.13 lakhs constituting 0.04%), Mela and Promotion Expenses (Rs.57.16 lakhs constituting 0.24%), Software Expenses (Rs.0.5 lakhs constituting 0.00%), miscellaneous expenses (Rs.41.51 lakhs constituting 0.17%), Printing and Stationary Expenses (Rs.16.22 Lakhs constituting 0.07%), Professional & Legal Expenses (Rs.7.10 lakhs constituting 0.03%), Rates & Taxes (Rs.5.33 lakhs constituting 0.02%), Renewal Charges (Rs.2.04 lakhs constituting 0.01%), Repair and Maintenance (Rs.13.06 lakhs constituting 0.05%), Security Charges (Rs.21.49 lakhs constituting 0.09%), Selling expenses (Rs.23.94 lakhs constituting 0.10%), Telephone Expenses (Rs.7.73 lakhs constituting 0.03%), Travelling & Conveyance Expenses (Rs.68.25 lakhs constituting 0.28%) and Balances Written off (Rs.16.96 lakhs constituting 0.07%).

Profit before tax (PBT):

Profit before tax for period ended on March 31, 2025 stood at Rs.1,042.22 lakhs. During this period, our Company recorded Profit before tax margin of 4.30% of Total Income.

Profit after tax (PAT):

Profit after tax for period ended on March 31, 2025 stood at Rs.777.60 lakhs. During this period, our Company recorded Profit after tax margin of 3.21% of Total Income.

Comparison of FY 2024-25 with FY 2023-24 (Based on Restated Financial Statements)

Total Income:

Total income for the financial year 24-25 stood at Rs. 24,246.07 lakhs whereas in financial year 23-24 the same stood at Rs.21,133.48 lakhs representing an increase of 14.73%. Total income is composed of revenue from operations and other income. The rise in total income is mainly attributed to the increase in revenue from operations, this increase is due to a rise in sales of vehicles.

Revenue from Operations:

During the financial year 2024-25 the revenue from operations of our Company increased to Rs.24,236.65 Lakhs as against Rs.21,122.82 lakhs in the Financial Year 2023-24 representing an increase of 14.74%. This increase in revenue from operations is due to a rise in sales of vehicles. Specifically, sales of vehicle increased by Rs.18,375.28 lakhs to Rs.20,926.96 lakhs from financial year 23-24 to financial year 24-25.

Other Income:

During the financial year 2024-25, Other income decreased by 11.64%, from Rs.10.66 lakhs in financial year 23 - 24 to Rs.9.42 lakhs in financial year 24-25, primarily on account of decrease in Sale of Fixed Asset and Rental Income.

Total Expenses:

The Total expense for the financial year 2024-25 increased to Rs.23,203.85 lakhs from Rs.20,730.82 lakhs in the financial year 2023-24 representing an increase of 11.93%. Such increase was due to increase in the volume of business operations of the Company.

Purchase of Stock-in-Trade:

The Purchase of Stock-in-Trade increased from Rs.19,788.79 lakhs in financial year 2023-24 to Rs.22,252.34 lakhs in financial year 2024-25. This represents an increase of approximately Rs.2,463.55 lakhs or 12.45%.

Change in inventories of Stock-in-Trade:

The Change in inventories of Stock-in-Trade decreased from (Rs.895.86) lakhs in financial year 2023-24 to (Rs.1,864.75) lakhs in financial year 2024-25. This represents decrease of approximately (Rs.968.89) lakhs or (108.15%).

Direct Expense:

The Direct Expense increased from Rs.551.41 lakhs in financial year 2023-24 to Rs.721.62 lakhs in financial year 2024-25. This represents an increase of approximately Rs.170.21 lakhs or 30.87%.

Employee benefits expense:

Our Company has incurred Rs.741.90 lakhs as Employee benefits expense during the financial year 2024 -25 as compared to Rs.582.07 lakhs in the financial year 2023-24. The increase of 27.46% was due to increase in salaries & wages, Employer PF Contribution, Employer ESI Contribution, staff welfare expense and Gratuity Provision. Employee benefit expenses in FY 2024-25 comprises of salary and wages amounting Rs.635.15 lakhs, staff welfare expenses of Rs.12.72 lakhs, directors remuneration of Rs.39.60 lakhs, gratuity provision of Rs.17.91 lakhs, employer PF Contribution Rs.28.19, and employer ESI contribution Rs.8.33.

Depreciation and Amortisation expenses:

Depreciation for the financial year 2024-25 stood at Rs.141.24 lakhs as against Rs.68.98 lakhs during the financial year 2023-24. The increase in depreciation was around 104.76% in comparison to the previous year.

Finance costs:

The Finance cost increased by 44.60% to Rs.628.85 lakhs in the Financial Year 2024-25 against that of Rs.434.91 lakhs in Financial Year 2023-24. The increase of the finance cost is on account increase in interest expenses.

Other expenses:

Other Expenses of the company has increased from Rs.200.52 lakhs in FY 2023 -24 to Rs.582.65 lakhs in FY 202425. This increase of 190.59 % was mainly due to (i) increase in Accounting and Consulting Charges by 331.33 % from Rs. 37.27 lakhs in FY 2023-24 to Rs.160.76 lakhs in FY 2024-25, (ii) increase in Commission by 38.06 % from Rs.64.67 lakhs in FY 2023-24 to Rs.89.28 lakhs in FY 2024-25, (iii) increase in Mela and Promotion Expenses by

1361.081% from ^3.91 lakhs in FY 2023-24 to Rs.57.16 lakhs in FY 2024-25, (iv) increase in Travelling and Conveyance Expenses by 180.28% from Rs. 24.35 lakhs in FY 2023-24 to Rs. 68.25 in FY 2024-25 lakhs, (v) increase in CDMS Expense no expenses in FY 2023-24 to Rs.25.82 lakhs in FY 2024-25 and (vi)increase in Misc. Expenses 536.63% from Rs.6.52 lakhs in FY 2023-24 to Rs.41.51 lakhs in FY 2024-25

Profit before tax (PBT):

Net profit before tax for the financial year 2024-25 increased to Rs.1,042.22 lakhs as compared to Rs.402.66 lakhs in financial year 2023-24. The PBT was 4.30% of total revenue in financial year 2024-25 compared to 1.91% of total revenue in F.Y. 2023-24. The profit is increased on account of increase in percentage of total revenue.

Profit after tax (PAT):

Net profit after tax for the financial year 2024-25 increased to Rs.777.61 lakhs as compared to Rs.288.67 lakhs in financial year 2023-24. The PAT was 3.21% of total revenue in financial year 2024-25 compared to 1.37% of total revenue in F.Y. 2023-24. This increase was mainly due to increase in Profit before Tax as mentioned above.

Comparison of FY 2023-24 with FY 2022-23 (Based on Restated Financial Statements)

Total Income:

Total income for the financial year 23-24 stood at Rs.21,133.48 lakhs whereas in financial year 22-23 the same stood at ^11,305.14 lakhs representing an increase of 86.94%. Total income is composed of revenue from operations and other income. The rise in total income is mainly attributed to the increase in revenue from operations, this increase is due to a rise in sales of vehicles.

Revenue from Operations:

During the financial year 2023-24 the revenue from operations of our Company increased to Rs. 21,122.82 Lakhs as against Rs.11,295.45 lakhs in the Financial Year 2022-23 representing an increase of 87.00%. This increase in revenue from operations is due to a rise in sales of vehicles of Rs.9827.37 lakhs from financial year 22-23 to financial year 23-24.

Other Income:

During the financial year 2023-24, Other income increased by 10.01 %, from Rs.9.69 lakhs in financial year 22-23 to Rs.10.66 lakhs in financial year 23-24, primarily on account of an increase in other income.

Total Expenses:

The Total expense for the financial year 2022-23 increased from ^11,211.04 lakhs to Rs.20,730.82 lakhs in the financial year 2023-24 representing an increase of Rs.9,519.78 lakhs or 84.91 %. Such increase was due to increase in the volume of business operations of the Company.

Purchase of Stock-in-Trade:

The Purchase of Stock-in-Trade increased from Rs.10,125.68 lakhs in financial year 2022-23 to Rs.19,788.79 lakhs in financial year 2023-24. This represents an increase of approximately Rs.9,663.11 lakhs or 95.43%.

Changes in Inventories of Stock-in-Trade:

The change in inventories of Stock-in-Trade decreased from Rs. (203.06) lakhs in financial year 2022-23 to Rs.(895.86) lakhs in financial year 2023-24. This represents a decrease of approximately Rs.692.80 lakhs or (341.18)

% which is due to corresponding operating revenue increase from Rs. 11,295.45 lakhs in financial year 2022-23 to Rs. 21,122.82 in financial year 2023-24.

Direct Expense:

The Direct Expense increased from Rs.319.60 lakhs in financial year 2022-23 to Rs.551.41 lakhs in financial year 2023-24. This represents an increase of approximately ^231.81 lakhs or 72.53%.

Employee benefits expense:

Our Company has incurred Rs.582.07 lakhs as Employee benefits expense during the financial year 2023 -24 as compared to Rs.441.02 lakhs in the financial year 2022-23. The increase of 31.98 % was due to increase in salaries & wages, staff welfare expense and Directors Remuneration. Employee benefit expenses in FY 2023-24 comprises of salary and wages amounting for Rs. 496.42 lakhs, staff welfare expenses for Rs. 4.02 lakhs, directors remuneration for Rs. 39.60 lakhs and gratuity provision for Rs. 11.42 lakhs.

Depreciation and Amortisation expenses:

Depreciation for the financial year 2023-24 stood at Rs. 68.98 lakhs as against Rs. 63.48 lakhs during the financial year 2022-23. The increase in depreciation was around 8.66 % in comparison to the previous year.

Finance costs:

The Finance cost increased by 32.13 % to Rs.434.91 lakhs in the Financial Year 2023-24 against that of Rs.329.15 lakhs in Financial Year 2022-23. The increase of the finance cost is on account increase in interest expenses.

Other expenses:

Other Expenses of the company has increased from Rs.135.17 lakhs in FY 2022-23 to Rs.200.50 in FY 2023-24 constituting increase of 48.33%. This increase was mainly due to (i) increase in Accounting and Consulting Charges by 276.46% from Rs. 9.90 lakhs in FY 2022-23 to Rs. 37.27 lakhs in FY 2023-24, (ii) increase in Car expenses by no expenses in FY 2022-23 to Rs. 13.39 lakhs in FY 2023-24, (iii) increase in Commissions by 149.88% from Rs. 25.88 lakhs in FY 2022-23 to Rs. 64.67 lakhs in FY 2023-24, (iv) increase in Repair and Maintenance by 111.60 % from Rs. 9.48 lakhs in FY 2022-23 to Rs. 20.06 lakhs in FY 2023-24, and (v) increase in Miscellaneous Expenses 36.40 % from Rs. 4.78 lakhs in FY 2022-23 to Rs. 6.52 lakhs in FY 2023-24.

Profit before tax (PBT):

Net profit before tax for the financial year 2023-24 increased to Rs. 402.66 lakhs as compared to Rs. 94.10 lakhs in financial year 2022-23. The PBT was 1.91% of total revenue in financial year 2023-24 compared to 0.83% of total revenue in F.Y. 2022-23.

Profit after tax (PAT):

Net profit after tax for the financial year 2023-24 increased to Rs.288.67 lakhs as compared to Rs.63.83 lakhs in financial year 2022-23. The PAT was 1.37% of total revenue in financial year 2023-24 compared to 0.56% of total revenue in F.Y. 2022-23.

Discussion on Restated Cash Flow Statement

Particulars	For FY 2024-25	For FY 2023-24	For FY 2022-23
A. Cash Flow from Operating Activities	(692.59)	(279.33)	(18.18)
B. Cash Flow from Investing Activities	(469.56)	(254.45)	(67.10)
C. Cash Flow from Financing Activities	1,227.42	628.37	(10.69)
Net increase in cash and cash equivalents	65.28	94.58	(95.97)
Opening Balance - Cash & Cash Equivalent	183.95	89.37	185.34
Closing Balance - Cash & Cash Equivalent	249.24	183.95	89.37

Net Cash Flow from Operating Activities

Net cash flow from operating activities comprises cash consumed / generated from operations, increase / decrease in working capital and increase / decrease in non-current / current liabilities.

Financial Year 2024-25

During the FY 2024-25, net cash flow from operating activities was Rs. (692.59) lakhs. Profit before tax stood at Rs. 1,042.22 lakhs. Primary adjustments were on account of depreciation and amortisation expense of Rs. 141.24 lakhs, interest expenses of Rs.573.89 lakhs, interest income on deposit of (Rs.8.32) lakhs, increase in inventories of Rs.1,864.75 lakhs, decrease in trade payables of Rs. 906.39 lakhs, increase in short term provision of Rs. 228.89 lakhs, increase in short term loans and advances of Rs. 179.32 lakhs, increase in trade receivables of Rs. 1206.24 lakhs, decrease in other current liabilities of Rs.65.54 lakhs, direct taxes paid of Rs.261.04 lakhs.

Financial Year 2023-24

During the FY 2023-24, net cash used in operating activities was Rs. (279.33) lakhs. Profit before tax stood at Rs. 402.66 lakhs. Primary adjustments were on account of depreciation and amortisation expense of Rs.68.98 lakhs, interest expenses of Rs.379.79 lakhs, interest income on deposit of (Rs.6.63) lakhs, increase in inventories of Rs.895.88 lakhs, decrease in trade payables of Rs.145.12 lakhs, increase in short term loans and advances of Rs.240.17 lakhs, increase in Short term provisions Rs.35.24 lakhs, increase in trade receivables of Rs.13.64 lakhs, decrease in other current liabilities of Rs.41.05 lakhs, direct taxes paid of ^113.76 lakhs.

Financial Year 2022-23

During the FY 2022-23, net cash flow from operating activities was Rs. (18.18) lakhs. Profit before tax stood at Rs.94.10 lakhs. Primary adjustments were on account of depreciation and amortisation expense of Rs.63.48 lakhs, interest expenses of Rs.297.16 lakhs, Gratuity Expense of (Rs.16.95) Lakhs, interest income on deposit of (Rs.3.95) lakhs, increase in inventories of Rs.203.06 lakhs, decrease in trade payables of Rs.318.75 lakhs, increase in short term loans and advances of Rs.71.38 lakhs, decrease in Short term provisions Rs.6.56 lakhs, decrease in trade receivables of Rs.525.53 lakhs, increase in other current liabilities of Rs.63.47 lakhs, direct taxes paid of Rs.27.71 lakhs.

Net Cash Flow from Investing Activities

Net cash flow from investing activities comprises interest income received, purchase of fixed assets. Proceeds from sales of fixed asset, increase/ decrease in long-term provisions and increase/decrease in Other Non-Current Assets.

Financial Year 2024-25

During the FY 2024-25, Net cash used in investing activities stood at Rs. (469.56) lakhs, primarily on account of interest income of Rs.8.32 lakhs, purchase of fixed assets amounted to Rs. (443.86) lakhs, increase in long term provisions of Rs. 17.91 lakhs and increase in other non-current assets of Rs.9.89 lakhs.

Financial Year 2023-24

During the FY 2024-25, Net cash used in investing activities stood at Rs. (254.45) lakhs, primarily on account of interest income of Rs.6.63 lakhs, purchase of fixed assets amounted to Rs. (258.33) lakhs, proceeds from sales of fixed assets of Rs.0.24 lakhs, and decrease in long term provisions of Rs. 11.42.

Financial Year 2022-23

During the FY 2024-25, Net cash used in investing activities stood at Rs. (67.10) lakhs, primarily on account of interest income of Rs.3.95 lakhs, purchase of fixed assets amounted to Rs. (23.01) lakhs, and decrease in long term provisions of Rs. 27.69.

Net Cash Flow from Financing Activities

Net cash flow from financing activities comprises of interest paid on borrowings, proceeds of share Capital, proceeds / repayment of borrowing, capital subsidy, interest and financial charges.

Financial Year 2024-25

During the FY 2024-25, net cash flow from financing activities was Rs.1227.42 lakhs comprising from interest paid on borrowings of Rs. (573.89) lakhs, decrease Long Term Borrowings of Rs. (47.67) Lakhs, increase in Short Term Borrowings of Rs.1848.98 Lakhs.

Financial Year 2023-24

During the FY 2024-25, net cash flow from financing activities was Rs. 628.37 lakhs comprising from interest paid on borrowings of Rs. (379.79) lakhs, decrease in Long Term Borrowings of Rs. (184.45) Lakhs, increase in Short Term Borrowings of Rs. 1192.61 Lakhs.

Financial Year 2022-23

During the FY 2022-23, net cash used in financing activities was Rs. (10.69) lakhs comprising of interest paid on borrowings of Rs. (297.16) lakhs, increase in Long Term Borrowings of Rs. 139.08 Lakhs, increase in Short Term Borrowings of Rs. 147.39 Lakhs.

Information required as per Item (II) (C) (iv) of Part A of Schedule VI to the SEBI Regulations:

An analysis of reasons for the changes in significant items of income and expenditure is given hereunder:

1. Unusual or infrequent events or transactions

Except as described in this Draft Prospectus, during the periods under review there have been no transactions or events, which in our best judgment, would be considered unusual or infrequent.

2. Significant economic changes that materially affected or are likely to affect income from continuing operations.

Our business has been subject, and we expect it to continue to be subject to significant economic changes arising from the trends identified above in ‘Factors Affecting our Future Results of Operations and the uncertainties described in the section entitled “Risk Factors” beginning on page 26 of this Draft Red Herring Prospectus. To our knowledge, except as we have described in this Draft Red Herring Prospectus, there are no known factors which we expect to bring about significant economic changes.

3. Whether our Company has followed any unorthodox procedure for recording sales and revenues Our Company has not followed any unorthodox procedure for recording sales and revenues.

4. Known trends or uncertainties that have had or are expected to have a material adverse impact on sales, revenue or income from continuing operations.

Apart from the risks as disclosed under Section “Risk Factors” beginning on page 26 of the Draft Red Herring Prospectus, in our opinion there are no other known trends or uncertainties that have had or are expected to have a material adverse impact on revenue or income from continuing operations.

5. Expected Future changes in relationship between costs and revenues

Other than as described in the sections “Risk Factors”, “Our Business” and “Managements Discussion and Analysis of Financial Condition and Results of Operations” on pages 26, 180 and 307 respectively, to our knowledge, no future relationship between expenditure and income is expected to have a material adverse impact on our operations and finances.

6. Extent to which material increases in net sales or revenue are due to increased sales volume, introduction of new products or services or increased sales prices

Changes in revenue in the last three financial years are as explained in the part “Financial year 2024-25 compared with financial year 2023-24 and financial year 2023-24 compared with financial year 2022- 23 above.

7. Total turnover of each major industry segment in which our Company operates

The company is engaged in dealership business of M/s Bajaj Auto Ltd and LG Electronics Ltd. The company is also engaged in sales and Spare parts and providing of Repair & Maintenance and Annual Maintenance Service of Automobile Products. Since all activities are related to the main activity having the same types and class of customer and regulatory environment, there is no other reportable segment as per the Accounting Standard on Segment Reporting AS-17 - Details as per reinstated Financials. Relevant industry data, as available, has been included in the chapter titled “Our Industry” beginning on page 126 of this Draft Red Herring Prospectus.

8. Status of any publicly announced New Products or Business Segment

Except as disclosed in the chapter titled “Our Business” beginning on page 180, our Company has not announced any new services or business services.

9. Seasonality of business

While we do not characterize our business as seasonal, our income and profits may vary from quarter to quarter depending on factors including change in weather, outbreak of viral and seasonal diseases.

10. Any significant dependence on a single or few suppliers or customers

Since our company operated as per the dealership agreement with Bajaj Auto Limited and LG Electronics, we are significantly dependent on our OEMs for the supply of products. Further, our company is not significantly dependent on any of the customers.

11. Competitive conditions

Competitive conditions are as described under the Chapters titled “Our Industry” and “Our Business” beginning on pages 126 and 180, respectively of this Draft Red Herring Prospectus.

12. Details of material developments after the date of last balance sheet i.e., March 31, 2025.

After the date of last Balance sheet i.e., March 31, 2025, the following material events have occurred:

1. The company converted its name from “Amba Auto Sales and Services Private Limited” to “Amba Auto Sales and Services Limited” as new Certificate of Incorporation received from Registrar of Companies on May 14, 2025.

2. Our company has passed a Board resolution in the board meeting dated August 01, 2025 authorizing the Board of Directors to raise funds by making an Initial Public Offering.

3. Our company has passed a special resolution in the meeting of shareholders dated August 26, 2025 authorizing the Board of Directors to raise funds by making an Initial Public Offering.

4. Our company has approved the audited financial statements for the period ended March 31, 2025, in the Board meeting dated September 08, 2025.

5. Our company has appointed Company Secretary and Compliance Officer by passing the resolution in the meeting of Board of Directors dated May 20, 2025.

6. Our company has appointed Chief Financial Officer by passing the resolution in the meeting of Board of Directors dated July 01, 2025.

7. Our company has appointed Managing Director by changing the designation of Mr Rakesh Lohia from executive director to managing director by passing the resolution in the meeting of Board of Directors dated July 01, 2025 and shareholders resolution dated 04 August 2025.

8. Our Company has approved the Restated Financial Statements for the financial year ended March 31, 2025, March 31, 2024 and March 31, 2023 in the Board meeting dated September 11, 2025.

9. Our Company has increased the Borrowing Power pursuant to Section 180(1)(c) by passing the Special Resolution on June 13, 2025

10. Our Company has increased the limit to create charge/mortgage over the properties of the Companies for the purpose of the Borrowings as per Section 180(1)(a) on June 13, 2025

11. Our Company has increased the limit for the Loan and Investment by the Companies as per Section 186 on June 13, 2025.

12. The Company has satisfied the charge with Charge ID 100200262, amounting to Rs. 46 Lakhs on September 06, 2025 held by Saraswat Co Operative Bank Limited.

13. The Company has satisfied the charge with Charge ID 100200263, amounting to Rs. 51 Lakhs on September 06, 2025 held by Saraswat Co Operative Bank Limited.

14. The Company has satisfied the charge with Charge ID 10381237, amounting to Rs. 40 Lakhs on August 18, 2025 held by Kotak Bank Limited.

15. Our Company has increased the Authorized Share Capital from Rs. 75,00,000 to Rs. 20,00,00,000 by passing the shareholders resolution on August 04, 2025.

16. Our Company has increased the paid up share capital of the Company by issuance of Bonus Shares by passing the shareholders resolution on September 09, 2025.

17. Our Company has constituted the Audit Committee, Stakeholder Relationship Committee, Corporate Social Responsibility and Nomination and Remuneration Committee by passing the resolution on July 01, 2025 in the meeting of Board of Directors.

18. Our Company has approved the Draft Red Herring Prospectus vide resolution in the Board Meeting dated September 28, 2025