Capitalnumbers Infotech Ltd Management Discussions

1. INDUSTRY OVERVIEW

Global IT Industry Outlook

The global Information Technology (IT) industry continues to remain at the forefront of driving digital transformation, innovation, and productivity across sectors. In 2024-25, the industry is expected to witness steady growth, supported by strong demand for cloud computing, artificial intelligence (Al), cybersecurity, data analytics, and enterprise software solutions. According to industry estimates, global IT spending is projected to cross USD 5.1 trillion in 2025, growing at around 6-7% annually.

Key Drivers of Growth

• Digital Transformation: Organizations across industries are accelerating digital adoption to enhance customer experience, improve operational efficiency, and enable remote and hybrid work models.

• Cloud Computing: Cloud migration and hybrid multi-cloud strategies continue to dominate IT investments, with global cloud spending expected to exceed US$ 1.3 trillion by 2025.

• Artificial Intelligence & Automation: Generative Al, machine learning, and robotic process automation are creating new opportunities for cost optimization, product innovation, and personalized services.

• Cybersecurity: Rising cyber threats and regulatory compliance requirements are fueling significant investments in security solutions.

• Sustainability & Green IT: Enterprises are increasingly focusing on energy-efficient IT infrastructure, carbon- neutral data centers, and sustainable technologies.

Global Trends

• North America and Western Europe remain the largest IT markets, driven by advanced digital ecosystems.

• Asia-Pacific is emerging as the fastest-growing IT hub, with countries like India, China, and Southeast Asian economies leading adoption in cloud and digital services.

• Talent shortages in advanced IT skills, coupled with geopolitical uncertainties and supply-chain disruptions, continue to be challenges for the sector.

Overall, the global IT industry is poised for resilient growth, underpinned by technology-driven innovation and its role as a critical enabler of business competitiveness worldwide

Indian IT Industry Outlook

India continues to strengthen its position as a global technology hub and digital innovation leader. The Indian IT and Business Process Management (BPM) industry is projected to reach USD 245 billion in FY2025, contributing over 7.5% to Indias GDP and employing more than 5.5 million professionals. India remains the largest outsourcing destination, offering cost advantages, a skilled talent pool, and an expanding digital ecosystem.

Growth Drivers

• Export-Led Momentum: IT services exports are expected to surpass USD 200 billion in FY2025, with North America and Europe remaining the key markets.

• Domestic Digital Transformation: Rapid adoption of digital platforms, fintech solutions, e-governance, and Industry 4.0 is driving strong domestic IT demand.

• Emerging Technologies: India is witnessing accelerated adoption of Al, cloud, blockchain, loT, and cybersecurity solutions across sectors such as BFSI, healthcare, retail, and manufacturing.

• Start-up Ecosystem: India is the worlds third-largest start-up ecosystem, fostering innovation in SaaS, fintech, edtech, and deep-tech solutions.

Policy & Government Support

• The Government of Indias initiatives such as Digital India, Start-up India, National Al Strategy, and 5G rollout are enhancing the digital infrastructure and creating a favorable environment for IT growth.

• Focus on skilling and reskilling under programs like Skill India is bridging the talent gap and preparing the workforce for next-generation technologies.

Industry Outlook

• Indian IT companies are expected to benefit from long-term outsourcing trends, cost efficiencies, and their ability to deliver end-to-end digital transformation services.

• With increasing global demand, Indian IT firms are expanding geographically, diversifying offerings, and investing in capability building in Al, cybersecurity, and sustainability solutions.

• While challenges such as pricing pressure, currency volatility, and global macroeconomic headwinds persist, the industrys strong fundamentals and adaptability position it for sustainable growth.

2. SUMMARY OF OUR BUSINESS

Capital Numbers is a premier Software Solutions company engaged in the business of digital consulting and IT engineering offering end-to-end software development solutions to enterprises, and startups worldwide.

The Company provides services across industries such as Healthcare, Banking & Financial Services, Real Estate, Automotive, Entertainment, Energy, Sports, Manufacturing sectors, Logistics, Retail, Travel, Education and Agriculture.

The company designs, develops and maintains software systems and solutions and offers various services such as Al/ML/GenAI, Data Engineering and Analytics, Cloud Engineering, Digital Engineering, Ul/ux Design, and Emerging Tech. By offering a comprehensive and integrated suite of services, the company is well-positioned to attract new customers and deepen relationships with existing ones, thereby enhancing its market presence and driving sustainable growth.

The company endeavors to bring together creativity and knowledge with a positive business strategy to furnish the requirements of diverse clients with an inclusive range of services which are comprehensive and cost- effective so that the client can focus on their core competencies to improve or expand their businesses. We continuously re-invent ourselves to help our customers with the latest technology solutions to make them market leaders in their chosen area.

Currently, CapitalNumbers Infotech Limited has two offices in India including a Registered office and another office in Gurgaon. The company is promoted by Mr. Mukul Gupta and Mr. Vipul Gupta who individually have 22 and 11 years of experience respectively.

The company operates with zero debt, ensuring financial stability and greater flexibility for future investments or strategic growth.

Our Milestone for Digital Excellence

In the FY 2024-25, the Company CapitalNumbers Infotech Limited was converted from Private Limited Company to Public Limited Company w.e.f. April 5, 2024 and achieved SOC 2, Type 2 Certification embarking on a new chapter of security and trust.

In the FY 2024-25, Company launched a new centre in Gurgaon, expanded with a Netherland office. The Company successfully listed on BSE SME platform on January 27, 2025 and raised Rs. 8,468.60 Lakh through public issues.

3. OPPORTUNITIES AND THREATS

We maintain long-standing relationships with customers across the globe, built on the criticality of our services to their core business operations. Our broad portfolio of service offerings enables us to effectively cross-sell to existing clients while continuing to attract and onboard new customers. To further strengthen these relationships, we conduct regular senior management reviews with key clients, gathering feedback, and exploring future growth opportunities.

By combining our comprehensive suite of services with deep industry-specific expertise, we deliver tailored, high-impact solutions across a wide range of sectors, business verticals, and geographies. This approach reinforces our commitment to customer satisfaction and underpins the ongoing trust and loyalty of our client base.

We provide direct support to both our customers and channel partners through a large, globally distributed support and implementation team, ensuring quick turnaround times and prompt resolution of any issues.

Experienced Promoters and Management Expertise

Our Company is promoted by Mr. Mukul Gupta and Mr. Vipul Gupta who have 20 years and 12 years of experience respectively. Mr. Mukul Gupta holds a certificate in Network Centered Computing from NIIT and has been recognized as a Microsoft Certified Professional. Additionally, he is certified as a Blockchain Expert by the Blockchain Council. With 20 years of experience in global operations, Mr. Gupta has been a driving force behind our company since its inception. Mr. Vipul Gupta plays a vital role in managing the companys internal operations, governance, and finance-led strategic growth initiatives. Mrs. Herprit Gupta has 8 years of working experience at Citibank from 2005 to 2013. Since joining our company as Director in 2013, she has been overseeing the human resources department and its related functions.

Focused on driving innovation

We remain focused on driving innovation and adopting solutions that align with the rapidly evolving technological trends. Our strong culture of innovation has been instrumental in building a consistent track record and improving the delivery of our services.

We have established dedicated, cross-functional teams of skilled professionals with deep technical knowledge and domain expertise across each of our industry verticals. These teams follow a structured approach to innovation and solution development, working closely with our delivery functions to identify the concerns of our customers and generate actionable ideas and concepts to address such concerns.

Our commitment to innovation has played a critical role in strengthening and retaining long-term customer relationships. It has also enabled us to drive measurable process and productivity improvements for our clients. This focus has supported the continuous expansion and diversification of our service offerings and ensured we remain competitive in a dynamic market environment.

Diversified revenue from multiple geographies

Our Company has diversified revenue from multiple geographical reach across the world and 95% of revenue is generated from exports sales from various countries like North America, UK & Europe, Middle East & Africa and Rest of World and 5% from India. As an IT service company, our presence in multiple geographies as service providers not only helps us in expanding our client base but also helps us by keeping ourselves in tune with the latest technological advancements world-wide.

Risk Identification and Mitigation

Retaining top talent and professionals with specialized skills remains a key challenge for the company. The implementation of hybrid and remote work models present potential challenges regarding productivity loss and associated risk in cybersecurity and data protection. The company is actively monitoring productivity issues and security concerns that may arise from the remote work setup.

Businesses facing cost pressures may seek to negotiate pricing terms, which could impact margins. In parallel, increasing customer expectations for shorter lead times can result in higher resource costs and affect overall profitability. Delays in service or order fulfillment may also lead to potential revenue loss. To mitigate these risks, the Company is exploring and implementing cost optimization strategies, including cloud deployment, increased automation, offshoring, and resource model adjustments, in alignment with client needs and expectations. Demand forecasting and proactive supply planning are key enablers in ensuring timely and efficient resource deployment.

In addition, the Company recognizes the inherent risks of data breaches, non-compliance with information security standards, and cyber-attacks. Unauthorized access, use, or disclosure of employee, customer, or Company data can result in serious consequences, including contractual breaches, regulatory penalties, and reputational damage. To address these concerns, the Company has robust information security protocols, conducts regular audits, and continues to invest in cybersecurity infrastructure and employee training to safeguard its digital ecosystem.

Our competition

We operate in a highly competitive and rapidly evolving market environment, characterized by intense competition and the continual emergence of new players, particularly in areas driven by agility, innovation, and emerging technologies.

We typically compete with global technology service providers in response to Requests for Proposals. Clients often cite our industry expertise, comprehensive end-to-end service capability and solutions, ability to scale, digital capabilities, established platforms, superior quality and process execution, distributed agile global delivery model, experienced management team, talented professionals and track record as reasons for awarding us contracts.

In future, we expect intensified competition. We expect increased competition from firms that offer technology- based solutions to business problems and from firms incumbent in those market segments. Additionally, insourcing technology services by the technology departments of our clients is another ongoing competitive threat.

4. SEGMENT - WISE OR PRODUCT WISE PERFORMANCE

The Company operates in only one segment, i.e. Software Consultancy services.

5. OUTLOOK

Our cliental base constitutes customers of diverse sectors across 13+ countries encompassing various industries Healthcare, Banking & Financial Services, Real Estate, Automotive, Entertainment, Energy, Sports, Manufacturing sectors, Logistics, Retail, Travel, Education and Agriculture. Our strategy is to seek new customers and at the same time secure additional engagements from existing customers by providing high quality services. Our engagement model includes both Timesheet-based and Milestone-based project structures. The revenue distribution currently comprises:

• 89% from Timesheet-based (Time & Material) projects, offering flexibility and transparency for ongoing client needs.

• 11% from Fixed Cost (Milestone-based) projects, focused on clearly defined scopes and deliverables.

We believe that our current capabilities and plans for the future ensure that we are well positioned to attract and develop new customer relationships.

The Company has developed a long-standing relationship with the clients. Further, we continuously endeavour to increase our client base and have a dedicated marketing team at Kolkata and Gurgaon and overseas office for client acquisition.

6. BUSINESS RISKS AND CONCERNS

(a) Unfavourable geopolitical developments and economic events may result in currency fluctuations and reduced client spending on IT services, which may adversely impact the demand for our offerings, affecting both growth and profitability.

(b) Talent Supply and Work from Office dynamics for junior employees and the dynamic demand of the talented resources and quick turnaround time as per expectations of client could be a risk that can impact on our reputation and cost structures.

(c) Cyberattacks remain a significant risk and could disrupt operations, compromise data, or lead to regulatory penalties and reputational damage.

(d) After the outbreak of COVID-19 and the resulting work from home (WFH) situation,

(i) Employee productivity has been a major risk and challenge for the entire IT industry. However, our approach of emerging ahead always to implement the business continuity plan and seamless optimized delivery model has really helped to overcome this challenge.

(ii) Retention of people has been a major challenge for the entire IT industry.

7. THREATS, BUSINESS RISKS AND CONCERNS

The Company is concerned about prevailing exposure norms, financial position, entry of new players in the market, rising competition from new entrants, uncertain business environment, fluctuation in rupees, likely increase in cost of capital due to volatile market conditions. Further, the state of business and policy environment in the country also has a cascading effect on the interest-rate regime, cost and availability of human resources.

8. INTERNAL CONTROL SYSTEM AND THEIR ADEQUECY

The Company has an Internal Financial Control System that commensurate with the size, scale and complexity of its operations. The Company is equipped with a proper and adequate system of internal controls for ensuring the orderly and efficient conduct of its business, including adherence to companys policies, safeguarding of its assets, prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information.

The Company has a well-placed, proper and adequate internal financial control system which ensures that all of its assets are safeguarded and protected against loss from unauthorized use or disposition, and transactions are authorized, recorded, and reported correctly. Independence of the audit and compliance is ensured by direct reporting of the Internal Audit Team to the Audit Committee of the Board.

9. FINANCIAL PERFORMANCE

Standalone Performance: For financial year 2024-25, your Company reported a Revenue from Operations of !f 9,972.52 Lacs, delivering a growth of 1.56% for the year. The Net Profit after Tax stood at if 2,575.64 maintaining similar levels to FY 2023-24.

Consolidated Performance: For the financial year 2024-25, your Company reported revenue from operations of if 9,972.90 Lacs, representing a 1.59% growth over the previous year. The Net Profit After Tax stood at if 2,579.64 Lacs maintaining similar levels to FY 2023-24.

10. HUMAN RESOURCES

Human Resource programs and initiatives in your Company are aligned to meet the business needs. Your company believes in investing in people to develop and expand their capability. The Company has been able to create a favourable work environment that motivates performance, customer focus and innovation. The companys strategies are based, inter alia, on processes of continuous learning and improvement. The Company has strong programs to update the skill, knowledge, and confidence of its employees through ongoing human resource interventions.

11. ANALYSIS OF SIGNIFICANT CHANGES IN FINANCIAL RATIOS

As per the recent amendments to the SEBI Listing Obligations & Disclosure Requirements (LODR), we give below additional information in respect of financial parameters that are applicable to our company:

Detail of Significant changes (i.e. change of 25% of more as compared to the immediately previous financial year) in key financial ratios, along with detailed explanation therefore as under:

Key Ratios	FY 2024-25	FY 2023-24	Change %	Explanation, if required
Current Ratio	32.81	18.75	74.99	Ratio is increased mainly due to increase in current assets.
Return on Equity Ratio	23.04	41.04	(43.85)	Ratio is decreased mainly due to increase in Reserves and Surplus.
Trade Receivables turnover ratio	13.99	14.61	(4.23)	NA
Trade payables turnover ratio	39.80	39.07	1.85	NA
Net capital turnover ratio	0.99	1.80	(44.94)	Ratio is decreased mainly due to increase in Reserves and Surplus.
Net profit ratio	25.83	26.44	(2.31)	NA
Return on Capital employed	21.71	51.99	(58.25)	Ratio is decreased mainly due to increase in Reserves and Surplus.
Return on investment	14.41	13.54	6.45	NA

CAUTIONARY STATEMENT

Statements in the Management Discussion & Analysis Report may please be considered as "forward looking statements" only and are stated as required by applicable laws and regulations. Actual results could differ from those expressed or implied. Companys operations should be viewed considering changes in market conditions and demand, economic developments in the country and such other factors.

	For and on behalf of the Board
	Mukul Gupta	Vipul Gupta
Place: Kolkata	Managing Director & CEO	Executive Director
Date: 28.08.2025	DIN:05298689	DIN: 2805298174