COSCO (India) Ltd Management Discussions

is may be read in conjunction wi e Directors Report

In a year marked by persient geopolitical tensions and policy transitions, e global economy displayed commendable resilience, ough regional performance varied considerably. e International Monetary Fund (IMF) has projected Global grow at 3.0 percent for 2025 and 3.1 percent in 2026. Over e next ve years, global grow is expected to average around 3.2 per cent, which is mode by hiorical andards. While e overall global outlook remains eady, grow varies across di erent regions. Amid is uncertain global backdrop of higher trade protectionism and trade con icts, e focus will be on Indias domeic consumption driven grow ory.

Indias economy continue to remain resilient wi robu GDP for FY25 eimated at 1,87,97,000 crore (US$ 2.20 trillion), from 1,76,51,000 crore (US$ 2.06 trillion) in FY24 wi a grow rate of 6.5%. RBI in its Monetary policy atement 2025-26 has retained Indias GDP grow for 2025-26 at 6.5 per cent and projected grow of 6.6% for Q1 of FY 2026-27. IMF has forecaed Indias economic grow 6.4 percent in 2025 and 2026, rea rming Indias position as e worlds fae growing major economy. Looking ahead, Indias economic prospects for FY26 are balanced.

is grow is driven by rising employment and ronger private consumption, supported by improving consumer sentiment, which is expected to keep e momentum going in e near future. Rural consumption is expected to remain healy wi tailwinds from favourable monsoon, farm and non-farm wage grow and continued focus from Central and ate governments on rural-focused welfare spends. Slowing trend in urban consumption is also expected to wane after almo two years and e budgetary support in terms of lower personal income taxes for e lower-income and middle-income households is expected to provide a boo to consumption. Tighter scal and loosening monetary policy is furer expected to support fall in intere rates in e domeic economy and wi rebound in public capex cycle by e Government, its trickle-down e ect in terms of rural and urban wages will support consumption trends in e near term. Private consumption, aided by rural demand, and xed invement, supported by buoyant government capex, continue to boo economic activity; In H1 FY25, Indias grow-focused approach was underscored by e governments capital expenditure outlay of 15,02,000 crore (US$ 176 billion), reinforcing its commitment to infraructure-led development. In e Union Budget of FY26, capital expenditure took lead by eeply increasing e capital expenditure outlay by 10% to 11,21,000 crore (US$ 131 billion) over 10,18,000 crore (US$ 119 billion) in FY25. ronger revenue generation because of improved tax compliance, increased pro tability of e company, and increasing economic activity also contributed to rising capital spending levels. Wi a reduction in port congeion, supply networks are being reored.

Headwinds to grow include elevated geopolitical and trade uncertainties and possible commodity price shocks.

Indias comparatively rong position in e external sector re ects e countrys positive outlook for economic grow and rising employment rates. Indias total goods and service exports surged by 76% over e pa

decade, touching 70,36,425 crore (US$ 825 billion) in FY25. In 2024, India rose to 15 place globally in FDI rankings and retained its position as Sou Asias top recipient.

Indias Export of Indian Sports Goods and Toys increased during FY 2024-25; As per data based on e export returns submitted by its members, compiled by e Sports Goods Export Promotion Council, e export of sports goods & toys for e year 2024-2025 has been recorded as 2,015 Crore as compared to 1,900 Crore during 2023-2024, showing moderate increase of about 6% in Rupee terms.

India exports a wide range of Sports Goods and aletic items including in atable balls, tennis balls, table tennis, tennis, and badminton rackets, general exercise equipment, gymnaics articles, cricket gear, sportswear, toys, recreational games, puzzles, video games, parlour and billiard games, casino articles, feive, carnival and entertainment articles, swimming and outdoor games equipment, shing and hunting equipment, swings, circus, shooting gallery and fairground amusement article.

India exports sports goods to over 150 global markets. Between FY 2022-23 and FY 2024-25 (Apr-Jan),e United Kingdom and e US consiently led in import volumes, followed by Auralia and Germany. ese markets togeer account for a subantial share of Indias overall sports exports. Exports to e USA, UK, and Auralia increased by 36%, 14%, and 6%, reaching US$ 189.49 million, US$ 75.05 million, and US$ 33.09 million in FY24, respectively. From FY25 (April-June), exports to e US ood at US$ 48.86 million, e UK ood at US$ 15.63 million, Auralia ood at US$ 8.95 million, Germany ood at US$ 7.92 million, and e Neerlands ood at US$ 6.23 million. Major international brands such as Mitre, Umbro, and Wilson source eir in atable balls and oer sports goods from India.

is export footprint indicates rising volume and diversi cation of demand, ranging from high-end sportswear and protective gear to general tness and recreational products. Indian exporters have expanded digital marketing and trade fair participation to grow access in non-traditional regions, supported by bo central and ate government schemes. Since FY18, sporting goods exports from India have witnessed grow at a CAGR of 11%.

e sports goods indury of India is nearly a century old and holds a prominent position in e global market. e indury has ourished, driven by a skilled workforce hence known for its role in creating employment and contributing to e countrys economy. e indury employs more an 500,000 people. India currently manufactures more an 300 sports-related goods such as toys, video game consoles and articles, feive and carnival articles, gymnaics and sportswear goods, shing articles, outdoor games, toys, etc. Uttar Pradesh, Punjab, Maharashtra, Delhi, Tamil Nadu, Jammu, and We Bengal are among Indias top sports goods-producing ates. Among ese, Jalandhar City in Punjab, and Meerut City in Uttar Pradesh account for about 75-80% of e total production in e country. ese two cluer cities for e manufacturing of sports products, ho more an 3000 manufacturing units and 130 exporters. e majority of sports and tness products are currently made by small and medium-sized businesses (SMEs).

e Indian sports indury is experiencing rapid grow, wi a Deloitte and Google report projecting a valuation of $130 billion by 2030, driven by increased government support, digital engagement, and a growing fan base for sports like cricket, football, and kabaddi. e indury includes various segments such as sports manufacturing, media rights, sponsorships, and sports technology, all contributing to signi cant economic impact and job creation, wi a goal to develop a rong national sports ecosyem. e report ated at government initiatives like Khelo India and e Target Olympic Podium Scheme (TOPS) are driving e development of grassroots and elite sports, wi e goal of positioning India as a leading sports nation.

e global sports goods indury is highly competitive owing to e presence of many eablished multinational players. Mo of e production of sports goods is outsourced to e Asia-Paci c region, making it one of e worlds large sports goods manufacturing regions. India, e ird-large manufacturer in Asia, has become a big participant in e aletic goods market and has made great rides in enhancing its soft power.

Foreign Brands and overseas manufacturers/suppliers from China and oer countries are having edge over Indian manufacturers. Sports Indury in India needs continuous Technological Upgradation, Setting up of composite sports cluers equipped wi technical and logiics support of international andards and JVs wi global Indury leaders. e Indury needs to diversify its product range and should go in for e production of Hi- tech sports items and physical equipment(s). e Indian Sports Goods Indury is gradually moving towards mechanization on a reasonable scale for increasing productivity and competitiveness of Indian Sports Goods Sector. e Indury is gradually adapting new technology to keep up wi e changing global trends.

Government is focusing on overall grow of Sports Sector and development of Infraructure for Sports. Public Private Partnership in creating Sports Infraructure are being encouraged. Sports Infraructure needs furer expansion and optimum utilization. e sports goods indury has potential for employment, grow and export and to become e next big indury in India.

For e development and exposure of Indian sporting goods, e Sports Goods & Toys Export Promotion Council (SGEPC) regularly arranges international and domeic trade events. e Market Access Initiative (MAI) scheme has been implemented to play a catalytic role in promoting and exporting Indian goods and services. e scheme for e remission of Duties and Exported Products (Rode) has also been implemented to support Indian exporters.

e MDA scheme works mainly to assi exporters in export promotion activities in e international markets. e scheme also assis e respective export promotion councils in undertaking export promotion activities for eir products. Similarly, rough is scheme, e government helps focus export promotion programs on international regions such as e LAC, Africa, CIS, and e ASEAN economies.

e main objective of e MAI scheme is to promote e export of Indian goods to international markets. Under is scheme, nancial assiance is provided to export & trade promotion organisations, national initutes, research initutes, exporters, etc. e parameters covered under e nancial aid are marketing projects, capacity enhancement, supporting atutory compliances, udies, research, project development, and supporting cottage and handicraft units in India.

To boo e sporting goods manufacturing sector, e government has eablished e Sports Goods Export Promotion Council (SGEPC), dedicated to promoting Indias sports goods exports. SGEPC regularly organizes bo international and domeic trade events to provide Indian manufacturers wi exposure to global market trends and a platform to showcase eir products. e Market Access Initiative (MAI) scheme and e Remission of Duties and Exported Products (RoDTEP) scheme have been implemented to promote e export of Indian goods and services.

e Sports Auority of India (SAI) at works supporting e Miniry of You A airs and Sports is credited for e advancement of Sports and Games in e country. Auority formulates and executes a progression of changes and schemes to help Sports department. e various initiatives taken by e Government in e recent pa to boo e sports is yielding results and will have positive impact on e sports indury in future .

e Key Schemes of e Government namely Khelo India Scheme, Target Olympic Podium Scheme, Fit India Movement and oer initiatives have transformed e Sports in India.

Khelo India Scheme e National Programme for development of sports was launched in 2016 po e fusion of ree earlier schemes Rajiv Gandhi Khel Abhiyan (RGKA), Urban Sports Infraructure Scheme (USIS), and National Sports Talent Search Scheme (NSS). e Khelo India programme has been introduced to revive e sports culture in India at e grass-root level by building a rong framework for all sports played in our country and eablish India as a great sporting nation. e plan endeavors to advance "Sports for All" as well as "Sports for Excellence". e plan was revamped in e year 2017 wi an aim to mainream sports as an inrument for individual and local area development, monetary development, and national development. Wi a view to achieving e twin objectives of mass participation and promotion of excellence in sports, e Government of India has decided to continue e Scheme of -Khelo India National Programme for Development of Sports

over e 15 Finance Commission Cycle (2021-22 to 2025-26) at an outlay of 3165.50 Crore. e scheme is e key to giving aletes from all across e country to show case eir sporting skills on a national platform and to be identi ed for furer training. e scheme supports aletes wi scholarship. e Central Government in partnership wi ates has set up Khelo India Centres of Excellence e ate of art training centres for senior and elite aletes wi a focus on speci c sporting disciplines. In addition, Khelo India accredited academies, private academies and adopted schools where Khelo India Aletes and Sportspersons are trained have added to e reng of e sporting infraructure.

Fit India Movement was launched on e occasion of National Sports Day on 29 Augu, 2019 by Honble Prime Minier, to make tness a way of life for every citizen. Citizens across India, from school udents to youngers to seniors, are participating in various tness activities such as maraons, cycloons, runs and more, roughout e year, making it a Peoples movement. Sports Talent Search Portal was launched to recognize e be talent among e you of India. e portal allows youngers to upload eir achievements. Signi cant level committee conituted in 2017 on e occasion of International Women Day in 2017 to address complaints and issues of women sports persons.e Empowered eering Committee (ESC) was comprised in January 2017 on e recommendations of e Olympic Task Force for preparing a far-reaching action plan for e powerful participation of Indian players in e Olympic Games.

National Sports Awards Scheme acknowledges and respects sports personalities wi e Arjuna Awards, Rajiv Gandhi Khel Ratna, Dhyanchand Awards, and Dronacharya Awards for eir achievements and commitments as sportspersons and coaches in e eld of sports. Sports and Games for Persons wi Disabilities Scheme - Under is plan, e di erently-abled sportspersons are trained in eir eld for conducting sports competitions and assiing schools and initutes having di erently-abled sportspersons.

Target Olympic Podium Scheme - e Sports Miniry released e Target Olympic Podium (TOP) Scheme in May 2015 under e National Sports Development Fund (NSDF) to help e potential medal possibilities for e Olympic Games. e main focus is given to Aletics, Badminton, Boxing, Archery, Wreling, and Shooting sports.

e Government is providing numerous opportunities to sportspersons. Sports make signi cant socio- economic impact on a nation and its citizens and promotes social inclusiveness. It unites people from diverse backgrounds, hence promoting peace and development. Greater sports participation is critical to e future heal and productivity of Indias large population. Sports plays an important role in ensuring physical tness and healy lifeyle among e citizens of a country.

e Government of India is making signi cant invement on e development and promotion of Sports as ated hereinbefore. e Indian Government has made improving sports outcomes a rategic priority. e sports sector has e potential to make signi cant contribution to e economy. In Indias Economic grow ory, e Sports and Sports goods Indury will continue to have signi cant role to play.

In India, sports contribute about 1% of e national economy comparable to mo major sporting nations. e Sports Indury in India has some good quality manufacturing units and skilled manpower base. New Markets and Overseas buyers, who are also looking for alternate sources of supply in addition to China and developing countries, need to be explored for Exports. Wi e growing importance of sports, many entrepreneurs have ventured into e indury to cater to e needs of aletes and sports enusias. In recent years, India has seen an in ux of sports-focused art-ups. e sports sector in India is expected to see continued grow rough art-ups as e market is ill in its early ages. ese art-ups o er a range of services such as online ticket purchasing, prediction games, and e provision of high-quality sports and tness products and equipment. ese sports art-ups are primarily focused on delivering sports-related services and products to people in e country. ese artups are attracting invement from venture capitalis and oer inveors, contributing to e grow of e sports manufacturing indury. Wi signi cant room for grow and new policies and infraructure measures, India is well-positioned to become a global sports powerhouse

India ranks 13 among G20 countries in e ink Sports Index, wi e US, UK and Auralia leading e rankings. e ink Sports Index evaluates commercial factors, performance and heritage, and sporting foundations.

Our Company is one of e leading and mo organized Indian Company in Sports Indury and has immense potential to leverage upon its brand, accreditation and quality to increase sales and pro tability. wi network of branches, diributors and around 730 auorized dealers in India. Our company manufactures mainly Sports Balls and deals in vide range of Sports Goods and Fitness Equipments. It has tie ups and arrangements wi reputed International and Domeic manufacturers /suppliers. e Company on continuous basis upgrades e quality of its products wi in-house R & D. e company e Companys Cosco Brand is well recognized in e Domeic Market. e products manufactured/traded by e company conform to International andards.

e Companys products segments are classi ed broadly into two segments viz

- Own manufactured products viz Sports Balls

- Traded Goods viz Fitness Equipments and oer Sports Goods.

e Segment wise performance and relevant information is given in Notes on e Financial atements (Refer Note No. 33 of Notes on e Financial atements Segment Information

e Indian sports and tness goods market size was valued at USD 4.88 billion in 2024 and is expected to grow at a CAGR of 7.40% during 2025-2034, reaching approximately USD 9.96 billion by 2034.

e Indian sports and tness goods market is growing due to various factors, such as increasing heal awareness, rising disposable income, changing lifeyle preferences, and government initiatives to promote sports culture. Increases in government initiatives and policies to promote sports and tness by improving e sports infraructure, facilities, and encouraging e participation and performance of aletes in national and international events. e government also provides incentives, subsidies, and schemes to support e sports and tness indury, which enhances e development of e sports and tness goods market in India. Govt. of India and ate Governments are gradually increasing budgetary allocations for Sports and taking progressive policy initiatives to promote Sports and Sports Indury. ese initiatives prove at sports have a future in India as a business. India is now being seen as a power to reckon wi. Several elite international sports bodies have chosen India as ho country in recent years.

Furer Khelo India School Games initiative has encouraged a shift in e way people ought about sports, especially at e grass-root level. Greater sports participation is critical to e future heal and productivity of Indias large population. e initiatives of e Government Khelo India Scheme Target Olympic Podium Scheme, Fit India Movement And of e Sports bodies for organizing regular sports events such as Indian Premier League (Cricket), Hockey India League, Indian Badminton League, Prokabbadi, Indian Super League (Football) and professionalization of Heritage sports events such as Goti, Gilli Danda, Lagori, Kiliatt, Gatta Gusi are changing e old face of Indian sports. is is driving demand for better sports syems, facilities and inputs. Over e la few years, e activity around e business of sports has been tremendous in ese domeic leagues. ese initiatives have shown Indians, a world of sports beyond cricket. Indian Sportspersons have been making mark in various sporting disciplines in international competitions.

Furermore, late innovations and advancements in manufacturing technologies have also increased e sports and tness goods market value. ese products include smart tennis racquets, motorised treadmills, speed training equipment, and tness bands.

ere is ever growing awareness about Sports and Fitness among e urban as well as rural population, which will furer boo is product segment in India. Many multinational organizations have in-house gymnasiums or sponsor eir a for sports and tness activities and/or organize intra-o ce sports events. Demand for sporting goods and tness goods is growing wi Indias burgeoning consumer class wi e ongoing rise in popularity of outdoor and home-based sports.

Additionally, e emergence of online platforms, social media in uencers, and celebrity endorsements have also booed e demand for sports and tness goods among consumers. e rise of social media platforms such as Facebook, Inagram, and Twitter, is also catalyzing e sports and tness goods market size. rough social media channels, companies can communicate directly wi e audience looking for tness equipment. e sports and tness goods manufacturers are also using ese platforms to advertise, ereby informing potential cuomers about eir late products.

Your Company is well positioned wi its rong management team, technology interventions and robu processes. e company sees promising future of Sports and Heal & tness in India. Looking ahead to e future of e sporting goods indury, Cosco (India) Limited expects at competition in e global market will remain severe despite global increases in heal consciousness and grow in e number of people participating in sports in emerging countries. Your Company has con dence on intrinsic rengs of its brands, innovation capabilities, and rong diribution network and co e ciency programs.

reats

1. Competition from Global Brands and eir popularity among Indian consumers;

2. Infringement of Companys Brand and Trade mark by grey market operators;

3. e challenges of supply chains;

4. Skilled Manpower conraints & rising manpower cos;

5. Infraructure conraints for development of Sports;

6. e lack of indury atus for sport (sports infraructure aside), e absence of clear guidelines for business operations and e unorganized nature of e sector a ects inveor con dence;

7. High taxes levied on Sports and Fitness equipments; 8. geopolitical risks and civil unre; 9. economic uncertainty and rising cos;

10. shifts in consumer behavior, including declining physical activity and changing media consumption patterns;

Your Company has in place adequate internal control syems and procedures commensurate wi size and nature of its business. e internal control syems of e Company provide for policies, guidelines, auorizations and approval procedures. All e transactions are properly auorized, recorded and reported to e Management. e Company has appointed Internal Auditors who conduct Internal Audit periodically. Audit Committee reviews Internal Audit Reports and adequacy of internal controls for ensuring checks and balances and at internal control syems are properly followed. e syem of internal nancial control ensures at all transactions are evaluated, auorized, recorded and reported accurately and at all assets are safeguarded and protected again losses at may arise from unauorized use or disposition. Board has taken note of e observations of e Auditors for improvement in some areas of Internal Financial Controls and Scope of Internal Audit, which have been dealt in e main Directors Report under e head Independent Auditors Report. e company will furer rengen its Internal Financial Controls in areas observed by e Auditors. Board is of e opinion at e Companys internal nancial controls were reasonably adequate and e ective during e nancial year 2024-2025.

e company is following e applicable Accounting andards and has prepared nancial atements for e year ended 31.03.2025 in accordance wi Ind AS. e Company prepared its nancial atements in accordance wi Generally Accepted Accounting Principles (GAAP) in India and complied wi e Accounting andards.

Discussion on nancial performance wi respect to operational performance. e relevant information is given in e Directors Report under headings Financial Results, Companys Performance and ate of A airs for Financial Year 2024-25 read wi e Financial atements.

Material developments in Human Resources/Indurial Relations

e ru of e Company is to create responsive and market driven organization. e Management believes in tru, transparency and teamwork. e management of e Company believes at Human Resources is e driving force towards progress of e Company and regards it as its mo valuable asset. Your company has total number of permanent employees as on 31.03.2025 on e rolls of e Company is 362. e relations wi employees remained cordial and satisfactory during e year under review. Your Directors are ankful for e con dence reposed by all associated wi e Company and eir continued support. e Company seeks to motivate and provide opportunities to its personnel to grow wi e organization.

In accordance wi e SEBI (Liing Obligations and Disclosure Requirements) Regulations, 2015, e Company is required to give details of signi cant changes (change of 25% or more as compared to e immediately previous nancial year) in key nancial ratios.

Following are e key nancial ratios:

Reason for signi cant change:

· Decrease in Intere Coverage Ratio: Due to decrease in Pro t after Tax (PAT), impacted by agnancy in sales, which were marginally down by 308.90 Lakhs and increase in co of imported goods due to adverse exchange rate resulting in low gross margins;

· Decrease in Operating Pro t Margin: Operating Pro t Margins decreased due to various factors viz. decrease in sales by 308.90 Lakhs. Exports sales were down by 192.88 Lakhs and domeic sales by 49.76 lakhs, increase in co of imported goods due to adverse exchange rate impacting gross margins and higher Employee Co ;

· Decrease in Net Pro t Margin: PAT decreased due to lower Operating Pro t margins impacted by decrease in sales, increase in co of goods due to adverse exchange rate and higher Employee Co ;

· Decrease in Return on Net Wor: Pursuant to Lower PAT, which decreased by 242.64 lakhs due to various factors as ated here in above;

atements in e Management Discussion and Analysis Report describing e Companys objectives, expectations or forecas may be forward-looking atements wiin e meaning of applicable laws and regulations. e actual results may di er materially from ose expressed in e atements due to various factors viz. market conditions, input cos, changes in e regulations, economic development wiin/outside country etc.