Deccan Transcon Leasing Ltd Management Discussions

(For the Financial Year ended March 31, 2026)

The Directors are pleased to present the Management Discussion and Analysis Report (MDAR) for the year ended March 31, 2026. This report outlines the Companys business performance, industry outlook, key opportunities and challenges, internal control systems, financial indicators, and future strategy. It should be read in conjunction with the financial statements and other sections of the Annual Report.

INDUSTRY STRUCTURE AND DEVELOPMENTS

COMPANY OVERVIEW

Deccan Transcon Leasing Limited (the Company) is actively engaged in the logistics and shipping industry , specializing in end-to-end bulk liquid logistics and integrated supply chain solutions. With a presence across India and key international markets, the Company offers:

Safe transportation of bulk liquids (hazardous and food-grade) using over 3,000 TEU, including ISO tanks, flexi-bags. Shipping services for dry cargo through a fleet of 20GP and 40HC containers. Global freight forwarding by sea, air, and multimodal routes. Customised logistics and supply chain management solutions. Tech-enabled platforms for real-time cargo tracking and operations.

The Company has built a strong reputation for safety, reliability, and regulatory compliance. It services a diversified client base of over 1,000 customers, with a high retention rate driven by customer-centric solutions.

SEGMENT-WISE PERFORMANCE

The Company operates primarily in a single business segment: logistics and shipping services . Given the integrated nature of its operations, separate segmental reporting is not applicable.

TECHNOLOGY & DIGITAL TRANSFORMATION INITIATIVES

The Company is Implementing a company-wide ERP solution, with go-live targeted for November 2026, to standardize data and drive operational efficiency.

Investing in AI initiatives to develop a route-planning tool for optimal lane selection to drive profitability, automate repetitive manual tasks, and enhance fleet optimization.

Upgraded IT infrastructure to strengthen security, with further investments planned to safeguard data and users across the organization.

Focusing on identifying opportunities where technology can increase ROI or improve process efficiency, with the end goal of enhancing company scalability.

OPPORTUNITIES AND THREATS

Opportunities:

Expansion of global trade and increased outsourcing of logistics services. Rising demand for integrated, technology-driven shipping and logistics solutions. Government push towards infrastructure development and multimodal connectivity. Growth in e-commerce, pharmaceuticals, and manufacturing sectors. Increase in manufacturing activity in Asia apart from China. Increasing preference for environmentally responsible logistics partners.

Threats:

Global supply chain disruptions due to geopolitical factors.

Volatility in fuel prices and foreign exchange rates.

Competitive pricing from unorganized and regional logistics players. Increased presence of large European players in the Asian market. Rising compliance requirements in hazardous material handling and shipping. Technological disruptions and cyber risks.

RISKS AND CONCERNS

The logistics and shipping sector is inherently exposed to several risks, including:

Market Risk: Economic slowdowns or trade restrictions may impact volumes. Operational Risk: Dependence on international shipping routes and third-party vendors. Regulatory Risk: Compliance with evolving maritime, customs, and environmental laws. Credit Risk: Exposure to delays or defaults in customer payments.

The Company has implemented a comprehensive risk management framework to identify, evaluate, and mitigate such risks.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company maintains a robust internal control system to ensure: Accuracy in financial reporting. Regulatory compliance. Safeguarding of assets. Efficiency of operations.

These systems are periodically reviewed by an internal auditor and monitored by the Audit Committee, ensuring corrective actions are taken wherever necessary.

PERFORMANCE EVALUATION

FINANCIAL PERFORMANCE INDICATORS

(Amount in Lakhs)

Particulars	Standalone basis		Consolidated basis
	Financial Year 2025-26	Financial Year 2024-25	Financial Year 2025-26	Financial Year 2024-25
Revenue from Operations	9,082.23	8,571.10	15,984.81	16,631.26
Other Income	224.53	33.66	161.01	29.41
Profit Before Interest	676.96	424.42	1336.67	846.25
Costs & Tax
Profit Before Tax	296.55	195.33	859.78	731.82
Profit After Tax	326.12	143.02	815.08	618.35
Earnings Per Share (EPS)	1.44	0.71	3.59	3.08

OPERATIONAL PERFORMANCE REVIEW

During the Financial Year ended 31 st March 2026, the Company continued to strengthen its core operational segments, Ocean Freight and Shipping and Lease Rentals , delivering consistent growth and optimizing cost structures.

In the Ocean Freight and Shipping Charges, the Company generated revenue of 14,919.93 lakhs in Financial Year 2025 26 as compared to 15,799.73 Lakhs in the previous Financial Year, reflecting a 5.57% variation over the previous year. Correspondingly, the operating expenses under this line of business reduced from 13,573.62 lakhs in Financial Year 2024 25 to 11,661.55 lakhs in Financial Year 2025 26, representing a 14.09% reduction. This reduction in costs was driven by a deliberate reduction in the number of long-haul routes operated to the United States and Europe, which had been adversely affected by the ongoing conflict in Ukraine and disruptions in the Red Sea. These developments are estimated to have impacted consolidated revenue by approximately 15% during the year. In response, the Company prioritised asset utilisation and margins over volume by increasing longer-term contracts for domestic deployment in India and Thailand, and by converting a portion of its operating lease assets to finance leases. Together, these steps were the primary drivers of the improvement in EBITDA and EBIT margins during the year, and also affected the performance of the Malaysian Subsidiary, which was engaged in these long-haul routes.

In the Lease Rental line of business, the Company reported revenue of 1,064.88 lakhs in Financial Year 2025 26 as compared to 831.53 lakhs in the previous Financial Year, reflecting a growth of 28.06%. Lease rental-related expenses amounted to 76.44 lakhs during the year. The lower lease rental expenses contributed positively to the profitability of this business segment

In support of its operations, the Company incurred employee benefit expenses amounting to 1,737.34 lakhs in Financial Year 2025 26 as compared to 994.38 lakhs in Financial Year 2024 25, representing an increase of 74.72%.

The increase in employee benefit expenses was primarily attributable to increments and revisions in employee remuneration, strengthening of the workforce, and fluctuations in foreign currency exchange rates, particularly in respect of the Companys operations in Malaysia. The Company continued to invest in its people and capabilities to support the growth of its liquid transportation business, including through senior leadership hiring and enhanced end-user outreach across multiple geographies.

The geographical bifurcation of employee benefit expenses is set out below:

Particulars	FY 2025 26 ( in Lakhs)	FY 2024 25 ( in Lakhs)	Increase
India	908.54	835.68	8.72%
Malaysia	829.20	158.69	422.31%
Total	1,737.74	994.37	74.72%

The increase in employee benefit expenses attributable to India operations was mainly due to increments and revisions in employee remuneration, along with the strengthening of the workforce and addition of senior personnel. The increase in employee benefit expenses relating to Malaysia operations was significantly influenced by strengthening of the workforce and addition of senior personnel, fluctuations in foreign currency exchange rates and revisions in employee remuneration during the year.

Other components of employee benefit expenses include Director Remuneration of 91.96 lakhs, Bonus Expenses of 27.60 lakhs, and Gratuity of 13.29 lakhs.

The Company remains committed to investing in its human capital and strengthening its talent base to support operational efficiency, customer engagement and sustainable growth across its key markets.

KEY FINANCIAL RATIOS

Ratio	Financial Year	Financial Year
	2025-26	2024-25
Debtors Turnover Ratio	1.72	2.58
Interest Coverage Ratio	1.88	1.86
Current Ratio	1.80	2.24
Debt Equity Ratio	0.49	0.40
Operating Profit Margin	23.49%	21.56%
Net capital turnover ratio	2.78	2.84

The Companys net worth for the Financial Year 2025 26 stood at 9,738.68 lakh as compared to 7,696.71 lakh in the previous Financial Year 2024 25, registering an increase of 2,041.97 lakh. This significant growth is primarily attributable to the funds raised from the public through the issuance of shares at a premium during the year.

MATERIAL DEVELOPMENTS IN HUMAN RESOURCES.

The Company recognizes that its human resources are a key driver of sustained performance and long-term growth. During the Financial Year 2025 26, Deccan Transcon Leasing Limited undertook several initiatives to enhance workforce capabilities and employee experience. This included structured talent acquisition, focused learning and development programs, and employee engagement activities aligned with the Companys strategic objectives.

A strong emphasis was placed on occupational health and safety, particularly in areas involving hazardous cargo operations. Comprehensive safety protocols, regular training sessions, and workplace audits were conducted to ensure the well-being of employees across operational sites.

In line with the Companys commitment to fostering a respectful, inclusive, and safe work environment, a sensitization and awareness session on the Prevention of Sexual Harassment (POSH) was conducted on September 25, 2025. The session focused on educating employees about their rights and responsibilities, appropriate workplace conduct, and the internal redressal mechanism available under the Companys POSH Policy, in compliance with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The Company conducted IMDG Code Training Program on September 7, 8 and 9, 2025, in Mumbai, for 9 members. The training was aimed at enhancing participants knowledge and competency in the safe handling, documentation, transportation, and regulatory requirements relating to dangerous goods in maritime transportation.

Industrial relations continued to remain cordial and constructive throughout the year, contributing to a positive and collaborative workplace culture.

As of March 31, 2026, the Companys workforce stood at 81 employees, compared to 86 employees as of March 31, 2025. The Company remains steadfast in its commitment to nurturing human capital, fostering a culture of accountability and integrity, and empowering its people as a driving force in achieving long-term business objectives. Looking ahead, the Company will continue to focus on strengthening its talent base, enhancing employee capabilities, and building a committed and capable workforce to support sustained growth and create enduring value.

STRENGTHS

Domain expertise in logistics and shipping for hazardous and food-grade materials. Presence in international markets including UAE, Malaysia, China, and Thailand. Strong customer relationships and high client retention. Integrated digital platforms for logistics visibility and operational efficiency. Commitment to safety, sustainability, and compliance.

DISCLOSURE OF ACCOUNTING TREATMENT

In the preparation of its financial statements for the Financial Year 2025 26, the Company has followed the accounting treatments prescribed under the applicable Accounting Standards, as notified under the Companies Act, 2013.

No alternative or different accounting treatment has been adopted that deviates from the prescribed standards. Accordingly, there are no instances requiring disclosure of any deviation along with managements justification, as the financial statements reflect a true and fair view of the underlying business transactions in accordance with applicable regulatory requirements.

CAUTIONARY STATEMENT

Certain statements in this Report may be forward-looking in nature and are intended to describe the Companys expectations or forecasts. Actual results may differ materially from those expressed or implied due to changes in economic conditions, government regulations, market dynamics, or other external factors beyond the Companys control.

On behalf of the Board of Directors of DECCAN TRANSCON LEASING LIMITED.

Jaidev Parath Menon

Chairman & Whole Time Director

DIN: 07020583

Address: Suite No. 507, 5 th Floor, Image Capital Park,

Image Garden Road, Madhapur, Hyderabad, Shaikpet - 500081, Telangana

Date: 01.09.2026

Place: Hyderabad