Delphi World Money Ltd Management Discussions

• Margin compression in the outward remittance corridor arising from aggressive pricing by banks and digital-first competitors.

• Regulatory change affecting permissible transactions, documentation requirements or the tax treatment of outward remittances, which can alter customer behaviour at short notice.

• Sharp movements in exchange rates, which affect both realisation and the carrying value of currency positions.

• Disruption to international travel arising from geopolitical events, visa policy changes or public health developments.

• Dependence on principal relationships with global money transfer operators for the inward remittance business.

Your Company operates in a single reportable segment. A summary of performance across the principal product lines within that segment is set out below.

(Rs. (Rs. in Million)

The year under review was one in which the quality of earnings improved materially, even as the top line moderated.

(Rs. (Rs. in Million)

Total income for the year stood at 531.26 million as against 739.55 million in the preceding year. Profit before tax from continuing operations rose more than fivefold to 107.49 million from 19.75 million, and profit after tax from continuing operations increased to 56.17 million from 19.56 million.

The improvement in profitability on a smaller revenue base reflects a deliberate shift in emphasis from volume to value. Contributing factors were a change in product mix in favour of higher-yield retail transactions, tighter control over employee and establishment costs, closer scrutiny of branch and channel economics, the full repayment of borrowings during the year, and a lower exceptional item charge than in the preceding year. Your Company remains debt-free as at the close of the year, and the current ratio of 4.466 reflects a comfortable liquidity position.

The Board recognises that returns on the capital employed in the business, while improved, remain modest in absolute terms. Improving the efficiency with which the Companys capital base is deployed is accordingly a stated priority for the coming year.

Details of significant changes in key financial ratios, being a change of 25% or more as compared to the immediately preceding financial year, together with the explanations therefor, are set out below.

* Not applicable, the Company being engaged in the service industry and in the trade of foreign currency, and having had no debt service obligations during the year.

Your Company operates a Board-supervised risk management framework under which key risks are identified, assessed and monitored on a continuing basis. The principal risks to which the business is exposed, and the measures adopted to mitigate them, are summarised below.

Your Company maintains internal control systems commensurate with the nature, size and complexity of its operations, covering financial reporting, operational processes and regulatory compliance. Branch operations, transaction handling, cash and currency custody and information technology infrastructure are each governed by defined standard operating procedures and risk protocols providing for transaction-level tracking, grievance redressal and regulatory reporting.

The internal audit function, supported by independent professional firms, reviews the adequacy and operating effectiveness of these controls on a periodic basis. Audit findings, together with the remedial action taken by management, are placed before the Audit Committee, which reviews them and monitors implementation. The Board is satisfied that the internal control systems in place are adequate and were operating effectively during the year under review.

Your Company regards its people as central to a business built on trust and regulatory discipline. As at 31 March 2026, the Company had 154 employees on its rolls, as against 169 in the preceding year.

Training remained a focus area through the year, with structured programmes covering anti-money laundering and know-your- customer obligations, product knowledge in relation to digital foreign exchange offerings, and customer experience. Employee engagement and retention levels remained healthy, supported by transparent performance assessment, internal mobility and a positive working environment. Industrial relations remained cordial throughout the year, and there were no material developments on the industrial relations front.

Rising travel volumes, improving airport throughput and a growing outbound student population together provide your Company with a substantial opportunity over the medium term. The priorities for the coming year are to deepen integration with education loan partners, particularly for card-based disbursement of tuition fees; to raise branch productivity through centralisation of back-office processes, customer relationship management integration and training; to open new digital remittance corridors and fintech-led services; and to continue investing in the technology that supports seamless compliance, onboarding and issuance.

With a debt-free balance sheet, an improved margin profile and a leaner cost structure, your Company enters the financial year 2026-27 better positioned than it has been for some time. The emphasis will remain on profitable growth rather than growth pursued for its own sake.