Den Networks Ltd Management Discussions

Overview of the Global Economy:

Despite prevailing challenges, the global economy achieved a stable growth pace of 3.2% in the second half of 2024. However, recent indicators point to a potential softening of growth momentum, with business and consumer confidence weakening in several regions. Inflationary pressures persist across many economies, compounded by heightened policy uncertainty. A key concern is the increasing fragmentation of the global economy and uncertainties over tariffs, trade restrictions, and the escalation of trade wars. Additionally, if inflation remains higher than expected, it may trigger tighter monetary policies and abrupt repricing in financial markets. On the upside, agreements to reduce existing tariffs could support more substantial global growth.

As per the OECDs Interim Economic Outlook, global GDP growth is forecasted to ease from 3.2% in 2024 to 3.1% in 2025 and further to 3.0% by 2026. This slowdown is attributed to rising trade barriers across several G20 economies and increased policy uncertainty, dampening investment activity and household spending. In the United States, annual real GDP growth is anticipated to decelerate from its recent impressive performance to 2.2% in 2025 and 1.6% in 2026. The Euro area is expected to experience a modest increase of 1.0% in 2025 and 1.2% in 2026 as elevated uncertainty continues to constrain economic momentum. Meanwhile, Chinas growth is projected to gradually slow from 4.8% in 2024 to 4.4% by 2026.1 Global growth projections for 2025 and 2026 have been modestly scaled back, signalling a more cautious economic outlook.

Reflecting similar concerns, EY cautions that shifts in US regulatory, trade, immigration, and tax policies will have significant global repercussions, presenting risks and opportunities. Aggressive use of tariffs and protectionist policies could push the global economy toward stagflation, marked by sluggish growth and persistent inflation. Additionally, escalating tensions between major economies, particularly the US and China, and the emergence of geoeconomic blocs are likely to accelerate the fragmentation of global trade, reshaping supply chain dynamics and adding further complexity to the global economic landscape.2

Global Media and Entertainment Industry:

The global Entertainment & Media (E&M) industry is not directly exposed to the immediate effects of international trade headwinds. However, it cannot remain entirely insulated from broader macroeconomic challenges. While the global economy is currently grappling with heightened policy uncertainty, persistent inflationary pressures, and increasing trade fragmentation, these factors collectively shape the operating environment for the E&M sector, influencing consumer behaviour and corporate strategies.

Elevated inflation and tighter monetary policies across key economies may constrain discretionary spending, potentially affecting subscription-based services, advertising budgets, and box office revenues.

1 OECD Economic Outlook, Interim Report March 2025, 17th March 2025.

2 Global economic outlook, EY. Jan 2025.

3 Additionally, geopolitical tensions and the risk of new protectionist policies, including tariff hikes, could indirectly impact significant media and entertainment companies supply chains, production costs, and content distribution strategies. The emergence of geoeconomic blocs and trade fragmentation adds complexity, particularly for global players dependent on seamless cross-border operations and international advertising revenue streams.

PwC projects global Entertainment & Media revenues to reach USD 3.4 trillion by 2028, growing at a CAGR of 3.9%.

Before these developments, Pwcs Global Entertainment & Media Outlook 2024-2028 projected steady industry growth, forecasting total global E&M revenues to rise to USD 3.4 trillion by 2028, at a CAGR of 3.9%. The report highlighted robust digital consumption, streaming services expansion, and the increasing role of advertising and gaming as key drivers.4 However, PwCs projections were published in July 2024, preceding the US presidential election and subsequent policy shifts under the new administration. Given the evolving geopolitical landscape, some tapering of these growth expectations may be warranted, particularly if tariffs and other restrictive trade measures gain prominence, as recent industry analyses have indicated.

The report also highlights key industry trends, emphasising the dominant role of digital advertising in driving future growth. The sector is witnessing shifts towards direct-to- consumer models, with streaming platforms, gaming, and experiential entertainment leading the transformation. Integrating AI and personalisation technologies is reshaping content strategies and consumer engagement. However, the report also notes challenges such as rising operational costs, changing regulations, and the need for continual business model innovation.5

While the E&M industrys long-term fundamentals remain strong, the broader economic and policy environment will continue to shape the sectors growth trajectory. To sustain momentum, industry participants must remain agile and adapt to shifting macroeconomic conditions and regulatory landscapes.

Overview of the Indian Economy:

While India cannot entirely shield itself from global economic turbulence, it continues developing confidence in steering through these challenges, bolstered by strong diplomatic engagement and sound domestic fundamentals. Rural consumption remains resilient, supported by a solid agricultural performance, while the services sector sustains its role as a key growth driver. Furthermore, Indias manufacturing exports—particularly in high-value-added sectors like electronics, semiconductors, and pharmaceuticals—highlight its expanding role in global value chains. Amidst global uncertainties, India stands as an island of calm, offering relative economic stability.6

3 Trump Tariffs Loom Over Ad Industry, From Brands to Digital Sellers, WSJ, Feb 04, 2025.

4 Global Entertainment & Media Outlook 2024-2028, 16 July 2024.

5 Global Entertainment & Media Outlook 2024-2028, 16 July 2024.

6 Indian Economic Outlook, Deloitte India, January 2025.

Growth rate by country according to OECDs Interim Economic Outlook

Country/Region	2025 Projections (%)	2026 Projections (%)
World	3.1	3
United Kingdom	1.4	1.2
United States	2.2	1.6
China	4.8	4.4
India	6.4	6.6

Reflecting this optimism, Fitch Ratings projects Indias GDP growth at 6.3% for FY25, rising to 6.5% in FY26 and 6.3% in FY27. While the FY26 forecast is slightly below the Reserve Bank of Indias estimate of 6.7%, it aligns with the Economic Surveys projected range of 6.3-6.8 %. Strong business confidence and sustained double-digit growth in private- sector lending continue to support economic momentum. Additionally, the Union Budgets focus on public capital expenditure and adjustments to tax thresholds are expected to bolster investment and consumer spending over the medium term.7

The Government of Indias total effective capital expenditure stands at T15.48 lakh crore for FY25.

In the Union Budget 2025, the government reinforced its commitment to infrastructure-led growth by allocating ^11.21 lakh crore towards capital expenditure, marking a modest increase from the previous year. Including state allocations, the total effective capex stands at ^15.48 lakh crore. Further, ^1.5 lakh crore in interest-free loans was extended to states to support infrastructure priorities. The budget also focused on agriculture, digital transformation, defence modernisation, and space exploration while announcing significant tax relief measures to boost household consumption and sustain economic momentum amid inflationary pressures.8

Building on the momentum from the Union Budget, the Monetary Policy Committee (MPC), in its February 2025 meeting, unanimously opted to reduce the policy repo rate by 25 basis points, bringing it down to 6.25%. This decision was driven by moderating retail inflation and signs of slowing growth. Headline inflation eased notably, declining from 6.2% in October 2024 to lower levels in subsequent months, mainly due to softening food prices. For FY25 -26, CPI inflation is projected at 4.2%, supporting a more accommodative monetary stance to sustain growth.9

Industry Overview:

Media and Entertainment Industry in India:

Indias Media and Entertainment (M&E) industry is transforming, driven by rapid digitalisation, evolving consumer preferences, and expanding internet penetration. The sector, traditionally dominated by television and print, is increasingly led by digital media, online gaming, and OTT platforms, which are reshaping content consumption patterns. Digital advertising, subscription-based models, and on-demand content are accelerating growth, while legacy formats like television and print continue to adapt. This dynamic landscape reflects Indias position as one of the fastest-growing media markets globally, fuelled by a young, tech-savvy population and supportive policy frameworks.

7 Fitch sees Indias GDP growth at 6.5% in FY26, Financial Express, March 19, 2025.

8 Highlights of Union Budget 2025, Ministry of Finance PIB, Feb 01, 2025.

9 RBI MPC Meeting 2025 Highlights, The Hindu, Feb 07, 2025.

Indias Entertainment and Media (E&M) sector is experiencing robust growth, fuelled by its large millennial and Gen Z population of over 910 million. According to TRAI, the country boasts more than 1.19 billion telecom subscribers and over 940 million high-speed internet users, supported by rising per capita income and the worlds lowest data costs.10 India accounts for under 2% of the global E&M market, but it is the fastest-growing region, driven by its expanding economy and digital infrastructure. According to a recent FICCI EY Report, the sector is expected to grow 7.2% in 2025 to reach INR2.68 trillion (US$31.6 billion) and then grow at a CAGR of 7% to reach INR3.07 trillion (US$36.1 billion) by 2027.

While digital media and OTT platforms are witnessing rapid growth, this does not signify a decline in traditional media. Television and print maintain relevance, supported by their broad reach, established consumer base, and strong advertiser confidence. The growth trajectory of traditional media remains steady, albeit at a more moderate pace compared to digital counterparts. Rather than being replaced, traditional media is evolving alongside digital platforms, catering to diverse audience preferences and complementing the broader media ecosystem.

Indias Expanding Content Creation Powerhouse

India is emerging as a global leader in content creation, supported by its status as the worlds largest producer of films, with over 1,700 movies and 200,000 hours of content produced annually. The countrys Gen Z population, which is over 400 million strong, is deeply engaged in the creator economy, with a growing number of people identifying as content creators. India also hosts over 940 million internet users, making it one of the largest content-consuming markets globally.

Digital media, OTT, gaming, and VFX are witnessing CAGRs of over 15%, driven by rising mobile-first consumption; around 82% of E&M time is spent on mobile apps. The Indian government has announced a $1 billion fund to support creators, particularly in regional and vernacular content, reflecting its strategic focus on this sector.

Cultural and linguistic diversity fuels regional content growth, reaching audiences worldwide. Technological advances in AI, animation, and VFX further accelerate this momentum, positioning India as a global creative hub. With robust infrastructure, supportive policies, and a thriving creator ecosystem, Indias content creation landscape is set to scale new heights.

India Broadcasting and Cable TV Market:

Indias Broadcasting and Cable TV sector is one of the worlds most dynamic and expansive, serving a culturally rich population of over 1.4 billion. According to Research and Markets, valued at approximately USD 21.97 billion in 2024, the market is projected to grow at a 7.32% CAGR, reaching USD 33.45 billion by 2030. Despite global cord-cutting trends,

10 The Indian Telecom Services Performance Indicators, TRAI, Jan 01, 2025.

Indias television industry remains resilient, mainly due to its strong foothold in rural areas, where TV penetration is still around 61%, presenting untapped growth opportunities.11

A key trend shaping the sector is the rapid shift from analogue to digital broadcasting, enabled by technological advancements and government-led digitisation initiatives like the Digital Addressable System (DAS). This shift has improved signal quality, increased HD/UHD channel offerings, and encouraged the adoption of smart TVs and advanced set-top boxes. The rising popularity of OTT platforms and mobile streaming prompts broadcasters to integrate digital services, ensuring that traditional cable TV remains competitive.

Notably, the USD 8.5 billion merger of Disneys Indian operations with Reliances media assets—forming Indias most prominent entertainment entity—signals a wave of industry consolidation and an intention to revitalise television in the most populous country.12 Recent pricing actions by Jio-Disney-Hotstar, Sony, and Zee to hike subscription rates further indicate intensifying market pressures and potential consolidation among smaller players.13

However, challenges persist. Content monetisation remains difficult due to rising production costs and piracy, while growing competition from digital disruptors and frequent price hikes could strain consumer affordability. Balancing regulatory compliance, content protection, and consumer- friendly pricing will be crucial for sustainable growth.

Television Segment:

Indias Media and Entertainment (M&E) industry is witnessing a clear shift in growth patterns, with digital-led segments outpacing traditional formats. Digital media, live events, music, and animation & VFX are emerging as the primary growth drivers, registering double-digit compound annual growth rates (CAGR) to 2027.

While television continues to be a significant contributor, it is expected to see a slight contraction over the coming years, reflecting changing consumption habits. Print and radio remain stable with modest growth. The industry is projected to maintain a steady expansion, driven by rising digital adoption, improved connectivity, and increasing demand for on-demand and immersive content experiences.

Even with the surge of streaming services altering the entertainment landscape, television remains a crucial element of Indias media and entertainment industry. The FICCI EY Reports not-so-pessimistic forecast for television in India underscores the segment s strong resilience. With an expected degrowth of 0.6% CAGR from 2025 to 2027, the sector is estimated to remain among the popular entertainment choices.

Television Broadcasters:

Despite the rapid expansion of digital media, television consumption in India remained largely stable throughout 2024. As per the FICCI EY Report, the cumulative weekly reach of television stood at 753 million viewers, only slightly below the 758 million recorded in 2023. Notably, the average time spent per viewer per day increased marginally to three hours and forty-two minutes, reflecting consistent viewer engagement.

11 India Broadcasting and Cable TV Market, Research & Markets, Feb 2025.

12 Disney-Reliance Indian media giant says TV is not dead following $ 8.5bn merger, FT, Nov 14, 2024.

13 Cable bills set to soar as JioStar, Sony, Zee hike Prices, ET Brand Equity, Jan 08, 2025.

Television audiences remained steady across socio-economic segments, with news viewership witnessing a 13% growth during the year. The general elections, key state elections, and other major news events drove this surge, collectively leading news content to account for 7% of total TV viewership. In contrast, sports viewership declined by 6%, which is expected to perform better with the upcoming Indian Premier League (IPL) and the rising popularity of other sporting leagues like Womens Premier League (WPL), Indian Street Premier League (ISPL) and Pro Kabaddi League.

Among the 687 million sports viewers on linear TV in 2024, 53% were from rural areas, 36% from Tier-I and Tier-II cities, and 12% from metro regions. This shows that television is still the primary entertainment source in rural India. Women comprised a substantial portion of this audience, with 329 million female viewers contributing 41% of total sports consumption. This shift in content preference contributed to a 6% decline in television advertising revenue during the year.14

Broadcasting & Cable Services

Number of private satellite TV channels permitted by The Ministry of I&B for uplinking only/downlinking only/both uplinking and downlinking	912
Number of Pay TV Channels	362
Number of private FM Radio Stations (excluding All India Radio)	388
Number of Pay Subscribers Active with Private DTH Operators	59.51 million
Number of Operational Community Radio Stations	513
Number of pay DTH Operators	4

Source: The Indian Telecom Services Performance Indicators. Jul- Sep 2024 Report.

Company Overview:

Den Networks Limited, a leading mass media and entertainment company in India, provides visual entertainment through a diversified portfolio of digital cable TV and fixed broadband services. As a subsidiary of Reliance Industries Ltd. (RIL), DEN benefits from strong backing and strategic synergies within the broader Reliance ecosystem.

We command the most extensive subscriber base among all cable players in India, entertaining across 13 key states and more than 450 cities, including strongholds such as Delhi, Uttar Pradesh, and Maharashtra. Its cable TV operations span over 450 cities and towns, offering curated content across genres from various domestic and international broadcasters.

With its corporate headquarters in New Delhi and a strategic presence across India, we remain well-positioned to deliver quality, affordable digital services while adapting to evolving consumer preferences through innovation and integrated content delivery.

Operational Highlights for FY2024- 25:

Structural Improvement:

Eight Step down wholly-owned subsidiaries of the Company amalgamated with Futuristic Media and Entertainment Limited, a wholly-owned subsidiary of the Company with the appointed date of January 1, 2025. This amalgamation is expected to result in rationalisation and optimisation of the

14 Shape the future, FICCI EY Industry Report, March 2025.

groups legal entity structure, leading to greater alignment with the businesses by reducing the number of legal entities. This consolidation is expected to provide operational synergies, eliminate inefficiencies and streamline corporate structures and cash flows. The consolidation will lead to better centralised management and oversight, cost efficiencies and support the groups competitive growth.

Ease of payments:

The Company has introduced two additional online payment service providers to make it easier for the customers to pay Local Cable Operators by scanning a quick-response (QR) code on their TV screen. This initiative improves the payment process while also boosting customer satisfaction.

Employees Gratuity Fund:

The Company formed an Employees Gratuity Trust this year, a decision that provides significant benefits. By demonstrating a commitment to employees welfare through this well-managed Trust, The Company enhances morale and retention, building a more secure and loyal workforce.

Systems Applications and Products in Data Processing (SAP) improvements:

The Company has implemented Disaster Recovery (DR) plan within SAP system which is crucial to ensure financial operations continuity. This DR strategy focuses on minimizing downtime, safeguarding financial data and enabling swift restoration of operations in the event of system failures, cyberattacks or natural disasters. Key to this is real-time SAP HANA data replication for data integrity and security. Additionally, an alert mechanism has been established to monitor system performance across various components such as OS memory, CPU usage, DB server file system, application file system, ABAP extended memory, and background job statuses. Furthermore, the Asset Transfer Note process has been implemented to track and manage asset movements across India, enabling real-time accounting of asset movements as they occur. This improves asset control and ensures accurate financial records.

Financial Overview:

At DEN, we have consistently surpassed the ^1,000 crore revenue mark, reflecting the strength of our widespread geographic presence and loyal customer base. In FY25, we recorded total revenue of ^1,005 crore compared to ^1,081 crore in FY24. Our operating profit for the year stood at ^112 crore, compared to ^155 crore in the previous fiscal. The following are our key financial highlights for FY25:

Particulars	FY25 re Cr)	FY24 R Cr)	Change (%)
Revenue from Operations	1005	1081	(-) 7%
Expenses	893	926	(-) 4%
Operating Profit	112	155	(-) 28%
OPM %	11%	14%
PBT	249	245	2%
PAT	197	213	(-) 8%

Key Financial Ratios:

Details	FY25	FY24	Variance	Rationale
Interest Coverage Ratio	NA	NA	NA
Operational Ratio Margin (%)	11%	14%	(-)22%
Current Ratio	7.67	7.64	0%
Net Debt (^ Cr)	-3146	-2931	7%
Net Profit Margin (%)	20%	20%	(-)02%
Return on Net Worth (%)	6%	6%	(-)12%
Operating Cash Flow % to Operating Revenue	2%	8%	(-)76%	Due to lower operating profit and higher receivables

Analysis of Revenue Streams Cable Business

We continue to maintain a strong foothold in the Indian cable industry, operating across more than 450 urban and rural centres in 13 key states, including Uttar Pradesh, Maharashtra, Karnataka, Gujarat, Rajasthan, and West Bengal, among others. Leveraging its expansive network and deep local presence, the Company curates a broad selection of content from multiple broadcasters, offering diverse entertainment options tailored to regional preferences. In FY25, revenue from the cable business stood at ^ 978 crore.

Details	FY25 (* Cr)	FY24 (* Cr)	Variance (* Cr)	Contribution FY25 (%)	Contribution FY24 (%)
Subscription	442	534	(-)92	45%	51%
Placement / Marketing	490	435	(+)55	50%	41%
Others	46	80	(-)34	5%	8%
Total	978	1049	(-)70	100%	100%

Broadband Business

DEN Broadband Limited, a wholly owned subsidiary of DEN Networks Limited, operates under a Unified License for ISP Category "A" (License No. DS-11/448/2022-DS-III) granted by the Department of Telecommunications. For FY25, the broadband segment generated a revenue of ^ 45 crore.

Details	FY25 Cr)	FY24 Cr)	Variance Cr)	Contribution FY25 (%)	Contribution FY24(%)
Subscription	27	32	(-)5	60%	87%
Others	18	5	(+)13	40%	13%
Total	45	37		100%	100%

SCOT Analysis

Strengths

• Expansive Geographic Presence: We have a broad operational footprint, covering over 500 cities and towns across 13 Indian states, enabling intense market penetration in the entertainment and connectivity space.

• Market Leadership in Key Regions: The Company leads in Hindi-speaking states, reinforcing its dominance in Indias cable MSOs.

• Strategic Backing: As a subsidiary of Reliance Industries, we benefit from robust strategic support and access to advanced technologies such as Jios set-top box ecosystem.

• Diversified Offerings: We address a broad spectrum of customer needs with services spanning digital cable (DEN Cable) and high-speed broadband (DEN Broadband).

• Technology-Driven Infrastructure: A strong fibre optic network enabling broadband speeds of up to 100 Mbps.

• Established Brand Equity: We enjoy strong brand recognition and a large subscriber base, which is underpinned by our commitment to high-quality entertainment services.

Challenges

• Economic Volatility: Fluctuations in macroeconomic indicators, such as inflation and interest rates, can impact operational and financial performance.

• Intensifying Competition: The entry of new players and aggressive pricing by existing ones in the cable and DTH markets can erode market share.

• Cost of Technological Upgrades: Keeping pace with rapidly evolving media technologies requires continual investment in infrastructure and innovation.

• Cybersecurity Concerns: Increasing reliance on digital platforms and remote access heightens the risk of cyber threats, necessitating vigilant data protection measures.

• Regulatory Uncertainty: Frequent revisions to TRAI regulations, particularly in pricing and channel packaging, can create operational challenges and affect ARPU.

Opportunities

• Cable Digitisation: Ongoing digital transformation in the cable TV sector offers potential for operational efficiency, increased ARPU, and institutional investment. •

• Rising Demand for Regional Content: A growing consumer appetite for localised and regional language content allows us to diversify and localise our content strategy.

• Cable with Broadband Growth: Expanding demand for entertainment and high-speed internet creates room for growth in original content, broadband coverage, and integrated service bundles.

• Smart TV Integration: Increasing smart TV adoption opens opportunities for hybrid models combining traditional broadcasting with digital content access.

• Government Push for Connectivity: National initiatives like Digital India and BharatNet may expand broadband in underserved regions.

Threats

• Evolving Competitive Landscape: Alternatives such as OTT platforms, IPTV, and fixed-line broadband are gaining traction, posing risks to traditional cable services.

• Escalating Content Costs: Increased demand for quality content could increase acquisition costs, putting pressure on margins.

• ARPU Pressure: Intense competition and price sensitivity, particularly in rural and semi-urban markets, may restrict growth in average revenue per user.

• Shift to Short-Form, Mobile-First Content: The rising popularity of digital-first platforms offering bite-sized entertainment alters how younger audiences consume content.

Internal Control System and Risk Management

The internal control framework at DEN Networks forms a core component of our governance and compliance structure. It is designed to protect company assets, uphold financial integrity, and promote a culture rooted in ethical conduct. In FY25, we strengthened this framework to ensure operational excellence, mitigate risks effectively, and comply with applicable regulatory requirements across all business functions.

Our internal controls are built on well-defined Standard Operating Procedures (SOPs), which are continuously reviewed and refined to enhance efficiency, ensure compliance, and address emerging operational risks. These SOPs enable the smooth execution of critical business processes while embedding key control mechanisms.

We firmly comply with statutory obligations under the Companies Act, SEBI regulations, and other applicable industry standards. Our internal and statutory audit processes, conducted by reputed independent professionals, ensure regular monitoring of operational and financial records. Oversight by the Audit Committee and the Board of Directors, through structured quarterly reviews, reinforces transparency and accountability.

We have adopted a comprehensive Risk Management Framework approved by the Board to manage risks proactively. This framework supports the timely identification and mitigation of key risks impacting our business operations and strategic objectives.

Key Risk Areas and Mitigation Measures

1. Market Share Risk

The media and broadband industries continue to witness intense competition from traditional players and digital-first platforms such as OTT and DTH providers. Risks include customer churn due to set-top box (STB) replacements by other MSOs, downward pressure on ARPU, and difficulty expanding into new markets.

Mitigation Strategy: We focus on retaining and strengthening our distributor and LCO (Local Cable Operator) network through periodic engagement and support initiatives. The LCO Lighthouse App has been instrumental in improving communication and incentivising loyalty. Additionally, we continue to offer competitive pricing and best-in-class services to retain our leadership position.

2. Technological Disruption

The pace of change in digital content delivery, STB capabilities, and the rollout of high-speed networks like 5G pose operational and strategic challenges. Viewers increasingly demand seamless, interactive, high-quality content across platforms, compelling operators to upgrade their technological ecosystem.

Mitigation Strategy: We are committed to technology upgrades aligned with emerging consumer expectations. Enhancements such as migration to MPEG-4, offering only HD/MPEG-4 STBs, and increasing channel capacity at key head-ends help ensure signal quality and service reliability. Features like QR code-enabled online payments and casting from mobile to STB further strengthen customer convenience and engagement.

3. Regulatory and Policy Risks

The broadcasting and broadband sectors are subject to ongoing regulatory developments by authorities such as TRAI, DoT, and the Ministry ofInformation & Broadcasting. New directives on channel pricing, bundling, tariff orders (like NTO 3.0), or net neutrality could impact existing business models, cost structures, and customer offerings. Any changes in FDI policy or sector-specific taxation may alter the compliance landscape.

Mitigation Strategy: We actively engage with regulatory bodies through industry forums to remain informed and compliant. Our legal and compliance teams monitor policy updates closely to ensure the timely adaptation of internal processes and service models.

4. Cybersecurity Risks

Expanding digital infrastructure and remote operations have increased exposure to cyber threats, potentially affecting information systems confidentiality, availability, and integrity.

Mitigation Strategy: We have implemented robust IT safeguards, including secure VPN access to servers, 24/7 monitoring of critical systems, and periodic staff sensitisation through internal advisories on phishing, data security, and backup protocols.

We continue reinforcing our internal controls and risk mitigation strategies to support business continuity and long-term stakeholder value. Furthermore, we recognise the growing importance of ESG-related risks. We progressively integrate environmental, social, and governance considerations into our enterprise risk framework to build a sustainable and responsible future.

Human Resource Management

At DEN, the Human Resource (HR) function plays a pivotal role as a strategic partner in driving organisational success. We recognise our people as our most valuable asset and strive to ensure their alignment with roles that best suit their skills and potential. A continuous emphasis is placed on re-skilling and up-skilling high-performing employees to keep pace with evolving business needs.

In todays dynamic environment, attracting the right talent within defined timelines and retaining top performers remain key challenges. We have made significant progress while onboarding professionals from diverse industries, ensuring seamless integration into the organisational culture. We strongly focus on defining clear Key Performance Indicators (KPIs), rewarding outstanding performance, and nurturing high-potential talent.

During FY25, we advanced our HR agenda through a series of focused initiatives:

• Talent Acquisition and Development: Our hiring efforts remained robust across levels, emphasising diversity and capability. A structured onboarding procedure helps new joiners acclimate quickly to our systems, processes, and values.

• Fostering a High-Performance Culture: We uphold a meritocratic culture anchored in productivity and accountability. Business teams undergo monthly performance assessments based on predefined KPIs, while our Rewards & Recognition (R&R) framework honours individual and team achievements quarterly.

• Employee Engagement and Well-being: We promote a collaborative and inclusive workplace. The HR team curated various employee engagement and team-building activities, including wellness workshops and festive celebrations, to foster team spirit and support mental and physical well-being.

• HR Operations and Compliance: We remain committed to 100% compliance across all labour and employment regulations. We uphold a transparent, employee-friendly environment through an open- door culture and structured grievance redressal mechanisms. Internal committees ensure the timely resolution of employee feedback and promote a safe, inclusive, and supportive work atmosphere.

Forward-Looking Statements:

This document contains statements that may be considered "forward-looking” under relevant legal frameworks. These statements are subject to various risks and uncertainties, potentially leading to a significant divergence between projected outcomes and actual results. Factors that could influence the Companys performance include but are not limited to the effectiveness of growth strategies, prevailing economic and business conditions both domestically and internationally, regulatory shifts and the Companys adaptability to them, execution of strategic plans, technological advancements, political risks, fluctuations in interest and foreign exchange rates, legal and tax regime changes, industry competition dynamics, and other unforeseen factors. This analysis should be interpreted with the accompanying financial statements and notes. The Company might periodically provide further forward-looking statements. However, no commitment exists to revise any forward-looking statement reflecting new information or future events.