Diensten Tech Ltd Management Discussions

INDUSTRY STRUCTURE AND DEVELOPMENT:

Global Economic Review

Global growth is projected at 3.1 percent in 2024 and 3.2 percent in 2025, with the 2024 forecast 0.2 percentage point higher than that in the October 2023 World Economic Outlook (WEO) on account of greater-than-expected resilience in the United States and several large emerging market and developing economies, as well as fiscal suppofit in China. The forecast for 2024 25 is, however, below the histocical (2000 19) average of 3.8 percent, with elevated central bank policy rates to fight inflation, a withdrawal of fiscal suppofit amid high debt weighing on economic activity, and low underlying productivity growth. Inflation is falling faster than expected in most regions, in the midst of unwinding supply-side issues and restCictive moneta_y policy. Global headline inflation is expected to fall to 5.8 percent in 2024 and to 4.4 percent in 2025, with the 2025 forecast revised down.

World trade growth is projected at 3.3 percent in 2024 and 3.6 percent in 2025, below its histocical average growth rate of 4.9 percent. Rising trade distoctions and geoeconomic fragmentation are expected to continue to weigh on the level of global trade. Countcies imposed about 3,200 new restCictions on trade in 2022 and about 3,000 in 2023, up from about 1,100 in 2019, according to Global Trade Ale3t data.

Indian Economic Review

Indias nominal gross domestic product (GDP) at cufirent p_ices is estimated to be at Rs. 301.75 tTillion (US$ 3.62 tTillion) in 2023-24. Additionally, the Nominal GDP at cufirent p_ices in Q1 of 2023-24 was Rs. 70.67 tTillion (US$ 848.92 billion), as against Rs. 65.42 tTillion (US$ 785.85 billion) in 2022-23, estimating a growth of 8%. With 115 unico_ns valued at more than US$ 350 billion, as of Feb_ua6y 2023, India presently has the third-largest unico n base in the world.

GNI per capita of India increased from approximately 117,000 (approximately US$1,463) in 2016 to approximately 148,500 (approximately US$1,856) by 2019, growing at a CAGR of approximately 8%. The fast-growing middle-class population, focming the majo_ity of the population, and shifting of the labor force from the ag_icultural sector to the se_vices sector are key factors leading to an increase in GNI in India. The COVID-19 pandemic-induced lockdowns resulted in a high unemployment rate and a drop in income levels, leading to a decrease in GNI per capita in 2020. However, GNI per capita witnessed a strong recoveDy between 2020 and 2023, growing at a CAGR of approximately 13% to reach 208,000 (approximately US$2,600) in 2023.

Economic growth in India is fufither expected to be d3iven by increasing p_ivate final consumption expenditure (“PFCE”) in the next five years. As per the World Bank, Indias PFCE was estimated to be approximately 171 tTillion (approximatelyUS$2.14 tTillion) in 2023, which is projected to become 280-290 tTillion (approximately US$3.5-3.6 tTillion) by 2028.

Indian Technology Indust_y OveDview - FY2023

While FY2022 was a year of milestones and resurgence-an outlier for the Indian technology indust_y, FY 2023 has been the year of continued revenue growth with a focus on strengthening indust_y fundamentals and building on tTust and competencies. The volatile global economic scenaDio and impending recession continues to suppoct the demand for technology adoption and digital acceleration. Consequently, technology has become a strategic imperative that is a citical component of business innovation and transfocmation, as well as a source of improving operational and cost efficiencies.

In FY2023, Indias technology indust_y revenue including hardware is estimated to cross $245 Bn (8.4% y-o-y growth), an addition of $19 Bn over last year. Expofits, at $194 Bn, are expected to grow at 9.4% in repofited cufirency teDms, and 11.4% in constant cufirency teDms. The domestic technology sector is expected to reach $51 Bn,growing at 4.9%y-o-y. In _upee teDms, domestic tech revenues is expecting a 13% y-o-y growth on the back of continued investments by enterp%ise and the goveDnment. The indust_y continues to be a net hirer, adding 290K employees, taking the total employee base to 5.4 Mn (5.7% y-o-y growth), strengthening its position as the Digital Talent Nation for the world.

India IT indust_y is poised to grow @ about 11% for the cufirent FY and IT spend will be around USD 140 Bn and growing at a consistent growth rate of 7%. The Cufirent GCC market which is about 1700 in India will grow to 2500 in the next few years. Indian IT indust_y cufirently has about 5 to 5.5M employees with about approx. 1.5 Lakh IT contingent workforce and we expect this to grow to 8M and contingent IT workforce doubling in the coming years.

Tech Indust_y Segment Trends

Strategies Strengthening the Fundamentals

1. IT se_vices is expected to grow at 8.3% in FY2023 compared to last year. The key d ivers of growth include Application Mode_nization, Cloud Migration, Platfocmization, and Cyber secu_ity.

2. Business Process Management (BPM) is undergoing a drastic transfocmation, growing at ~8.7% in FY2023. Digital CX, data d3iven transfocmation, as well the position of BPM indust_y as a key strategic pafitner to the customer is d3iving growth.

3. ER&D is expected to grow at a double-digit figure of 11.1% y-o-y backed by strong fundamentals and _ising demand for Indian ER&D se_vices. Key growth d3ivers include strategic long-teDm deals, widespread proliferation of digitalization and cloudification of enginee ing activities.

4. Software products, expected to grow at 7.8% y-o-y in FY2023, is drastically alteDing the landscape by creating world class products from India which are scalable, thereby showcasing Indias entrepreneu_ial process, and a fast developing diverse and inventive Deep Tech staTt-up ecosystem.

5. Indian eCommerce indust?y is expected to leapfrog achieving 40% y-o-y growth in FY2023, d3iven by newer business models, _ising demand from tier II/III cities, and extensive use of technology in retail through platfocmization for customer engagement and expe_ience enhancement.

6. Indias Domestic technology adoption d_iven by growing cloud adoption and deals focusing on digital transfocmation in existing and niche veDticals. The GoveDnment is also playing a key role as an enabler of technology by building public platfocms, digital public infrast%ucture and other projects, making theDigital India initiative a reality.

7. India strengthens its position as a GCC hub in 2022 with not only expanding centres in teDms of scale and value but growing number of new GCCs setting-up base in India for the first-time. Global + local market focus, location diversification, positioning as Research and Innovation Hub were some of the distinct highlights for the sector.

8. Business and leadership strategies revisited to transfocm existing models and unlock new value from emerging and niche oppofitunities. Fi_ms are focusing on capability building through strategic acquisitions, pafitnerships and robust deal pipelines.

9. Re-Imagining the future of workplace and workforce Workplaces are witnessing a shift towards hyb_id working and satellite offices, following decentralised deliveDy models and _ise of satellite offices across Tier II and Tier III cities.

10. Strengthening the tech talent pipeline Digital skilling and emphasis on re-skilling and leaDning and development are expected to emerge as the leading d3ivers to grow digital talent and retain key employees within the organizations.

11. Emerging technology big bets and the India oppofitunity 12 technology big bets (that include sensor tech, smaDt robots, autonomous d3iving, computer vision, deep leaDning, autonomous analytics, AR/VR, sustainability tech, edge computing, dist_ibuted ledger, spacetech, 5g/6G) are areas where enterp%ise spend is expected to grow 2X higher than average. With investments in India for these sectors growing at a 31% CAGR, India is already home to a large number of innovative staTt-ups in these areas, and hence well placed to benefit from the oppofitunities.

Indias Value Proposition: A Strong Economy and a Diverse Tech Ecosystem

India holding the prestigious Presidency of G20 nations, has grown from being the tenth largest economy ten years ago to the fifth largest today. India has been the fastest growing major economy for the third year in a row poised for fufither growth, d3iven strongly by, among other factors, a robust and diverse technology ecosystem. Diverse and inclusive new-age skilled talent pool with strong entrepreneu_ial mindset, people first innovation, responsible & ethical tech & goveDnance built on tTust, commitment to Environmental, Social & GoveDnance (ESG) goals, & Corporate Social Responsibility (CSR), focm the co_nerstones of this vibrant ecosystem. Cost competitiveness and efficiencies, stable and t_usted Gove_nment consistently building a conducive business environment and infrast%ucture through refocms and policies, along with the largest and youngest working population and consumer market, makes the indust_ys foundation even stronger. Indias inherent leadership skills have ensured Indian ocigin leaders occupy a seat at the table in global organizations, fronting global chatters across va_ious veDticals

Re-Imagining the Future of Work and Workforce

The post Covid world is witnessing a shift towards hyb_id working and satellite offices as employees who retuTned to their hometowns are still thinking what to do next. Also, these models are suppofitive in getting new talent which is a major challenge for organisations these days. Another key strategy that companies are following to combat the talent challenge is fresher hi_ing, which is shaping up the new age workforce withtising share of Gen Z, which account for nearly 20% of the technology indust_y workforce.

Rise of Hyb id, the new reality in the new no_m

Du_ing the pandemic, the tech indust_y was forced to move towards remote working. This shift is shaping the future of work models in the new no_mal - that relies on hyb_id working and vi tual deliveDy.

Moreover, majo_ity of the companies in the tech indust_y are working in hyb_id mode and adopting va_ious spectDums available in this new work model with the evolving times.

Global Staffing Solutions OveDview:

Staffing Solutions Market is segmented into two broad categojies, such as:

O Tempora_y Staffing/ Flexi Staffing

General Staffing: This includes white, blue and grey collared staffing focused on job profiles such as sales and marketing, deliveDy of products, front-end personnel, supe_visors, telemarketing, customer se_vice, network operators, telecom tower maintenance executives, medical representatives, executives for content generation and _unning campaigns etc. across end user industCies such as E-commerce, Banking, Retail and Consumer, Logistics, Telecom, Manufactu_ing, Hospitality, Healthcare, Tou_ism, Ag_iculture etc.

IT Staffing: This includes white-collar staffing focused on the needs of IT and ITeS indust_y. Job requirements met include software programmers and developers, web designers, web planners, program managers, development project manager, development leads, test engineers, cloud engineers, infrast%ucture suppofit engineers, data warehouse maintenance personnel, hardware engineers for real time suppofit for data sefivers, full stack developers, DevOps etc.

PeDmanent Staffing Search: Search includes CXO positions and board level executives with management and domain expefitise. Rec_uitment & Rec_uitment Process Outsourcing (RPO) Solutions: PeDmanent staffing of senior, middle and junior level positions and outsourcing of the rec_uitment process.

Staffing Indust_y Analysts (SIA), a global advisor on staffing solutions, estimate the Global Staffing Solutions Market at USD 498 billion1 in 2019 and USD 443 billion in 2020. Of the total market, 91% is from the Tempora_y Staffing Solutions segment and the remaining 9% is from other se_vices such as PeDmanent Rec_uitment in 2020. The market recorded a CAGR of 5.2% from 2016 2019 and the COVID-19 impact on the total market is estimated at 11% degrowth in 2020.

Growth in Staffing Solutions market has been d3iven by the increased acceptance by organizations which are gradually increasing their share of tempora_y or flexi staff in their total workforce. As indust_y becomes familiar with the benefits associated with tempora_y staffing and regulatocy regime is rationalized, more expe_ienced staff may join the staffing segment.

Indian Staffing Solution Indust_y Analysis:

HR Solutions Market in India is segmented into Tempora_y Staffing, PeDmanent Staffing and other HR solutions such as Payroll, Time and Attendance and Rec_uitment Process Outsourcing. Tempora_y Staffing is the largest segment and is fufither divided into General Staffing, IT Staffing, and Professional Staffing.

The HR Solutions market size in FY2021 is estimated at INR 1,450.0 billion. The market witnessed strong growth in the past five years. The market grew by a CAGR of 13.1% between FY2016 FY2020. COVID-19 pandemic impacted the market growth and resulted in a marginal 4.0% growth in FY2021.

India accounts for 4.3% of the Global Staffing Solutions market in 2020 in revenue teDms. Though this value seems insignificant, in teDms of volumes Indian market is the 6th largest in the world and accounts for 5.8% of the total global market and has the potential to grow exponentially in the long- teDm. As per the Indian Staffing Federation, the total tempora_y workers in India reached 3.3 million in 2018 from 2.1 million in 2014 recording a CAGR of 16.1%.

DISCUSSION UPON FINANCIAL PERFORMANCEw.r.t. OPERATIONAL PERFORMANCE:

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The companys overall operational pe_focmance du_ing the financial year 2023-2024; Total tu_nover for the financial year ended has Rs. 40.96 Cr. The Company has incufired Net Loss of Rs. 3.37 Cr. On the other hand, the companys overall operational pe_focmance du_ing the financial year 2022- 2023; Total tu3nover for the financial year ended has Rs. 37.52 Cr. The Company has incu red the Profit before Tax of Rs. 0.22 Cr.

OPPORTUNITIES AND THREATS

Oppofitunities	Threats
DTL assists in secu_ing a qualified and skilled personnel due to the seveDity of the skills sho3tage.	Technological Catastrophe AlteDnative and Emerging focms of staffing i.e. Direct Contracts.
Corporate Training Product of DTL	Economic Downtu_ns.
Improved Operational Sophistication, Cost Optimization and efficiency.	Regulatocy Changes

SEGMENT-WISE OR PRODUCT-WISE PERFORMANCE

We categojize our se_vices in these major business segments: (1) IT Professional Solution Se_vices, and (2) Corporate Trainings.

? IT Professional Solution Se_vices

IT Professional Solutions Se_vices is our Companys flagship and p_ima y se_vice. Under this segment, p_ima ily we provide comprehensive IT professional resourcing, IT Consultancy and Software AMC. We provide the IT staff augmentation secvices across va ious indust_ies viz. Infocmation Technology se_vice, banking and financial se_vices, automotive and enginee ing, telecom, healthcare, Retail and EnteDtainment. Our revenue from IT Professional Solution se_vices was 95% (approx.) for the pe_iod ended March 31, 2024. Any organization big or small are st_uggling to deal with ever changing increased goveDnment regulations and volatile market demands. When things are so uncefitain, organizations may not want to hire pe_manent employees on a full-time basis, recent COVID - 19 pandemic is veDy recent proof of that. Business houses want the flexibility of an agile, on-demand workforce who is equipped to _un their business operations just the way they want them to. We provide reliable staffing solutions on contract basis that offer the ability to build our clients staff strength without absorbing them full time, assist overloaded employees du_ing citical times, and keep projects moving.

? Corporate Training Se_vices

Under this segment of our se_vice pofitfolio, we provide technical as well as soft skills based training se_vices, where we focus on infocmation technology, soft skills/behavioral, domain specific leaDning solutions that work for our clients business. These are some of the trainings we provide under Corporate Training Se_vice categojy:

? ERP and Business Application Trainings

? Behavioral training, Induction/ Onboarding Training

? Domain Specific Training, Train and Deploy

? CSR Implementation programs

? Disaster and Safety Management trainings

? LeaDning Solution and Education Tou_ism

(1) ERP and Business Application Trainings:

Under this training, DTL offers standard courses (without SAP cefitification) for SAP end-user and project teams. These are shott duration courses that help in the fulfillment of skill gaps identified and are p_ima ily focused on the specific needs of the project teams or SAP users. Some of the examples of these trainings are SAP, Transpofit management, Financial Management, Human capital management and GoveDnance, _isk & compliances.

(2) Behavioral training, Induction/ Onboarding Training:

Behavioral skills are a persons ability to interact effectively with co-workers and customers and are broadly applicable both in and outside the workplace. Soft skills training like etiquette, personal finance management, and communication that allow for personal and professional growth in employees. Some of the examples of these trainings are Personal Productivity, Customer Leadership Management & Negotiation Skills etc.

(3) Domain Specific Training, Train and Deploy:

Under this training, DTL offers standard courses to end user to upgrade their technical skills due to technology advancement. Some of the examples of this training include Devops, Tableau, Salesforce, Cefitified Agile Se_vice manager etc.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

Management has put in place effective Intefinal Control Systems to provide reasonable assurance for:

? Safeguarding Assets and their usage.

? Maintenance of Proper Accounting Records and

? Adequacy and Reliability of the infocmation used for ca_uying on Business Operations. Key elements of the InteDnal Control Systems are as follows:

? Existence of Autho_ity Manuals and pe_iodical updating of the same for all Functions.

? Existence of clearly defined organizational stflucture and autho_ity.

? Existence of corporate policies for Financial Repofiting and Accounting.

? Existence of Management infocmation system updated from time to time as may be required.

? Existence of Annual Budgets and Long-TeDm Business Plans.

? Existence of InteDnal Audit System.

? PeDiodical review of oppofitunities and _isk factors depending on the Global / Domestic ScenaDio and to undefitake measures as may be necessaDy.

Intefinal Audit Repofits are regularly circulated for pe_usal of SeniorManagement for approp_iate action as required.

RISK AND CONCERN

Our business is subjected to va_ious _isks and uncefitainties, Our result of operations and financial conditions are affected by numerous factors including the following:

? PeDfocmance of Companys competitors;

? Significant developments in Indias economic and fiscal policies;

? Failure to adapt to the changing needs of indust_y and in pafiticular Agrochemical Sector may adversely affect our business and financial condition;

? Volatility in the Indian and global capital market;

HUMAN RESOURCE/INDUSTRIAL RELATIONS:

The Company have a qualified and professional employee base of about more than 500 employees as of March 31, 2024. Our manpower is a p_udent mix of the expe_ienced and young people which gives us the dual advantage of stability and growth, execution of se_vices within time and quality. We believe human capital is one of the most valuable assets of our Company as their technical know-how and skill sets position us at a competitive advantage over our competitors in providing some of our se_vices.

Human Resources Development, in all its aspects like training in safety and social values is under constant focus of the management. Relations between the management & the employees at all levels remained healthy & cordial throughout the year. The Management and the employees are dedicated to achieve the corporate objectives and the targets set before the company.

BUSINESS OUTLOOK:

We are a next-generation IT consultancy se_vice provider that helps enterp%ises reimagine their businesses for the digital age. We provide end-to- end professional solutions to make large companies and organizations more competitive by combining in-depth knowledge of a wide range of business sectors and innovative technologies with a fully collaborative approach. We are a lifelong leaDning pafitner for enterp%ises, helping them build skills in emerging technologies at scale. Our Corporate Training division helps build innovative leaDning modules for organizations in the workplace by stfluctucing a smaDter workforce, suppofiting changes and d3iving growth.

Our Company, with an expefit panel reaches out to a wide range of IT suppofit and consultancy se_vices related to IT Skilled Staffing Solutions, IT Training, Development and Capacity Building. Our trained employee base whom wehire, train and deploy on our client sites based on type of agreements with them we have a strong national presence.

The company is putting continuous effocts to attain fufither efficiencies. Fucther, the Company is confident that in spite of the challenges and competition in the indust_y it will pe_focm better in view of the strong fundamentals of the Company and hope to increase its tu_nover. The Company is expecting to enhance its presence globally to rationalize its significance by enteDing into the new alliance.

KEY FINANCIAL RATIOS:

Details of significant changes (i.e. change of 25% or more as compared to the immediately previous financial year) in Key Financial Ratios and any changes in RetuTn on Net Wocth of the Company (on standalone basis) including explanations therefore are given in notes to the financial statements which focms pafit of this Annual Repofit.

CAUTIONARY STATEMENT:

Statements in the Management Discussion and Analysis and Directors Repofit desc_ibing the Companys strengths, strategies, projections and estimates, are focward-looking statements and progressive within the meaning of applicable laws and regulations. Actual results may va_y from those expressed or implied, depending upon economic conditions, GoveDnment Policies and other incidental factors. Readers are cautioned not to place undue reliance on the focward-looking statements.

	BY ORDER OF THE BOARD,
	For DIENSTEN TECH LIMITED
PLACE: New Delhi
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DATE: 29/08/2024
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	VIPUL PRAKASH
	DIN: 01334649
	MANAGING DIRECTOR
	ADDRESS: 204/1, NEB VALLEY
	SAINIK FARMS, NEB SARAI,
	NEW DELHI-110068