Diligent Media Corporation Ltd Management Discussions

Disclaimer

Investors are hereby informed that statements in this contained in this Management Discussion and Analysis ( MD&A ) describing the Company s objectives, projections, estimates and expectations may be forward-looking statements within the meaning of applicable laws and regulations. These statements are based on the Companys current expectations, assumptions and assessments and are subject to various risks, uncertainties and other factors. Actual results may differ materially from those suggested or implied by such forward looking statements . Important developments that could affect the Company s operations to cause such difference may include factors like Risks inherent in Company s growth strategies & expansion plans and ability to successfully implement those strategies & expansion plans, economic, political & business conditions in India and other countries which have an impact on our business activities or investments, Regulatory changes and our ability to respond to them, Technological changes, exposure to market risks, The monetary and fiscal policies of India, inflation, foreign exchange rates, the performance of the financial markets in India and globally, and Changes in industry competition etc. The following discussions and analysis should be read in conjunction with the Company s financial statements included herein and the notes thereto.

Indian Economic Overview 2026

India s GDP growth for FY26 is estimated at 7.4 per cent driven by the double engine of consumption and investment. It India s status as the fastest-growing major economy for the fourth consecutive year.

The real GDP growth for FY27 is projected at 6.8-7.2 per cent, while Video & Broadband the potential growth for India is estimated at around 7 per cent.

The domestic demand continues to underpin economic growth in FY26. According to the First Advanced Estimate, the share of final private consumption 61.5 per cent in FY26. This strength in consumption reflects a supportive macroeconomic environment, characterised by low inflation, stable employment conditions, and rising real purchasing power. Moreover, steady rural consumption, bolstered by strong agricultural performance, and the gradual improvement in urban consumption, aided by the rationalisation of direct and indirect demand istaxes, reaffirm broad-based.

In 2025, India stood out as a bright spot in global trade despite widespread uncertainties. India maintained strong momentum through resilient domestic manufacturing and expanding services exports.

Source: Annual Report 2025-26, Department of Commerce, Government of India

Indian media & entertainment industry

The Indian Media and Entertainment (M&E) industry is a sunrise sector for the economy and is making significant increasing availability of fast and cheap internet, rising incomes, and increasing purchases of consumer durables have significantly aided the industry. Indias media and entertainment industry are unique as compared to other markets. The industry is well known for its extremely high volumes and rising Average Revenue Per User

This significantly aided the country s industry and made India leading in terms of digital adoption and provided companies with uninterrupted rich data to understand their customers better. India has also experienced growing opportunities in the VFX sector as the focus shifted globally to India as a preferred content creator. Media companies are projected to achieve an 8% revenue growth, reaching US$ 7.14 billion ( 60,000 crore) by FY27, driven by increasing contributions from the digital segment, according to a Crisil analysis of 20 companies that account for 55% of the media industrys revenue.

The Indian M&E sector grew to 2,78,500 crore (US$ 30.08 reaffirms billion) in 2025 (a 9.1 % increase YoY). It is projected to grow ~2.8% in 2026 to 2,86,500 crore (US$ 30.91 billion), and at a ~5.8% CAGR to 3,30,000 crore (US$ 35.65 billion) by 2028. According Industry toMedia Partners Asia s Asia Pacific 2024 report, Indias video market, encompassing both TV and digital, is projected to grow from US$ 13 billion in 2023 to US$ 17 billion by 2028.

In 2025, Digital Media market in India reached US$ 13.13 billion. It(PFCE)inGDProseto is expected to contribute ~38% to the overall advertising industry in India, on par with television.

As per GroupM s TYNY report dated February 18, 2026, India s position as a top 10 global advertising market, with the sector representing 0.5% of India s GDP a share that continues to grow with per capita GDP expansion and digital-led formalization of advertising. India continues to be one of the fastest growing markets out of the Top 10 markets. Advertising forecast for India, projects 9.7% growth in 2026 with advertising revenue reaching Rs.2,01,891 crore an incremental addition of Rs.17,844 crore over 2025.

The Indian M&E industry is on an impressive growth path. The industry is expected to grow at a much faster rate than the global average rate. This can be majorly credited to rising incomes, increasing internet penetration and a growing push toward digital adoption.

In the long run, growth in the M&E industry is expected in retail advertisement on the back of several players entering the food and beverages segment, E-commerce gaining more popularity in the country, and domestic companies testing out the waters.

India s rural regions are expected to be the next regions for growth. India has also gotten on board with 5G and is already planning for 6G well ahead of the future. This push towards digital adoption especially in the rural regions will provide advertisers and publishers with an immense opportunity to capture untapped markets and help grow Indias media and entertainment industry forward.

Digital media emerged as the single largest segment of the M&E industry in 2025, crossing the 1 trillion mark for the Digital advertising recorded a 26% increase to 947 billion, accounting for nearly twothirds of total advertising revenues, as brands continued to shift spends toward performanceled, measurable and commercelinked formats.

Digital Media

Growth in digital media is likely to be led by SME advertising, which will grow at 16% to reach 563 billion by 2028. E-commerce and point-of-sale advertising may continue to grow at 22% to reach 404 billion. It is expected that more non-media platforms (such as education, BFSI, government, telecom and healthcare platforms) will increasingly monetize their captive time. audiences through advertising.

The share of programmatic advertising will increase such that over 75% of all non-premium and impact property Ad Inventory will be sold using self-serve algorithms, i.e., over 950 billion of digital ad spends will be managed through programmatic software by 2028.

Digital Advertising

Digital advertising is expected to lead the growth, adding 446 billion as large organizations and SMEs continue to invest in high attribution e-commerce, shoppable and point-of sale advertising, and Connected TVs grow from 40 million to 67 million connections.

Content monetization will widen

A survey of production houses indicates that rights values for digital, music and film will increase in 2026, while in the case of broadcast networks, impact properties will drive disproportionate investment. Investments will increase in reality shows and tentpole films, while content for Linear TV and AVOD platforms will be priced frugally. The demand for low-cost kids animation, content for young adults and anime-themed content (mythological/ religious storytelling) will increase. AI will help with production efficiencies and that could translate into cost differentiation for production houses. Revenue models for production houses will change; more IP will be co-owned or shared between producers and platforms.

Source: https://www.ey.com/content/dam/ey-unified-site/ey-com/en-in/ insights/mediaentertainment/2026/03/ey-stories-scale-and-impact-un-locking-indias-media-and-entertainment-economy.pdf

Risks and concerns

The Indian media and entertainment (M&E) industry in 2026 faces shifting risks and structural changes impacting its overall stability and growth. While the sector has scaled to an estimated 2.78 trillion, its performance remains highly uneven across segments. One of the primary and ongoing concerns is the evolving regulatory environment . Structural policy changes—such as the previous years severe tax interventions and bans in the online money-gaming format have underscored the industry s high sensitivity to government intervention. Looking forward, potential changes in data privacy governance, strict content regulations, and digital censorship continue to threaten creative flexibility and alter operational dynamics for media platforms. Furthermore, the rapid growth of generative AI presents emerging risks around intellectual property protection, synthetic replication, and automated misinformation. The industry s fiscal health remains heavily dependent on volatile economic and political factors at both national and global levels.

Economic uncertainties directly squeeze advertising revenues, which are transitioning rapidly. Legacy, ad-exposed models like

Linear Television are facing continuous pressure , experiencing sharp drops in ad volume as corporate spending shifts. In contrast, digital advertising now commands 63% of total ad revenues , driven strongly by e-commerce and performance-linked formats.

Consequently, any domestic or global economic slowdown causes companies to tighten traditional marketing budgets, disproportionately hurting legacy broadcasters while forcing digital platforms to rely more heavily on hyper-targeted, AI-driven personalization and hybrid monetization strategies (such as combining subscriptions with ad-supported tiers). Finally, unpredictability s stemming from force majeure events or global geopolitical friction continue to act as an underlying risk to international content production pipelines and global distribution.

Opportunities and Threats

The continued expansion of digital media presents massive, structural opportunities. Driven by ubiquitous smartphone usage and strong Digital Public Infrastructure (DPI), digital media has officially overtaken television as the 2.78 trillion media and entertainment ecosystem.

Paid digital video subscriptions have climbed to 216 million across 143 million households, opening deep monetization avenues beyond pure advertising. Furthermore, advancements in technology particularly the maturity of 5G networks, Connected TV (CTV) ecosystems, and spatial computing (including AR and VR) are moving media beyond flat screens into highly interactive, immersive spaces that tightly integrate content with instant e-commerce and social commerce.

Emerging Technological & Security Risks

However, this hyper-digital landscape brings pronounced cybersecurity risks. With digital consumption scaling exponentially, threats like advanced data breaches, cloud-infrastructure hacking, and targeted ransomware attacks threaten user data privacy and compromise content distribution networks.

Simultaneously, the industry faces an unprecedented threat from the evolution of Generative AI-driven fake news and deepfakes. The widespread use of social media and algorithmic discovery speeds up the spread of hyper-realistic misinformation, severely fracturing public trust and requiring companies to invest heavily in robust, automated fact-checking mechanisms and digital watermarking.

The blistering pace of technological change creates a persistent financial challenge. Media companies are caught in a cycle of continuous capital expenditure, requiring heavy investments in AI-led adtech, cloud-rendering pipelines, and predictive personalization algorithms just to remain competitive.

The 2026 Reality:

Success in India s media sector is no longer just about content volume, but managing the AND market balancing a highly resilient legacy print/theatrical audience while capturing the 63% share of advertising revenues that have now migrated entirely to digital platforms. financial,and Managing these security, technological risks strategically will dictate which media houses achieve long-term stability.

Company Overview

Diligent Media Corporation Limited ( DMCL or Company ) was incorporated under the Companies Act, 1956, on February 17, 2005, as a Joint Venture entity of two Media conglomerates to engage in the business of printing, publishing and distribution of Newspapers. DMCL established its presence in the Print Media business with the launch of the Mumbai edition of DNA , an English Newspaper, on July 30, 2005.

DMCL is in the business of production, curation, creation, conversion, procurement, buying, selling, and distribution of various forms of Multimedia content i.e. Digital News, Videos, Documentaries, and Photo Stories. The Company handles the distribution and aggregation of this content, be it related to media or other fields, in India and abroad through any existing or emerging mode of distribution.

As reported in the preceding years, the Company had discontinued w.e.f., 10 October 2019 i.e., during the financial year ended 31 March 2020 the printing division of its Newspaper DNA and continued the business of Digital Media. The said Digital Media business continues during the years thereafter.

Business overview

DNA is known for its quality, innovation and trust, with responsible journalism and customized content to cater to the varied spectrum of readers. Through news, views, analysis and interactivity, DNA provides its readers with a composite unbiased picture of the city, the country, its financial market, and news from around the world.

DNA is a thought leader and a change agent that continues to strive for betterment of society. Having a diverse range of products and sections DNA is for everyone in the family. With a diversified portfolio including some of the famous titles like DNA Verified, DNA Lit, DNA Dharma, DNA Her & DNA AI, DNA has ensured that there is something for everybody. DNA exists with a responsive and dynamic website (www. dnaindia.com) and has a strong presence on social media (Twitter - www.twitter.com/dna,Facebook-https:// www.Facebook.com/dnaindia, YouTubewww.youtube.com/@DNAIndiaNews & Instagram- www. instagram.com/dna_india).

Content is also offered through the content licensing division - which is solely responsible for Content Syndication and allied services. The monthly average number of users for DNA English is 3.41 Mn, and DNA Hindi is 1.56 Mn. Overall page views on its websites were 127.45 million, whereas monthly average page views during the year were 10.62 million.

During FY 2025-26, the Company s revenue from operations was 650.88 lakhs as against 1,319.19 lakhs during the previous year.

Internal Control Systems

Diligent Media has a sound Internal Control System, which aims to aligned with strategic ensure that operations are goals. The internal control framework is intended to ensure correct, reliable and timely financial reporting and management information. The Company has implemented the Internal Financial Control (IFC) framework to ensure proper Internal Controls over financial reporting. Then the internal control system is further supplemented by Internal Audit carried out by an independent firm of Chartered Accountants and periodic review by Management. The Internal Audit process is designed to review the adequacy of internal control checks in the system and covers all the significant areas of the Company s operations. The Audit Committee reviews the adequacy and effectiveness of the internal control systems and tracks the implementation of corrective actions, wherever required.

Human Resources

The primary objective of the Company is to create a lively and stimulating atmosphere for its employees, aiming to bring out their fullest potential. Alongside fostering talent through mentoring and demanding projects, the Company sustains motivation by organizing diverse engagement activities. The team coordinates workshops, seminars, and other learning opportunities to enhance employees skills and knowledge, supporting their professional growth. The Companys employee count as on March 31, 2026 was 38 in comparison to 55 on March 31, 2025.

FY 2025-26 Performance Financial Results

The financial performance of your Company for the year ended

31st March 2026 is summarized below:

(Amount in Lakhs)

For the year ended March 31,	2026	2025
Revenue from operations	650.88	1,319.19
Other income	55.50	1,372.92
Total income	706.38	2,692.11
Total expenses	942.48	1,304.95
Profit / (loss) before taxes	(236.10 )	1,387.16
Tax Expenses	651.44	25.31
Profit / (loss) for the year	(887.54)	1,361.85

Financial performance & review of operations

In alignment with our long-term vision, your Company continues to concentrate on expanding its Digital Platforms, maintaining a sharp focus on cost optimization and revenue maximization to navigate a challenging fiscal year. During the year under review, revenue from Operations, comprising of Syndication Income on Digital Media business decreased by 51% from 1319.19 lakhs in FY 2024-25 to 650.88 lakhs in FY 2025-26 due to decline in overall traffic. Loss before tax of 236.10 lakhs as against of 1387.16 lakhs during previous year.

Depreciation decreased by 67% to 4.35 Lakhs in FY 2025 -26 from 13.28 Lakhs in FY 2024- 25. Finance costs represent interest on statutory dues, which decreased from 87.97 Lakh to 15.66 Lakhs in FY 2024- 25. Other Expenses decreased by 30% from 754.02 Lakhs to 527.34 Lakhs due to various cost optimization measures.

Due to reduction in other expenses, overall cost decreases by 28% from 1,304.95 Lakhs to 942.48 Lakhs.

Material Related Party Transaction

During the year under review, the Company reviewed the performance of its digital media operations following the expiry of its erstwhile revenue-sharing arrangement with Indiadotcom Digital Private Limited ( IDPL ) on March 31, 2024. The Company observed a decline in key operating metrics, including Monthly Active Users (MAUs) and page views, The Management recommended reviving the arrangement to optimize the monetization and distribution of its digital properties. IDPL brings demonstrated expertise, operational capabilities, and market presence in digital media distribution and advertising operations.

Accordingly, upon the recommendation of the Audit Committee and approval of the Board of Directors, the proposal was represent interest on statutory dues, which decreased duly approved by the shareholders. Effective September 1, 2025, the Company reentered into the arrangement with IDPL, pursuant to which IDPL is entitled to a 15% share of the total revenue generated from the Companys digital assets. The arrangement is in the ordinary course of business and on an arm s length basis, and is aimed at enhancing the Company s financial growth.

Details of Significant Change in Key Financial Ratios:

Ratio	Year ended 31-03-2026	Year ended 31-03-2025	% Change	Remarks for > 25% or < -25% Change
Debtor Turnover (in times)	0.56	0.99	-43.75%	The decrease in the ratio is attributable to lower revenue from operations during the year.
Inventory turnover ratio (in times)	-	-	-	-
Interest Coverage Ratio (in time)	-	-	-	-
Current Ratio (in times)	42.16	5.73	635.95%	Due to decrease in current liabilities and current assets during the year.
Debt-equity ratio (in times)	-1.73	-1.79	-3.50%	-
Operating Profit Margin (%)	47.56%	72.53%	-34.43%	The decrease in the ratio is primarily attributable to the loss incurred during the current year, as against the profit reported in the previous year
Net profitratio (%)	-136.36%	103.23%	-232.09%	The decrease in the ratio is primarily due to the decrease in revenue and loss incurred during the current year as against the profit reported in the previous year .
Return on Networth - RoNW (%)	-1.20%	7.66%	-115.67%	The decrease in the ratio is primarily attributable to the loss incurred during the current year, as against a profit reported in the previous year.