DRS Dilip Roadlines Ltd Management Discussions

DRS Dilip Roadlines Limited is engaged in the business of providing comprehensive logisecs solu ons, including transporta on, packing, and movement of goods. With a focus on quality, reliability, and opera onal efficiency, the Company strives to deliver seamless logisecs services that cater to the diverse requirements of its customers.

1. COMPETITIVE POSITION OF THE COMPANY

a) Industry Structure and Developments

Industry Structure:

GLOBAL LOGISTICS INDUSTRY

Market Overview

The global logistics market is driven by the significant growth in development of international trade flow and the current economic environment. The advancements in technology constituting automated material handling equipment, packaging, and biometrics are helping organisations and businesses to work competently, thereby stimulating the growth of the logistics market in the region, also the major drivers of the industry, such as the growing retail sector, particularly e-commerce, rising disposable incomes, rapid urbanization, and growing technological advancements are expected to aid the market growth.

Particularly AI, IoT, and warehouse automation is rapidly reshaping the industry to improve route planning, inventory visibility, and predictive maintenance.

Market segmentation

The transportation and logistics industry are undergoing significant transformations due to factors such as digital innovation, the entry of new competitors, evolving customer expectations, and emerging business models. For this study, the global logistics market is categorized into three main segments: transportation type, logistic type, and end-user industry.

1.By Logis c Type:

First Party Logistics (1PL)

Second Party Logistics (2PL): This segment holds the largest market share.

Third Party Logistics (3PL)

2. By End-User Industry:

Industrial and Manufacturing

Retail

Healthcare

Oil & Gas

Others: The manufacturing segment holds the largest market share.

The global logistics market size was estimated to be in the range of US $4.3–12.16 trillion in 2026. It is projected to grow to approximately USD 21.91 trillion by 2033, reflecting a notable compound annual growth rate (CAGR) of 9.35% over the forecast period. This significant growth is driven by advancements in technology, increasing globalization, and rising e-commerce activities.

Growth Drivers

Increased adoption of outsourced logistics services in the region is driving the growth of the market. Increasing importsand exports along with a huge demand for logistics services due to the economic growth and urbanization are driving the manufacturers to trade across the globe. China, Japan, India, Australia, and Indonesia are the major markets in Asia Pacific region. China is the largest logistics market in the region due to a huge population in the country and the presence of a large manufacturing base.

North America is the second largest region in the market. Increasing trade activities between the Americas and Europe are driving the growth of the market in this region. Rising demand for foreign goods in Indonesia, Thailand, and India has strengthened the trade relations with the U.S. Europe is another major region in the market. Germany, the U.K., and France are the major logistics markets.

Government Initiatives

Transportation and logistics infrastructure is a constantly recurring priority in every new government policies. Economic reforms and government initiatives in terms of strengthening the manufacturing sector are expected to attract private investment. The development of transportation and logistics-related infrastructures, such as dedicated freight corridors, logistics parks, free trade warehousing zones, and container freight stations will help to improve efficiency. The governments plan is likely to make the economy competitive by reducing logistics costs, bring down pollution levels by reducing congestion on roads, give a boost to the industry and create employment. (Source: https://www.marketresearchfuture.com/reports/logistics-market-5076)

Geopolitical Developments and Impact on the Logistics Industry

Geopolitical tensions, including the ongoing conflict involving the United States and Iran, have contributed to heightened uncertainty in global trade and logistics. Disruptions and security concerns in the Middle East, particularly around the Strait of Hormuz, have the potential to affect international shipping routes, vessel availability, transit times, freight rates and marine insurance costs. Volatility in crude oil and fuel prices may further increase operating costs across road, ocean and air logistics. These developments could result in higher transportation and supply-chain costs, longer delivery lead times and increased working-capital requirements for businesses engaged in international trade. The evolving geopolitical environment may also accelerate the adoption of alternative sourcing and transportation routes, multimodal logistics and supply-chain diversification. The Company continues to closely monitor these developments and remains focused on operational efficiency, prudent cost management, route optimization and strengthening supply-chain resilience to mitigate potential disruptions and maintain service reliability. The Company will continue to assess the impact of these external factors on its operations and financial performance and take appropriate measures as required.

LOGISTICS SECTOR IN INDIA

In India, the logistics sector is a significant contributor to the overall growth of the economy. Further More than 22 million people rely on it for their livelihood. The sector is projected to add 1 crore jobs by 2027. This growth is driven by the expansion of e-commerce, increased manufacturing activity, and government initiatives to improve infrastructure and ease of doing business, As India continues to strengthen its position as a global manufacturing and export hub, the logistics industry is poised for substantial growth. In India, the logistics sector is dominated by transportation. At present, the road transportation sector has the largest share of around 66% of total cargo movement in terms of tonnage, followed by railways.

Opportunities lie in areas such as cold chain logistics, specialized transportation for hazardous and perishable goods, and the integration of advanced analytics and predictive modeling to optimize supply chain operations. By embracing these emerging trends and opportunities, the Indian logistics sector can enhance its competitiveness, drive economic growth, and meet the evolving needs of businesses and consumers.

The industry is crucial for the efficient movement of products and services across the nation and in the global markets. The logistics business is highly fragmented and has over 1,000 active participants, including major local players, worldwide industry leaders, the express division of the government postal service, and rising start-ups that focus on e-commerce delivery. The industry includes transportation, warehousing, and value-added services like packaging, labelling, and inventory management. With the advent of technology-driven solutions such as transportation management systems (TMS) and warehouse management systems, Indias logistics industry has witnessed tremendous development in recent years (WMS). These solutions have assisted logistics firms in increasing operational efficiency, lowering costs, and improving customer service. As depicted in the below Image (left), representing the segment-wise breakup of the logistics sector in FY26. Roads have the largest percentage share of 67% followed by rail (27%), Waterways and maritime (5%) and air (1%).

Segment-wise Modal Share in India Freight & Logistics (FY26)

The below pie chart (right) represents the fragmented structure of the Indian logistics industry. Source: https://skyways-air.in/Industry-Report-on-Industry-Report-on-Logistics-in-India_30-June-final.pdf)

Development:

? The outsourced logistics services is driving the growth of the market. Imbalance between the available resources and the consumption pattern is leading to increasing imports and exports along with a huge demand for logistics services.

? Strained trade relations of our country with few of its neighbors is compelling the manufacturers and traders to shift their manufacturing / trade hubs and thus leading to huge relocations.

? The recent shift of huge chunk of population from urbans to rurals has created new demands in the logistic industry.

? Rising demand for foreign goods in Indonesia, Thailand, and India has strengthened the trade relations with the U.S. Europe is another major region in the market. Germany, the U.K., and France are the major logistics markets.

? Transportation and logistics infrastructure is a constantly recurring priority in every new government policies. Economic reforms and government initiatives in terms of strengthening the manufacturing sector are expected to attract private investment.

? Work-from-home culture is giving new dimensions to the logistics industry

b) Opportunities and Threats

Opportunities:

1. Digitalisation, AI and automation: The adoption of artificial intelligence, advanced analytics, automation, robotics, IoT and digital platforms is creating opportunities to improve asset utilisation, route optimisation, warehouse productivity, shipment visibility and customer experience. Technology-led solutions can also support margin expansion through higher operational efficiency.

2. Supply-chain regionalisation and diversification: Geopolitical developments, trade-policy changes and supply-chain disruptions are encouraging businesses to diversify sourcing and manufacturing locations. This is expected to create additional logistics demand across emerging trade corridors and strengthen the role of logistics providers with broad geographic coverage.

3. The Logistic market is likely to witness good market growth rising at a 9.35 % CAGR during the global forecast period (2024 - 2030).

4. Launching of M-Parivahan mobile App and Pariwahan Sewa Portal.

Threats

1. Fuel and energy price volatility: Fluctuations in crude oil, diesel, aviation fuel and other energy costs can materially affect transportation and operating expenses. While fuel surcharges and contractual mechanisms may provide partial protection, rapid increases in fuel costs can create pressure on margins.

2. Economic slowdown and demand volatility: Logistics demand is closely linked to industrial production, consumer spending, trade activity and overall economic growth. A slowdown in major economies, weak manufacturing activity or subdued consumption can reduce freight volumes and capacity utilisation.

3. Intense competition and pricing pressure: The industry remains highly competitive, with traditional logistics companies, global integrated players, asset-light operators and technology-enabled platforms competing for customers. Competition can result in pricing pressure, higher customer acquisition costs and lower margins.

4. Infrastructure and capacity constraints: Congestion at ports, airports, roads, rail networks and logistics hubs can result in delays, higher operating costs and reduced asset utilisation. Weather events, natural disasters and other infrastructure disruptions can further affect network reliability.

c) Segment- wise or Product-wise performance Company Performance Highlights:

• ISO 9001:2015 certified - for providing Quality Management System in the field of Packers, Movers and Logistics.

• Company became Indian Banks Association approved transport operator in the year 2010.

• Company became a Core Member of the International Association of Movers (IAM) in September 2013.

• Company entered the World Book of Records for Conceptualizing Innovative Van Design for Household Shifting in 2018.

Segment- wise performance:

Revenue	2025-26	2024-25
Transport - Household	16,475.54	16,454.51
Transport - Commercial	1,921.17	1,765.71
TOTAL	18,396.71	18,220.22

Our established relationships with customers lead to stability of demand. Some of our top customers include MRF Ltd, Jindal Fibres,Eco Spin Yarn, Usha Yarn , Tata Consultancy Services Ltd, National Polyplast India Pvt Ltd,Vinishma Technologies Pvt Ltd, Birla Carbon India Pvt Ltd, Motherson Sumi Wiring India Pvt Ltd, Godrej & Boyceev Mfg Co ltd, Birla Carbon India Pvt Ltd, Pink World logistics, TTK Prestige Ltd, Rohim Semi Conductors India Pvt Ltd, GSM logistics, Rajasthan Delhi Transport Company, Godfrey Philips India Ltd, Ultra tech cements Ltd, Mahindra and Mahindra Ltd, GR infra projects Ltd etc.

d) Outlook

The Indian logistics industry is entering a phase of sustained structural growth, supported by economic expansion, rising consumption, increasing manufacturing activity, e-commerce penetration and continued investments in transportation and logistics infrastructure. The industry is progressively transitioning from a fragmented, cost-driven model towards an integrated, technology-enabled and organised ecosystem. The outlook for the road logistics segment remains positive. ICRA expects the Indian road logistics sector to record 8-10% revenue growth in FY2027. Moreover, with the increasing adoption of technology and the governments push for a digital economy, there is also significant potential for logistics players to leverage data analytics, artificial intelligence, and machine learning to improve operational efficiency and enhance customer experience. There are also opportunit es for foreign investment as internatonal companies look to tap into Indias growing logistcs market. All this has helped us report buoyant performance during the FY 2025-26.

e) Risks and concerns

The logistcs industry, faces numerous risks that can impact our business in various ways:

Politcal, macroeconomic and demographic changes could adversely affect economic conditons in India thus impact ng the logistcs industry. Since we derive a majority of our revenue from contracts with customers in India, such risks may impact our earnings.

Downside risks. Despite the recent positve growth surprises, plausible risks contnue to be skewed to the downside:

Rising fuel prices and inflatonary pressures on wages and assets can impact our cash flows and profitability.

Inflaton persists: Tight labor markets and pass-through from past exchange rate depreciaton could push up inflaton and risk de-anchoring longer-term inflaton expectatons in a number of economies. The insttutonal setup of wage setting in some countries could amplify inflaton pressures on wages. Moreover, El Nino could bring more extreme temperature increases than expected, exacerbate drought conditons, and raise commodity prices. The war in Ukraine could intensify, further raising food, fuel, and fertlizer prices. The recent suspension of the Black Sea Grain Initatve is a concern in this regard. Such adverse supply shocks might affect countries asymmetrically, implying different dynamics for core inflaton and inflaton expectatons, a divergence in policy responses, and further currency movements.

Financial markets reprice: Financial markets have adjusted their expectatons of monetary policy tghtening upward since April but stll expect less tghtening than policymakers have signaled, raising the risk that unfavorable inflaton data releases could—as in the first quarter of 2023—trigger a sudden rise in expectatons regarding interest rates and falling asset prices. Such movements could further tghten financial conditons and put stress on banks and nonbank financial insttutons whose balance sheets remain vulnerable to interest rate risk, especially those highly exposed to commercial real estate. Contagion effects are possible, and a flight to safety, with an attendant appreciaton of reserve currencies, would trigger negatve ripple effects for global trade and growth.

Chinas recovery underperforms: Recent developments shift to the downside the distribut on of risks surrounding Chinas growth forecast, with negatve potental implicatons for trading partners in the region and beyond. The principal risks include a deeper-than-expected contracton in the real estate sector in the absence of swift acton to restructure property developers, weaker-than- expected consumpt on in the context of subdued confidence, and unintended fiscal tghtening in response to lower tax revenues for local governments.

Debt distress: Debt distress remains an asymmetric risk in Indias logistics sector, heavily impacting small-fleet operators and capital-heavy infrastructure developers. While the broader industry benefits from structural tailwinds like e-commerce growth and formalizat on, the unorganized segment—which forms the majority of the market—faces critcal margin squeezes. These smaller operators struggle with volatle fuel costs, rising vehicle asset financing rates, and steep technology adopton overheads. Meanwhile, specialized infrastructure developers face delayed cash flows due to long gestaton periods and aggressive leverage strategies. In contrast, organized 3PL and tech- enabled players are largely insulated from distress thanks to strong equity backings and robust insttutonal cash flows. Ultmately, systemic defaults are well-mitgated by government initatves like PM Gat Shakt and targeted fiscal policy reliefs that improve working capital liquidity across the supply chain.

Geo-economics fragmentation deepens: The ongoing risk that the world economy will separate into blocs amid the war in Ukraine, Iran and other geopolitical tensions could intensify, with more restrictions on trade (in particular that in strategic goods, such as critical minerals); cross-border movements of capital, technology, and workers; and international payments. Such developments could contribute to additional volatility in commodity prices and hamper multilateral cooperation on providing global public goods.

With global trade splintering the prolonged transit delays tie up inventory, severely stalling cash- flow cycles. Freight rates and marine insurance premiums have experienced spikes, disproportionately impacting small and medium enterprise (MSME) freight forwarders.

Technology and Security Concerns: Technology and security concerns pose significant threats to the logistics industry as operations become increasingly digital and reliant on interconnected software. Sophisticated cyberattacks, such as ransomware and data breaches, frequently target vital supply chain management platforms and cloud databases, leading to severe operational paralysis. Furthermore, the rapid integration of Internet of Things (loT) devices and automated systems expands the potential digital attack surface for hackers. Companies also struggle with costly integration hurdles when trying to merge legacy software with modern artificial intelligence or blockchain tools. Ultimately, a single system vulnerability can disrupt entire global distribution networks, resulting in massive financial losses and damaged brand reputation.

? Large scale and prolonged agitations, such as the recent Farmers agitation near Delhi Haryana borders.

? Cargo damages, personal injury claims may adversely affect the business.

? Constant Increase of fuel prices.

? Lack of experienced drivers

? Increase in taxes, significantly affect profits

? The increase in the age of vehicles and an increase in the prices of new vehicles

? Fog conditions, unpredictable rains and other weather-related issues.

? Natural calamities, such as cyclone, floods etc.,

? Traffic disruptions etc.

? Highly competitive industry

? Competition to attract and retain labour

? Dependency on third parties for supply of equipment and maintenance of vehicles.

? The branches (including transshipment hubs) are located at leased premises.

? Employee misconduct or errors could adversely affect our business prospects

? Increase in costs of labour

? Demand for services may decrease during an economic recession.

? Increased tensions with neighbour countries.

Strengths:

? Strong network scattered throughout the country

? Diversified business portfolio

? Negligible dependence on external debt

? Large fleet of owned vehicles,

? Experienced senior management

? Strong customer base

? Labour friendly policies

f) Internal Control systems and their adequacy

The Company has a nationwide presence with branch offices, warehouses, and hubs across multiple cities and towns. Accordingly, we have put in place comprehensive policies and procedures that enable effective implementation of internal financial controls across the organization. These controls ensure smooth and efficient conduct of operations, adherence to Company policies, protection of assets, prevention and detection of fraud, error-reporting mechanisms, accuracy and integrity of accounting records, and timely preparation of reliable financial statements. Internal financial controls are an essential component of the risk management framework, addressing both financial and reporting risks. They have been systematically documented, digitized, and integrated into the business processes.

g) Discussion on financial performance with respect to operational performance

Particulars	2025-26	2024-25
Revenue from operations	18,396.71	18220.22
Other Income	569.27	475.92
Finance Costs	59.85	38.00
Depreciation	218.13	247.23
PAT	610.04	601.03

As observed in the table laid above, the overall performance of the company has increased in the FY 2025-26 as compared to last year. Our management deserves to be appreciated for their efforts in the backdrop of horrific conditions that have arisen on account of global logistics issues.

For the Financial year 2025-26, the Company recorded a turnover of Rs. 183.96 Crores, as compared to Rs. 182.20 Crores in FY 2024-25, a growth of approximately 0.97%. The Companys Net Profit increased to Rs. 6.10 Crores from Rs. 6.01 Crores in the previous financial year, a growth of approximately 1.50%. The Earnings Per Share (EPS) for FY 2025-26 stood at Rs. 4.05 per share, as compared to Rs. 3.99 per share in FY 2024-25

h) Material developments in Human Resources / Industrial Relations front, including number of people employed

As far as logistics industry is concerned, wherein your Company operates, it has reinforced the fact that a dedicated fleet of employees are the backbone of any organization. To supplement the said, the Company focuses on retaining the trusted and experienced staff. The Company looks for specific skill-sets, interests and background that would be an asset for its kind of business. Manpower is a prudent mix of the experienced and young people which gives us the dual advantage of stability and growth, whereas execution of services within time and quality. The skilled resources together with our strong management team have enabled the company to successfully implement the growth plans.

The senior management is diversified and have different operational heads to support operations such as accounting, booking orders, marketing, human resource management, and field work for packing and moving, finance related activities.

Additionally, the Company employs, casual laborers and temporary laborers on daily wages as drivers and other for loading / unloading of the goods according to our requirements.

Category	Number of employees as on 31.03.2026
1 Executive Director	02
2 Key Managerial Personnel (KMP)	02
3 Other employees	222
4 Total	226

*Anjani Kumar Agarwal is the CEO & Managing Director, and Sugan Chand Sharma, is the Whole Time Director, KMPs of the Company and considered under the category of "Executive Director" only.

i) Details of significant changes (i.e. change of 25% or more as compared to the immediately previous FY) in key financial ratios, along with detailed explanations:

Ratios	2025-26	2024-25	Explanation
1 Debtor Turnover	7.93	8.04	Increase In credit Sales and Receivables.
2 Inventory Turnover	0.02	0.02	-
3 Interest Coverage Ratio	14.44	22.37	Increase in Finance charges as compared to last year.
4 Current Ratio	0.59	1.07	Increase in short term Borrowings and movement of fixed deposits from current to non-current.
5 Debt Equity Ratio	0.21	0.06	Increase in term loans & Utilization of cash credit facility.
6 Operating profit Margin (%)	0.04	0.04	-
7 Net Profit Margin	0.03	0.03	-

j) Details of changes in Return on Net Worth as compared to the immediately previous financial year along with a detailed explanation thereof

Particulars	2025-26	2024-25	Explanation
01 Net worth (In Lakhs)	4002.08	3392.00	Due to change in Reserves and surplus as compared to last year on account of increase in profit.
02 Return on net worth (%)	0.15	0.18	Increase in Net profit and Net worth in FY: 2025-26 as compared to last year.

2. DISCLOSURE OF ACCOUNTING TREATMENT:

In the preparation of financial statements, a treatment different from that prescribed in an Accounting Standard has not been followed. The financial statements represent a true and fair view of the underlying business transactions.

3. CAUTIONARY STATEMENT

This report contains forward-looking statements extracted from reports of Government Authorities / Bodies, Industry Associations etc. available on the public domain which may involve risks and uncertainties including, but not limited to, economic conditions, government policies, dependence on certain businesses and other factors. Actual results, performance or achievements could differ materially from those expressed or implied in such forward-looking statements. This report should be read in conjunction with the financial statements included herein and the notes thereto.

	For and on behalf of the Board For DRS DILIP ROADLINES LIMITED
	Sd/-	Sd/-
	Anjani Kumar Agarwal	Sugan Chand Sharma
	CEO & Managing Director	Whole Time Director
	DIN:00006982	DIN:07064674
	Address: Plot No. 25/a,	Address:4-2-202,4th
	Janakpuri Colony Gunrock,	Floor,Old Bhoiguda,
Place: Hyderabad	Karkhana, Hyderabad-	Near Mahankali Temple-
Date: 02.09.2026	500009	500003