Enfuse Solutions Ltd Management Discussions

OVERVIEW

Your company has kept pace with the overall market scenario in the focused segment and continues to grow in specific domain. The Management expects to improve the growth in the years to come, subject to favorable market conditions, and stable economic policies.

FINANICIAL PERFORMANCE & REVIEW

The standalone financial statements for the year ended March 31, 2026 have been prepared in accordance with the Accounting Standards (AS) notified under Section 133 of the Companies Act 2013 read with the Companies (Accounts) Rules, 2014. The financial statement under Section 133 of the Companies Act 2013 read with companies (Accounts) Rules 2014.

Financial Summary is as under:

(Rs. In Lakhs)

Particulars	2025-26	2024-25
Profit before Interest, Depreciation & Tax	(517.06)	1166.34
Less- Finance Cost	323.31	235.16
Less- Depreciation & Amortization Expenses	683.23	430.74
Profit/(Loss) before Tax	(1523.60)	500.44
Provision for Tax
Income Tax	(38.84)	100.00
Deferred Tax	56.92	(4.98)
Earlier year Short/excess tax	0.00	80.88
Net Profit/(Loss) after tax	(1541.68)	324.54
Earnings per share (EPS)
Basic	(17.42)	3.67
Diluted	(17.42)	3.67

The company made a loss of Rs. 1541.68 Lakhs during current financial year as against a profit of Rs. 324.54 Lakhs during the previous year.

SEGMENT WISE PERFORMANCE

As there is no particular operational activity segment wise performance in not applicable.

RISK MANAGEMENT

All material Risks faced by the company are identified and assessed. For each of the risks identified corresponding controls are assesses, and policies and procedures are put in place for monitoring, mitigating and reporting risk on a periodic basis.

OUR BUSINESS, OUTLOOK AND STRATEGY

EnFuse Solutions Limited, founded in 2017, is an industry-focused digital enterprise specializing in integrated digital transformation solutions. What began as a services organization serving clients across India, Europe and North America has, over the year under review, evolved into a multi-geography enterprise with an expanding footprint across the Middle East and North Africa (MENA) region.

With over [750+] employees, the Company partners with Fortune 500 and global enterprise clients to deliver enterprise data management services, AI-enabled operations, metrics-driven execution frameworks and measurable cost savings typically reducing client OPEX by 45% or more.

The year under review has been one of deliberate transition. Our Company has moved from being a capable execution partner to becoming a strategic transformation partner for its clients: winning larger and longer-duration mandates, entering new industry verticals, and beginning the shift from a purely services-led revenue model toward a blended model that includes proprietary, licensable intellectual property.

BUSINESS STRATEGY

1. Deepening Enterprise Relationships and Winning Larger Mandates

Your Companys growth continues to be anchored in long-standing relationships with marquee global enterprises across technology, education technology, industrial distribution and professional services. During the year, several of these relationships expanded materially in both scope and contract value, moving from single-service engagements to multi-service, multi-geography programs.

Notably, the Company secured a large-scale data annotation and labelling mandate among the most significant wins in its history by volume reflecting both the maturity of its delivery capability and the growing global demand for high-quality, human-in-the-loop training data for artificial intelligence systems. Management views the expansion of existing accounts as the highest-return growth lever available to the Company and continues to invest in dedicated account leadership to systematically expand wallet share within its installed base.

2. A Formalized New-Logo Acquisition Engine

Historically, new business at EnFuse originated principally from digital campaigns and referrals. During the year, your Company made a decisive investment in institutionalizing demand generation. A dedicated Business Development function was established from the ground up, comprising:

- A structured, tiered BD organization with clearly defined KRAs across Executive, Senior Manager and AVP levels

- A technology-enabled Account-Based Marketing (ABM) program, running on a modern CRM and marketing automation stack, with campaign calendars allocated across all service lines and priority weighting toward Analytics & AI

- A standardized prospect research and proposal methodology, ensuring every enterprise pursuit is supported by rigorous account intelligence, service-fit mapping and decision-maker analysis

- An actively managed enterprise pipeline spanning target accounts across technology, industrial, retail, education and distribution sectors in North Americas, Europe and Asia-Pacific.

This transition from opportunistic to systematic pipeline creation is expected to be a principal driver of new-logo addition in the coming financial years.

3. Building Proprietary, IP-Led Revenue Streams

Your Company has commenced a strategic shift toward productized intellectual property, developing a suite of proprietary AI platforms designed to be licensed and deployed at scale, rather than delivered solely as managed services. These platforms span AI-enabled proctoring for the education and certification sector, identity verification and KYC solutions for financial services, and AI-assisted content tagging and enrichment.

These products remain at an early, pre-revenue or early-revenue stage, and the Board wishes to be measured by setting expectations regarding their near-term financial contribution. However, management believes the platform strategy is important for two reasons: it creates the potential for higher-margin, recurring and more scalable revenue over time, and it materially strengthens the Companys competitive differentiation in enterprise pursuits.

4. Geographic Expansion into the Middle East and Asia-Pacific

The Company is actively developing its presence in the MENA and Asia-Pacific regions, which management regards as one of the most attractive medium-term growth markets globally, given sustained public and private investment in digital infrastructure and financial services modernization. Your Company is evaluating both organic and inorganic routes to establishing a meaningful regional footprint. Any transaction of a material nature will be undertaken only after appropriate diligence and Board approval and will be disclosed to shareholders in accordance with applicable regulatory requirements.

5. Talent Development and Culture

EnFuse continues to regard its people as its primary asset. The Company fosters continuous upskilling through structured digital learning platforms and internal capability programs, with a growing emphasis on artificial intelligence, data engineering and analytics competencies in line with the direction of the business.

Culture initiatives including a deliberately flat hierarchy, open brainstorming forums and structured mentorship continue to reinforce the Companys core values: Accountability, Service Excellence, Passion, Integrity, Respect and Empathy (ASPIRE).

6. Flexible and Agile Operational Model

The Companys engagement framework continues to enable rapid ramp-up, delivery flexibility and resource scalability. As mandates have grown in size and complexity, this model has been progressively strengthened through investment in delivery governance, quality assurance frameworks and multi-site continuity planning, ensuring the Company can absorb larger programs without compromising service levels.

7. Risks, Controls and Governance

Your Company systematically identifies and monitors material risks, implements internal control policies and maintains compliance with corporate governance practices, ensuring reliable financial reporting and operational integrity. As the business expands across new geographies and enters new regulatory environments, the risk management framework has been correspondingly broadened to address cross-border regulatory, data privacy, information security and client concentration considerations.

Outlook

Growth expectations. Management anticipates continued expansion, supported by a strengthened order book, a maturing enterprise pipeline and the widening scope of existing client relationships. This outlook assumes a stable macroeconomic environment and favorable industry conditions.

Structural tailwinds. The accelerating global adoption of artificial intelligence is expanding demand for the precise capabilities your Company has built high-quality data preparation, business intelligence, advanced analytics, annotation and labelling, enterprise data management, and AI-enabled process operations. Management believes EnFuse is well positioned in this cycle.

Revenue mix. Over the medium term, the Company intends to progressively increase the contribution of higher-margin analytics, AI and platform-led offerings within its overall revenue mix, while continuing to grow its established service lines.

Geographic diversification. Expansion into the Middle East and Asia-Pacific, alongside continued growth in North Americas and Europe, is expected to reduce dependence on any single market and open access to new client segments.

Talent strengthening. The Company continues to emphasize the enhancement of its top and middle management bench and the creation of a performance-driven environment, supported by competitive compensation and a sustained focus on employee welfare.

The Board records its appreciation of the confidence reposed in the Company by its shareholders, clients and employees, and remains committed to building a durable, well-governed and profitable enterprise.

Disclaimer: Certain Statements made herein describing the Companys expectations or predictions are "forward looking statements". The Companys results, performance or achievements can significantly differ materially from those projected via such statements. Important factors that could make a difference to the Companys operations include, among others, economic conditions affecting demand/supply, changes in government regulations, tax regimes, economic developments and other incidental factors. The Company assumes no responsibility in respect of forward- looking statements that may be amended or modified in future on the basis of subsequent developments, information or events.

HUMAN RESOURCES

Your company has built significant talent pool in the form of top and middle management; the Company have also created a performance-oriented work culture with focus on building long term talent pool. Also, we continuously endeavor to improve and enhance the work environment for employees of the Company. Competitive compensation package, innovative and challenging environment to work etc.; are some of the steps taken by the company for the welfare of its employees.

INTERNAL CONTROLS

The Company has the internal control systems in place, adequate for the size of the Company and the nature of its business. The primary function of our internal control systems is to ensure efficiency in business operations, safeguarding of companys assets, adherence to policies and procedures, protecting and detecting errors and frauds, strict compliance with applicable laws and ensuring the reliability of financial statements and reporting.

The Company has in place the internal financial controls for the various processes of the Company such as Revenue reporting and recognition, Fixed assets, Finance and accounts, Taxation, Treasury, HR & Payroll and Procurement etc. The internal control systems adopted by the Company ensures that all transactions are executed with proper authorization, are recorded and reported correctly, and assets are safeguarded and protected against loss from unauthorized use. In addition, the compliance of corporate policies is duly monitored.

The Company also has an Audit Committee to interact with the Statutory Auditors, Internal Auditors and Management in dealing with matters within its terms of reference including the matters relating to financial reporting and internal controls.

BOARD GOVERNANCE

The top leadership of EnFuse Solutions comprises of 8-member Board that provides guidance and supervision to the Company. The Board of Directors consists of individuals with diverse background, specific skills, and experience.

BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The standalone financial statements have been prepared in compliance with Indian Accounting Standards ("Ind AS"), the provisions of the Companies Act, 2013 ("the Companies Act"), as applicable and guidelines issued by the Securities and Exchange Board of India ("SEBI"). The Ind AS are prescribed under Section 133 of the Companies Act read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and amendments issued thereafter. The Management accepts the responsibility for the integrity and objectivity of these financial statements, as well as for various estimates and judgements used therein. The estimates and judgements relating to the financial statements have been made on a prudent and reasonable basis, so that the financial statements reflect in a true and fair manner the form and substance of transactions, and reasonably present the state of affairs, profit/loss and cash flows for the year.

KEY FINANCIAL RATIOS:

Sr. No. Particulars	31.03.2026	31.03.2025
1 Current Ratio	0.98	1.42
2 Debts Equity Ratio	1.48	0.72
3 Debt Service Coverage Ratio	-0.96	2.51
4 Return on Equity Ratio	-1.57	0.10
5 Trade Receivable Turnover Ratio	5.96	4.02
6 Trade Payable Turnover Ratio	NA	NA
7 Net Profit Ratio	-0.28	0.07