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Eraaya Lifespaces Ltd Management Discussions

36.38
(-4.39%)
Sep 30, 2025|12:00:00 AM

Eraaya Lifespaces Ltd Share Price Management Discussions

Global Economic Overview

The global economy continues to display resilience despite uneven regional performance. According to the IMFs July 2025 update, world GDP is projected to grow at around 3.0% in 2025 and 3.1% in 2026, supported by easing trade pressures and relatively stable financial conditions, though policy uncertainty and structural headwinds remain.

In the United States, economic momentum has shown signs of recovery. Real GDP expanded by 3.3% on an annualized basis in Q2 2025, following a contraction of 0.5% in the first quarter. The labor market, however, has softened slightly, with the unemployment rate rising to 4.3% in August 2025, representing 7.4 million unemployed persons. In the Euro Area, economic activity remains subdued with GDP increasing by only 0.1% quarter-on-quarter in Q2 2025, while employment also grew by a marginal 0.1%. Inflation edged up slightly, with flash estimates placing the HICP at 2.1% in August 2025, compared to 2.0% in July.

The United Kingdom is witnessing pressures on household purchasing power. The Office for National Statistics reported that the Household Costs Index increased by 3.9% year-on-year in June 2025, with lower-income households experiencing higher impacts due to food and energy costs. In contrast, Indias inflationary scenario has markedly eased, with the all-India CPI rising only 1.55% year-on-year in July 2025—its lowest level since June 2017. Food inflation was negative, at -1.76% year-on-year, highlighting improved price stability and providing a boost to real household consumption.

Chinas economy has maintained steady, though moderating, growth momentum. Official statistics show GDP expanded by 1 .1% quarter-on-quarter in Q2 2025, following 1.2% in Q1, indicating stable output despite global headwinds. Japan, meanwhile, has been experiencing firm price growth, with consumer prices rising 3.1% year-on-year in July 2025, while unemployment remains historically low at 2.3%, reflecting a tight labor market.

For Eraaya Lifespaces, these dynamics carry both opportunities and risks. Indias benign inflation outlook supports stronger consumption and higher digital adoption, creating a favorable environment for scaling Ebixs digital payments, insurance exchanges, and CRM platforms. In parallel, steady growth in China and Japan sustains demand for B2B technology solutions, particularly in financial services and healthcare IT. However, persistent weakness in the Euro Area and pressures in the U.S. labor market present risks to enterprise IT spending, while currency volatility and regulatory shifts across geographies remain key factors to monitor.

Indian Economic Overview

Indias economy continues to stand out as the fastest-growing major economy in the world, expanding at a steady and confident pace despite global uncertainty. In FY 2024-25, real GDP growth was estimated at 6.5%, supported by strong domestic demand, resilient consumption, robust capital markets, and rising exports. The Reserve Bank of India (RBI) expects growth to sustain at a similar rate in FY 2025-26, while other agencies echo this optimism— the United Nations projects 6.3% in 2025 and 6.4% in 2026, and the Confederation of Indian Industry (CII) forecasts between 6.4% and 6.7%.

Momentum has been particularly strong in FY 2025-26 so far. In Q1 (April-June 2025), real GDP grew 7.8%, up from 6.5% a year earlier. Nominal GDP rose 8.8% to Rs86.05 lakh crore, while Gross Value Added (GVA) expanded by 7.6%, indicating balanced growth across sectors. Sectoral performance reflects broad-based resilience: agriculture grew 3.7%, manufacturing and construction registered around 7.6-7.7%, and the services sector surged by 9.3%, reaffirming its role as the backbone of Indias economy. Consumption trends are also encouraging—government spending grew 9.7%, private consumption rose 7.0%, and gross fixed capital formation (GFCF) increased 7.8%, underscoring investment momentum.

— LdTa

External indicators highlight Indias growing macroeconomic strength. Exports grew 6.3% in FY 2024-25, while foreign exchange reserves reached nearly USD 700 billion. The current account deficit narrowed to just 0.6% of GDP, supported by steady service exports and strong inward remittances. Inflation remains under control, with CPI inflation easing to 1.55% in July 2025, the lowest since 2017—helping boost consumption and investor confidence.

Looking ahead, India is projected to become the worlds third-largest economy by 2030, with GDP expected to reach USD 7.3 trillion, driven by urbanization, digital transformation, structural reforms, and fiscal incentives. Policy momentum remains strong: the government is considering GST simplification and new tax rebates, which could add around Rs20 lakh crore to the economy, further strengthening domestic demand.

Despite global headwinds, including ongoing U.S.-India trade tensions and tariff pressures that could shave 0.5% off GDP, Indias Chief Economic Adviser has reaffirmed a 6.3-6.8% growth forecast for FY 2025-26, reflecting confidence in domestic drivers of growth.

Source: https://www.pib.gov.in/PressNoteDetails.aspxRsNoteId=154840&ModuleId=3 Implications for Eraaya Lifespaces Limited

Indias strong growth trajectory offers a fertile backdrop for Eraaya Lifespaces, especially in the context of its acquisition of Ebix Inc.:

• Stronger Consumer Engine: Sub-2% inflation and rising private consumption create favorable conditions for demand in hospitality, QSRs, and digital marketing—enhancing cross-sell and upsell opportunities.

• Tech-driven Growth: Capital formation and robust service sector growth align with rising adoption of digital platforms. Ebixs solutions in CRM, payments, and e-commerce are well-positioned to benefit from this digital acceleration.

• Structural Reforms: GST simplification and tax relief measures will likely bolster private investments and consumer engagement, boosting Eraayas core verticals and enabling deeper penetration of Ebixs offerings in insurance, fintech, and healthcare segments.

• Export Resilience: While global trade uncertainties continue, Indias diversified export base and strong NEER support reduce volatility for Ebixs international operations, enhancing revenue visibility.

• Strategic Edge: With India projected to become the worlds 3rd-largest economy by 2030, Eraayas domestic and global footprint via Ebix provides a strategic advantage to tap increasing enterprise and consumer opportunities.

Industry Overview for Our Company Businesses

1. Hospitality & Hotels

Indias hospitality sector is experiencing robust growth, driven by rising incomes, surge in domestic and international tourism, and Pro-development policies. The hotel market alone was valued at USD 15.67 billion in 2024 and is projected to reach USD 22.41 billion by 2030, growing at a CAGR of approximately 9.3%. The broader hospitality industry—which includes hotels, resorts, homestays, and other accommodations—was estimated at USD 281.8 billion in 2025, with forecasts indicating it will reach USD 541.7 billion by 2030, representing about 13.9% CAGR.

This rapid expansion is underpinned by infrastructure development, the rise of Tier-2 and Tier-3 tourism hubs, and digital transformation in booking and loyalty systems.

Source: GlobeNewswire; Research and Markets

2. Digital Marketing & Advertising

Indias digital marketing industry is scaling rapidly, underpinned by expanding internet penetration and investor confidence. One estimate places the digital marketing market at approximately USD 5.15 billion in 2024, expected to surge to USD 72.1 billion by 2034, at an impressive CAGR of over 30%.

According to Grand View Research, the digital advertising segment alone generated around USD 13.63 billion in 2024, with projections of USD 32.33 billion by 2030, growing at 15.3% CAGR. Additionally, PwC India estimates that digital ad spend will grow at a CAGR of 15.6% through 2028, outpacing traditional media and reinforcing the shift toward digital platforms.

Source: Claight; Grand View Research; PwC

3. Technology & FinTech (Ebix Inc.)

Although direct data on Ebix is limited in public government sources, the global InsurTech market is expected to maintain a high growth trajectory (noted elsewhere in MDAR). Within India, the e-commerce sector—key to digital platforms—was valued at USD 147.3 billion in 2024 and is anticipated to achieve a CAGR of around 18.7% through 2028. Given Ebixs fintech, CRM, and digital payments capabilities, it stands to benefit from these booming trends in digital commerce and financial services.

Source: IBEFWikipedia

4. Synergies & Cross-Sector Integration

Eraayas diverse verticals—hospitality, digital marketing, QSRs, and technology services via Ebix—place it at a strategic confluence:

• Hospitality & Digital Marketing: Leveraging digital marketing prowess can enhance guest engagement, customer loyalty, and direct-booking channels.

• FinTech & Hospitality Crossovers: Ebixs digital payment and CRM technology can seamlessly integrate into hospitality and QSR operations, improving convenience, personalization, and cross-selling.

• Scalability & Diversification: The technology segment offers high margins and scalability, balancing the capital-intensive nature of hospitality and offering growth diversity.

Business Expansion through Ebix Inc. Acquisition

Our Companys core strengths lie in Hospitality and Digital Marketing Services, where we continue to focus on customer experience, operational excellence, and technology-led growth. In line with our strategy of diversification and value creation, the recent acquisition of Ebix Inc. has significantly expanded our business horizon and positioned us in high-growth global markets.

Ebix Inc. is a leading international supplier of on-demand software and e-commerce services, primarily catering to the insurance, financial services, healthcare, and e-learning industries. Its integrated suite of offerings includes customer relationship management (CRM), front-end and back-end insurance exchanges, risk and regulatory compliance platforms, and digital payment solutions. With operations spanning across the US, Asia, Europe, and other geographies, Ebix serves a diverse base of corporates, financial institutions, brokers, and government agencies.

This acquisition represents a major step forward for Eraaya Lifespaces, enabling us to:

• Diversify our portfolio beyond hospitality and marketing into technology-driven services.

• Leverage Ebixs global presence to access new markets and customer segments.

• Enhance digital capabilities through advanced platforms, creating synergies with our core businesses.

• Unlock cross-sector opportunities by integrating technology solutions with hospitality and allied services.

The global InsurTech market, in which Ebix is a prominent player, is expected to grow at a CAGR of over 25% between 20242030, driven by rising demand for digital insurance solutions, automation, and Al-driven platforms. Similarly, the global digital payments market is projected to cross USD 15 trillion by 2027, fueled by e-commerce penetration, mobile transactions, and regulatory support for cashless economies. The e-learning industry is also expanding rapidly, projected to grow at a CAGR of 13-14% through 2030, supported by increasing digital adoption and demand for remote learning solutions.

In India, digital adoption is accelerating across insurance, healthcare, and financial services, with regulatory reforms and consumer preference for digital-first platforms creating strong opportunities. By combining Ebixs technological expertise with Eraaya Lifespaces strengths in hospitality and digital marketing, the Company is well-positioned to participate in these high-growth sectors and drive long-term value creation for all stakeholders.

Hospitality

The hospitality industry remains a cornerstone of global economic activity, contributing significantly to employment, tourism, and cultural exchange. It encompasses diverse sectors such as accommodation, food & beverages, and travel & tourism, all driven by customer satisfaction and service excellence. The sector continues to evolve with rising demand for personalized experiences, sustainability, and technology-enabled service models.

In India, the hospitality industry is witnessing robust recovery and growth, supported by increasing domestic tourism, rising disposable incomes, and government initiatives like "Incredible India" and infrastructure investments. The Indian hotel industry is projected to grow at a CAGR of 8-10% over the next five years, driven by both leisure and business travel.

Digital Marketing

Digital marketing has emerged as a critical growth driver across industries. With rising internet penetration, smartphone adoption, and affordable data, India is now one of the worlds largest digital consumer markets, surpassing China in internet consumption growth. Businesses are increasingly relying on SEO, social media, email campaigns, influencer marketing, and data analytics to strengthen customer engagement, visibility, and revenues.

The Indian digital advertising industry is expected to grow at a CAGR of 27-30%, crossing INR 1 trillion by 2030, as companies continue to prioritize digital-first strategies.

Quick Service Restaurants (QSRs)

QSRs represent one of the fastest-growing segments of the food service sector. Focused on speed, standardization, and affordability, QSRs thrive on high customer volumes and efficient service delivery. With formats such as counter service and drive-throughs, coupled with strategies like bundle pricing, QSRs continue to capture demand for convenience-led dining.

In India, the QSR market is projected to grow at a CAGR of over 15%, supported by urbanization, youth demographics, and growing acceptance of branded and organized food outlets. International chains and domestic players alike are expanding aggressively to meet rising demand.

IT Business - Ebix Inc.

The most significant development for Eraaya Lifespaces in the year has been the acquisition of Ebix Inc., a global leader in on-demand software and e-commerce solutions. Ebix operates across multiple industries, with a particular focus on insurance technology (InsurTech), financial services, healthcare, digital payments, and e-learning. Its portfolio includes:

• Insurance & Financial Services: Front-end and back-end insurance exchanges, compliance platforms, and CRM solutions.

• FinTech & Digital Payments: Digital wallet solutions, cross-border remittances, and merchant payment platforms.

• Healthcare Technology: Information systems, billing platforms, and patient engagement solutions.

• E-learning: Online learning platforms, content management systems, and digital classroom solutions.

Ebix has a global footprint across more than 40 countries, with major operations in the United States, India, Europe, and Asia-Pacific, serving insurers, brokers, corporates, and government institutions.

With this diversified portfolio, Eraaya Lifespaces is evolving into a multi-vertical enterprise with strong domestic foundations and global growth potential. The Company aims to leverage synergies, enhance shareholder value, and build a resilient, future-ready business model that balances technology, services, and consumer-driven growth.

Global Industry Outlook for Ebix Verticals

• InsurTech: Expected to grow at a CAGR of ~25% (2024-2030), crossing USD 160 billion by 2030, driven by digital adoption, AI integration, and regulatory support for digital insurance models.

• Digital Payments: Projected to exceed USD 15 trillion globally by 2027, fueled by mobile-first economies, e-commerce penetration, and government-backed cashless initiatives.

• Healthcare IT: Anticipated to grow at a CAGR of 16% through 2030, supported by telemedicine, digital health records, and patient-centric platforms.

• E-learning: Valued at USD 399 billion in 2022, expected to grow at 13-14% CAGR through 2030, supported by corporate upskilling and remote learning demand.

By integrating Ebix, Eraaya Lifespaces gains direct participation in these high-growth industries, making it more resilient

and globally relevant.

The acquisition of Ebix Inc. represents a transformational milestone for Eraaya Lifespaces Limited. While hospitality, QSRs,

and digital marketing remain core strengths in the domestic market, Ebix positions the Company as a global technology-

enabled enterprise with access to multiple high-growth industries.

• InsurTech and FinTech businesses will drive international expansion.

• Digital payments and e-learning solutions are poised to capture the accelerating global digital adoption wave.

• Hospitality and QSR businesses will continue to grow, supported by domestic demand.

• Digital marketing services will complement Ebixs platforms, creating an integrated ecosystem of consumer and enterprise solutions.

SWOT Analysis - Eraaya Lifespaces Limited

Strengths

1. Diversified Portfolio: The Company operates across hospitality, digital marketing, and QSRs, and with the acquisition of Ebix Inc., has entered high-growth technology-driven sectors like InsurTech, FinTech, and E-learning. This diversification reduces dependence on a single business vertical.

2. Global Reach via Ebix: With Ebixs operations spread across 40+ countries, Eraaya gains international exposure and access to a global customer base, significantly enhancing its scale and market relevance.

3. Synergy Across Verticals: The combination of service-driven businesses (hospitality/QSR) with technology-led services (Ebix and digital marketing) provides opportunities to create integrated offerings and improve customer engagement.

4. Strong Customer Orientation: Eraayas hospitality and marketing services are built on customer-centric values, ensuring strong brand recall and long-term loyalty. This cultural strength can be extended to technology-led services as well.

5. Innovation & Technology Adoption: Through Ebix, Eraaya now has access to advanced platforms in CRM, digital payments, and compliance management, positioning it as a technology-enabled enterprise.

Weaknesses

1. Integration Challenges: The integration of a large, globally diversified entity like Ebix with Eraayas existing domestic- focused businesses may bring cultural, operational, and compliance complexities.

2. High Diversification Risk: Operating simultaneously in hospitality, QSRs, marketing, and technology may dilute management focus, potentially impacting strategic clarity and execution efficiency.

3. Capital Intensive Model: Both hospitality infrastructure and global technology acquisitions demand heavy investment, which could strain short-term cash flows and increase financial leverage.

4. Regulatory Exposure: Ebixs businesses are highly regulated (insurance, finance, payments, healthcare), which increases the Companys compliance costs and exposes it to policy shifts across jurisdictions.

5. Dependence on Global Economic Conditions: International operations expose Eraaya to currency fluctuations, geopolitical risks, and global economic downturns, which may affect profitability.

Opportunities

1. High-Growth Digital Verticals: Global InsurTech (25% CAGR), Digital Payments (15-18% CAGR), and E-learning (13-14% CAGR) industries are expanding rapidly, providing Eraaya with significant room to scale through Ebixs offerings.

2. Rising Domestic Consumption: Growth in disposable incomes, urban lifestyles, and increasing domestic tourism in India will continue to fuel demand for hotels, restaurants, and QSR formats.

3. Digital India & Internet Penetration: With India becoming one of the largest digital consumer markets globally, Eraaya can expand its digital marketing services while leveraging Ebixs platforms for fintech and online education.

4. Cross-Sector Integration: Ebixs fintech and CRM solutions can be integrated into hospitality and marketing businesses, creating unique service models and improving customer retention.

5. Global Partnerships & Expansion: Ebixs strong client network allows Eraaya to forge global partnerships with insurers, banks, and e-commerce players, enhancing its market credibility and opening new revenue streams.

Threats

1. Regulatory Uncertainty: Frequent changes in insurance, healthcare, financial services, and payment regulations across countries could disrupt business models and increase operational complexity.

2. High Competition: Both hospitality and QSR industries face intense competition domestically, while the global InsurTech and FinTech markets have aggressive digital-first competitors who are rapidly innovating.

3. Economic Volatility: Global recessions, inflationary trends, or geopolitical instability could negatively impact discretionary spending in hospitality and investment flows into technology businesses.

4. Technological Disruption: The pace of innovation in AI, blockchain, and cloud services could outpace existing platforms, requiring Eraaya to continuously invest in upgrades to remain competitive.

5. Operational & Cybersecurity Risks: Integration of global technology operations exposes the Company to cyber threats, data privacy concerns, and potential disruptions in IT systems, which could harm reputation and trust.

Business Overview and Outlook

Eraaya Lifespaces Limited has undergone a remarkable transformation in recent years. Originally engaged in the manufacturing of childrens bicycles under the brand Tobu Cycles, the Company has strategically diversified its portfolio through amendments to its object clause and a series of new business initiatives. Today, Eraaya operates across hospitality, digital marketing, quick service restaurant (QSR) leasing, and financial technology services—with the landmark acquisition of Ebix Inc. marking a significant step in its global growth journey.

Hospitality Division

The hospitality vertical represents one of the core strengths of the Company, offering a wide spectrum of services tailored to both leisure and business travelers. Through hotels, resorts, restaurants, cruise services, and event spaces, Eraaya focuses on creating immersive experiences where customer comfort, cultural connection, and personalized service remain paramount. With Indias hospitality industry projected to expand at a double-digit CAGR over the coming decade, the Company is well-positioned to benefit from rising domestic tourism, international arrivals, and consumer demand for high-quality service offerings.

Digital Marketing Services

Recognizing the digital-first shift in consumer behavior, Eraaya has built a strong presence in digital marketing solutions. The Company provides end-to-end services including strategic planning, search engine optimization (SEO), social media campaigns, influencer partnerships, and data-driven analytics. These solutions empower businesses to expand their digital footprint, improve customer engagement, and achieve measurable growth. With Indias digital advertising market expected to exceed USD 20 billion by 2028, Eraaya is strategically aligned to capture this momentum.

QSR and Commercial Leasing Initiative

To further strengthen revenue diversification, Eraaya has entered the commercial property leasing segment, with a focus on supporting Quick Service Restaurants (QSRs). Under a structured fixed rent plus revenue-sharing model, the Company provides QSR brands with well-located properties designed to handle high customer traffic. This model ensures scalability for partners while generating stable and recurring income for the Company. The QSR sector in India is projected to nearly double in value by 2028, making this an attractive and resilient business vertical.

Technology and Financial Services - Ebix Inc. Acquisition

The acquisition of Ebix Inc., a leading global supplier of on-demand software and e-commerce solutions for the insurance, financial, healthcare, and e-learning industries, has significantly expanded the Companys technological capabilities. Ebix

brings expertise in customer relationship management (CRM), insurance exchanges, digital payments, compliance, and fintech platforms, with operations spanning more than 40 countries. This acquisition diversifies Eraayas portfolio into high- growth global industries such as InsurTech, FinTech, and HealthTech, creating opportunities for integration with hospitality and digital services, while also positioning the Company in one of the fastest-growing global technology segments.

Outlook

With a diversified portfolio spanning hospitality, digital marketing, QSR leasing, and financial technology, Eraaya Lifespaces is well-positioned to capitalize on structural growth trends across multiple industries. The Indian economys steady expansion, combined with global opportunities in digital payments and InsurTech, provide a fertile environment for the Companys continued growth. Backed by strong fundamentals, strategic acquisitions, and a focus on operational excellence, Eraaya aims to deliver sustained value creation for its shareholders and establish itself as a forward-looking, innovation-driven enterprise.

Adequacy of Internal Control System

The Company has put in place a comprehensive and well-structured internal control framework designed to ensure effective oversight of operations, accuracy in financial reporting, and strict compliance with applicable laws and regulations. These controls provide reasonable assurance regarding the reliability of financial information, efficiency of operations, safeguarding of assets, and prevention of fraud or irregularities.

Regular internal audits are conducted across all business verticals to assess the effectiveness of these controls. Findings from these audits are reviewed by the management, and corrective actions are implemented promptly to address identified risks and strengthen the control environment.

The Audit Committee of the Board provides active oversight, periodically reviewing the adequacy and effectiveness of the internal control system. The Committee also ensures alignment with evolving business needs, regulatory requirements, and industry best practices, thereby reinforcing transparency and accountability.

The Company remains committed to maintaining a robust internal control environment, recognizing it as a critical enabler of sound governance, operational excellence, and long-term sustainable performance.

Discussion on Financial Performance with respect to Operational Performance

The detailed analysis of the financial results of the Company for the year under review has been provided in the Boards Report. These results reflect the operational strategies implemented by the management and the efficiencies achieved in diversified business segments, including hospitality, digital marketing, QSR leasing, and financial technology services.

Human Resources Development / Industrial Relations

The Company considers its human capital as a vital resource for driving growth and innovation. Throughout the year, employees have demonstrated strong cooperation and commitment, enabling the Company to pursue its expansion plans effectively.

Consistent emphasis is placed on skill development, capacity building, and leadership training to align employee capabilities with evolving business needs. Structured training programs, continuous learning opportunities, and a culture of collaboration ensure that employees remain motivated and future-ready. The industrial relations climate has remained harmonious and constructive, supporting organizational stability and growth.

Key Financial Ratios:

Parameters

For the year ended FY 2024-25 For the year ended FY 2023-24 Change in percentage

Debtors Turnover Ratio

2.90 1012.36 (100)

Inventory Turnover

NA NA NA

Interest Coverage Ration

(0.08) 0.30 (125.39)

Current Ratio

1.58 15.87 M

Debt Equity Ratio

2.93 0.00 NA

Operating Profit Margin (%)

H51} 0.07 (2225.46)

Net Profit Margin (%)

(1.21) 0.27 (552)

Cautionary Statement

This Management Discussion and Analysis report contains certain statements that may be deemed to be "forward-looking statements" within the meaning of applicable securities laws and regulations. Such statements are based on certain assumptions and expectations of future events. The actual results, performance, or achievements of the Company may differ materially from those expressed or implied, due to factors such

as changes in the economic environment, government policies, regulatory framework, and global market conditions. The Company assumes no responsibility to publicly amend, modify, or revise any forward-looking statements on the basis of subsequent developments.

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