Focus Business Solution Ltd Management Discussions

ANNEXURE-IV

Your directors take pleasure in presenting the Management Discussion and Analysis Report for the year ended March 31, 2025.

STRUCTURE OF THE INDUSTRY, DEVELOPMENTS AND SWOT ANALYSIS:

Company Overview and Structural Framework Corporate Structure

Focus Business Solution Limited, a public limited company listed on the SME Platform of BSE since July 13, 2021, was originally incorporated as Focus Business Solution Private Limited on November 10, 2006, in Gujarat. The Company transitioned to its current status as a listed entity in line with its vision of expanding operational capabilities and enhancing governance standards.

Under the continued guidance and leadership of its founders, Mr. Mohamedamin Mohammad Nathani and Mr. Mohamedyaseen Muhammadbhai Nathani, the Company has grown steadily over the past two decades, establishing a strong foothold in the debt collection industry. Their strategic direction, combined with the support of an experienced senior management team, has enabled the Company to achieve several milestones in collections and client servicing.

With over 20 years of experience in the debt recovery domain, Focus Business Solution Limited is now on a trajectory to achieve its long-term vision of PAN India coverage, catering to leading banks, NBFCs, and financial institutions across multiple regions.

Operational Structure

Focus Business Solution Limited offers end-to-end debt collection and recovery solutions through a multi-channel delivery model. The operational setup is designed to meet the needs of a wide range of financial institutions while ensuring efficiency, compliance, and customer sensitivity.

Our suite of services includes Tele-calling, Field visits, IVR Solution, Voice blast, E-mail Blast, and Legal Services, all seamlessly integrated into our smart, all-encompassing digital Solution.

Compliance and Governance Mechanism

Focus Business Solution Limited adheres strictly to the regulatory framework laid out by the Reserve Bank of India (RBI), as well as the specific requirements and codes of conduct set forth by its banking and financial institution clients. The Company follows comprehensive Standard Operating Procedures (SOPs) designed to ensure ethical recovery practices and client data confidentiality.

A strong internal audit system is implemented through the Companys internal audit team, which conducts periodic reviews of operations, documentation, and staff conduct. Regular training sessions are organized for employees and collection agents to reinforce adherence to: Code of Conduct , Fair Practices Code , RBI Guidelines and Client Protocols and Data Protection and Privacy Norms

Technology Integration in Structure

With over two decades of industry-specific expertise, we have honed a hybrid digital solution encompassing both Telecalling and referral field visit. Our commitment lies in establishing an organization with a robust foundation in debt collection and recovery, driven by our innovative digital approach. This fusion of traditional practices with cutting-edge technology ensures the delivery of efficient, dependable, and transparent debt collection services.

In crux, Focus Business Solution Limited has developed a resilient, scalable, and tech-enabled organizational structure that underpins its mission to deliver ethical, effective, and customer-centric debt recovery services. With clearly defined departmental responsibilities, strong governance controls, and a commitment to continuous innovation, the Company is well-positioned to expand its footprint across India and strengthen long-term partnerships with financial institutions.

We have staff strength of around 1378 covering all branches which included 98 staff on our payroll and 1280 staff hired on contractual basis and each of our staff is fully trained and all types of assignment like recovery, collection, field investigation and other allied services.

THE GLOBAL ECONOMY:

In FY 2024-25, the global economy saw a cautious recovery amid easing inflation in major economies, but growth remained moderate due to high interest rates, geopolitical tensions, and supply chain disruptions. Emerging markets, especially in Asia, showed stronger performance driven by domestic demand and improved industrial output, though energy price volatility and climate-related issues continued to pose risks.

The financial services sector globally shifted further towards digitalization and tighter regulations, with a focus on financial inclusion and responsible lending. Rising debt stress led to increased NPAs in some regions. For debt recovery agencies, this created both challenges and opportunities. Focus Business Solution Limited remained adaptive by emphasizing compliance, digital tools, and customer-centric strategies to align with global best practices and support clients in effective recovery management.

THE GLOBAL OUTLOOK:

In FY 2024-25, the global debt collection industry is navigating rising defaults, especially in high-yield segments, driven by inflation, high interest rates, and geopolitical tensions. Major players are under pressure, seeking restructuring due to large debt burdens.

Amid these challenges, the industry is embracing AI, machine learning, and data analytics to improve recovery rates and efficiency. Theres also a growing shift toward ethical, customer-focused recovery practices. Despite economic headwinds, the sector is poised for growth through digital transformation and expanding demand in emerging markets.

INDIAN ECONOMY AT GLANCE:

In 2024-25, the Indian economy is projected to grow at 6.4%, creating a favorable environment for credit expansion and financial activities. However, rising non-performing assets (NPAs) across banks have highlighted the growing importance of effective debt recovery mechanisms. In response, banks are increasing legal actions, offering one-time settlements, and exploring refinancing options.

The debt collection industry is undergoing a digital transformation, with the market for collection software growing at a CAGR of over 10%. Regulatory bodies like the RBI are also working to formalize and streamline recovery practices. Additionally, the securitization of bad loans is gaining momentum, further boosting the sector. Overall, the industry is poised for growth, driven by technology, compliance, and evolving financial regulations.

DEBT COLLECTION INDUSTRY 2025:

In 2025, Indias debt collection industry is undergoing significant transformation, driven by economic pressures, regulatory reforms, and technological advancements.

Economic Landscape and Rising NPAs:

The Indian economy is experiencing a surge in non-performing assets (NPAs). The NPA ratio marginally decreased from 5.57% to 5.32%. This rise is attributed to factors such as increased loan disbursals, competitive market pressures leading to business failures, and borrower expectations for government loan waivers.

Technological Advancements:

The debt collection industry is embracing technology to enhance efficiency and compliance. Artificial Intelligence (AI) and Machine Learning (ML) are being utilized to predict consumer behavior, optimize repayment plans, and improve contact center efficiency. Digital-first communication strategies, including omni-channel approaches via SMS, email, chat apps, and mobile applications, are becoming standard to meet consumer preferences.

Regulatory Reforms

The Reserve Bank of India (RBI) is enforcing stricter regulations to ensure ethical debt collection practices. This includes adherence to the Fair Practices Code, which mandates respectful and lawful collection methods. Additionally, the RBI has increased risk weights on personal loans to curb excessive lending, impacting credit availability and pushing heavily indebted individuals into further crisis.

Outlook

The Indian debt collection industry in 2025 is at a crossroads, balancing the need for effective recovery mechanisms with ethical practices and technological integration. Stakeholders must navigate economic challenges, regulatory requirements, and evolving consumer expectations to ensure sustainable growth and financial stability

SEGMENT-WISE OR PRODUCTS-WISE PERFORMANCE:

During the year 2024-25, following are the segment wise performance of the Company.

Revenue from trading business	Rs. 2395.90 Lakhs
Net Profit after Tax from trading business	Rs. 74.08 lakhs

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:

The Company has adequate internal control systems including suitable monitoring procedures commensurate with its size and the nature of the business. The Internal Auditors and Companys Internal Audit Department conduct regular audits to ensure adequacy of internal control system, adherence to management instruction and compliance with laws and regulations of the country as well as to suggest improvements. The statutory auditors while conducting the statutory audit, review and evaluate the internal controls and their observations are discussed with the Audit committee of the Board.

DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

During the period 2024-25, the movement in the Total Income and net profit after tax are as follows:

Particular	FY 2024-25	FY 2023-24
Total Income	Rs. 2395.90 Lakhs	Rs. 2136.30 Lakhs
Net Profit after Tax	Rs. 74.08 lakhs	Rs. 57.57 lakhs

HUMAN RESOURCES

One of the key pillars of the Companys business is its people. The Company considers human resources as one of the vital and important factors for sustained growth, business success and creating value for Stakeholders. Company has maintained cordial and harmonious relations with all Employees.

The total numbers of Employees on pay roll were 98 as on 31st March, 2025.

CAUTIONARY STATEMENT

Certain statements made in the Management Discussion and Analysis Report describing the Companys objectives, projections, estimates, predictions and expectations may be forward looking statements, within the meaning of applicable securities law and regulations and actual results may differ materially from those expressed or implied. Significant factors that make differences to Companys operations include competition, change in Government policies and regulations, tax regimes and economic development within India. The Company assumes no responsibility to publicly amend, modify or revise any forward looking statement, on the basis of any subsequent development, information or events or otherwise.

For and on behalf of the Board

Focus Business Solution Limited

Sd/-

Mr. Mohamedyaseen Muhammadbhai Nathani

Managing Director & Chairman

DIN:02759578

Date: 20th June, 2025

Place: Surat