Global Capital Markets Ltd Management Discussions

ANNUAL OVERVIEW AND OUTLOOK

India is a significant global economic player, with its nominal GDP at current prices estimated at Rs. 296.58 trillion (US$ 3.56 trillion) in 2024-25. The country boasts the third-largest unicorn base globally, reflecting a vibrant startup ecosystem. The government is committed to renewable energy sources, aiming for 40% of energy from non-fossil sources by 2030 and striving for Net Zero Emissions by 2070 through the ‘Panchamrit strategy. India ranks third in the renewable energy country attractive index, indicating a favorable environment for renewable energy investments. Indias GDP growth is projected to moderate to 6.8% in the upcoming fiscal year, down from the current fiscals better-than-expected 7.6%. This moderation is due to several factors. Firstly, higher interest rates, which are typically used to manage inflation by reducing borrowing and spending, can potentially alleviate inflationary pressures. Secondly, a reduced fiscal impulse, indicating a decrease in government spending or an increase in taxes, can affect inflation dynamics by impacting consumer spending and overall economic activity. Lastly, the normalizing effect of net taxes on demand refers to tax adjustments that could affect consumer purchasing power and, consequently, inflation trends. Indias GDP growth is projected to moderate to 6.8% in the upcoming fiscal year, down from the current fiscals 7.6%. Despite this moderation, India is expected to retain its position as a significant global economic player. The Interim Budget for 2024-25 allocates a significant amount for capital expenditure, focusing on infrastructure and development projects. This investment is expected to stimulate economic activity and contribute to GDP growth. Tax receipts are estimated to increase, with GST collections crossing significant benchmarks. This increase in tax collections indicates a robust economy. The fiscal deficit is estimated at 5.1% of GDP in 2024-25, aligning with the goal of reducing it below 4.5% by 2025-26. This reduction in fiscal deficit is a positive sign of fiscal responsibility and economic stability. The governments commitment to renewable energy sources and its aim for 40% of energy from non-fossil sources by 2030 shows a progressive approach towards sustainable development. Global uncertainties and domestic factors, such as the ongoing effects of previous interest rate increases and the Reserve Bank of Indias measures, could pose challenges. However, these are being actively managed to ensure stable economic growth. In conclusion, while there are challenges ahead, the article suggests that India is well-positioned to maintain strong economic performance in the future. The governments focus on infrastructure development, fiscal responsibility, employment generation, and sustainable energy sources are key factors that will contribute to this growth. However, its important to note that these projections are based on current data and assumptions, and actual outcomes may vary.

INDUSTRY OVERVIEW

The market focus on stocks should not preclude interest in other asset classes in 2025. Corporate bonds in the U.S., Asia and Europe, for example, are likely to remain interesting for investors for several reasons. These include institutional demand, still high yields and the return of the (term) premium. Supply and demand will remain fundamental to commodities such as oil and industrial metals but we also see other factors maintaining a relatively high price for gold in 2025. In alternative assets, we focus in this outlook on infrastructure central to investing in future growth and what we call the public and private mixology of investing in this area. FX considerations will, as always, be a central consideration for investors and here 2025 will clearly be a case of strong economy, strong currency for the U.S. dollar. The euro will look weak in comparison, but rate rises and growth could support the Japanese yen. 2025 will not always be an easy year for investors as markets navigate through geopolitical or other risks (including the “three Rs” of recession, rates and rotations). But we believe that these risks are manageable. With markets already anticipating the impact of future economic growth and development, this means that being and staying invested will be essential for portfolio success both in the short and long term. I hope you find the analysis in this annual outlook useful and we are, of course, always here to guide you through 2025 and beyond.

OPPORTUNITIES & THREATS Opportunities

The Union Budget 2025-26, unveiled by Finance Minister Nirmala Sitharaman, has set the stage for transformative changes in Indias financial sector. The upcoming budget concentrates on developing economic expansion while making credit options more accessible and improving the regulatory process to build a stronger finance system for India. The Financial Budget 2025-26 contains several essential financial sector trends that will significantly affect the industry. Indias Stocks Market in 2025 The stock market in India Investors are able to examine opportunities for long-term growth during the current decline in 2025. The Indian stock market is already starting to experience price changes impacted by volatility after hitting all-time highs. Even though indexes have seen drops, this stage is crucial for market stabilization & long-term financial expansion. Even though the current market phase represents temporary changes, the Indian economy is still expected to grow in the long run. India is desirable place to invest due to their robust business sector, aggressive policies & expanding consumer base. It is likely that investors who remain committed to long-term wealth creation, disciplined investing and solid fundamentals will profit from the possibilities that lie ahead. Future development and prosperity are anticipated when confidence returns and the market stabilize. The outlook for the India Stock Market 2025 remains positive, with the economy showing resilience and adaptability in the face of global and domestic challenges. This period could very well be looked back upon as a pivotal moment for entering the vibrant Indian market.

Threats

The impact of geo-political tensions is becoming increasingly evident in the global markets. In 2024, the Ukraine-Russia war and ongoing tensions between Israel and Iran caused significant losses for investors. Additionally, the trajectory of the US markets and political developments impacted the Indian market. Following the election of Donald Trump as the new US President, the Indian stock market witnessed a sharp decline, and the rupees value fell against the dollar in the exchange market. The biggest factor that would play an important role in shaping of global economy in 2025 would be President-elect Donald Trump. Global economic experts are of the opinion that Trump might take some harsh decisions, which may fuel global protectionism and further slump in the global markets. "Trump has threatened to impose a 60% tariff on imports from China. Chinese-made products are widely used in the US, and even a 30% tariff would significantly increase their prices. This would add to the challenges faced by the Federal Reserve, which has been striving to curb inflation in the US economy. Halting the interest rate cut cycle, which the Fed successfully initiated, would hurt the global economy in general and the US economy in particular."

RISKS AND CONCERNS

Global Capital Markets Limited (GCML) has exposures in various line of business. GCML are exposed to specific risks that are particular to their respective businesses and the environments within which they operate, including market risk, competition risk, credit risk, liquidity and interest rate risk, human resource risk, operational risk, information security risks, regulatory risk and macro-economic risks. The level and degree of each risk varies depending upon the nature of activity undertaken by them.

MARKET RISK

The Company has quoted investments which are exposed to fluctuations in stock prices. GCML continuously monitors market exposure in equity and, in appropriate cases, also uses various derivative instruments as a hedging mechanism to limit volatility.

LIQUIDITY AND INTEREST RATE RISK

The Company is exposed to liquidity risk principally, because of lending and investment for periods which may differ from those of its funding sources. Management team actively manages asset liability positions in accordance with the overall guidelines laid down by various regulators. The Company may be impacted by volatility in interest rates in India which could cause its margins to decline and profitability to shrink. The success of the Companys business depends significantly on interest income from its operations. It is exposed to interest rate risk, both as a result of lending at fixed interest rates and for reset periods which may differ from those of its funding sources. Interest rates are highly sensitive to many factors beyond the Companys control, including the monetary policies of the RBI, deregulation of the financial sector in India, domestic and international economic and political conditions and, inflation. As a result, interest rates in India have historically experienced a relatively high degree of volatility. The Company seeks to match its interest rate positions of assets and liabilities to minimize interest rate risk. However, there can be no assurance that significant interest rate movements will not have an adverse effect on its financial position.

HUMAN RESOURCE DEVELOPMENT

The Company recognizes that its success is deeply embedded in the success of its human capital. During 2024-25, the Company continued to strengthen its HR processes in line with its objective of creating an inspired workforce. The employee engagement initiatives included placing greater emphasis on learning and development, launching leadership development programme, introducing internal communication, providing opportunities to staff to seek inspirational roles through internal job postings, streamlining the Performance Management System, making the compensation structure more competitive and streamlining the performance-link rewards and incentives.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

The provision of the Companies Act, 2013 relating to CSR Initiatives are not applicable to the Company.

COMPLIANCE

The Compliance function of the Company is responsible for independently ensuring that operating and business units comply with regulatory and internal guidelines. The Compliance Department of the Company continues to play a pivotal role in ensuring implementation of compliance functions in accordance with the directives issued by regulators, the Companys Board of Directors and the Companys Compliance Policy. The Audit Committee of the Board reviews the performance of the Compliance Department and the status of compliance with regulatory/internal guidelines on a periodic basis. The Company has complied with all requirements of regulatory authorities except delay in complying with the provisions of SEBI LODR Regulations, 2015.

Kolkata, August 30, 2025	By order of the Board
	For GLOBAL CAPITAL MARKETS LIMITED
	S/d-
Registered Office :	I. C. Baid
Sir RNM House, 5th Floor, 3B Lal Bazar	DIN: 00235263
Street, Kolkata 700 001	Chairman & Managing Director