Globtier Infotech Ltd Management Discussions

1. Industry Structure and Developments

The global information technology industry continues to undergo significant transformation driven by rapid advancements in artificial intelligence, cloud computing, data analytics, cybersecurity, automation, and digital engineering. Organizations across industries are accelerating their digital transformation initiatives to improve operational efficiency, customer experience, business resilience, and cost optimization.

India continues to strengthen its position as one of the worlds leading technology service hubs, supported by a highly skilled workforce, robust digital infrastructure, and growing government initiatives that promote digital adoption. According to industry reports by NASSCOM, Indias technology sector continues to demonstrate resilient growth despite global economic uncertainties, with increasing demand for cloud migration, AI-driven automation, managed services, cybersecurity, and enterprise modernization.

Enterprises are increasingly shifting towards outcome-based managed services, cloud optimisation, AI-enabled service delivery, and platform-driven business models. The growing adoption of hybrid work environments, Industry 4.0 technologies, and intelligent automation continues to create new opportunities for technology service providers.

While macroeconomic uncertainties and cautious discretionary spending continue to influence certain segments of the market, long-term industry fundamentals remain robust. Organizations continue to prioritize investments in digital transformation, cloud modernization, enterprise applications, cybersecurity, and data-driven decision-making, creating significant opportunities for companies with strong execution capabilities and domain expertise.

Globtier remains well-positioned to benefit from these evolving industry trends through its diversified service portfolio, technology partnerships, in-house developed platforms, and customer-centric delivery model.

2. Opportunities and Threats

Opportunities

Expanding into Emerging Markets

Expanding into emerging markets outside India presents a significant growth opportunity for our Company. These regions feature developing economies and a rising demand for IT solutions, enabling us to broaden our market reach and diversify our client base. To succeed, we must strategically enter these markets through in-depth research, local partnerships, and tailored offerings. This expansion will boost revenue streams and enhance resilience by reducing dependency on existing markets. Additionally, it will provide access to local talent and resources, fostering innovation, and driving sustainable growth.

High Margin Business Selection

Focusing on high-margin business sectors presents an opportunity to improve financial performance by targeting industries with greater profitability. By concentrating on specialized services and advanced technologies, we can command premium pricing, differentiate ourselves from competitors, and attract clients seeking high-quality solutions.

Growing Demand for Cloud Services

The growing demand for cloud services offers a significant opportunity to expand our service offerings. As businesses increasingly adopt cloud computing for its scalability, cost-efficiency, and flexibility, we can leverage our knowledge to provide innovative cloud solutions, including secure ecosystems, migration services, and ongoing support. By broadening our cloud services portfolio, we can attract new clients, strengthen existing relationships, and enhance operational efficiency, driving long-term growth and success.

Advancements in AI and Automation

The advancements in AI and automation present a significant opportunity for us to develop advanced, AI-driven solutions that meet the growing demand for efficiency, cost reduction, and innovation. By leveraging our knowledge, we can create intelligent systems for data analysis, predictive analytics, process automation, and customer engagement, helping clients optimize operations and improve decision-making.

Digital Transformation Initiatives

The increasing focus on digital transformation across industries presents a key opportunity for us to position our Company as a strategic partner. By leveraging our knowledge, we can guide businesses through the adoption of advanced technologies, such as automation and data-driven solutions, to enhance efficiency, innovation, and growth.

Platform Enabled and Recurring Revenue

The Companys investments in proprietary Cloud FinOps and AI-enabled Service Management platforms provide an opportunity to complement project-based services with technology-enabled managed services and recurring revenue models, thereby improving differentiation, customer engagement, and long-term revenue visibility.

Threats

Intense Competition

The intense competition in the IT services industry presents a significant threat, requiring constant innovation and differentiation to maintain our market position. Failure to do so risks losing market share to competitors, which calls into question ongoing strategic efforts to stay competitive and continue leading in the industry.

Economic Uncertainty

Economic fluctuations present a threat by influencing client budgets and spending on IT services, particularly during periods of instability when businesses prioritize cost-cutting. To mitigate these challenges, we must adopt a flexible strategy by diversifying our client base across industries and regions and offering scalable services that cater to varying budget needs. This approach will help us maintain stability and continue serving clients effectively, even in challenging economic conditions.

Regulatory Changes

Evolving regulations pose a threat, requiring continuous compliance to avoid legal and financial repercussions. To address this, we must stay ahead of regulatory changes, invest in compliance programs, and ensure our team is trained to handle new requirements. Proactively managing regulatory challenges ensures our continued stability and industry standing. Cybersecurity and data privacy risks are inherent to the IT services business, including evolving regulatory requirements (e.g., Digital Personal Data Protection Act, 2023)

Longer Payment Cycles

Longer payment cycles can strain cash flow and disrupt operational stability. To mitigate this, we will enforce stronger credit control, monitor accounts receivable closely, and implement proactive financial strategies such as setting clear payment terms and encouraging early payments. This approach will ensure smooth operations even during delayed payment periods.

3. Segment/Service-wise Performance

In the 2025–26 financial year, the Companys operating revenue lightened compared to the prior year. This slowdown happened because clients spent less money on technology and took longer to make decisions. At the same time, management intentionally stopped working on low-profit or low-value projects to improve overall business quality.

The Company adopted a more selective approach towards new business acquisition and renewal of existing engagements, with greater emphasis on profitability, customer quality, scalability, and long-term revenue potential. Accordingly, Management focused on reallocating delivery and business development resources towards higher-value areas such as Managed IT Services, Cloud Services, Enterprise Applications, Digital Transformation, Artificial Intelligence, Automation, Data Analytics and Cybersecurity.

While this transition had an impact on reported revenue during the year, Management believes that the realignment is important for building a more sustainable and profitable business mix over the medium to long term.

During FY 2025-26, the Companys revenue from operations moderated compared with the previous financial year. The performance during the year was influenced by cautious technology spending and extended decision cycles across certain customer segments, together with a conscious Management decision to rationalise selected engagements that were generating lower margins or had limited strategic value.

The Company also continued to strengthen its international business development capabilities. The United States remains an important market for future growth, while the establishment of a presence in the United Kingdom provides Globtier with an additional platform to pursue opportunities in the UK and European markets. This geographical diversification is expected to gradually reduce dependence on the domestic market and expand access to higher-value technology engagements.

Alongside its services business, the Company has invested in developing proprietary technology capabilities. These include its Cloud FinOps platform for cloud cost optimisation, governance and financial management, as well as the continued development of an Artificial Intelligence-enabled IT service management platform.

These initiatives are intended to complement the Companys existing service capabilities and enable a transition towards a combination of services, managed solutions and platform-enabled recurring revenue, as detailed below:

(Amount in INR Thousands)

*Including exports to SEZ

The Companys revenue was derived 98.60% from domestic operations and 1.40% from export of services during FY 2025-26.

4. Outlook

The Management remains cautiously optimistic about the Companys medium and long-term growth prospects. Following the portfolio recalibration undertaken during FY 2025-26, the Companys strategy for the coming years will focus on rebuilding growth through a combination of higher-value technology services, recurring managed services, proprietary platforms, international expansion and deeper engagement with existing enterprise customers.

A key priority will be to increase the contribution from higher-value service areas, including Cloud Services and FinOps, Artificial Intelligence and Automation, Managed IT Services, Cybersecurity, Enterprise Applications, Data Analytics and Digital Transformation. The Company intends to leverage its existing customer relationships and delivery capabilities to increase cross-selling and expand the scope of services provided to its enterprise customers.

Globtier will also continue to develop and commercialise its proprietary Cloud FinOps and AI-enabled IT Service Management platforms. Management believes that combining proprietary technology with implementation, consulting and managed services capabilities can create differentiated solutions, improve customer stickiness, and progressively increase recurring revenue opportunities.

International expansion will remain another important growth lever. The Company intends to strengthen its business development efforts in the United States and leverage its presence in the United Kingdom to pursue opportunities across the UK and selected European markets. Strategic technology partnerships and local market relationships will continue to support this expansion.

Management will maintain a disciplined approach towards new business acquisition with greater focus on project profitability, sustainable pricing, customer quality, and revenue visibility. Operational automation, improved utilisation of resources, and greater use of artificial intelligence within service delivery are also expected to support productivity and operating efficiency.

Accordingly, the Companys future business model is expected to increasingly combine traditional IT services with higher-value consulting business, recurring technology services, focused digital transformation services, and proprietary technology platforms.

Management believes this diversified model will provide a stronger foundation for sustainable revenue growth and long-term shareholder value creation.

Corrective Measures and Management Actions

To further support the storyline, the following can be highlighted either under Point 4 or incorporated appropriately elsewhere in the MDA:

- Rationalisation of selected low-margin and economically unattractive engagements

- Greater focus on margin, scalability and strategic relevance while evaluating new opportunities.

- Expansion of higher-value Cloud, AI, Digital Transformation, Enterprise Applications, Cybersecurity and managed services offerings.

- Development of proprietary Cloud FinOps and AI-enabled IT service management platforms.

- Strengthening of sales and business development activities in the United States and the United Kingdom.

- Increased focus on cross-selling and account expansion within the existing enterprise customer base.

- Increased focus on revenue diversification across customers, technologies and geographies.

- Expansion of services and platform-enabled revenues.

- Greater use of automation and AI within service delivery to improve productivity and operational efficiency.

- Continued development of strategic partnerships with global technology providers.

5. Risks and Concerns

Key risks identified by the management, along with mitigation measures, are summarised below:

- Client concentration

Active diversification of client base across sectors and geographies; long-term framework contracts with key accounts.

- Attrition/talent risk

Structured learning & development programs, competitive compensation benchmarking.

- Technology obsolescence

Continuous investment in training, Centres of Excellence, and partnerships with technology providers.

- Cybersecurity/data protection

ISO 27001/industry-standard information security practices [confirm certification status], periodic VAPT audits, employee awareness training.

- Foreign exchange risk

Natural hedging through cost base alignment/forward contracts, where applicable.

- Regulatory and compliance risk (newly listed entity)

Dedicated compliance function, engagement of merchant banker/RTA/Practicing Company Secretary for ongoing SEBI LODR compliance.

6. Internal Control Systems and Their Adequacy

The Company has put in place adequate internal control systems commensurate with its size and the nature of its business, covering areas such as procurement, revenue recognition, payroll, and IT systems access controls. The internal auditor reviews the efficacy of these controls periodically and reports to the audit committee. The statutory auditors have also evaluated the internal financial controls over financial reporting as part of their audit, and their observations are contained in the auditors report annexed to this annual report.

7. Financial Performance with Respect to Operational Performance

A detailed discussion of the Companys financial performance is provided in the Financial Results section of the Boards Report. Revenue from Operations declined from INR 942,268.61 thousand in FY 2024 25 to INR 730,462.40 thousand in FY 2025 26 by 22.48%. Profit After Tax for the year was INR 13,351.81 thousand, impacted by one-time listing expenses of approximately INR 355 Lakhs.

8. Human Resources/Industrial Relations

The Company regards its employees as a key strategic asset. As of March 31, 2026, the Company had 611 permanent employees. The Company maintained cordial relations with its employees throughout the year, with no instances of industrial unrest. Key HR initiatives during the year included [talent acquisition for niche skills, structured onboarding, performance management system enhancements, and employee engagement programs]. Attrition for the year stood at 40.36%, in line with industry benchmarks.

9. Details of Significant Changes in Key Financial Ratios

In terms of Schedule V Part B of the SEBI (LODR) Regulations, 2015, details of significant changes (i.e., change of 25% or more as compared to the immediately previous financial year) in key financial ratios, along with detailed explanations, are given below:

10. Cautionary Statement

Statements in the MD&A section about prospects may involve forward-looking elements that carry various identified or unidentified risks and uncertainties, potentially causing actual results to differ significantly. The assumptions used, based on available internal and external data, guide the specific information in the report. Since these assumptions may evolve, estimates are subject to change. Forward-looking statements reflect the Companys current intentions, beliefs, or expectations and are valid only As of their date. The Company does not commit to updating or revising these statements based on new information or future events.