Indiabulls Enterprises Ltd Management Discussions

OVERVIEW

We are engaged in the services of providing business of Construction equipment renting, leasing of comprehensive range of construction, infrastructure, manufacturing, and mineral handling equipment(s), including various types of machineries, turnkey solutions to Engineering Procurement & Construction (EPC) Companies.

The primary equipment in our rental fleet includes multiple range of heavy duty tower cranes, passenger hoists, piling rigs, excavators, dozers, motor graders, wheel loaders, mobile boom placers, steel stir-up machines and many more. The equipment offered by Indiabulls Enterprises is of reputed global brands with unmatched productivity and efficiency.

We have our offices in Mumbai, Gurgaon, Kolkata, Hyderabad, and Bangalore. We have rental yards at key locations to serve on a pan India basis and ensure higher productivity. We are providing seamless services to our customers through a focused and professional team managing the business.

The equipment rental industry is highly fragmented and diverse. We have extensive resources and competitive advantages. This results in our customers increasing their reliance on our execution and management abilities. We have a sustainable business model in place as our fleet has breadth and depth to serve sectors with different trade cycles.

We continue to pursue excellence in the following areas:

Customized leasing and rental solutions

Ability to swiftly mobilize and execute projects across the country

Design and execution capabilities to handle complex projects

Professional team to manage O&M activities at project sites

Highest safety standards

Higher availability and reliability of rental machines, which helps customers to execute projects faster

Our company is fully poised to grow its equipment rental business in FY 24-25, by taking advantage of the governments Investment in the infrastructure sector and the revival seen in the real estate segment.

The pandemic proved to be a watershed moment in equipment renting demand since the government will be compelled to work on a very strict monitoring mechanism of infrastructure projects implementation to restore the impressive GDP growth, in the near future.

BUSINESS OUTLOOK-

General Review of business environment

The business environment continues to be not so positive due to various factors such as stock market volatility, high interest rates, certain bank failures, tightness in money market and funding winter for the startup ecosystem, Russia Ukraine war.

Economic outlook

The world economic outlook dated April 2024; global growth is projected at 3.2 percent in 2024 and 3.3 percent in 2025. However, varied momentum in activity at the turn of the year has somewhat narrowed the output divergence across economies as cyclical factors wane and activity becomes better aligned with its potential. Upside risks to inflation have thus increased, raising the prospect of higher-for-even-longer interest rates, in the context of escalating trade tensions and increased policy uncertainty.

Global Financial Conditions

As per the global financial stability report of International Monetary Fund (IMF) April 2025, financial markets have turned quite optimistic Expectations for a global economic soft landing and continued progress on disinflation have created an environment for households and businesses to obtain financing at lower costs, notwithstanding still-high interest rates. Even though the Russian- Ukraine war led to a global energy and food crisis, supply-chain disruptions are easing, showing resistance. A globally synchronised tightening of monetary policy played a crucial role, and eventually, the inflation eased off gradually.

Source: htp s://www.imf.org/en/publications/gfsr

SEGMENT?€“WISE OR PRODUCT-WISE PERFORMANCE (STANDALONE)

Segment revenue (Rs.in Crores)

Particulars	31 March 2025	31 March 2024
Equipment renting services	49.66	47.18
Revenue from continuing operations	49.66	47.18
Revenue from discontinued operations	0.00	0.02
Total revenue from continuing and discontinued operations	49.66	47.20

Segment results (Rs.in Crores)

Particulars	31 March 2025	31 March 2024
Equipment renting services	(6.01)	(16.47)
Less: Interest	10.55	12.63
Less/Add: Other unallocable expenditure net off unallocable income	3.72	(3.90)
Profit/ (Loss) before tax from continuing operations	(12.84)	(33.00)
Profit/ (Loss) before tax from discontinued operations	0.88	(0.96)
Profit/ (Loss) before tax from continuing and discontinued operations	(11.96)	(33.96)

INDUSTRY OUTLOOK

The Governments push for growth through larger infrastructure spends continues in FY 2024-25. The private capex continues to provide tailwinds to the growth momentum. Buoyancy in tax collections during the current fiscal year supports the capex- led growth aspirations. A healthy balance sheet of private players, improving consumer confidence and investment activity, as well as growing demand conditions, will provide support to economic growth in the near term. It is expected that the prolonged geopolitical conflict in Europe could continue to impact supply chain dynamics and keep commodity prices volatile for a longer period. Rising interest rates across the world could also influence capital flows into the country. Finally, India, due to the structural reforms and the infrastructure-strengthening efforts of the Government and the monetary support from the RBI, is in a better position to counter the challenges and sustain its growth agenda.

BUSINESS RESTRUCTURING

In line with the long term business objectives of the Company to further accelerate the scaling up of the operations and to provide synergy of consolidated business operations and management and to streamline the operations of the Company and /or identified subsidiaries to have a simplified and streamlined holding structure with pooled resources, the Board of Directors of the Company, had approved the composite Scheme of Arrangement inter-alia involving Amalgamation of the Company, with and into Yaari Digital Integrated Services Limited (" Amalgamated Company " / " Resulting Company " Yaari ") and subsequent automatic dissolution of the Company.

The Scheme is subject to all applicable statutory and regulatory approvals, including approval from the stock exchanges, SEBI, shareholders and creditors of the company and Honble National Company Law Tribunal, Chandigarh bench (NCLT). Post filing the Scheme with National Stock Exchange of India Limited (NSE) and BSE Limited (BSE), the Company had received the Observation Letters from BSE and NSE on March 1, 2024 and March 4, 2024, respectively. Honble Competition Commission of India (CCI) had approved the Scheme on December 19, 2023 and detailed Order of CCI has also been received.

First motion application of the Scheme was approved by Honble NCLT, vide its order dated January 29, 2025. In compliance with said Order of Honble NCLT and in supervision of NCLT Nominated Chairperson, meeting of Equity Shareholders and Unsecured Creditors of Indiabulls Enterprises Limited were convened on March 29, 2025 wherein the shareholders and unsecured creditors of the Company have passed the resolutions with requisite majority approving the Scheme of Arrangement. In compliance with the Regulatory provisions, a joint Second Motion Petition has been filed with the Honble NCLT in April, 2025.

Upon the Scheme coming into effect, the fully paid-up equity shares of Yaari will be issued to the shareholders of the Company, basis the swap ratio as mentioned in the Scheme i.e.

" 110 equity shares of Yaari of INR 2/- each fully paid-up for every 100 equity shares of IEL of INR 2/- each fully paid- up."

Further under the Scheme the Real Estate Undertaking (as more elaborately defined thereunder ) of India Land Hotels Mumbai Private Limited (ILHMPL) will stand demerged and vested into Indiabulls Pharmacare Limited (IPL), presently a wholly owned subsidiary of the Company, which will become wholly owned subsidiary of Yaari. In consideration of merger of Real Estate undertaking of ILHMPL into IPL "322 equity shares of Yaari, INR 2/- each fully paid-up, will be allotted to the Shareholders of ILHMPL, for every 1 equity share held by them in ILHMPL".

OUR STRATEGY

Our strategy focuses on ensuring that our customer is at the core of everything we do. We believe in building a sustainable organization that remains relevant to the agenda of our stakeholders, and providing value to our clients, and aim to create growth opportunities to our employees and profitable returns to our investors.

THE CUSTOMER EXPERIENCE IS AT THE CENTRE OF THE INDUSTRY

Customers now demand a transparent and seamless experience enabled by technology that provides quick information/ feedback. Customers are now setting new standards of ease, convenience and value, expecting 24-hour access, at competitive prices & better options. Customer journeys and an increasing focus on customer experiences is now emerging as a key imperative for the growth of Industry.

OUR STRENGTHS

Presence of dynamic leadership and professional management team

The Company and the group companies are headed by professional industry leaders and are overseen by Boards comprising of eminent industry veterans. The Group benefits immensely from the diverse and collective experience of these individuals and the social commerce business will also draw from their inputs and experience.

TECHNOLOGICAL EXPERTISE

The Company has effectively deployed technology to further expand its reach into the hinterlands. The technology thrust of the Group is customer focused and aims at offering utmost customer convenience and maximum cost effectiveness.

ROBUST SYSTEMS AND PROCESS

The Company believes that the systems and processes are its major strength. Considering the nature of the business, the Company will put in place robust processes and systems for the orderly growth of the Company. We shall develop appropriate systems and processes to ensure that the investments of the Company are in line with the regulatory requirements and asset- liability norms.

OPPORTUNITIES

Equipment Renting, Management & Maintenance Services Opportunity drivers:

Infrastructure demand of the young demographic in India and impetus to develop new areas.

Continuously adopting new technologies to achieve better productivity in project execution space.

Companys presence in all regions and opening branches in major cities of the country.

Service differentiation by keeping simple performance matrices.

Although the equipment rental , management & maintenance service industry is highly fragmented and diverse, the Company believes that it is well-positioned to take advantage of this environment. As a large company, it has extensive resources and compelling advantages. The Companys size gives it greater purchasing power and the resources to provide customers with a broader range of equipment and services. The Company is also able to transfer equipment across various regions and sites to satisfy customer needs.

RISKS AND THREATS

Uncertainty

Uncertainty is the inability to predict the future with confidence. Because of the presence of uncertainty, we need to consider the effects of possible deviations from the projected figures. Due to overall uncertainty in the environment, the market volatility and consumer confidence we could experience a drop in demand as consumer confidence in the stock market is shaky.

Supply chain management

The manifold disruptions due to Covid-19 related lockdowns, challenges in production, managing supply, volatile global environment due to Russia Ukraine war and distribution networks pose multi-dimensional risks that are rapidly evolving. These can disrupt supply chain and manufacturing processes and adversely impact business.

Cyber Security Risks

Our operations are increasingly dependent on IT systems, digital interactions and management of information. The cyber- attack threat of unauthorized access and misuse of sensitive information or disruption to operations can inhibit business operations in several ways.

Competition Risks

The risk is that the Company may face stiffer competition for the growth of its businesses. With the expanding capacities of existing players and also the emergence of new entrants, competition is a sustained risk.

Strategic initiatives to enhance brand equity through enhanced marketing activities and continuous efforts in enhancing the product portfolio and value-adding services have been the thrust areas of the Company.

Financial Risks

The risk of exposure to interest rates, foreign exchange rates, and the requirements of cash for operations.

The Company has elaborate financial risk management policies which are followed for every transaction undertaken. The Companys policies to counter such risks are reviewed periodically and keep a track of the operations to ensure a consistent cash conversion cycle.

Internal Control Systems

The company has adequate internal control systems, based on policies and guidelines, which ensure timely and accurate execution of responsibilities. Internal Control Systems evaluate operations, financial reporting, strategic investments and regulatory compliances to protect interests of the investors. The effectiveness and reliability of Internal Control Systems is reviewed periodically by the Audit Committee and the Board of Directors which gives its recommendations regarding improvements over existing control systems.

Discussion on financial performance with respect to operational performance

For management purposes, the Company is organized into business units based on the nature of the products and services and their differing risks and returns. The organization structure and internal reporting system has one reportable segment, as follows:

1. Equipment renting services.

During the year ended 31 March 2025, the Company earned net revenue from operations of Equipment renting services of INR

49.66 crores vis-? -vis INR 47.18 crores during the year ended 31 March 2024; and the loss from the Equipment renting services during the year ended 31 March 2025 was INR 6.01 crores vis-? -vis loss of INR 16.47 crores during the year ended 31 March 2024.

HUMAN RESOURCES

The Company firmly believes that its employees are the key to driving performance and developing competitive advantage. The emphasis has been on proper recruitment of talent and empowerment while devoting resources for their continuous development. The structured recruitment process, which the Company employs, focuses on recruiting people who have the right mindset for working, supported by structured training programs and internal growth opportunities. As on March 31, 2025, the Company had a strong team of 45 employees, who are aligned and dedicated towards the Companys goals.

Significant Changes in Key Financial Ratios

In compliance with the requirements of Schedule V of the SEBI LODR Amendment Regulations, 2018, significant changes (change of 25% or more from FY 2023-24 to FY 2024-25) in the key financial ratios applicable to the Company, are as under:

Particulars			31 March 2025 (%)	31 March 2024 (%)	Variance	Reason
Debt Ratio	Service	coverage	1.17	- 0.19	- 734.10%	The improvement is primarily due to a reduction in losses compared to the previous year.
Trade receivable Turnover Ratio			2.89	1.88	53.72%	The increase is attributed to lower average trade receivables during the year, driven by improved collection from debtors.
Net profit ratio			- 25.85	- 66.97	- 61.40%	The improvement is mainly due to other income earned during the year and reduced losses from disposal or write-off of property, plant, and equipment.
Trade Payables turnover ratio			7.50	4.40	70.37%	The increase is due to a decrease in average trade payables, resulting from timely settlement of outstanding dues.
Net Capital Turnover Ratio			1.59	0.46	247.73%	The ratio increased significantly due to a substantial reduction in working capital, driven by provisioning against financial assets during the year.
Return on Equity (ROE)			- 2.42	- 5.00	- 51.62%	The variance is due to lower losses, primarily from other income and reduced losses on asset disposals or write-offs.
Return of Capital Employed			- 0.00	- 0.03	- 87.77%	The variance is due to a decrease in other financial assets during the current year compared to the previous year.

Change in Return on Net worth:-

During the FY 2024-25 and FY 2023-24, the Company has incurred losses and hence return on net worth is negative.

CAUTIONARY STATEMENT

Statements in this Report on Management Discussion and Analysis describing the Companys objectives, estimates and expectations may be forward looking based on certain assumptions and expectations of future events. Actual results might differ substantially or materially from those expressed or implied. The Company here means the consolidated entity consisting of its subsidiary (ies).