Intrasoft Technologies Ltd Management Discussions

Management Discussion and Analysis Report

GLOBAL ECONOMY OVERVIEW AND OUTLOOK

The global economy entered 2026 with resilient momentum, but the outlook has become more uncertain. The OECDs June 2026 Economic Outlook highlights the impact of energy-market disruption, geopolitical uncertainty, trade frictions and inflationary pressures, while also noting that investment in artificial intelligence and other transformative technologies can support productivity and growth.

Under the OECDs "time-limited disruption" scenario, global GDP growth is projected to slow from 3.4% in 2025 to 2.8% in 2026 before recovering to 3.1% in 2027. Average G20 headline inflation is projected at 4.0% in 2026 before easing to 3.1% in 2027.

ECONOMY	2025	2026E	2027E
World	3.4%	2.8%	3.1%
United States	2.1%	2.0%	1.8%
Euro area	1.4%	0.8%	1.2%

U.S. ECONOMY OVERVIEW AND OUTLOOK

The OECD projects U.S. GDP growth of 2.0% in 2026 and 1.8% in 2027. The outlook reflects a balance between resilient underlying activity and pressures from energy costs, trade uncertainty and household purchasing power. For retailers and e-commerce businesses, this environment increases the importance of pricing discipline, inventory efficiency and agile sourcing.

For IntraSoft, the macroeconomic environment reinforces the need to remain flexible: maintaining a broad product portfolio, using data to respond to demand and pricing changes, and strengthening an operating platform that can adapt to marketplace and supply-chain volatility.

GLOBAL RETAIL AND E-COMMERCE OVERVIEW

The long-term shift toward online retail continues globally. EMARKETERs forecast (as published by Shopify) estimates global retail e-commerce sales at $6.88 trillion in 2026, up 7.2% from 2025, with online sales representing approximately 21.1% of worldwide retail sales. By 2028, global e-commerce sales are projected to approach $7.89 trillion and account for 22.5% of retail sales.

YEAR	GLOBAL ECOMMERCE SALES	YOY GROWTH
2022	$5.080 tn	5.9%
2023	$5.580 tn	9.6%
2024	$6.007 tn	7.7%
2025	$6.419 tn	6.8%
2026E	$6.880 tn	7.2%
2027E	$7.375 tn	7.2%
2028E	$7.886 tn	6.9%

A larger, more sophisticated market

• Online retail continues to gain share of global consumer spending.

• As e-commerce matures, competitive advantage increasingly depends on fulfilment speed, data quality, marketplace visibility and customer experience.

• Mobile commerce, social discovery, AI-assisted shopping and marketplace ecosystems are reshaping how consumers discover and purchase products.

• For brands, the operational cost of managing multiple digital channels is rising, increasing the relevance of specialist e-commerce partners.

US RETAIL AND E-COMMERCE INDUSTRY

U.S. e-commerce sales reached an estimated $1.2337 trillion in 2025, up 5.4% year-on-year, and represented 16.4% of total U.S. retail sales under the Census Bureau definition. Q1 2026 then showed a notable acceleration, with online sales rising 9.7% year-on-year to approximately $302.3 billion.

The data points to a market that is both mature and still expanding. Consumers continue to shift spending online, while brands increasingly require sophisticated marketplace capabilities across catalogue management, advertising, pricing, inventory, fulfilment and customer service.

TRADE AND TARIFF ENVIRONMENT

The U.S. trade environment remained fluid through 2025 and into 2026. OECD analysis notes that U.S. effective tariff levels remained above pre-2025 levels despite changes to individual measures. For retailers and suppliers, tariff uncertainty can affect landed costs, sourcing decisions, inventory planning and ultimately consumer prices.

KEY OPERATING IMPLICATIONS

More volatile product economics; greater need for SKU-level profitability visibility; possible changes in sourcing and supplier terms; and additional complexity in forecasting consumer demand.

OUR RESPONSE

Maintain pricing and assortment discipline, deepen vendor-direct relationships, use data to respond to changes in demand and cost, and preserve flexibility across fulfilment and supplier networks.

THE RISE OF AI IN COMMERCE

Artificial intelligence is rapidly moving from experimentation to practical use in digital commerce. Applications span product-content creation, search and discovery, advertising optimisation, customer support, demand forecasting, inventory planning, fraud detection and operational automation. The opportunity is not only to reduce manual effort, but also to improve the quality and speed of decisions.

AI, TECHNOLOGY AND BUSINESS PERFORMANCE

Technology as a force multiplier

For an e-commerce operator, the value of AI and advanced analytics lies in their ability to make high-volume decisions faster and more consistently. We continue to evaluate and deploy technology where it can strengthen our operating model, improve service levels and support scalable growth.

• Demand and inventory: better pattern recognition can support forecasting, replenishment and stock allocation.

• Pricing and promotions: data can help teams evaluate competitive price positions and promotional effectiveness more quickly.

• Catalogue and content: automation can improve the speed and consistency of product-data workflows.

• Customer and partner service: AI-assisted workflows can improve response times while allowing teams to focus on higher-value exceptions.

• Operations: analytics can identify process bottlenecks, service-level issues and opportunities to automate repetitive tasks.

BUSINESS PERFORMANCE, 2025-26

During FY 2025-26, IntraSoft continued to advance its vendor-direct strategy while evolving into a more technology-centric platform. Consolidated revenue from operations increased 5.3% to Rs 534.22 crore and profit after tax increased 4.7% to Rs 13.28 crore. Finance costs reduced materially to Rs 1.15 crore, supporting a more efficient capital structure.

Our operating priorities remain consistent: strengthen the technology platform, improve data- led decision-making, deepen vendor relationships and raise service levels. In the e-commerce ecosystem, IntraSoft plays the role of connecting product-focused vendors with customer- focused marketplaces. Our ability to understand demand, manage marketplace execution and coordinate fulfilment helps translate supply into online sales.

As part of our long-term vision, we remain committed to investment in our platform, people and processes. We believe sustainable growth will come from combining market opportunity with disciplined execution - scaling the business while continually improving the quality and efficiency of our operating foundation.

FINANCIAL OVERVIEW

Consolidated Statement of Profit and Loss for the year ended 31 March 2026

Particulars (Rs in lacs)	2025-26	2024-25
Revenue from Operations	53,421.98	50,719.37
Cost of Goods Sold	34,247.66	32,107.22
Gross Profit*	10,920.43	11,067.80
Shipping and Handling Expenses	8,253.89	7,544.35
Sales & Marketing Expenses	7,957.27	7,554.11
Employee Benefit Expenses	619.77	927.25
Other/G&A Expenses	665.1 1	829.95
Earnings from Operations*	1,678.28	1,756.49
Other Income (Net)	39.63	141.13
EBITDA	1,717.91	1,897.62
Depreciation & Amortisation	68.42	85.38
EBIT*	1,649.49	1,812.24
Finance Costs	115.22	255.55
Profit Before Tax (PBT)	1,534.27	1,556.69
Tax Expense	206.57	288.19
Profit After Tax (PAT)	1,327.70	1,268.50

RISK MANAGEMENT

1. Technology, cybersecurity and platform change

Risk: Rapid technology change, data-security threats or marketplace-system changes could affect efficiency and service levels. Mitigation: Continue technology upgradation, process controls and periodic operating reviews; build systems and teams that can adapt to changing requirements.

2. Marketplace and policy concentration

Risk: Changes in marketplace policies, fees, algorithms or account requirements can affect sales and operating processes. Mitigation: Maintain close marketplace integration, diversify products and vendors, and use data-led execution to respond quickly to policy changes.

3. Supply chain, tariffs and seasonal execution

Risk: Tariffs, carrier disruption, supplier constraints or peak-season demand can affect cost, availability and fulfilment. Mitigation: Deepen vendor-direct relationships, preserve logistics flexibility and use demand, pricing and inventory data to support timely decisions.

INTERNAL CONTROLS

The Company has internal control systems commensurate with the nature of its business, size and complexity of operations. These systems and processes are designed to support reliable financial reporting, timely review of operational and strategic performance, compliance with applicable policies and regulations, and appropriate safeguarding of the Companys assets and resources.

Internal audit remains an important component of the control framework. Significant observations and corrective actions are reviewed with the Audit Committee on a regular basis. Management also reviews key processes and controls to identify opportunities for strengthening systems as the operating environment and business requirements evolve.

RELIABILITY

Controls support accurate and timely financial and operating information.

COMPLIANCE

Policies and review mechanisms support adherence to applicable requirements.

PROTECTION

Controls are intended to promote efficient use and safeguarding of assets and resources.

HUMAN RESOURCES MANAGEMENT

Our people are central to our ability to scale smarter. E-commerce operations require a combination of marketplace knowledge, technology orientation, analytical thinking, attention to detail and a strong ownership mindset. We seek to build teams that can operate reliably today while continuing to learn and adapt for tomorrow.

Our approach is to attract capable people, provide them with clear responsibilities and create an environment where performance, learning and improvement are encouraged. As technology changes the nature of work, we will continue to invest in skills that strengthen data-led decisionmaking, process automation, marketplace execution and partner service.

People priorities for the year ahead

• Strengthen role clarity, accountability and process ownership across operations.

• Build technology and data fluency so teams can use automation and analytics effectively.

• Develop deeper functional expertise in marketplace operations, finance, compliance and partner service.

• Encourage continuous improvement by identifying repetitive work that can be simplified or automated.

• Promote a culture of integrity, responsiveness and collaboration across locations and functions.