JHS Svendgaard Retail Ventures Ltd Management Discussions

Business Overview

JHS Svendgaard Retail Ventures Limited operates in the organized retail sector with a focused strategy of identifying and securing premium, high-footfall retail spaces across India. The Company primarily seeks to establish a presence at strategically important locations, including high streets, airports, shopping malls and other high-visibility retail destinations, with the objective of enhancing customer reach, brand visibility and revenue potential.

The Companys business strategy is centered on selecting locations that offer strong consumer footfall, accessibility and long-term growth potential. By focusing on strategically located retail spaces and adapting its retail formats to the characteristics of each market, the Company aims to serve a diverse consumer base comprising domestic consumers as well as travellers and other high-frequency retail customers.

The Company continues to evaluate opportunities for expanding its retail footprint across attractive locations in India, while maintaining focus on operational efficiency, customer experience and sustainable growth. Its strategy is supported by evolving consumer preferences, increasing adoption of organized retail and the growing demand for convenient and experience-led shopping environments.

Industry Overview

Retail Sector

The Indian retail sector is one of the most dynamic and fastest-growing markets globally, driven by robust macroeconomic fundamentals, favorable demographics, and evolving consumer preferences. The sector contributes significantly to the countrys GDP and employment and has transformed into a key pillar of Indias consumption-driven economy.

Several factors continue to fuel the expansion of the retail industry in India:

• Rising disposable incomes and expanding middle class: Higher income levels, coupled with greater aspirations, are leading to a sharp increase in discretionary spending across product categories.

• Urbanization and organized retail penetration:

The steady migration toward urban centers, along with the development of organized retail formats such as malls, supermarkets, and exclusive brand outlets, has reshaped the shopping landscape.

• Evolving consumer behavior: Modern consumers increasingly prefer branded, premium, and convenience-led offerings. The demand for quality, variety, and personalized experiences is encouraging retailers to innovate and diversify.

• Technology adoption and digital integration: The convergence of offline and online channels, driven by e-commerce, omni-channel retailing, and digital payment ecosystems, has further accelerated industry growth.

• Expansion into new geographies: Retail infrastructure is expanding beyond metropolitan hubs into Tier II and Tier III cities, unlocking significant untapped potential.

• Emergence of niche segments: Categories such as luxury retail, experiential retail, health & wellness, and value fashion are gaining traction, catering to distinct consumer needs.

• Increasing brand awareness and preference for organized retail: Growing consumer awareness regarding product quality, authenticity, brand reputation and after-sales service is supporting the shift from traditional retail towards branded and organized formats.

• Growth of omni-channel and experiential retail:

Consumers are increasingly seeking seamless integration between physical and digital shopping experiences. Retailers are therefore focusing on omni-channel capabilities, enhanced in-store experiences and personalized engagement to strengthen customer loyalty and improve overall retail performance.

• Improving retail infrastructure and supply-chain ecosystem: Continued investments in logistics, warehousing, technology-enabled supply chains and retail infrastructure are improving product availability and distribution efficiency. These developments are enabling retailers to serve a wider customer base while supporting scalable and efficient business operations.

Post-pandemic, the sector has shown strong resilience, supported by renewed consumer confidence, increasing footfalls across physical retail spaces, and the normalization of supply chains. Retailers are also leveraging technology, data-driven insights, and consumer engagement platforms to deliver differentiated experiences and enhance operational efficiency.

Importantly, the Indian retail industry is not limited to any single format or location. This diversified retail ecosystem provides companies the flexibility to cater to a wide spectrum of consumer segments, ranging from value-conscious buyers to aspirational and luxuryseeking customers.

Companys Business Model and Strategy

The Companys business model is centered around creating a differentiated retail experience by strategically securing spaces at niche and high- potential locations across India. Our approach ensures visibility, accessibility, and engagement with a wide consumer base, while optimizing costs and maximizing returns.

Key Elements of the Business Model

1. Strategic Location Acquisition:

• Focus on identifying and acquiring premium retail spaces in high-footfall areas including malls, airports, metro stations, and key high streets.

• Target Tier I, Tier II, and emerging Tier III markets to achieve a balanced geographical presence.

• Prioritize locations that offer long-term growth potential and align with evolving consumer demographics.

2. Brand Partnerships & Product Mix:

• Curate a mix of renowned national and international brands tailored to customer needs.

• Leverage exclusive tie-ups, franchise models, and partnerships to strengthen brand offerings.

3. Operational Efficiency & Scalability:

• Standardize store operations, supply chain processes, and vendor management to maintain efficiency and cost-effectiveness.

• Establish scalable systems to rapidly expand across new locations while maintaining uniform service quality.

4. Revenue Model:

• The Company follows an asset-light, partnership- driven retail model, under which it provides retail space and a curated platform for brand partners to showcase and market their products under mutually agreed commercial arrangements.

• This model is designed to enable operational efficiency and relatively lower execution risk, with a significant portion of the operating costs associated with the retail format being supported by the respective brand partners.

• In turn, brand partners are able to access ready-to- use, well-located and high-footfall retail spaces without committing to direct real estate investment, making the arrangement mutually beneficial for the Company and its brand partners alike.

• This asset-light structure enables the Company to generate sustainable revenue while maintaining a lean cost structure and efficient utilisation of retail space.

• Going forward, the Company remains focused on enhancing store productivity, strengthening its portfolio of brand partnerships and expanding its retail presence, while maintaining an efficient and scalable operating model.

5. Customer Engagement & Value Proposition:

• Deliver value through location convenience, curated brand offerings, and a differentiated shopping environment.

Market Outlook and Growth Drivers

According to industry reports, the Indian retail market continues to witness healthy growth, supported by increasing consumer spending, expansion of organized retail, digitalisation and the continued growth of e- commerce. The Indian retail market was valued at approximately USD 1,124.2 billion in 2025 and is projected to grow at a CAGR of approximately 12.8% between 2026 and 2034, reaching approximately USD 3,505.4 billion by 2034. Separately, industry estimates indicate that Indias overall retail sector could cross USD 1 trillion to USD 2 trillion by 2030, reflecting continued growth opportunities across the countrys evolving organized retail landscape.

The positive growth trajectory of the global and Indian retail sectors is being supported by several structural factors, including:

• Expanding economies, especially in emerging markets like India.

• Increasing urban population density driving demand for modern retail formats.

• Rising foreign direct investment (FDI) in the Indian retail sector.

• Growing consumer preference for organized retail spaces such as supermarkets, hypermarkets, and airport retail outlets.

• Technological advancements in retail operations, including digital payments and supply chain integration.

• Availability of retail finance options facilitating consumer spending.

In addition to these factors, the Indian Governments continued focus on infrastructure development, improving the ease of doing business, strengthening logistics and promoting investment has further enhanced the growth prospects of the retail sector. Indias FDI framework remains supportive of foreign investment, with the Government continuing to review and rationalise its FDI policies to maintain an investor- friendly business environment.

The outlook for the Indian retail industry remains positive, supported by favourable demographics, rising disposable incomes, increasing brand awareness, expansion of organized retail, rapid digital adoption and growing penetration into emerging markets. The continued expansion of retailers across Tier II and Tier III cities, along with the emergence of experience-led, premium and omni-channel retail formats, is expected to provide further avenues for sustainable growth.

Sources: The Business Research Company; India Brand Equity Foundation (IBEF); Department for Promotion of Industry and Internal Trade (DPIIT).

Opportunities

The Indian retail industry continues to present significant growth opportunities, driven by structural shifts in consumer behavior, evolving demographics, and supportive policy frameworks.

The following key opportunities are expected to benefit the Company in the medium to long term:

1. Expanding Consumer Base:

• Rising disposable incomes, particularly among the middle class, are leading to increased purchasing power.

• Growing aspirations of young consumers and their preference for branded, organized retail formats create strong demand potential.

2. Urbanization and Infrastructure Growth:

• Rapid urbanization and smart city developments are expanding organized retail markets in Tier II and Tier III cities.

• Enhanced connectivity through metros, airports, and highways is creating new high-footfall retail hubs.

3. Shift Toward Organized Retail:

• The unorganized-to-organized shift in retail is accelerating, supported by better infrastructure, government reforms, and GST implementation.

• Consumers are increasingly preferring organized outlets for convenience, quality assurance, and brand variety.

4. Digital and Omni-Channel Integration:

• Growing internet penetration and smartphone adoption are driving omni-channel opportunities.

• Hybrid models that combine offline retail with e- commerce platforms are expected to attract wider consumer segments and increase wallet share.

5. Global Brand Entry and Collaborations:

• India continues to be an attractive destination for global retail and lifestyle brands.

• Partnerships, franchising, and licensing models with international players present avenues for expansion and differentiation.

6. Experiential and Niche Retail Growth:

• Consumers are seeking experiences beyond traditional shopping-cafes, entertainment, and lifestyle services within retail spaces are gaining popularity.

• Niche retail formats at airports, transit hubs, and luxury malls present high-margin opportunities.

Threats

• High Operating Costs:

Operating in premium locations such as airports and high streets involves substantial rental and operational expenditures. Maintaining profitability amidst these high fixed costs while ensuring superior service delivery is an ongoing challenge.

• Intensifying Competition:

The organized retail segment, particularly in prime locations like airports, faces increasing competition from domestic retailers and international brands. Sustained growth will depend on continuous product innovation, competitive pricing strategies, and delivering exceptional customer experiences.

• Macroeconomic and Sectoral Risks:

The retail sector is sensitive to macroeconomic factors such as inflation, economic slowdowns, fluctuating consumer spending patterns, and disruptions in air travel (e.g., pandemics, geopolitical tensions), all of which could negatively impact sales.

• Regulatory Environment:

Changes in regulatory frameworks, including policies from airport authorities, customs regulations, or FDI guidelines, could affect operational flexibility. Proactive compliance and adaptability to evolving regulatory landscapes are essential for uninterrupted business operations.

Key Segments

The Company operates within the organised retail sector, with a focus on creating value through a diversified retail presence, strategically selected formats, brand partnerships and evolving consumer offerings. The Companys business can broadly be represented across the following key segments:

1. Product & Category Segments:

• Lifestyle & Fashion: Apparel, footwear, accessories and other lifestyle products catering to evolving consumer preferences and increasing demand for branded offerings.

• Personal Care & Wellness: Beauty, personal care, wellness and related products supported by increasing consumer awareness and spending in these categories.

• Food & Beverages: Food and beverage concepts forming part of the broader retail ecosystem and catering to evolving consumption and convenience preferences.

• Other Consumer Categories: Other branded consumer products and retail concepts, depending on market opportunities and consumer demand.

• Digital & E-commerce Retail: Digital-first retail platforms, e-commerce channels and technology- enabled consumer solutions aimed at enhancing accessibility, convenience and customer engagement.

2. Retail Channels:

• Physical Retail: Store-based retail presence across high-street locations, shopping centres, commercial developments and other strategically selected locations.

• Omnichannel Retail: Integration of physical retail with digital channels, e-commerce and other technology-enabled platforms to provide consumers with a seamless shopping experience.

3. Brand & Partnership-led Retail:

• Domestic & International Brands: Association with established and emerging brands across relevant consumer categories, supporting their expansion and retail presence across selected markets.

• Franchise & Partner-led Formats: Retail operations undertaken through appropriate franchise, partnership or other commercial arrangements, enabling efficient expansion and access to new markets.

Market Outlook

The Indian retail market is projected to grow to approximately USD 2 trillion by 2030, at a CAGR of approximately 9-10%. Key drivers for this expected growth include technological advancements in retail operations, increasing application of data analytics for customer insights, and a growing consumer preference for shopping locally and sustainably.

With a focused product strategy, strong operational capabilities, and presence in high-footfall retail locations, JHS Svendgaard Retail Ventures Limited remains well-positioned to capitalize on future market opportunities and deliver sustained growth.

Financial Review

The Company generated revenue from operations of Rs.1,618.50 Lacs for the financial year ended 31st March 2026, as compared to Rs.1,614.14 Lacs in the previous year ended 31st March 2025, reflecting a broadly stable revenue performance during the year.

The Profit After Tax (PAT) for the year stood at (Rs.21.03 Lacs) as compared to Rs.11.75 Lacs in the previous year. During the year, the Company remained focused on strengthening its business platform and creating a foundation for sustainable growth. The Company continued to pursue opportunities for expansion of its retail presence, development of its brand portfolio and enhancement of its market reach.

The Companys performance during the year should be viewed in the context of its ongoing business expansion and strategic initiatives aimed at building scale and strengthening its position in the organised retail sector. The Company remains focused on improving operational efficiencies, optimising its retail network, strengthening relationships with brands and identifying opportunities for expansion across emerging markets.

With the continued evolution of the organised retail sector and increasing consumer preference for branded and organised retail formats, the Company is well positioned to leverage emerging opportunities and progressively build its business scale. The management remains focused on disciplined growth, efficient deployment of resources and strengthening the Companys operating platform to support sustainable growth over the long term.

The detailed financial performance and financial position of the Company for the financial year 2025-26 are set out in the Standalone Financial Statements forming part of this Annual Report

Key Financial Ratios

Details of changes in key financial ratios as compared to immediate previous financial year.

Key Financial Ratios	Year ended March 31, 2026	Year ended March 31, 2025	Absolute Variance (%)	Reason for Variance if Variance if 25% o r more
Current Ratio (in times)	4.31	2.02	114%	The improvement in the current ratio is primarily attributable to a decrease in current lease liabilities during the year, resulting in a lower current liability base and consequently an improved current ratio.
Debt-Equity Ratio (in times)	0.21	0.44	-51%	The decrease in debt-equity ratio is primarily due to the increase in equity on account of preferential allotment made by the company, coupled with a reduction in lease liabilities during the year.
Debt Service Coverage Ratio (in times)	0.95	0.95	-	NA
Return on equity ratio (%)	(0.49)	0.99	-150%	The negative movement in the return on equity ratio is primarily attributable to the deferred tax expense recognised during the year, which adversely impacted the profitability of the Company.
Trade Payables turnover ratio (in times)	14.96	17.31	-14%	NA
Debtors Turnover (in times)	25.05	26.84	-7%	NA
Return on Capital employed (%)	3.15	5.09	-38%	The decrease in the return on capital employed is primarily attributable to the increase in the equity base during the year, resulting in a higher capital employed base.
Net Capital turnover ratio (in times)	1.74	3.42	-49%	The decrease in the net capital turnover ratio is primarily attributable to a decrease in lease liabilities during the year, which resulted in an increase in the denominator used for computation of the ratio.
Net Profit Margin (%)	(1.30)	0.73	-279%	The negative movement in the net profit margin is primarily attributable to the deferred tax expense recognised during the year, which resulted in a net loss for the year as against a net profit in the previous year.
Inventory Turnover	8.28	8.11	2.09%	NA
Interest Coverage Ratio	0.98	1.01	-3%	NA
Operating Profit Margin (%)	5.61	6.33	-11.37%	NA

Outlook

The outlook for JHS Svendgaard Retail Ventures Limited remains positive, supported by favorable industry dynamics, rising consumer demand, and the Companys strategic initiatives. The Indian retail sector is poised for sustained growth, driven by increasing disposable incomes, rapid urbanization, changing lifestyle preferences, and the accelerated shift toward organized and omni-channel retail. Expanding opportunities in Tier II and Tier III cities, coupled with the growing influence of digital and experiential retail formats, provide a strong foundation for future growth.

The Company, with its focus on securing niche locations such as high streets, shopping malls, and transit hubs, is well-positioned to capitalize on these opportunities. By leveraging its brand partnerships, consumer-centric formats, and operational efficiency, the Company aims to strengthen its presence across diverse retail segments and deliver sustainable value to its stakeholders.

The Company remains focused on strengthening its product portfolio by introducing new product categories aligned with evolving consumer preferences, particularly in the natural, wellness, and sustainable product segments. Plans are underway to explore additional opportunities for expanding the retail footprint across more airports in India, ensuring wider brand reach and increased consumer engagement.

In addition to physical expansion, the Company is also actively exploring digital integration to enhance the overall customer experience. Initiatives such as preordering and click-and-collect services at airport outlets are expected to not only contribute to increased sales but also build greater customer loyalty through convenience-driven offerings.

With a robust foundation, a clear strategic direction, and a favorable industry environment, the Company remains optimistic about its growth prospects in the coming years.

Risks and Concerns

While the overall outlook is promising, certain risks and challenges may impact the Companys operations and financial performance:

• Supply Chain Management:

Ensuring an uninterrupted supply of products to retail outlets is essential for operational success. Disruptions in the supply chain arising from supplier constraints, transportation delays, or other logistical challenges could lead to product shortages and lost sales opportunities.

• High Fixed Operating Costs:

The Companys retail operations involve certain fixed and recurring costs associated with maintaining and operating retail stores, including rentals, utilities, staffing, maintenance and other store-related expenses. While the Companys business model provides for recovery or sharing of certain standard store-related costs from the associated brands, any underperformance of a store, lower-than-expected sales or failure of the associated brand to meet its contractual or financial commitments may impact the Companys ability to adequately absorb or recover such costs, thereby placing pressure on margins and profitability.

The Company seeks to mitigate this risk through careful evaluation of locations and commercial arrangements, monitoring of store-level performance, regular engagement with brand partners and disciplined management of store-related costs.

• Regulatory and Compliance Risks:

Operating in airport environments requires strict adherence to regulatory norms and compliance with various guidelines issued by airport authorities and government agencies. Any non-compliance could result in fines, operational restrictions, or the risk of losing retail licenses at certain locations.

• Intensifying Competition:

The organized airport retail space is highly competitive, with several domestic and international brands vying for market share. Continuous product innovation, pricing strategies, and superior customer service will be essential to maintain competitive differentiation.

Internal Control Systems and Their Adequacy

JHS Svendgaard Retail Ventures Limited has in place a robust internal control framework designed to ensure effective risk management, accurate financial reporting, and compliance with applicable laws and regulations. The internal control systems are structured to:

• Safeguard the Companys assets.

• Ensure accuracy and reliability of accounting records.

• Facilitate the efficient conduct of operations.

The internal audit function operates independently and conducts regular reviews of the Companys operational and financial processes. Identified gaps or weaknesses in controls are promptly addressed through corrective measures. Management regularly monitors and evaluates the effectiveness of these internal controls to ensure operational resilience.

Additionally, the Company places significant emphasis on ethical conduct, strong corporate governance, and regulatory compliance. Regular training sessions are conducted across all levels of the organization to reinforce awareness of internal policies, legal obligations, and the importance of maintaining the highest standards of integrity in business practices. Through these systems, the Company remains committed to ensuring that its operations remain resilient, efficient, and compliant with all applicable regulatory requirements.

Material Developments in Human Resources

The Company has always had a focus on introducing new benefits & policies that would help a culture of diversity, equity and inclusion to thrive while ensuring the well-being of the employees.

The human capital has always been the driving force behind Company success. A strategic transformation was undertaken by the HR department, aligning its efforts with the companys long-term business objectives. This revamped approach prioritized attracting and retaining top talent through enhanced recruitment and retention strategies.

The HR strategy focused on maximizing employee potential and aligning individual contributions with the companys overarching purpose, vision, mission and values. The Company understands that engaged employees, who feel valued and connected, are more likely to support its success. The total number of employees as on March 31, 2026 were 180.

Cautionary Statement

Statements in this Management Discussion and Analysis Report describing the Companys objectives, projections, estimates, expectations or predictions may be "forward-looking statements" within the meaning of applicable securities laws and regulations. These statements are based on certain assumptions and expectations of future events and are subject to various risks and uncertainties.

Actual results, performance or achievements could differ materially from those expressed or implied in such statements. Important factors that could influence the Companys operations include economic conditions affecting demand and supply, government regulations, tax laws, natural calamities, and other incidental factors over which the Company does not have direct control. The Company assumes no obligation to publicly update, amend or revise any forward-looking statements, whether as a result of new