Kore Digital Ltd Management Discussions

INDUSTRY STRUCTURE AND DEVELOPMENT, OPPORTUNITIES AND THREATS

Kore Digital Limited ("KDL") was established with the objective of providing advanced communication solutions to corporates and Telecom Network Operators. The Company is a growing passive telecommunication infrastructure provider in Maharashtra, primarily engaged in the installation and commissioning of poles, towers, and Optical Fibre Cable ("OFC") systems.

"Passive infrastructure" refers to telecommunication towers that support wireless services, while "OFC" enables the hosting and functioning of active infrastructure required for transmitting signals and carrying voice and data traffic. As a passive communication infrastructure company, KDL focuses on providing infrastructure services to Telecom Network Operators, Broadband Service Operators, and Internet Service Providers ("ISPs") across Maharashtra, particularly in and around Mumbai.

The Company holds an Infrastructure Provider (IP-I) License, granted by the Department of Telecommunications (DoT) in 2009. Under this license, KDL is authorized to establish and maintain assets such as dark fibre, right of way (ROW), duct space, and towers, which can be leased, rented, or sold to Telecom Network Operators, Broadband Service Operators, and ISPs.

In addition to infrastructure services, the Company offers project management for duct and optic fibre cable laying, construction of transmission and telecom utilities, dark fibre leasing, optic fibre network construction, maintenance services, and turnkey solutions. KDL is also engaged in operations and maintenance activities, ensuring network uptime and preventing underground optic fibre cuts caused by civic activities like road repairs, digging, or expansion projects.

Over the past 14 years, the Company has commissioned more than 600 pole-based cell sites in and around Mumbai, developed its own network of approximately 700 kms in the last 5 years, and delivered an underground fibre optic backbone covering nearly 600 kms in just 2 years. Leveraging its decade-long expertise, KDL identifies strategic routes where telecom operators lack presence and builds networks that are subsequently leased either through duct or fibre arrangements. In cases where operators face challenges such as high ROW costs, project viability issues, or local constraints, they entrust KDL to execute projects on their behalf. While operators are granted the right to use such networks for a defined period, ultimate ownership remains with KDL.

Our key customers among T elecom Network Operators include Bharti Airtel, Vodafone Idea, Reliance Jio, and Tata Teleservices. In the broadband and ISP segment, our customers include Dvois SSV, Intech, Trunet, Star, Sterlite, Lio Ducts/Duct Rove, and Usha Martin.

Significant Developments Subsequent to the Last Financial Year

Since the last audited accounts dated March 31, 2025, the Board confirms that there have been no material developments that could adversely affect the Companys trading, profitability, asset value, or its ability to meet liabilities in the near term.

The telecom sector, however, continues to undergo significant transformation. Traditional customer touchpoints are disappearing, while new digital-first engagement models are emerging. Reinventing communication and adapting to this evolving customer journey will remain one of the industrys greatest challenges. Companies that successfully align with this shift will be best positioned to capture future opportunities.

THE FUTURE OUTLOOK

In line with the evolving industry landscape, KDL is actively pursuing geographical expansion beyond its current markets. This initiative is expected to place the Company on an accelerated growth trajectory, further strengthen its presence in the telecom infrastructure sector, and create sustainable value for all stakeholders.

Key factors affecting our results of operation:

The operational and financial performance of the Company is influenced by several external and internal factors, including:

• General economic and demographic conditions;

• Fluctuations in Indian and foreign currency exchange rates;

• Impact of global and domestic health crises, including the COVID-19 pandemic;

• Depreciation, repair, and maintenance requirements of equipment;

• Significant developments in Indias economic and fiscal policies;

• Ability to obtain necessary licenses and approvals in a timely manner;

• Capability to attract and retain customers;

• Expansion of the Companys infrastructure network;

• Ability to maintain strong relationships with distributors, wholesalers, and service operators;

• Demand, supply, and pricing dynamics of telecom and allied equipment;

• Age, quality, and condition of deployed infrastructure and machinery;

• Changes in laws, regulations, or government policies affecting telecom infrastructure usage;

• Shifts in segment-wise contribution to revenue.

SEGMENTWISE PERFORMANCE

The Company operates in a single business segment, namely Telecommunication Infrastructure Services. Accordingly, separate segment reporting is not applicable.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY

The Company has established a robust framework of internal control systems and processes to ensure efficient business operations and compliance with applicable laws and regulations.

• A comprehensive delegation of authority enables timely and effective decision-making.

• Detailed guidelines for financial reporting and accounting ensure uniform compliance.

• All critical functional areas are governed by structured operating manuals.

• Independent internal audits are conducted regularly by an experienced firm of accountants, in close coordination with designated Company officials.

• The Internal Auditors periodically review the adequacy and effectiveness of internal financial controls, including operational processes, and confirm that such controls are appropriate and functioning effectively.

HUMAN RESOURCES

Industrial relations at the Head Office and across operational locations remained cordial throughout the year. The Company places strong emphasis on aligning human capital with organizational objectives, fostering teamwork, and promoting skill enhancement, leadership development, and functional excellence.

As on March 31, 2025, the Company had 14 full-time employees on its payroll.

FINANCIAL PERFORMANCE

The financial statements have been prepared in accordance with the requirement of the Companies Act 2013, and applicable accounting standards issued by the Institute of Chartered Accountants of India. The details are mentioned below:

PARTICULARS	Year Ended 31-03-2025	Year Ended 31-03-2025	Year Ended 31-03-2024
	Consolidated	Standalone
Revenue from operations	32,774.44	13,197.52	10,350.76
Other income	7.19	7.19	157.28
Total Revenue	32,781.63	13,204.71	10,508.04
Less: Expenses other than Finance cost and Depreciation	28,026.88	11,460.58	8,800.32
Profit before finance cost, depreciation & amortization, and tax	4,754.75	1,744.13	1,707.73
Less: Finance Costs	36.77	36.77	33.90
Less: Depreciation and amortization expenses	499.77	499.77	43.55
Profit before Tax	4,218.21	1,207.60	1,630.26
Less: Tax Expenses
Current Tax	1,053.35	295.58	457.18
Deferred Tax (Assets)/Liabilities	(50.35)	(50.35)	13.88
Excess/(Shortfall) Prov. For Tax in P.Y.	-	-	9.91
Profit for the year	3,215.20	962.36	1149.29
Earning per equity share
Basic	7.91	8.00	34.51
Diluted	7.91	8.00	34.50

FINANCIAL REVIEW (INR in Lakhs)

Revenue from Operations:

During the Financial Year 2024-2025, the Total Revenue (Standalone) of your Company has increased from Rs. 10,508.04 (in lakhs) to Rs. 13,204.71 (in lakhs). The increase in total revenue is 25.66% over the previous year.

Total Expenses (INR in Lakhs)

During the financial year 2024-25, the Companys total expenses comprised of material consumed, cost of trading goods, change in value of stock of finished goods/work-in-process, employee benefit expenses, finance cost, depreciation and amortization expenses, and other operating expenses.

The total expenses increased to Rs 11,997.12 lakhs in FY 2024-25 as compared to Rs 8,877.78 lakhs in FY 2023-24.

Employee benefit expenses (INR in Lakhs)

Expenses incurred towards Directors remuneration, employee remuneration, and employee welfare stood at Rs 160.82 lakhs during the financial year 2024-25, as against Rs 143.41 lakhs in 2023-24

Finance Cost (INR in Lakhs)

Expenses towards finance and interest cost increased to Rs 36.77 lakhs in the financial year 2024-25, as compared to Rs 33.90 lakhs in 2023-24

Depreciation & Amortization expense (INR in Lakhs)

During the financial year 2024-25, the Companys depreciation and amortization expense increased significantly to Rs 499.77 lakhs, as against Rs 43.55 lakhs in 2023-24.

Profit after Tax (INR in Lakhs)

The Company reported a Profit After Tax (PAT) of Rs 962.36 lakhs in the financial year 2024-25 as compared to Rs 1,149.29 lakhs in 2023-24.

CAUTIONARY STATEMENT 2024-25

Statements in this Report, particularly those relating to the Management Discussion and Analysis describing the Companys objectives, projections, estimates, expectations, or predictions, may be considered as "forward-looking statements" within the meaning of applicable securities laws and regulations.

Actual results may differ materially from those expressed or implied due to various factors including, but not limited to: global and domestic demand-supply dynamics, availability and pricing of key inputs, cyclical trends in the Companys principal markets, changes in Government policies and regulations, tax regimes, economic developments in India and abroad, as well as other factors such as litigation outcomes, labour negotiations, and unforeseen business contingencies