NESCO Ltd Management Discussions

Global Economic Overview

The global economy remained resilient in CY 2025, with growth estimated at 3.4%, supported by strong domestic demand in the United States and increased investment in artificial intelligence and technology. Emerging market and developing economies grew by 4.4%, outpacing advanced economies at 1.9%. Within developed markets, the United States recorded growth of 2.1%, while the Euro area registered 1.4%, weighed down by elevated energy costs and weak industrial production. While inflation moderated across most economies, rising trade tensions and ongoing geopolitical conflicts continued to disrupt trade flows, increase energy costs and pose risks to the global growth outlook.

Outlook

The near-term outlook reflects a measured downward revision in growth expectations, with the International Monetary Fund (IMF) projecting CY 2026 global Gross Domestic Product (GDP) growth at 3.1%, a step-down from CY 2025 that reflects the compounding effects of tariff escalation and sustained geopolitical tensions in West Asia, which have kept energy markets elevated and supply chains volatile. Growth is expected to recover to 3.2% in CY 2027 as the conflict-related shock dissipates. On inflation, global consumer prices are expected to rise modestly to 4.4% in CY 2026 before easing to 3.7% in CY 2027, supported by tighter monetary conditions in the preceding cycle and stabilising commodity prices outside energy. The path of monetary easing in advanced economies and its consequent impact on capital flows to emerging markets, remains a critical variable.

Source

1. IMF WEO April 2026

Indian Economic Overview

India sustained strong economic momentum during FY 2025-26, holding its position as the worlds fastest-growing major economy. Real GDP growth for the year is estimated at 7.7% consistent with April 2026 forecast, up from 7.1% recorded in FY 2024-25. The expansion was broad-based, supported by firm domestic demand, a recovery in manufacturing and the continued strength of services.

Nominal GDP grew 8.6% during the year, reaching H 345.47 lakh crore. This performance, aided by methodological refinements including the adoption of a new base year (2022-23), helped the economy consolidate its global standing further. Macroeconomic stability was a core feature of the year, with foreign exchange reserves of USD 701.4 billion as of 16 January 2026, import cover of roughly 11 months and consumer price inflation well contained.

Source

Economic Survey 2025-26 https://www.pib.gov.in/PressReleasePage aspx?PRID=2269286r=48&lang=2#:~:text=The%20growth%20rate%20in%20 Real,a%20growth%20rate%20of%208.9%25.

Key Macroeconomic Indicators

7.6% 8.6%

Real GDP Growth Nominal GDP Growth

5.25% USD 701+ bn

Repo Rate (Year-end) Forex Reserves

Drivers of Domestic Growth

Indias expansion in FY 2025-26 drew on a combination of policy initiatives, consumption strength and sustained capital allocation:

Private Consumption and Income Tax Reform

Domestic consumption was the primary growth driver, with real private final consumption expenditure rising about 7.0% and accounting for 61.4% of GDP in H1 FY 2025-26, its highest share since FY 2011-12. Income-tax rationalisation lifted disposable incomes, particularly within the salaried middle class, spurring demand across services, real estate and experiential categories.

Government Capital Expenditure

Public investment continued at scale, with infrastructure outlays under the Union Budget reaching approximately H11.21 lakh crore for FY 2025-26. The governments focus on national highway and expressway corridors has widened Indias road network considerably, complementing the broader infrastructure pipeline.

Services Sector Leadership

Services were the principal engine of growth, expanding 9.1% in FY 2025-26 and contributing 53.6% of GDP in H1 FY 2025-26. The services share in Gross Value Added (GVA) touched a historic high of 56.4%, reflecting the rising weight of modern, tradable and digitally delivered services. Strong showings in IT-BPM, financial services, logistics and hospitality widened the services surplus, with India now the worlds seventh-largest exporter of services.

GST Rationalisation and Structural Reforms

The 56th GST Councils approval of Next-Generation GST reforms in September 2025 introduced a simplified two-slab structure (a 5% merit rate and an 18% standard rate) in place of the earlier four slabs, while retaining a special 40% rate for luxury and sin goods. The reforms also lowered rates on several essentials and corrected inverted duty structures, easing cost burdens for households and businesses, with compliance streamlined through pre-filled returns and faster refunds.

These fiscal measures were designed to support consumption- led growth and improve the ease of doing business. Parallel labour reforms added workforce flexibility, while the continued rollout of Production-Linked Incentive (PLI) schemes strengthened Indias place in global manufacturing supply chains. Together, these reforms contributed to a more agile and efficient economic framework.

Outlook

The IMF projects Indias real GDP growth at 6.5% for both FY 2026-27 and FY 2027-28, a measured step-down from the 7.6% recorded in FY 2025-26. This moderation reflects a higher base from the prior year, the adverse impact of the Middle East conflict on energy prices and global demand and the broader drag from tariff fragmentation, partly offset by the carryover of strong FY 2025-26 momentum. Inflation for FY 2026-27 is now projected at 5.1% raised from the earlier 4.6%, mainly on imported pressure from elevated crude oil prices and a weaker rupee, against the IMFs 4.7% projection.

The outlook stays constructive nonetheless, underpinned by a structural shift toward domestic consumption, the ongoing infrastructure capex supercycle and the deepening of Indias services economy. Substantial foreign exchange reserves and steady foreign investment inflows affirm enduring confidence in Indias medium-term path, in line with the Viksit Bharat 2047 vision.

Sources

1. IMF WEO April 2026

2. NSO New Series, Base 2022-23

3. Economic Survey 2025-26 Highlights

4. RBI MPC Apr 2026

5. Economic Survey 2025-26

6. Union Budget 2025-26

7. IBEF Roads & Highways

8. PIB - Next-Gen GST Reforms

Macro Trends Shaping Indias Growth Landscape

Indias economic path is increasingly shaped by structural shifts that align closely with Nescos diversified operating model.

Urbanisation at Scale

Urban migration is among the most powerful forces at work, with the national urban population projected to reach approximately 600 million by 2036, about 40% of the countrys population. By then, urban areas are expected to contribute close to 70% of GDP, intensifying demand for high-grade commercial infrastructure, integrated business districts and large-format venues able to host complex business and cultural activity.

India as a Global Business Hub

The countrys standing as a premier global business destination shows in the presence of more than 1,700 Global Capability Centres (GCCs) together employing approximately 1.9 million professionals. This expansion is a primary driver of office-space absorption, particularly within integrated IT-park ecosystems that offer operational reliability and technical scalability.

Premiumisation of Consumer Choices

Domestic consumption is undergoing a marked transition. Rising disposable incomes and wider global exposure are driving a clear preference for premium offerings across food, hospitality and entertainment, with consumers increasingly willing to pay more for superior quality and environmentally responsible products.

The Infrastructure Build-Out

The extensive build-out of national infrastructure is a defining feature of the current economic cycle. Sustained government investment in high-speed expressways, multimodal logistics parks and last-mile connectivity is cutting travel times and logistics costs, opening previously underserved regions to organised commerce.

Alongside this, sustainability has moved from a voluntary differentiator to a core market requirement. Corporate occupiers, exhibition organisers and institutional investors now prioritise ESG-compliant assets, with environmental and social governance built into commercial decision-making, thereby shaping venue selection.

Sources

1. World Bank India - Urban Transformation

2. CBRE India - Rise of GCCs in Emerging Indian Cities

Industry Review Commercial Real Estate

Indias commercial office sector delivered a record year in CY 2025. Per Cushman & Wakefields Office Q4 MarketBeat, net absorption across the top eight cities reached 61.4 mn. sq. ft., a 25% year-on-year increase, while Knight Franks India Real Estate report recorded total gross leasing of 86.4 mn. sq. ft. across eight cities, the sectors strongest showing to date.

GCC-led Demand:	Global Capability Centres were the largest source of leasing, taking 38% of total leasing in 2025, up sharply from prior years and reflecting the deepening footprint of multinationals that use India as a strategic base for global operations. They remain the most consistent driver of demand for high- specification, scalable workspace.
Capital Inflows in Mumbai:	The Mumbai Metropolitan Region continues to draw substantial institutional investment across office and mixed-use assets, anchored by a stable rental-income profile and supply discipline in core micro-markets.
Rental Appreciation:	Tightening vacancy and limited supply have supported healthy rental growth across prime and emerging office corridors, with Mumbai recording approximately 6% appreciation in 2025.
Preference for Grade-A Campuses:	Occupiers increasingly prioritise integrated Grade-A developments offering comprehensive amenities, environmental certifications and operational reliability. Grade-A space accounted for 91% of total leasing in 2025.
Expansion-led Leasing:	Fresh leasing made up approximately 80% of activity in 2025, pointing to firm occupier appetite for quality space and a clear step-up from the relocation-led demand of earlier cycles.
Flexibility and Institutionalisation:	Flexible-workspace operators drove a meaningful share of leasing as corporates pursued more agile workplace strategies. At the same time, the maturing of Indias REIT market is widening institutional participation and strengthening the appeal of high-quality commercial real estate.

Sources

1. Cushman & Wakefield - India Office Q4 2025

2. Knight Frank India - Real Estate H2 2025

Exhibitions

Indias exhibition and business-events industry ranks among the fastest-growing markets globally. The organised MICE segment alone is valued at approximately USD 5.42 billion in FY 2025-26 and is forecast to reach USD 9.09 billion by FY 2032-33 at a CAGR of 6.67%. The broader business events ecosystem, which includes business travel, hospitality, transport and ancillary services, is significantly larger: the Ministry of Tourism places the India MICE market at USD 49.4 billion in 2024, projected to reach USD 103.7 billion by 2030 at a CAGR of approximately 13%, driven by new Meetings, Incentives, Conferences and Exhibitions (MICE)-ready destinations such as Varanasi, Khajuraho and Kochi, alongside established hubs.

Growth Drivers and Trends

» Industrial Linkages: Sectoral expansion is closely aligned with Indias industrial growth trajectory. National initiatives, including Make in India and the Production-Linked Incentive (PLI) schemes, are building manufacturing ecosystems that use exhibitions as primary platforms for market entry and business development.

» Global Positioning: Indias standing as a premier business destination, reinforced by the G20 presidency and the launch of the Meet in India programme, has lifted international participation.

» Infrastructure and Capacity: Recent infrastructure additions, more than 150 operational airports, over 1.5 lakh km of highways and 2.48 million hotel rooms, have markedly raised national capacity for hosting large-format exhibitions and business events.

» Technological Integration: Digital transformation is reshaping the industry, with AI-driven matchmaking, digital registration and hybrid participation models lifting engagement and delivering measurable outcomes.

» Sustainability in Venue Selection: Renewable energy, efficient waste management and carbon-conscious operations have become decisive factors when organisers choose a venue, an area where established, certified venues hold an edge. » Diversifying Portfolios: The addressable market is widening throughnewexhibitioncategories,includingelectricmobility, semiconductors, defence, wellness and cultural industries. » Mumbai as a Hub: Even as activity gradually disperses to emerging cities, Mumbai stays the principal gateway for large-scale international exhibitions.

Sources

1. Markets and Data - India MICE Market

2. IBEF - India MICE Industry

3. Ministry of Tourism - MICE Industry

Hospitality

The Indian hospitality sector held steady momentum in FY 2025-26. Investment Information and Credit Rating Agency (ICRA) expects industry revenues to grow 9-12% year-on-year, with premium hotel occupancy holding at 72-74% and operating margins of 34-36%, supported by firm domestic travel and corporate demand. Growth in the sector is increasingly shaped by demand for elevated guest experiences and by activity linked to large-scale events.

Growth Drivers and Trends

» Events-led Demand: The revival of physical exhibitions and live entertainment is a primary catalyst for hospitality demand. Nesco is well placed to benefit through its integrated campus model, where the Bombay Exhibition Center and Nesco Events generate substantial guest traffic for on-site hospitality services.

» Corporate and Mixed-use Demand: The expansion of Grade-A office ecosystems and the national move toward integrated commercial precincts combining office, retail, hospitality and event infrastructure in a single location together create a captive, high-frequency base of demand for institutional food services, banqueting and business stay hospitality. Operators with on-site hospitality infrastructure hold a clear advantage in serving this recurring, non-discretionary demand and purpose-built hotels and serviced apartments within these precincts address the chronic undersupply of quality accommodation in key commercial corridors.

» Premiumisation and Wellness: Consumer preferences across institutional and event hospitality are shifting toward high-quality, hygiene-assured and responsibly sourced food experiences. Operators with multi-format dining capability, quick service, premium dining, banqueting and outdoor catering are best placed to meet this demand.

Sources

1. ICRA - Indian Hospitality Industry, January 2026

Events

Indias live entertainment sector has become one of the fastest growing verticals within the broader media and entertainment economy. EY-Parthenon places the live entertainment market at H12,000+ crore in 2024, projected to grow at a CAGR of approximately 19% over the next three years.

Growth Drivers and Trends

» Demographic Dividend: Demand is supported by a young population, with approximately 70% of live event attendees under 35, many under 30, who favour experiential spending over conventional consumption.

» Corporate and Brand Activity: The expanding scale of corporate town halls and brand led activations serves as a consistent volume driver for the industry.

» Geographic Expansion: Event demand is moving beyond traditional metropolitan hubs, with cities such as Shillong, Guwahati and Nashik recording marked increases in footfall. » Infrastructure Deficit : A critical shortage of purpose-built venues persists, particularly for large-scale events requiring capacities of more than 10,000 attendees.

» Premiumisation and Economic Impact: Event formats are transitioning toward more immersive and premium experiences. The economic footprint of single large-scale events has grown materially; Coldplays January 2025 Ahmedabad tour generated an estimated H 641 crores in

direct economic impact reflecting the scale opportunity for venue operators with the requisite capacity.

» Global Ambitions: Indias live events economy is on a trajectory to scale significantly, with the Government of India targeting positioning India among the worlds top five live entertainment destinations by 2030.

Sources

1. EY-Parthenon - Indias Rising Concert Economy

2. MIB White Paper - Live Events Economy

Food and Beverage

Indias food and beverage sector is expanding, accounting for approximately 3% of Indias GDP and employing more than 7 million people, making it the countrys single largest employer. Growth is most visible in the institutional segment, which is expanding rapidly on the back of fast-multiplying organised commercial ecosystems.

Growth Drivers and Trends

» Institutional Demand: The expansion of corporate campuses, exhibitions and large format events is a primary driver of institutional catering.

» Experiential and Wellness Dining: Consumer preferences are shifting toward high-quality, diverse and more immersive offerings, with a clear pull toward clean-label and functional products. Premium formats, curated menus and global cuisines are being adopted more widely across institutional and event settings.

» Premium Hydration: The Indian packaged drinking water market reached approximately USD 3.6 billion in 2025 and is forecast to grow to USD 6.5 billion by 2032 at a CAGR of 8.8%. Within the category, premium, hygiene assured and aseptic packaged formats, including carton-packed formats (such as Tetra Pak) and other non PET options, are gaining share, reflecting consumer preference for recyclable packaging, longer shelf life without preservatives and on-the-go convenience. Functional variants such as alkaline water are seeing rapid uptake across hospitality and institutional channels.

» Sector Consolidation: The industry is increasingly led by operators with strong scale advantages, supply chain efficiency and multi-format capability.

Sources

1. IBEF - Food and Beverage Industry

2. Persistence Market Research - India Packaged Drinking Water

Engineering Solutions

Indias industrial manufacturing and infrastructure sectors hold a steady demand for surface preparation technologies. The global shot-blasting machine market was valued at USD 1.41 billion in 2025, with Asia-Pacific commanding the largest regional share at 36.9%. India is a meaningful contributor to that share, with ongoing capital investment in blasting unit production across the Pune and Ahmedabad industrial corridors.

Growth Drivers and Trends

» Sectoral Demand: Growth is closely tied to primary end markets, including railways, defence, automotive and heavy engineering.

» Indigenisation Mandates: Indigenisation under Atmanirbhar Bharat is generating steady demand for precision shot-blasting and peening across ordnance units and naval engineering facilities.

» Infrastructure Outlay: Record investment in ports, bridges and industrial parks drives demand for surface preparation ahead of protective coatings.

» Service Market Expansion: An ageing installed base of industrial equipment is widening the replacement and Annual Maintenance Contract (AMC) market, opening margin accretive revenue streams.

» Preference for Integrated Providers: Customers increasingly favour single-source providers offering equipment, abrasives, spares and lifecycle services to keep quality uniform.

Sources

1. Fortune Business Insights - Shot Blasting Machine Market

Wayside Amenities (WSA)

Indias rapid expansion of its highway infrastructure is creating a new category of organised consumption. The National Highways Logistics Management Limited (NHLML) has so far awarded 501 WSA sites, with 94 operational across national highways and motorways, at intervals of 40-60 km.

Growth Drivers and Trends

» Motorisation: National vehicle production has crossed 31 million units a year, intensifying high-speed corridor usage and widening the volume base for organised highway services.

» Infrastructure Modernisation: The rapid build-out of the national highway network, alongside parallel investment in expressways and high speed corridors, is creating high traffic nodes that need structured service ecosystems. » Concession Economics: Institutional participation is enabled by a lease-based Public-Private Partnership (PPP) concession framework, under which National Highways Authority of India (NHAI) handles land acquisition and permissions while the private partner takes on development, operation and maintenance for 15-30 years.

» Integrated Commercial Hubs: WSAs are evolving from basic rest stops into multi-format commercial hubs that bring together food services, retail, fuel stations and Electric Vehicle (EV) charging.

» Organised Retail Shift: Consumer expectations are moving toward branded, hygiene assured formats, hastening the displacement of unorganised highway offerings.

» Clean Energy and Localisation: New concessions mandate EV charging ports and Village Haat/Bazaar zones for area specific handicrafts and handlooms by local artisans, securing long-term asset relevance through clean-energy provision and market access for the local economy.

Sources

1. PIB - Wayside Amenities Status

2. IBEF - Roads & Highways

Business Review

In FY 2025-26, the Company delivered a strong performance across its operating segments, with total income crossing H1,000 crores for the first time at H 1,031.58 crores up from H845.67 crores. The integrated campus model again worked in our favour, letting infrastructure be shared across the portfolio, lifting the exhibitions, events and hospitality divisions, while real estate held the line on income.

Nesco Realty

Realty remained the Companys largest contributor to total income. Nesco IT Park ran at 100% occupancy through the year on long-term leases with a diversified base of multinational tenants. The segment recorded full-year revenue of H 397.92 crores, up 8.67% from H366.17 crores, with segment profit (before finance costs and tax) of H 331.76 crores higher by 7.16% over previous year. The strength of contracted rentals gives clear earnings visibility. The vertical is a direct beneficiary of the forces reshaping the office market, GCC led demand for high-specification space and a growing occupier preference for certified Grade-A campuses, all of which favour an asset like the IT Park within established Mumbai micro-markets.

Bombay Exhibition Center (BEC)

BEC delivered a strong year, carried by a full calendar of industrial trade fairs and exhibitions. The segment recorded full-year revenue of H259.82 crores, up 29.72% from H 200.30 crores, with segment Profit (before finance costs and tax) rising to H 133.12 crores higher by 36.35% over previous year. Through the year it hosted over 135 exhibitions and events, drawing a footfall of more than 2 million. With Hall 6, an 18,000+ visitors-capacity facility, now operational, BEC is well placed to capture the expansion in Indias MICE and exhibitions market, where scale, organised infrastructure and venue certification increasingly decide where large events are held.

Nesco Foods

Hospitality more than doubled over the year, lifted by a busier exhibitions-and-events calendar and steady demand from the IT parks captive base. Revenue rose to H238.51 crores, higher by 107.13% over the previous year. While segment profit (before finance costs and tax) nearly doubled to H 25.79 crores higher by 95.08% over previous year. As greater scale and higher facility utilisation flowed through. The business spans catering, banquets and food service formats and is the clearest beneficiary of the campus model: the more the exhibitions, events and office ecosystem fills up, the more institutional and event led demand the hospitality vertical captures.

Indabrator

The engineering segment recorded revenue of H35.81 crores, compared to H 50.39 crores of the previous year, with the decline reflecting softer order phasing across its capital-goods end-markets. Segment profit (before finance costs and tax) held steady at H 2.65 crores, against H 2.33 crores, as a tighter cost base protected margins through the year. Indabrator continues to serve critical industrial sectors: railways, defence and heavy engineering, where indigenisation under Atmanirbhar Bharat and a growing preference for single source equipment, spares and lifecycle providers play to its integrated model. The H8.51 crores order from Chittaranjan Locomotive Works secured during the year points to the scale of opportunity ahead.

Wayside Amenities

The Company formally introduced Wayside Amenities as a new segment during the year, developed on long-term leased land along expressway corridors. Still in its development phase, the vertical recorded a operating loss (before finance costs and tax) of H5.28 crores, reflecting initial capital outlays and pre-operational costs. It marks Nescos first move into an infrastructure-linked, off-campus opportunity and is expected to evolve as the secured expresway project progress towards operational completion.

Strategic Developments

The Company is putting its existing land bank to work for long-term value. A key milestone is the planned development of Tower 2 at Nesco IT Park, for which the Intimation of Disapproval (IOD) has been received. The development will span approximately 5.01 mn. sq.ft., pairing premium office space with a 850+ key hospitality complex of hotel rooms and serviced apartments positioned to rank among Indias largest hospitality developments and catering to the captive audience of the IT Park and exhibition centre.

Nesco has also widened its service portfolio through infrastructure modernisation. The commissioning of Hall 6, an 18,000+ capacity facility, has materially expanded the Companys ability to host large format, high-impact events at the Bombay Exhibition Center. This is complemented by the growth of Nesco Foods, which has scaled its restaurant footprint and moved its kitchen and facilities to renewable energy. Together, these developments reinforce the integrated campus model and support incremental growth across every vertical.

During the year, the Company advanced a set of growth initiatives while deepening its integrated operating platform, each aimed at capturing infrastructure-linked and experience-led consumption. The foray into Wayside Amenities (WSA) marks the Companys first expansion beyond its core Mumbai campus, positioning it within high-potential mobility corridors. With nine sites secured across three expressway corridors, Nesco is building integrated facilities that combine food services, retail, fuel and EV charging, designed for the rising demand for organised, hygiene-assured stops among highway travellers.

Financial Review

Nesco delivered a strong financial performance in FY 2025-26, with total income crossing H1,000 crores for the first time. Total income rose to H 1,031.58 crores, from H845.67 crores a year earlier, a 21.98% increase, led by steady realty income and a marked step-up in activity across the exhibitions, events and hospitality segments. Revenue from operations grew to H932.06 crores from H732.01 crores, driven largely by higher exhibition-hall utilisation and a sharp rise in hospitality throughput.

Total expenses for the year stood at H515.91 crores against H356.50 crores, the increase moving in step with the broader expansion in business volume, particularly in hospitality and exhibitions, where operating costs track activity levels closely. Even with these higher outlays, the Company held healthy margins. Profit Before Tax rose to H515.67 crores from H489.17 crores, registering a growth of 5.42%, while Profit After Tax grew to H412.80 crores from H375.22 crores, registering a growth of 10.02%, lifting earnings per share to H 58.59 from H53.25.

The Companys financial position strengthened further over the year. Net worth rose to H 2,996.49 crores from H2,629.44 crores and the balance sheet stayed entirely free of debt, maintaining liquid resources of H 1,471.62 cores. Reflecting this performance, the Board has recommended a final dividend of H7.00/- per equity share (face value H 2), amounting to H49.32 crores, against H6.50/- per share the previous year. A diversified income base and steady operating cash flows give the Company the liquidity to fund its ongoing infrastructure projects and planned expansions, Tower 2, Hall Modernisation and Wayside Amenities among them, from internal accruals. KeyFinancialRatiosaredisclosedinNoteNo.48ofthestandalone financial statements and are therefore not reproduced here for sake of brevity.

Human Resources

Nescos people underpin a portfolio that spans commercial real estate, exhibitions, events, hospitality, engineering and the new wayside amenities vertical. The human capital strategy rests on three priorities: attracting and retaining the right talent, building a high-performance and equitable culture and safeguarding the health, safety and well-being of everyone associated with the business.

Culture, Engagement and Workplace Recognition

Nesco earned Great Place to Work r certification for the second year running in FY 2025-26, on the back of a survey with 100% employee participation, a result drawn from how it scores on employee centric policies, transparent leadership and fairness in compensation and recognition. Diversity, equity and inclusion are built into hiring and promotion and the Company holds a zero-tolerance line on discrimination, harassment and human rights violations. Succession planning stays a priority, identifying and developing emerging talent for senior leadership.

Talent Acquisition and Performance Management

Recruitment turns on cultural fit, domain expertise and long-term potential across the engineering, hospitality, facility management and infrastructure functions. The full HR lifecycle runs on AdrenalinMAX, an integrated HRMS covering recruitment, onboarding, payroll, attendance, learning and development, performance management and analytics. Performance is assessed through a Balanced Scorecard, with structured goal setting, mid-year reviews and final appraisals completed in March, so increment letters and salary revisions take effect before the new financial year begins.

Learning and Development

Learning is structured, measurable and run through the HRMS. During the year, every employee and worker reached 100% completion on mandatory modules covering health and safety, human rights, PoSH, the Whistleblower Policy, Prevention of Insider Trading and the Code of Business Conduct and Ethics. Function specific training is delivered in person where needed and offered in Hindi and Gujarati to remove language barriers. Managers carry team development goals within their own annual objectives, keeping peoples growth inside the management cycle rather than apart from it.

Occupational Health and Safety

The Company runs an occupational health and safety management system aligned to ISO 45001:2018, with mandatory safety training for employees, workers, contract staff and vendors. In FY 2025-26, Nesco recorded zero lost-time injuries, zero fatalities and zero high-consequence incidents. Training at the head office, Nesco IT Park and the Vishnoli and Karamsad manufacturing facilities covered emergency evacuation, firefighting, first aid and response team readiness, while the FSSAI Eat Right Campus certification for the Nesco food court reinforces the focus on food safety. Benefits health and accident insurance, maternity and paternity leave, term life insurance extend to the eligible permanent and contract workforce.

Risk Management

Nesco operates across real estate, exhibitions, events, hospitality, engineering and wayside amenities, each with its own operating environment and risk profile. Managing risk is therefore a continuous discipline: spotting potential issues early, assessing their impact and building mitigation into day-to-day operations.

Governance and Oversight

Our risk management framework runs across clear levels of responsibility, with reporting lines that carry visibility from operational teams up to the Board.

Particulars	Particulars
Board of Directors	Approves the Policy and any revisions; receives updates on mitigation measures against key risks.
Audit Committee	Provides additional oversight on financial risks and internal controls.
Risk Management Committee	Frames, implements and reviews the risk management policy, reviewed at least once every two years or earlier if needed; identifies strategic, corporate level risks that could materially affect performance.
Managing Director	Reviews strategic and significant operating risks across each business vertical.
Core Management Team (Risk Owners) and Governance, Risk and Compliance team	Identify and propose risks; implement the risk strategy, prepare SOPs, track Key Risk Indicators against the defined risk appetite and independently test the effectiveness of mitigation actions.

The Risk Management Committee

The Risk Management Process

Risk is managed through a continuous five-step process across all business units, with each step folded into regular operations.

Identification	Risks are mapped from internal factors \u2014 operations, systems and processes \u2014 and external ones such as market conditions, competition and regulatory change, with root causes identified at this stage.
Assessment and Categorisation	Each risk is classified by nature \u2014 internal or external, controllable or uncontrollable \u2014 and assessed for severity after accounting for existing controls.
Analysis	Risks are evaluated for likelihood and impact, then prioritised using set parameters, including risk ratings and early-warning indicators with trigger points.
Mitigation	A response is defined for each risk \u2014 avoidance, reduction, acceptance or transfer \u2014 with clear ownership for implementation.
Review and Monitoring	Risks and mitigation actions are reviewed on a rolling basis; early-warning indicators are tracked and new or evolving risks feed back into identification.

Classification, Rating and Treatment Risk Categories

Strategic	Risks affecting high-level goals aligned with the Companys mission and vision.
Operational	Risks to the effectiveness and efficiency of operations, varying with managements choices on structure and performance.
Compliance	Risks relating to adherence to applicable laws and regulations.
Financial	Risks to performance and profitability, including safeguarding resources against financial loss.

Risk Rating

Rating	Description	Required Action
High	Events that can be tolerated but may carry a prolonged negative impact and wide consequences.	Continuous active management
Medium	Events that can be managed but call for additional resources and management effort.	Periodic monitoring
Low	Events that can be managed or absorbed under normal operating conditions.	No major concern

The Risk Management Committee periodically reviews the risk assessment framework and apprises the Board of key risks and developments.

Treatment Strategies

Each risk is assessed individually and the response may combine one or more of the following:

Business Continuity

Business continuity arrangements are designed to keep critical operations running or restore them quickly in the event of a disruption, while safeguarding people and assets. They sit within our internal control systems, with the Governance, Risk and Compliance team and the Core Management Team overseeing response mechanisms, communication protocols and periodic training to maintain preparedness across the organisation.

Our Risk Landscape

Risk	Category	Business Units Impacted	Mitigation Approach	Opportunity
Capital Risk		Realty,	Phased capex funded through	A debt-free balance sheet lets Nesco self
Risk of delays, cost overruns or rework in the multi- year capex cycle, deferring commercialisation and tying up capital.		Bombay Exhibition Center (\u2018BEC\u2019), WSA	internal accruals Structured project monitoring Independent technical and financial reviews	-fund Tower 2 , modernisation of halls and WSA on its own timeline, capturing value from its land bank without external leverage or refinancing pressure
Competition Risk Sensitivity of leasing demand, event spend and exhibition footfall to economic cycles, alongside intensifying competition from new venues and commercial real estate stock.		Realty, BEC, Events, Hospitality	Staged commercialisation Diversified portfolio across cycles Long-term tenant and organiser relationships Sustained brand investment Service differentiation	The integrated campus \u2014 real estate, exhibitions, events and hospitality on one site \u2014 is difficult to replicate, deepening tenant and organiser stickiness and supporting premium positioning as supply expands.
Health, Safety and Operations Risk Safety risks for employees, contractors and visitors across high-footfall venues, kitchens, manufacturing facilities and highway sites.		All BUs	ISO 45001:2018-aligned safety management systems Periodic training and drills Dedicated on-site safety teams Certified facility management practices	A strong safety record \u2014 zero LTIs and fatalities \u2014 and certified operations strengthen Nesco\u2019s standing with global tenants, organisers and institutional clients for whom safety assurance shapes venue and partner selection.
Climate and Environmental Risk Physical risks from Mumbai monsoons and extreme weather, alongside transition risks from evolving regulations on energy, emissions, water and waste.		All BUs	Climate-resilient infrastructure design	As ESG credentials increasingly drive occupier and organiser choices, Nesco\u2019s LEED
			LEED Platinum-certified buildings Transition to renewable energy across operations	Platinum certification and renewable-energy base position it as a preferred destination \u2014 turning compliance into a commercial advantage.
Cyber Security and Data Privacy Risk Risk of cyber incidents or data breaches affecting tenant operations, customer data and business systems, with operational and reputational consequences.		All BUs (particularly Realty, BEC, Hospitality)	Information security policy and access controls Periodic audits Employee awareness programmes Alignment with the Digital Personal Data Protection Act and industry standards	Robust data governance and DPDP-aligned controls build trust with multinational tenants and enterprise clients, reinforcing the reliability and scale they expect from a Grade-A campus.
Regulatory and Compliance Risk Exposure to evolving regulations across real estate, environment, food safety, manufacturing, taxation, labour and ESG disclosures as a multi-sector listed conglomerate.		All BUs	Compliance management framework Internal audit oversight Ongoing regulatory tracking and periodic policy review	A mature, multi-sector compliance capability becomes a competitive edge as disclosure and ESG requirements tighten \u2014 easing entry into new regulated verticals such as Wayside Amenities and packaged beverages.
Credit and Market Risk Credit risk on receivables from tenants, organisers and B2B customers, alongside market risk on the treasury portfolio of mutual funds, debt and equity.		All BUs; Enterprise- wide (treasury)	Credit assessment and security deposits for tenant and organiser engagements Diversified treasury portfolio Conservative investment mandates	A debt-free position and substantial reserves give Nesco the liquidity to invest counter- cyclically \u2014 funding expansion when others are capital-constrained and earning steady treasury income through the cycle.

Internal Control Systems and Their Adequacy

Nesco operates an internal control framework designed to safeguard assets, uphold the accuracy and integrity of financial reporting and maintain compliance with applicable laws and regulations. The framework is proportionate to the scale and complexity of the Companys operations, supported by defined policies and procedures and validated by management, internal auditors and statutory auditors.

Accountability and continuous improvement sit at the centre of the control environment. Functional heads are responsible for adhering to established procedures, while audit findings are reviewed by the Audit Committee and tracked through structured action plans for timely implementation. The development and strengthening of Standard Operating Procedures (SOPs) is a continuous exercise aimed at enhancing operational efficiency and governance standards. The Company keeps adopting governance and control practices that reinforce transparency, discipline and operational effectiveness across the organisation.

Internal Audit

An independent firm of Chartered Accountants conducts the Internal Audit function under the oversight of the Audit Committee, with the Governance, Risk and Compliance (GRC) function forming an integral part of the framework. The audit follows a risk-based approach, focusing on critical functions and high-exposure areas to assess control effectiveness, process efficiency and compliance with internal policies and regulatory requirements.

Internal audit plan and scope is decided at the beginning of the financial year after seeking inputs of the Audit Committee. In addition to detailed process audits, transaction-level reviews are undertaken to identify deviations and provide a basis for recommending corrective measures. Key findings are presented to the Audit Committee and escalated to the Board when necessary. The Audit Committee also holds separate meetings with the Internal Auditor, without the presence of the Executive Directors or management, to facilitate candid discussions on audit observations, internal controls, risk management and governance matters. Statutory Auditors and Senior Management Personnel are regular invitees to the meetings. This audit mechanism maintains transparency, enforces operational discipline and supports the ongoing improvement of the Companys internal control environment.

Cautionary Statement

This Management Discussion and Analysis may contain forward-looking statements regarding the Companys objectives, strategies, projections and expectations. Actual results may differ materially from those expressed or implied, on account of various risks and uncertainties. These include, but are not limited to, macroeconomic conditions, regulatory changes, tax policies, global and domestic demand-supply dynamics, and geopolitical developments in the regions where the Company operates.

For and on behalf of the Board of Directors,

Krishna S. Patel
Chairman and Managing Director
DIN: 01519572

Mumbai
25 May 2026