onmobile global ltd Management discussions

INDUSTRY STRUCTURE & DEVELOPMENT

OnMobile Global operates in the dynamic and rapidly growing mobile gaming and mobile entertainment industry, which has experienced a remarkable expansion in recent years. The mobile gaming market has become a major force in the global entertainment sector, driven by advancements in mobile technology, increasing smartphone penetration, and the growing demand for immersive and interactive gaming experiences. In 2022, the global mobile gaming market size surged to an impressive $184 billion, and its growth trajectory indicates even more significant expansion in the the number of smartphone users has reached 1.65 billion and is projected to reach 6.2 billion within the next 4 years. Since a significant 79% of all gamers opt phones, companies operating in the mobile gaming market, like ours, have a promising outlook for substantial growth in the foreseeable future.

In India, OnMobile Globals home market, the mobile gaming industry has witnessed phenomenal growth. With approximately 500 million gamers, predominantly mobile gamers, the market offers immense opportunities for expansion and revenue generation. The majority of gamers in India prefer mobile gaming, making it a strategic focus for OnMobile Globals product portfolio. In terms of revenue, mobile gaming holds a significant market share, accounting of the $184 billion generated by all types of games in 2022, as reported by Newzoo.

While revenue may have declined, there was a surge in mobile game downloads in 2022, reaching almost 90 billion, which is 6 billion more than the previous year. Hyper-casual games, quizzes and puzzles played a major role in driving these downloads, showcasing their popularity among mobile gamers. Statista predicts that the mobile games market will continue to grow, reaching $419 billion by 2027. Additionally, the average revenue per user (ARPU) for mobile games is projected to reach $164 in 2023.

Despite the challenges faced by the industry, such as inflation, the cost of living crisis, and changes in advertising regulations, the mobile gaming market continues to grow. The increasing number of players, rising average revenue per user (ARPU), and the dominance of in-app purchases highlight the potential for sustainable revenue generation. OnMobile Global is well-positioned to capitalize on these trends, with its focus on innovation, customer-centric approach, and a strong portfolio of mobile gaming products.

As the mobile gaming industry evolves, OnMobile Global remains committed to staying at the forefront of technological advancements, understanding customer preferences, and delivering exceptional gaming experiences. The companys strategic initiatives and dedication to excellence position it for continued growth and success in the dynamic mobile gaming market.

OPPORTUNITIES

OnMobile Global is well-positioned to capitalize on the emerging trends and technologies in the telecom and mobile gaming industry, which present significant years ahead. As of 2023, companys growth and success.

Firstly, the surge in hyper-casual games, quizzes and puzzles to provides a vast market for OnMobile Global to develop gamesplay on their mobile that cater to a wide audience. By leveraging the simplicity and easy gameplay mechanics of these categories, the company can create engaging experiences that resonate with mobile gamers.

Hyper-casual games, quizzes and puzzles have gained significant traction, accounting for 86% of all game downloads in 2021 and generating annual sales of $2-2.5 billion with over 17 billion downloads.

The advent of 5G technology opens up new possibilities for OnMobile Global to deliver immersive gameplay, real-time multiplayer, cloud gaming, and augmented reality experiences. With higher download speeds and improved network bandwidth, for 50% or $92 billion out the company can provide seamless and high-quality gaming experiences that take advantage of the enhanced capabilities of 5G.

Following the very sizeable investment in 5G, telcos worldwide are eager to find use cases for its monetisation, showcasing its value to their subscribers and enticing them to upgrade. Mobile Cloud Gaming is a clear case of such implementation, and were already seeing considerable interest in telcos to offer services to their customers. This places OnMobile in a unique, strong position to partner with hundreds of telcos in the coming years.

The rise of in-app subscriptions in the gaming sector provides a sustainable monetization strategy for OnMobile Global. By adopting this model, the company can generate improved revenue streams and increase customer retention, ensuring a steady and predictable income from its gaming offerings. AI-assisted game development offers OnMobile Global the opportunity to reduce content development expenses and compete with larger producers in the market. By leveraging machine learning (ML) and AI to generate assets, the company can optimize its resources and deliver high-quality games that resonate with its target audience.

Cloud gaming remains a promising opportunity for OnMobile Global. With the proliferation of fast networks like 5G, the demand for device-agnostic access to games and virtual worlds continues to grow. By offering cloud gaming services, the company can provide convenient and accessible gaming experiences to users, overcoming the limitations of specialized gaming hardware.

The rise of competitive gaming (eSports) presents an avenue for OnMobile Global to engage with a dedicated fan base and participate in the eSports industry. By organizing mobile eSports competitions, the company can deepen user engagement, further strengthening its position in the market.

The increasingly growing cost of acquisition in mobile gaming could be an opportunity as game developers keep looking for different business models and more cost-efficient acquire new users. Our exclusive relationship with telcos around the world, giving us access to over 1B users, is a great new channel e and prevent data breaches. confidenc to reach new players.

Gamification strategies provide tool to enhance user engagement and foster customer loyalty.

Gamified approaches facilitate targeted marketing campaigns, and studies show a 48% increase in customer retention and 82% higher engagement gamified brands. Gamification with also yields up to a 50% boost in customer engagement and improved loyalty, according to industry reports. By introducing challenges, rewards, and leaderboards as a new SaaS product, the company can create interactive and enjoyable experiences that attract new customers, increase brand awareness, and improve customer retention for themselves and others.

THREATS

In the dynamic landscape of the mobile gaming industry, OnMobile Global faces both opportunities and threats. While the industry shows immense growth potential and market rebound, some challenges require careful consideration. By addressing these threats head-on, OnMobile Global can navigate the ever-changing market, protect its intellectual property, ensure regulatory compliance, adapt to consumer needs, prioritize data security, and overcome pricing challenges to maintain a strong position in the mobile gaming industry.

One significant threat is the potential and piracy. Malicious actors can reverse engineer software and distribute modified versions of games that offer free access, ad-free experiences, or bypass in-app purchase verification. This leads to revenue loss and exposes the risk of user data collection for illicit purposes. Businesses must remain vigilant in protecting their intellectual property and combating piracy to maintain their market position.

Another threat comes from regulatory changes. The regulatory landscape surrounding the mobile gaming sector is complex and subject to constant evolution. Regulators in various jurisdictions have shown interest in areas such as loot boxes, which raises concerns for businesses. Adhering to regulatory frameworks, maintaining compliance, and navigating shifting legislation are crucial to avoid legal repercussions and safeguard the companys reputation.

Security concerns are another significant mobile gaming industry. Data security and privacy become crucial considerations as reliance on mobile devices and digital connectivity increases. Users face risks such as viruses, identity theft, and phishing attacks. Engaging with unofficial sources, cheat codes, or interacting with strangers through chat functions exposes users to malware and identity theft. Businesses must ways to prioritize data security, implement robust security measures, and comply with data protection laws to safeguard customer

Furthermore, the rising prices of data and devices pose

Global with a powerful challenges, particularly in markets like India and the Middle East.

As digitization spreads, the increasing cost of data can impact consumer behaviour and consumption patterns. Telecom companies in India are striving to raise data charges, which may lead to changes in how users engage with mobile gaming. Price increases can disrupt the market and potentially reduce data usage. The impending introduction of 5G tariffs further adds uncertainty to pricing structures and consumer adoption. In the face of these threats, OnMobile Global must proactively address intellectual property protection, maintain compliance with regulatory changes, adapt to evolving consumer preferences, prioritize data security, and navigate potential disruptions caused by changing data pricing structures. By staying ahead of these challenges, OnMobile Global can position itself as a resilient and innovative player in the mobile gaming industry, ensuring long-term success and growth.

RISKS & CONCERNS

The mobile gaming industrys dynamic and highly competitive landscape presents several risks and concerns that OnMobile Global must address. These risks include the impact of market variation, the challenge of market saturation, the difficulty of in-app purchase bypass user acquisition and retention in a saturated market, and the need to adapt to technological advancements while ensuring compatibility. These factors require careful consideration and proactive measures to mitigate potential negative impacts on the companys success and growth. By understanding and addressing these risks, OnMobile Global can navigate the industrys challenges and position itself for continued success in the ever-evolving mobile gaming market.

In the fast-paced and ever-evolving landscape of the mobile gaming industry, OnMobile Global must navigate challenges stemming from market variation and constant updates. The rapid advancement of technology poses a significant new products quickly become outdated. It is crucial to recognize that the value and demand of products are subject performance hasto change, necessitating continuous adaptation and updates. Neglecting to adjust and add relevant features to meet market demands can lead to the game losing its user base and becoming inactive. Therefore, routine maintenance evaluations and feature updates are vital for the longevity of games in the market. Furthermore, the mobile gaming industry has become highly saturated with a multitude of games across various genres. The intense competition presents a challenge for companies, increasing the possibility of oversupply and greater rivalry.

With over 1.96 million mobile games available on the App Store alone, attracting and retaining customers becomes increasingly difficult. Effective user acquisition strategies and captivating gameplay experiences are essential in order to stand out and maintain a loyal user base. However, the average mobile app retention rate for gaming apps after 30 days is only 21%, highlighting the importance of engaging users and keeping them interested over time.

Moreover, technological advancements contribute to compatibility issues and necessitate ongoing adaptation. The introduction of new operating systems, device configurations, and hardware features can impact the compatibility and performance of games. To ensure that their games are compatible with a wide range of devices and optimized for the latest technology, companies must invest in research and development efforts and embrace technological advancements.

In conclusion, OnMobile Global faces challenges in a market characterized by variation, intense competition, user acquisition, and retention struggles. By staying proactive and agile, continuously updating and enhancing its products, the company can navigate these challenges and remain competitive in the ever-evolving mobile gaming industry.

PRODUCT-WISE PERFORMANCE AND OUTLOOK Challenges Arena

Challenges Arena has created numerous opportunities for

OnMobile, leading to remarkable growth and momentum. In the last year, the product has witnessed a surge in customer confirmations, with the number increasing from 38 to 66, further rising to 73 in Q1FY24. Revenue live customers have also seen substantial growth, jumping from 20 to 40, with an increase to

54 in Q1FY24. The products strong momentum is reflected in the remarkable 28X quarterly revenue growth over the past 7 quarters.

With the product available in 20 languages and the trivia and puzzles section experienced in an impressive 42 languages,

Challenges Arena has successfully expanded into 11 new countries whereobstacleas OnMobile had no market presence. This demonstrates the companys commitment to growth and expansion. outstanding, The financial with annual revenue growth 8 times greater than the previous year. Major refinements in the product, such as a revamped UI, Fantasy Sports and Predict and Win, have gained significant traction in the market and have effectively addressed previous user experience issues. The products trivia content and games have seen a 25% increase. Additionally, Challenges Arena has implemented AI-based personalized in-app messaging and chatbot integration to further enhance user engagement. These achievements underscore OnMobiles dedication to delivering exceptional products and services while expanding its reach in the market, with global coverage of 6.1% in terms of revenue. The companys continuous efforts have resulted in increased customer satisfaction, with an M1 retention rate of

56.95%.

In summary, Challenges Arenas success story includes increased customer confirmations, revenue live customers, and net active subscribers, along with substantial revenue growth. It has expanded into new markets, introduced innovative features, and improved user engagement, leading to an impressive track record of growth and performance.

ONMO

ONMO began its rollout with telcos in August 2022, going live with an operator in India and subsequently with three more telcos in Africa, the Middle East, and Asia. The plan this fiscal year is to launch theres significant interest from telcos due proposition. The product is evolving to drive short and long-term engagement, aiming to become a truly social experience for players. ONMO facilitates connections among players with 1000s of gaming moments so that they can connect, compete, and win tournaments and unique competitions.

With proprietary streaming technology, ONMO effectively manages the growing numbers of customers and players across various geographies. The content library is constantly expanding, boasting over 1000s of moments from 100s of games, and discussions with multiple game developers are ongoing to add their IP to the platform. ONMO gives access to the best parts of the best games and lets players experience games they know and love in new exciting ways and also discover new great games. The ONMO team comprises top gaming talent from India,

Europe, and North America, united by their passion to create the best social cloud gaming experience.

Gamize

Gamize is a SaaS-based Gamification in launching gamified campaigns industry is projected to reach $95.45 Bn with a CAGR of 25.6% by 2030. Gamize empowers enterprises to acquire, engage and retain customers with pre-built gamification activities, 50+ games, Leaderboards and Badges, along with in-app currency and 1000+ brand vouchers as rewards that motivate users to engage with the applications more.

Commercially launched in one Telecom operator in Bangladesh in Q4 FY23, Gamize plans to expand across different enterprises and industries like Retail, BFSI, Edu-Tech, OTT & Media, and

Fitness to address user acquisition, engagement, and retention challenges. With its user-friendly Campaign Manager, businesses them can easily across various digital channels such as apps, social media, websites, SMS, WhatsApp, and email. To ensure comprehensive insights, Gamize provides exhaustive reports and dashboards, offeringa 360-degree view of campaign performance, aiming to revolutionize user engagement and loyalty.

Tones

In FY ‘23, the Ring Back Tones service achieved significant milestones with 62 million active users, generating INR 195.8 million in topline revenue. Its mobile applications were downloaded 27.13 million times, indicating strong demand. Major features like JusPay, the first digital payment wallet for RBT service for Vi users, was introduced and integrated, and a customized AYCE (All You Can Enjoy) charging model in the RBT PWA for Dialog was introduced. A festival-themed RBT SDK user interface was launched in Vi to enhance engagement. Expanding globally, RBT services are now available in Oman (Omantel), Democratic Republic of Congo (Vodacom), Bangladesh (Banglalink), and Vodacom Mozambique (RBT PWA). Additionally, the RBT service in VF Egypt was launched during the festive period. The Artist Portal, a derivative of the popular Tones product suite, was unveiled in Vodacom, South Africa, showcasing three incredibly talented local artists, further enhancing innovative and immersive mobile experiences.

Videos & Editorials

Videos & Editorials focus was on delivering an exceptional customer experience and actively addressing their concerns with new initiatives introduced to enhance customer satisfaction and reduce complaints throughout the financial year. The revamp of the services UI/UX led to a significant increase in monthly active users (MAU). Additionally, steps were taken to address user complaints, bolstering trust and protection against fraudulent activities. By expanding self-service options, customers can now conveniently address their queries independently. These strategic actions reflect a strong commitment to providing an improved customer experience

Platform aiding enterprises while effectively managing potential issues.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY . The Gamification

Internalcontrolandriskmanagementarenecessaryprerequisites of corporate governance. The Corporate Governance Policy guides the conduct of affairs of the Company and clearly delineates the roles, responsibilities and authorities at each level with an adequate system of internal controls. This ensures that all transactions are authorized, recorded and reported correctly, and assets are safeguarded and protected against loss from unauthorized use or disposition. Properly documented policies, guidelines and procedures laid down for this purpose stand widely communicated across the enterprise to provide the foundation for Internal Financial Controls with reference to the Companys operations and financial statements. Such Financial Statements are prepared on the basis of Significant Accounting Policies, in line with the applicable Accounting

Standards, that are reviewed by management and approved by the Audit Committee and the Board.

The Company recognizes that any internal control framework, no matter how well designed, has inherent limitations and accordingly, regular audit and review processes ensure that such systems are reinforced on an ongoing basis.

The Company has a set of Standard Operating Procedures (SOPs) that have been established for individual processes. In addition to this, the Company has identified and the risks and control for each process that has a relationship to the operations and financialreporting. The Company uses SAP and other internally developed ERP systems as a business enabler and also to maintain its Books of Account. The SOPs in tandem with transactional controls built into the ERP systems, ensure appropriate segregation of duties, approval mechanisms and maintenance of supporting records. The Information

Management Policy reinforces the control environment. The systems, SOPs and controls are reviewed by the management and audited by Internal Auditors whose findings and recommendations are reviewed by the Audit Committee and tracked through to implementation. The Company has in place adequate internal financial controls with reference to the

Financial Statements. Such controls have been assessed during the year, taking into consideration the essential components of internal controls stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by The Institute of Chartered Accountants of India. Based on the results of such assessment20% carried out by management, no reportable material weakness or significant design or operation of internal financial controls

DISCUSSION ON CONSOLIDATED FINANCIAL PERFORMANCE FOR THE YEAR ENDED 2022-23

The consolidated financial statements relate to OnMobile Global Limited, referred to as "the Company", and its subsidiaries and associates together referred to as "the Group".

RESULT OF OPERATIONS

(In Rs Million except EPS)

	FY 2022-23	% of total revenue	FY 2021-22	% of total revenue	Growth %
Results from operations
Mobile Entertainment Services	5251.65	98	5,195.44	99	1
Other Income	107.05	2	72.12	1	48
Total Income	5358.70		5,267.56		2
Content fees and royalty	2431.06	45	2,530.17	48	(4)
Contest expenses	32.90	1	48.72	1	(32)
Cost of software licenses and others	136.5	3	112.03	2	22
Employee benefits expenses	1339.06	25	1,230.64	23	9
Finance costs	5.95	0	7.48	0	(20)
Depreciation and amortisation expenses	102.58	2	103.72	2	(1)
Other expenses	1187.26	22	821.54	16	45
Total Expenses	5235.31	98	4,854.30	92	8
Profit before share of loss of associates, exceptional items and tax	123.40	2	413.26	8	(70)
Share of loss of associates	0.14	0	1.04	0	(87)
Profit before exceptional items and tax	123.54	2	414.30	8	(70)
Exceptional items	(51.64)		57.22	1	(190)
Profit before tax	71.90	1	471.52	9	(85)
Provision for taxation	4.02	0	146.96	3	(97)
Profit for the year	67.88	1	324.56	6	(79)
Profit/(Loss) attributable to Shareholders of the Company	67.88	1	324.56	6	(79)
Other Comprehensive Income (Net)	36.01	1	32.28	1	12
Total Comprehensive income (loss) attributable to the	103.89	2	356.84	RIGHT>7	(71)
Owners of the Company
EPS- Basic	0.64		3.08		(79)
EPS -Diluted	0.64		3.05		(79)

Revenue

Revenue is derived from Mobile Entertainment Services, including Ring Back tones, Mobile entertainment and other services. Revenue from Mobile Entertainment Services is recognized on providing the services in terms of revenue-sharing arrangements with the telecom operators. Revenue from Other Services including maintenance services are recognized proportionately over the period during which the services are rendered as per the terms of the contract.

The revenue for the FY 2022-23 was Rs 5,251.65 Million as against Rs 5,195.44 Million in FY 2021-22, with an increase of 1%. Domestic revenues registered a growth of 34%, whereas revenue outside India has de-grown by 6%.

The segmentation of revenue by geography is as follows:

(In Rs Million)

	FY 2022-23	% of total Revenues	FY 2021-22	% of total Revenues	Growth %
India	1198.55	23	896.26	17	34
Outside India	4053.09	77	4,299.18	83	(6)
Total Revenue	5,251.65		5,195.44		1

Other Income

Other Income was Rs 107.05 Million in the FY 2022-23 as compared to Rs 72.12 Million in FY 2021-22. FY 2022-23 includes Rs 98.25 Million for interest earned on fixed deposits, profit from investments and dividend yield on mutual funds, and for FY value was Rs 46.78 million. Other Income includes Rs 2.32 Million net gain on foreign currency transactions and translations for FY 2022-23. For the previous year, loss on foreign currency transactions and translations is 18.56 Million.

The surplus funds of the Group continue to remain mainly invested in bank fixed deposits and debt funds in adherence to the Groups investment policy.

Cost of Sales and Services

Cost of Sales and Services consists of amount incurred towards content fee and contest expenses, cost of software licenses and other charges. Content fee is paid to content providers such as music label companies, royalty agencies, sports licensing authorities, games publishers, and other content licensors from whom the Company procures content. Cost of software licenses and other charges include the cost of software licenses and services used by the Company for providing services to the customers. During FY 2022-23, the cost of sales and services was Rs 2600.46 Million as against Rs 2,690.92 Million incurred in FY 2021-22.

(In Rs Million)

	FY 2022-23	% of total Revenues	FY 2021-22	% of total Revenues	Growth %
Content fee	2431.06	46	2,530.17	48	(4)
Contest expenses, cost of software licenses and others	169.40	3	160.75	3	5
Cost of Sales and Services	2600.46	49	2,690.92	51	(3)

Employee Benefits Expense

Employee Benefits Expense comprise salaries paid to employees, contributions made to various employee welfare funds and expenses incurred towards welfare of the employees.

During the FY 2022-23, the Group incurred a cost of Rs 1339.06 Million as against Rs 1,230.64 Million in FY 2021-22, thus representing an increase of 9% from the previous year.

The total employee strength of OnMobile Global Limited and its subsidiaries as on March 31, 2023, was 622.

Finance Charges

Finance Charges represent interest on finance Lease Liabilities. During FY 2021-22, the group adopted Ind AS 116 ‘Accounting of

Lease resulting in the above charge.

Depreciation and Amortization

The Group provided a sum of Rs 102.58 Million and Rs 103.72 Million towards Depreciation and Amortization for the FY 2022-23 and FY 2021-22, respectively, thus representing a fall of 1% over the previous year. Decrease in Depreciation and Amortization is on account of reduction in depreciation and amortization charges for upfront customer contract fees, which is regrouped as a reduction in revenues as per Ind AS 115 for a full year in the current year as compared to only nine months in last year. Further decrease is contributed by Lease modification for headquarters.

Depreciation and Amortization on assets are provided on a monthly basis using the straight-line method based on useful/ commercial lives of these assets as estimated by the Management, other than for market development and deployment rights, which is amortized over its useful/ commercial life in time proportion of its economic benefits, that are expected to accrue to the Company. The amortization method is reviewed at each year-end for any significant change in the expected pattern benefits. Expenditure incurred on research and development is not being capitalized.

Other Expenses

In the FY 2022-23, Other Expenses increased by 45% to Rs1187.26 Million as against Rs 821.54 Million incurred in FY 2021-22. The break- up of the expenses is as follows: (In Rs Million)

	FY 2022-23	% of total Revenues	FY 2021-22	% of total Revenues	Growth %
Legal, professional & consultancy charges (including Remuneration to Auditors)	182.33	3	157.32	3	16
Marketing Expenses	754.52	14	398.17	8	89
Rent and other facilities cost	34.92	1	37.88	1	(8)
Travelling and Conveyance	57.83	1	18.04	0	221
Communication charges	25.96	0	21.81	0	19
Rates and taxes	15.54	0	39.37	1	(61)
Others	116.15	2	148.95	3	(21)
Total	1187.26	22	821.54	16	45

Exceptional Items

Exceptional item in FY 2022-23 is Rs (51.64) Million and Rs 57.22 Million for FY 2021-22.

Share of loss from Associates

Share of Profit / (Loss) of Associates in FY 2022-23 is Rs0.14 Million and Rs 1.04 Million for FY 2021-22. Share of loss from Associates refers to loss from Mobile voice connect.

Profit before Tax

The Profit/(Loss) before Tax of Rs 71.90 Million in the current FY 2022-23, as compared to Rs 471.52 Million during the previous year.

Provision for Taxation

The amount provided for taxation in the current FY 2022-23 is Rs4.02 Million as against Rs146.96 Million for FY 2021-22. Effective tax rate in FY 2022-23 is at 6% from 31% in FY 2021-22.

Other Comprehensive Income

Other Comprehensive income for the year 2022-23 includes a gain of Rs37.80 Million on account of exchange differences in translating the financial statements of foreign operations and a loss ofRs1.54 Million due to re-measurements of defined benefit liabilities. Other Comprehensive income /(loss) was Rs 36.01 Million in FY 2022-23 compared to Rs 32.28 Million in FY 2021-22.

Total Comprehensive Income for the year

The Total Comprehensive Income is Rs 103.89 Million in the current FY 2022-23, compared to Rs 356.84 Million during the previous FY

2021-22.

FINANCIAL CONDITION Non-Current Assets

Property, Plant and Equipment, Capital Work-in-Progress and Intangible Assets

The Company did not incur any amount in Capex for FY2022-23.

Capital Work-in-Progress represents the cost of the assets that are not ready for their intended use at the Balance Sheet date. There is an increase of Rs 83.61 Million in Capital Work-in-Progress on account of assets put to use during the FY 2021-22.

Intangible Asset under Development

Intangible asset under Development refers to the capitalization of Research and Development costs for the new Game Streaming Platform, and Balance as on March 31, 2023 are Rs 1449.44 Million.

Right to Use Assets

Right to use Assets refers to Financial Lease obligation accounted under Ind AS 116. Right to use Assets as on March 31, 2023, are Rs 47.57 Million as compared to Rs 65.48 Million as on March 31, 2022.

Non-current Financial Assets

Non-current Financial Assets include Investments, Loans and Other Financial Assets. Non-Current Financial Assets as on March 31, 2023 are Rs 724.08 Million as compared to Rs 707.05 Million as on March 31, 2022, representing an increase of Rs 17.03 Million. Increase in non-current investment value.

Other Non-Current Assets

Other Non-Current Assets as on March 31, 2023, are Rs 2470.49 Million as compared to Rs 2,616.95 Million as on March 31,

2022, representing a decrease of Rs 146.46 Million on account of Contract acquisition cost.

Current Assets Current Investments

Current Investments as on March 31, 2023, is Rs 0.00 Million as compared to Rs 300.23 Million as at March 31, 2022.

Trade receivables

The Trade Receivables (net of Provision for Doubtful Trade Receivables) amount to Rs 1330.02 Million as on March 31, 2023, as against Rs 1,606.68 Million as on March 31, 2022.

Cash and cash equivalents

Cash and cash equivalents as on March 31, 2023, is Rs 864.22 Million as against a balance of Rs 1,352.06 Million as on March 31, 2022.

Loans

Loans and advances outstanding as on March 31, 2023, is Rs 6.04 Million as compared to Rs 8.76 Million outstanding as on March 31, 2022, thus representing a decrease of Rs2.72 Million mainly on accountofsecuritydepositsreclassified to non-current.

Investment in Associates

Investment in Associates as on March 31, 2023, and as on March 31, 2022, is NIL.

Other financial assets

The Other financial assets as on March 31, 2023, isRs 648.39 Million as compared to Rs 565.92 Million as on March 31, 2022, representing an increase of Rs 82.47 Million. The increase was mainly on account of accrued interest on deposits.

Other current assets

Other current assets as on March 31, 2023, is Rs 562.32 Million as compared to Rs 519.21 Million outstanding as on March 31, 2022, representing an increase of Rs 43.11 Million mainly on account of increase in balances with statutory authorities.

Equity and Liabilities

Equity

Equity Share Capital

The Authorized Share Capital of the Group is Rs 1,500 Million, comprising 149,500,000 equity shares of Rs10/-each and 500,000 preference shares of Rs10/- each.

As at March 31, 2023, the Group has equity of 106,014,821 shares of Rs10/- each as Issued, Subscribed and Paid-up Capital which was 105,602,073 shares at March 31, 2022.

Other Equity

A summary of the Other Equity is given below:

(Rs Millions)

	As at March 31, 2023	As at March 31, 2022
Capital Redemption	176.48	176.48
Reserve
Securities premium	2,442.63	2,431.36
Stock Options outstanding	94.68	36.87
General Reserve	133.84	133.84
Foreign Currency	99.44	62.51
Translation Reserve
Retained Earnings	2,394.30	2,485.27
Other items of Other	144.62	145.53
Comprehensive Income
Total	5,485.99	5,471.86

Foreign Currency Translation Reserve comprises the exchange difference relating to the translation of the financial results and net assets of the Companys foreign operations from their respective functional currencies to the Companys presentation currency.

The surplus retained in theStatement Profitand Loss as at March 31, 2023, is Rs 2,394.30 Million.

The total Net Worth of the Group as at March 31, 2023, is Rs6546.14 Million, with the book value of each share being Rs 61.75/- (Face value of Rs 10/- each). The corresponding numbers for the previous FY are Rs 6,527.88 Million and Rs 61.82/- respectively.

Liabilities

Non-Current Liabilities Lease liabilities

The Lease liabilities outstanding as on March 31, 2023, are Rs 37.07 Million as compared to Rs 54.83 Million as on March 31, 2022. This represents Long term maturities of Finance Lease obligation as per Ind AS ‘Accounting of Leases. The reduction is on account of Depreciation charge off during the year.

Other Financial liabilities

The Long-term liabilities outstanding as on March 31, 2023, and as on March 31, 2022, are NIL.

Long-term provisions

The Long-term Provisions outstanding as on March 31, 2023, are Rs 154.13 Million as compared to Rs 131.29 Million as on March 31, 2022, thus representing an increase of Rs22.84 Million. The increase is primarily on account of the provision for Gratuity.

Deferred Tax Liability

Deferred Tax Assets and Liabilities are recognized for the future tax consequences of temporary differences between carrying values of the assets and liabilities and their respective tax bases and are measured using enacted tax rates applicable on the

Balance Sheet date. Deferred Tax Assets are recognized subject to managements judgment that realization is virtually certain.

The Deferred Tax Liability (net) represents the deferred tax liability of the Group and as on March 31, 2023, is Rs 9.07 Million as compared to Rs9.04 Million as on March 31, 2022.

Current Liabilities

The Current Liabilities outstanding as on March 31, 2023 are Rs 2323.14 Million as compared to Rs 2,385.39 Million as on March 31, 2022, thus representing a decrease of Rs62.25 Million.

Ratios

	As at March 31, 2023	As at March 31, 2022
Debtor Turnover (times)	1.4	1.7
Inventory Turnover	NA	NA
Interest Coverage Ratio	NA	NA
Trade payables turnover ratio (times)	0.4	0.4
Current Ratio	2.2	2.3
Debt Equity Ratio	NA	NA
Operating Profit Margin %	4.2	9.8
Net Profit Margin (%)	(1.0)	7.9
Return on Capital employed (%)	(0.3)	0.9
Return on Equity Ratio (%)	(0.3%)	2.2%

Debtors turnover ratio as on March 31, 2023, is 1.4 vs 1.7 as on March 31, 2022. Current ratio, as on March 31, 2023, is 2.2 vs 2.3 as of March 31, 2022. Net profit margin % in the current year March 2023, is at -1.0% as compared to 7.9% in the last year. Net profit has decreased from Rs 324.56 Million to Rs 67.88 Million on a consolidated basis mainly due to an increase in Marketing expense from 398.17 Mn in FY22 to 754.52 Mn in FY23 and revenue remaining flat.

MATERIAL DEVELOPMENTS IN HUMAN RESOURCES Talent Acquisition

The Great Resignations continued for the second year in a row while the attrition rates were stable at 20%, similar to the previous year. This was a market-wide phenomenon considering competitive offers and retention strategies deployed by the companies in the market. We have on-boarded more than 140 resources across India, Canada, Bangladesh, Spain, Sweden & Mexico, while our offer to acceptance ratio is at 60%, similar to the previous year.

Our focus for the year was to exercise prudence in spending talent budgets by relying less on the specialist firms and focus on building a strong network through the primary sourcing channels

LinkedIn, Naukri & Indeed. We have also focused on claw backs and long-term incentives to create compelling offers for the candidates. Like the previous year, we leveraged the hiring managers and their LinkedIn connections to expand the hiring funnel, and this helped us close quite a few key roles.

The transition from virtual onboarding to on-campus onboarding resulted in a significant reduction in the while creating a better employee onboarding experience through team lunches, office tours, etc.

Going forward, we will focus on identifying unique cohorts while building personalized reward strategies for each individual cohort.

Talent Management & Employee Engagement

In addition to delivering interventions in line with our business needs, we aimed to make our learning efforts more customised and employee-led in FY 2022-23 by encouraging people to take up certifications and courses suited to their aspirations in consultation with their managers. We opened the opportunity to pursue certifications on topics Marketing, Gaming, Content Acquisition and 5G from partners like Udemy and Coursera for CFU. Employees had the option to choose from over 50 courses shortlisted by different Access to learning platforms like KodeKloud, ACloud Guru and Pluralsight has been provided to Technology Team to be used for upskilling during onboarding or other projects.

A quick summary of the interventions for this year is given below -

Type of Intervention	Trainings	Target Audience	No. of employees covered	Total person- hours	Total person days*
	Emotional Intelligence	Across Org	77	424	53
Behavioural/	Addressing Unconscious Bias	Managers	70	105	13
Leadership/	Session on Equity	Across Org	120	180	23
Managerial ILTs	Problem Solving	Technology & erstwhile PM&BE	20	50	6
	Varied technical topics – DevSecOps, Python, Core	Technology, Products, erstwhile PM&BE	140	5254	657
Technical/ Functional ILTs	Game Development, Java, Ansible
	Product Training	CFU	14	56	7
Total			441	6069	759

*One - person day = 8 hrs of training

As seen from the table above, we have covered nearly 441 employees (non-unique) through different interventions. These interventions were global across geographies.

Apart from the aforementioned interventions, quarterly induction programs were conducted as part of onboarding new hires to give an overview of different Business Units, policies and systems at OnMobile. We conducted four batches of induction in FY 2022-23, covering over 130 new hires in around 50 sessions.

Building employee connect became our guiding principle as we experimented with initiatives to bring different groups of people together and share their experiences and feedback to make our workplace better. We started a quarterly program to create a space for BU Heads to connect with new hires in their respective units and understand their experiences and needs. We also conducted

Focus Group Discussions with female employees to understand how we can make OnMobile safer and more desirable to that group. Based on the inputs, we automated the declaration process for working late for women in India and commenced sending out monthly policy updates.

We added another category, Trailblazers, to our existing Excellence Awards: Above & Beyond, Rockstars and Dynamos. This half-yearly award recognizes the accomplishments and contributions of Directors.

One of our most notable activities for this year was in the space of DEI, where we conducted programs spread over three days for

International Womens Day, keeping in line with this years theme, ‘Embracing Equity. Kick-off was a program on ‘Unconcious Bias curated for Managers, followed by ‘Gender Bias Bingo for female employees and a session titled ‘Achieving an Equal Future for everyone globally. These culminated in the launch of OnMobiles Womens Forum, ‘Femme Collective.

CAUTIONARY STATEMENT

Statements in the Management Discussion and Analysis describing the industrys projections and estimates (which are based on reliable third-party sources) as well as Companys objectives, estimates, projections and expectations may be "forward-looking statements" within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could influence the Companys operations include economic developments within the country, demand and supply conditions in the industry, changes in Government regulations, tax laws and other factors such as litigation and labour relations.