Pace E-Commerce Ventures Ltd Management Discussions

Economic overview

GLOBAL ECONOMY

The global economy is forecasted to grow by 3.0% in 2025, with a slight improvement to 3.1% in 2026. These estimates reflect a more optimistic outlook compared to earlier projections, supported by quicker-than-expected adjustments in global trade, a softer US dollar improving financial conditions, lower effective tariffs in the US, and fiscal expansion in several key markets.

Global headline inflation is expected to moderate to 4.2% in 2025 and further to 3.6% in 2026, though regional disparities are likely to persist. While the United States may continue to experience elevated price pressures, other large economies are expected to maintain more stable inflationary trends.

Nevertheless, risks remain tilted to the downside. Rising tariff disputes, geopolitical uncertainties, and commodity price fluctuations may disrupt supply chains. Fiscal imbalances, risk aversion, and the possibility of higher long-term interest rates could further tighten financial conditions. In addition, concerns over economic fragmentation and slow progress on structural reforms may heighten volatility across global markets.

On the upside, constructive trade negotiations that create a more transparent and predictable policy environment could add momentum to growth. Strengthening investor confidence, ensuring financial and price stability, rebuilding fiscal buffers, and advancing structural reforms remain key global policy priorities.

Uncertainty continues to cast a shadow over the global economic outlook, with trade tensions, evolving tariff regimes, shifting fiscal policies, and geopolitical risks contributing to volatility across markets. While shortterm measures and policy interventions have provided intermittent relief, concerns around long-term fiscal sustainability in advanced economies and unresolved global disputes continue to weigh on investor sentiment. The persistence of these headwinds underscores the fragile nature of the current recovery and the need for cautious optimism as economies navigate an evolving external environment.

INDIAN ECONOMY

Indias economic outlook for FY26 reflects a balance between global headwinds and robust domestic fundamentals. GDP growth for FY25 is projected to moderate to 6.2%, yet underlying indicators continue to highlight the resilience of the economy.

While growth may appear slower compared to the exceptional pace of the past two years, recent upward revisions to national accounts provide valuable perspective. FY24 growth was revised to 9.2%, the fastest in over a decade (excluding the post-pandemic rebound) emphasising the strength of domestic consumption, which continues to anchor Indias growth story.

Temporary headwinds in FY25, including election-related uncertainty, erratic monsoons, and disruptions in global trade, dampened sentiment in certain sectors. However, these are largely transient in nature and expected to ease as policy clarity improves and external conditions stabilise.

Looking forward, several macroeconomic enablers are likely to support growth in FY26. Tax incentives from the Union Budget are expected to boost consumption and investment, with potential to add 0.6%-0.7% to GDP. At the same time, moderating inflation, favourable interest rates, stable oil

prices, and improved liquidity conditions are set to create a supportive environment for broad-based sectoral recovery.

External risks remain a consideration. Shifting trade dynamics, particularly with the United States, could marginally impact export competitiveness, with possible downside of 0.1%-0.3% to projected growth.

Balancing these factors, GDP growth for FY26 is estimated at 6.5%-6.7%. High-frequency indicators such as rising GST collections, healthy automobile sales, and steady FMCG demand reinforce the outlook of sustained momentum.

In essence, India is well-positioned to maintain its growth trajectory despite a challenging global backdrop. With stable fundamentals, proactive policy support, and a resilient consumption base, the country continues on its path of long-term economic transformation.

Source: Deloitte India Economic Outlook

Industry overview

INDIAN E-COMMERCE INDUSTRY

Indias e-commerce sector currently stands at an estimated US$136.43 billion (2025), with projections indicating it could surpass US$327.38 billion by 2030, corresponding to a robust CAGR of 19.13%. This impressive expansion is supported by ubiquitous mobile connectivity, maturing digital payments infrastructure, and enabling public policy. As a result, online retail is rapidly extending beyond metropolitan hubs into tier-2 and tier-3 cities. Indeed, around 60% of newcomers to online shopping now hail from these emerging urban centres, a structural shift that underlines the transformational potential of Indias e-commerce ecosystem.

The surge in UPI transactions, exceeding 208 billion in FY 2024, has dramatically reduced transaction friction, embedding real-time digital payments at the heart of the consumer experience. Meanwhile, evolving fulfilment and engagement models such as quick commerce, live- stream shopping, and the booming direct-to-consumer wave, combined with global initiatives like Digital India, are accelerating the journey towards a USD 1 trillion digital economy.

Key insights

BUSINESS MODEL

B2C platforms commanded approximately 87% of e-commerce revenue in 2024. Yet, peer-to-peer C2C marketplaces are poised for substantial growth, with C2C transactions forecasted to expand at nearly 25% CAGR through 2030.

DEVICE PREFERENCE

Smartphones remain the dominant mode of access, accounting for over 78% of transactions in 2024. However, emerging channels, such as AR-assisted commerce, IoT- enabled purchases, and voice-activated reordering, are growing rapidly at a projected CAGR of approximately 26%.

PAYMENTS LANDSCAPE

Digital wallets and UPI continued to dominate in 2024, representing just over 50% of payment volume. Meanwhile, Buy-Now-Pay-Later (BNPL) solutions are gaining traction, with projections suggesting a strong CAGR of around 23% to 2030.

CATEGORY DYNAMICS

Fashion and apparel remain the largest online category (circa 32% of revenue), while food and beverages are witnessing the fastest growth trajectory, propelled by rapid delivery models and impulse-driven consumer behaviour.

LOGISTICS MOMENTUM

The logistics sector supports this expansion, valued at US$ 4.42 billion in 2025 and expected to grow to US$ 7.85 billion by 2030, at an estimated CAGR of 12%. This reflects the critical importance of delivery infrastructure in meeting rising consumer expectations.

Supporting trends and challenges

The rapid digitisation of payments, especially via UPI, is empowering deeper market penetration in non-metro India. Smartphones now exceed 400 million in number, while low data pricing (US$ 0.68 per GB) is fuelling video commerce, live demos, and immersive formats that drive engagement and conversion.

The D2C ecosystem is also thriving, with over USD 5 billion invested in recent years, enabling brands to bypass traditional distribution, retain higher margins, and build direct consumer relationships. Quick-commerce penetration, meanwhile, is surpassing USD 6 billion in GMV, driven by delivery speeds under 30 minutes and an expanding dark-store network across urban clusters.

Nevertheless, the landscape is not without hurdles. Inefficient interstate logistics and high reverse-logistic costs (especially in fashion) continue to strain margins. Compliance requirements, notably under the Digital Personal Data Protection framework, impose significant operational burdens, disproportionately affecting smaller players. Also, rising customer acquisition costs in tier- 2/3 markets and heightened privacy concerns may slow personalisation efforts.

Geographic shifts & competitive landscape

While Mumbai, Delhi, Bengaluru, and Chennai still lead as spending centres, the bulk of growth now emanates from tier-2 and tier-3 cities. These regions may exhibit higher price sensitivity and longer purchase cycles, yet they deliver strong customer lifetime value when served effectively. Factors such as regional language support, hyperlocal fulfilment, and vernacular engagement are increasingly unlocking these markets. Cross-border commerce also presents a significant growth runway, with India positioning to become a US$200-300 billion outbound market by 2030.

Marketplace dynamics continue to evolve. A few large players - Amazon, Flipkart, Reliance Retail, etc., continue to dominate, but vertical specialists and nimble D2C brands are steadily chipping away at market share. Technological edge is becoming a key differentiator, from AI-powered personalisation to AR try-ons and voice commerce experiments. Heavy investments from e-commerce giants (for example, Amazons USD 15 billion commitment, and Flipkarts USD 1 billion raise) underline the competitive urgency and capital intensity of the sector. Meanwhile, emerging opportunities in B2B commerce, rural fulfilment, and cross-border trade point to untapped growth corridors.

Source: Mordor Intelligence

INDIAN PRINT ON DEMAND INDUSTRY

The Indian print on demand (POD) market was valued at US$652.20 million in 2024 and is projected to expand from US$833.51 million in 2025 to US$5931.42 million by 2033, recording a CAGR of 27.8% over the forecast period (20252033).

Print on demand refers to a technology-driven business model that enables single or small-batch production, activated only when a customer places an order. Traditionally, prior to the advent of digital printing, such a model was impractical, as conventional methods like offset or letterpress made it prohibitively expensive to produce single copies. This prevented businesses from adopting a build-to-order model until digital solutions transformed the process.

Market growth drivers

Indias growing population has created a vast consumer base for the POD industry. With more than 1.3 billion inhabitants, the potential demand for specialised and custom products is immense. The POD sector is well positioned to address varied demographic segments, each with distinct consumer tastes and aspirations.

At the same time, rising disposable incomes have further bolstered demand. As purchasing power improves, consumers are increasingly inclined to spend on customised and premium offerings. This trend is particularly pronounced among middle-class and urban populations, who actively seek unique products that reflect individuality and lifestyle preferences. Personalised clothing, accessories, home decor and promotional items are witnessing greater traction as discretionary spending rises. The middle-class population is expected to surpass 200 million by 2025, further strengthening consumer demand and creating fertile ground for POD expansion.

Market constraints

Despite robust growth potential, the POD market continues to face hurdles from infrastructural challenges. Logistics and transportation networks remain uneven across Indias vast geography, leading to delays and higher shipping costs. Inadequate warehousing capacity and limited storage space add further operational inefficiencies, hampering scalability and fulfilment speed.

Internet connectivity also poses a concern, particularly in rural and remote regions where inconsistent access and frequent power outages disrupt workflows. These gaps undermine the ability of POD companies to seamlessly manage digital platforms, deliver customer service, and ensure timely order fulfilment.

The government is actively investing in infrastructure development to address these constraints. Improvements in logistics, warehousing and digital infrastructure are expected to significantly reduce these barriers over time, creating a stronger foundation for the industrys sustained growth.

Market opportunities

The rapid rise of e-commerce in India has unlocked considerable opportunities for the POD sector. Online platforms have provided POD businesses with direct access to vast consumer audiences, while the increasing adoption of smartphones and internet connectivity has made it easier for customers to browse and purchase customised products online.

E-commerce platforms also enable targeted digital marketing, allowing POD companies to engage consumer segments with a higher propensity for personalised goods. Integration with online platforms has streamlined processes such as order management and fulfilment, improving efficiency and customer experience.

For instance, Indian POD firms can list products on major marketplaces such as Amazon and Flipkart, tapping into their wide customer bases. Integration with e-commerce enablers such as PACE helps businesses automate operations, scale offerings, and strengthen customer relationships. As a result, the growth of e-commerce has become a powerful driver of POD adoption across India.

Regional insights

Indias POD industry is expanding rapidly, supported by demographic, technological and behavioural trends. The personalised products market was valued at approximately US$1.7 billion in 2020, and the sector has continued to scale in the years since. At the same time, online retail in India generated around US$ 39 billion in 2020, providing POD enterprises with a strong channel to reach customers.

The countrys rising disposable income levels are further shaping consumption patterns, with the middle-class population expected to grow to 540 million by 2025. Additionally, Indias internet user base exceeded 624 million in 2021, making it the second-largest online market globally.

The relatively low entry barriers into POD, combined with widespread access to digital printing technology and e-commerce platforms, have spurred entrepreneurship and the growth of small businesses. These factors, alongside continued advances in digital printing, are fuelling demand for customisable products and strengthening the sectors long-term outlook.

Segmental overview

The Indian POD market is categorised by product type and platform.

Product segments include Apparel, Home Decor, Drinkware, Accessories and others. Among these, the Apparel segment holds the largest share and is projected to grow at a CAGR of 28.4% over the forecast period.

Platform segments include Software and Services. Of these, software dominates and is expected to record a CAGR of 26.0% during the forecast period.

Conclusion

The Indian print on demand market presents immense potential, driven by a large consumer base, rapid e-commerce penetration, rising discretionary spending, and continuous technological advances. While infrastructure remains a constraint, ongoing improvements are expected to mitigate these challenges. Businesses that harness digital platforms and focus on delivering personalised experiences will be well placed to capture opportunities in this dynamic and fast-growing industry.

Source: Straits Research

Company overview

Pace E-Commerce Ventures Limited is a dynamic player in Indias rapidly evolving digital commerce landscape, positioned at the intersection of technology, consumer aspirations, and entrepreneurial empowerment. We have built a diversified portfolio of businesses that cater to both B2C and B2B segments, enabling us to serve a wide spectrum of customers and partners across the online retail ecosystem.

Our business model is designed with agility and innovation at its core. Through our multiple verticals, we provide tailored solutions that range from lifestyle and fashion products to technology-driven offerings such as Print-on- Demand (POD) and Direct-to-Consumer (D2C) brands.

This integrated approach allows us to leverage synergies across segments, creating a holistic ecosystem that not only addresses the needs of consumers but also empowers entrepreneurs, distributors, and business partners.

In the B2C space, we continue to engage directly with customers through our online retail platforms, curating a product portfolio that aligns with changing lifestyle preferences. Our ability to identify trends early and to respond with speed has positioned us as a trusted brand in the competitive e-commerce industry. Meanwhile, our B2B operations provide scalable solutions for businesses, from distribution networks to POD services, opening up opportunities for enterprises to grow and diversify.

Actually, our B2B operations form a vital pillar of our business model, enabling us to create scalable and sustainable growth while deepening industry partnerships. Through a strong network of distributors, retailers, and institutional clients, we deliver customised solutions

that align with market needs and evolving consumer preferences. By leveraging technology-driven platforms and efficient supply chain management, we ensure seamless integration, faster turnaround, and value-driven offerings for our partners. This segment not only enhances brand visibility across wider geographies but also strengthens recurring revenue streams, while creating opportunities for long-term collaborations. As we expand our portfolio and diversify into new categories, our B2B business continues to position PACE as a trusted enabler of growth for enterprises of all sizes.

At the heart of our journey is our dual focus on enhancing consumer experiences and creating growth pathways for businesses. Our diversified model not only reduces risk but also ensures resilience in the face of market shifts, while our tech-driven offerings ensure we remain at the forefront of industry innovation.

With Indias e-commerce sector expanding at a remarkable pace, supported by rising digital adoption, consumer demand, and entrepreneurial opportunities, we are well- placed to harness this momentum. Our offerings are designed to address evolving market needs, solve pain points such as customisation and distribution scalability, and create sustainable value for all stakeholders.

As we step into the next phase of our growth, we are committed to deepening our customer engagement, expanding our brand portfolio, and scaling our business-to- business solutions. By doing so, we are building not only a company but an ecosystem that thrives on collaboration, innovation, and trust.

FY25 financial performance

PARTICULARS	FY25	FY24
Revenue from Operations	7213.87	4281.41
Other Income	201.15	116.81
Total Revenue	7415.02	4398.22
LESS: Total Expenses except interest and depreciation	6800.33	3963.82
Profit/(Loss) Before Interest and Depreciation	614.69	434.40
(-)Interest	84.94	65.61
(-) Depreciation	95.62	40.16
Net Profit/(Loss) before exceptional items	434.13	328.63
(+) Exceptional Items	--	--
Net Profit Before prior period item & Tax	434.13	328.63
(+) Prior Period Items	--	--
(-) Tax expense	115.00	87.32
Short/Excess Provision of tax	(6.17)	--
Deferred Tax (Assets)/ Liabilities	(5.53)	2.03
Net Profit/(Loss) for the year After Tax	330.83	239.27
Total Comprehensive Income for period	330.83	239.27
Earnings Per Share
- Basic	1.47	1.06
- Diluted	1.47	1.06

Key financial ratios

PARTICULARS	FY25	FY24	% of Variance	Remarks for variance more than 25%
Current Ratio (In times)	2.03	2.27	(10.86)	N.A
Debt Service Coverage Ratio (In times)	2.49	2.65	(6.04)	N.A
Inventory Turnover Ratio (In times)	8.10	4.57	77.15	Company having inventory to accommodate future market demand.
Trade Payable Turnover Ratio (In times)	13.28	10.51	26.40	This indicate that the company has plenty of cash available to pay off its short-term debt in a timely manner.
Net Profit Ratio (In %)	4.46	5.44	(17.99)	N.A
Debt-Equity Ratio (In %)	17.97	12.74	41.05	N.A
Return on Equity ratio (In %)	4.34	3.28	32.26	This indicates that a higher portions of the assets are financed using shareholders equity rather than borrowing money.
Trade Receivable Turnover Ratio (In times)	10.77	39.59	(72.78)	This indicates that higher portions of customers making their payments quickly.
Net Capital Turnover Ratio (In times)	4.76	3.94	20.71	N.A.
Return on Capital Employed Ratio (In %)	6.81	5.41	25.95	This indicates that company company is efficient to use of capital.
Return on Investment (In %)	N.A.	N.A.	N.A.	N.A.

Human Resources and Industrial Relations

At Pace E-Commerce Ventures Limited, we regard our people as our most valuable asset, recognising that a supportive and empowering workplace is fundamental to our success. Our human resources framework is designed to attract, nurture, and retain high-calibre talent while fostering a culture of diversity and equal opportunity. We are committed to ensuring that our workforce reflects the dynamic and inclusive communities we serve.

We place strong emphasis on employee well-being, introducing initiatives that address physical, mental, and emotional health, thereby promoting a balanced and holistic work environment. Continuous learning and development remain central to our approach, enabling our employees to strengthen their skills and adapt to the ever-evolving needs of the industry.

Open communication between management and employees is actively encouraged, underpinned by transparency, fairness, and mutual respect. This culture of collaboration ensures that employees feel valued, while their perspectives contribute meaningfully to organisational growth.

Our focus on maintaining healthy industrial relations helps in creating a harmonious, engaged, and future-ready workforce. We believe that such an environment not only drives long-term growth but also strengthens our reputation as an employer of choice within the industry.

As on 31^st March 2025, the Company employed 35 dedicated professionals who continue to play an integral role in advancing our vision and growth trajectory.

Internal control systems and their adequacy

At Pace E-Commerce Ventures Limited, we place the highest importance on establishing and sustaining a strong internal monitoring and control framework. This system is carefully designed to promote operational efficiency, safeguard company assets, and ensure that all financial transactions are duly authorised.

A comprehensive Budgetary Control mechanism forms a cornerstone of this framework, enabling continuous monitoring of actual performance against planned financial targets. This proactive process facilitates strict adherence to budgets and timely corrective measures wherever required. Complementing this is a well-defined organisational structure, supported by an authority matrix and internal policies, which together reinforce the effectiveness of our internal control system.

Our internal auditors play a vital role in evaluating the adequacy and effectiveness of these controls. Their reviews ensure full compliance with accounting standards, regulatory requirements, and statutory provisions.

The findings of internal audits are presented to senior management and the Audit Committee of the Board, where they are thoroughly examined. Recommendations arising from these reviews are promptly implemented to further strengthen our control environment.

Through this disciplined and systematic approach, we ensure accuracy and integrity in financial and operational records, thereby enabling the preparation of reliable financial statements and precise asset management. By maintaining such a robust internal control framework,

Pace E-Commerce Ventures Limited consistently upholds the highest standards of transparency, accountability, and financial governance.

SWOT analysis

At Pace E-Commerce Ventures Limited, we continue to navigate the dynamic e-commerce landscape with clarity of purpose and an unwavering focus on creating value for our stakeholders. Our strengths form the bedrock of our business, while our opportunities highlight the vast potential ahead. At the same time, we remain vigilant of our weaknesses and external threats, ensuring proactive strategies to mitigate risks.

STRENGTHS

ROBUST AND DIVERSIFIED PORTFOLIO OF PLATFORMS AND BRANDS

Our well-curated assortment of platforms addresses distinct consumer needs and lifestyle aspirations, empowering individuals and businesses alike. This breadth allows us to capture multiple revenue streams and diversify risks across customer segments.

AGILE AND RESILIENT BUSINESS MODEL

We have designed a highly adaptable operating structure, enabling us to pivot swiftly in response to evolving consumer preferences, technological shifts, and macroeconomic changes.

CAPITAL-LIGHT, LOW-RISK OPERATING FRAMEWORK

Leveraging the print-on-demand model and digital- first strategies, we effectively minimise inventory risks, reduce capital requirements, and ensure operational efficiency.

CONSUMER-FIRST ETHOS

With a deep understanding of consumer behaviour, particularly the rising demand for personalisation, we continuously create offerings that reflect individuality and resonate with young, aspirational audiences.

COMMITMENT TO GOVERNANCE AND CONTROL

Our strong internal monitoring, budgetary control systems, and rigorous audit processes uphold financial discipline, transparency, and accountability, strengthening investor confidence.

HUMAN CAPITAL EXCELLENCE

We recognise our employees as our greatest asset, fostering an inclusive workplace where collaboration, learning, and well-being drive both individual and organisational success.

OPPORTUNITIES

RAPIDLY EXPANDING E-COMMERCE SECTOR IN INDIA AND BEYOND

The exponential growth of both B2C and B2B e-commerce, fuelled by rising internet penetration, smartphone adoption, and favourable demographics, presents us with vast avenues for expansion.

BOOMING PRINT-ON-DEMAND MARKET

Indias print-on-demand sector is witnessing remarkable growth, driven by rising disposable incomes, middle-class expansion, and the increasing preference for customised products. This provides us with significant runway for scaling our offerings.

DIGITAL AND TECHNOLOGICAL ADVANCEMENTS

Innovations in digital printing, artificial intelligence, and platform integrations enable greater personalisation, improved operational efficiency, and enhanced customer engagement.

SHIFT IN CONSUMER PREFERENCES TOWARDS PERSONALISED LIFESTYLES

Young professionals and urban consumers are increasingly seeking unique, tailored products, from apparel and accessories to home decor, offering us a growing market to capture.

E-COMMERCE ECOSYSTEM MATURITY

The proliferation of integrated platforms, logistics networks, and digital payment systems continues to create a more enabling environment for us to deliver superior consumer experiences and expand our reach.

WEAKNESSES

HIGH INTENSITY OF COMPETITION

The e-commerce space remains fiercely competitive, requiring constant differentiation, innovation, and investment to sustain market share.

RELIANCE ON EXTERNAL VALUE-CHAIN PARTNERS

Dependence on outsourced functions in logistics, warehousing, and certain operational areas exposes us to potential bottlenecks and service variability.

CONCENTRATION IN NICHE CATEGORIES

While personalisation is a strength, the usability of customised products may remain limited to certain segments, necessitating continuous diversification to avoid overdependence on niche demand.

SMALL WORKFORCE AT PRESENT SCALE

With a lean team size, we may face resource constraints as we expand, requiring further investments in talent acquisition and skill development.

THREATS

MACROECONOMIC AND GEOPOLITICAL UNCERTAINTIES

Volatility in global markets, trade disputes, fiscal imbalances, and geopolitical tensions may disrupt supply chains, impact consumer sentiment, and influence growth trajectories.

OPERATIONAL CHALLENGES FROM EVOLVING CONSUMER BEHAVIOUR

Constantly shifting consumer tastes and rapid technological adoption demand agility, and any lag in adaptation may affect competitiveness.

CYBER SECURITY AND DATA PRIVACY RISKS

As a digital-first business, we are exposed to risks around data security, cyber breaches, and privacy, which could affect consumer trust and brand reputation.

INFRASTRUCTURE AND LOGISTICAL CONSTRAINTS

Indias e-commerce growth continues to be tempered by challenges in logistics, warehousing, and last-mile delivery, which could impact service levels in certain regions.

Cautionary statement

This communication may include certain forwardlooking statements relating to our business and future prospects. Such statements involve inherent risks and uncertainties, and actual results, performance, or achievements may vary materially from those anticipated or implied. Contributing factors may include, but are not limited to, changes in government regulations and taxation policies, shifts in online payment gateway policies, brand partnerships and agreements, and broader economic conditions in India and globally.

PACE E-Commerce Ventures Limited undertakes no obligation to publicly update or revise any forward-looking statements in light of subsequent developments, new information, or future events. Accordingly, readers are advised not to place undue reliance on these statements, as they represent the Companys views only as of the date of this communication.