Palred Technologies Ltd Management Discussions

FOR THE YEAR 24-25

The Company has three subsidiaries, Paired Electronics Private limited (formerly known as Paired Online Technologies Private Limited} (PEP), Palred Technology Services Private Limited (PTS) and Palred Retail Private limited (PRP). Palred together with its subsidiaries, is hereinafter referred to as "the Group."

The Company is a Public Limited Company incorporated and domiciled in India having its registered office in Hyderabad, Telangana. The Company is listed on Bombay Stock Exchange and National Stock Exchange of India Limited.

1. SUBSIDIARIES:

Paired Electronics Private Limited (PEP)

Palred Electronics Private Limited, through its flagship brand pTron, has continued to build on its vision of delivering smart digital accessories to the Indian masses at value-driven prices. The company operates across product categories including TWS (True Wireless Stereo), Smart Wearables, Wired and Wireless Headphones, Bluetooth Speakers, Power Banks, Cables, and Chargers. pTron products are distributed through a mix of online marketplaces, offline retail channels, and more recently, hyperlocal quick commerce platforms.

FY 2024-25 marked a phase of consolidation and introspection, as the company navigated complex market challenges while deepening its strategic focus on cost efficiency, product value enhancement, and channel diversification.

Economic and Industry Overview

The Indian consumer electronics industry experienced a turbulent year in FY 2024-25, shaped by a confluence of macroeconomic pressures. Persistently high inflation, reduced discretionary income, and cautious consumer spending patterns adversely impacted categories such as wearables and entry-level audio products.

While industry growth rates slowed, structural shifts became evident-consumers increasingly sought quality over quantity, while value-consciousness heightened across urban and semiurban markets. The penetration of quick commerce platforms reshaped buying behavior for accessories and smaller-ticket products, ushering in faster purchase cycles and need-based consumption. This emergence of new-age distribution channels offered growth opportunities for nimble brands with agile supply chains.

Amid these changes, pTrons strategic investment in in-house manufacturing, product design improvements, and marketing recalibration laid the groundwork for navigating through adversity.

Performance Overview

The performance of pTron in FY 2024-25 was characterized by contrasting trends across its portfolio. The TWS category, which had previously been a dominant contributor, witnessed steep degrowth owing to heightened competition, saturated demand, and price-led commoditization. The segment also suffered from reduced festival and event-driven demand, coupled with margin erosion driven by aggressive discounting across platforms.

In contrast, the Power Banks and Speakers categories displayed resilience and moderate growth, driven by utility-led demand and relevance across both urban and Tier 2/3 consumers. Another noteworthy development during the year was the successful entry into quick commerce platforms such as Instamart and Zepto. These platforms emerged as high-potential, high- velocity channels, especially for fast-moving SKUs like charging accessories, cables, and budget audio devices.

The company also achieved an operational milestone over 80% of its total volumes were assembled domestically at its Nacharam facility. This shift enabled better supply chain responsiveness, enhanced control over product quality, and improved working capital efficiency.

Key Financial Highlights:

• Revenue: Total revenue declined by 26.83% year-on-year, reflecting weaker performance in core segments, especially TWS and Smart Wearables.

• Profitability: The Company reported a consolidated net loss of Rs.11.18 crore, compared to Rs.7.14 crore in the previous year. Increased promotional expenses, high return rates, and pressure on contribution margins were key drivers of the loss.

• Margins: Despite internal efficiencies from local assembly, margins contracted due to platform-driven discounting and adverse product mix.

Business Strategy

In FY 2024-25, pTron recalibrated its business strategy around four core pillars:

1. Manufacturing Efficiency

2. Channel Diversification

3. Product Portfolio Optimization

4. Cost and Marketing Rationalization

Segment-wise Performance

TWS (True Wireless Stereo): Worst-affected segment with significant volume and revenue decline.

Smart Wearables: Growth stalled due to competition, pricing pressure, and returns.

Power Banks: Positive traction with demand for fast-charging models.

Speakers: Consistent growth with improved product features. Cables & Chargers: Steady demand from replacement and upgrade cycles.

Marketing and Promotional Activities

Marketing efforts were streamlined to balance visibility with cost. Focus areas included ROI-led digital marketing, quick commerce campaign alignment, influencer collaborations, and selective offline branding.

Risks and Concerns

- Category saturation in TWS and wearables

- High return rates

- Platform dependency

- Global supply chain risks and FX volatility

Outlook

pTron aims to consolidate gains in resilient categories while revamping underperforming segments. The company will continue scaling quick commerce, improving margins, and enhancing product offerings in FY 2025-26.

Conclusion

FY 2024-25 was a year of sharp contrasts for pTron. Despite headwinds, strategic progress in manufacturing, distribution, and product focus laid the foundation for future growth.

Paired Technology Services Private Limited (PTS)

PTS offers a bouquet of Products through its brand "Xmate" that is exclusively available on Amazon.in. Xmate Sells products like Bluetooth headsets, Bluetooth speakers, wired headsets, chargers and cables, Computer Accessories, Cameras & Camera Accessories etc. The brand faced many challenges since inception because of high advertisement costs and competition from other big brands. The Company was not able to achieve desired growth and it continues to make losses. Hence, the Company has decided to exit "Xmate" brand business.

Paired Retail Private Limited (PRP)

Palred Retail Private Limited owns ecommerce website, ptron. in and www.LatestOne.com that specialize in selling of tech and mobile accessories such as Bluetooth speakers and headsets, cables, power banks, headsets, smart watches, fashion accessories etc.

FINANCIAL PERFORMANCE:

A. Sources of Funds

1. Equity Share Capital

As on 31st March 2025, the Company has only one class of issued shares - Equity Shares of Par value of Rs. 10/- per share. The Authorised Capital of the Company is Rs. 35,00,00,000/- (Thirty Five Crores ) divided into (a) 2,80,38,800 (Two Crore Eighty Lacs Thirty Eight Thousand Eight Hundred Only) shares of Rs. 10/- (Rupees Ten Only) each and (b) 6,96,120 (Six Lakhs Ninety Six Thousand One Hundred and Twenty) Preference Shares of Rs.100/- each. The Paid up Equity Share Capital of the Company as on date of this report is Rs. 12,23,25,660 (Twelve Crores Twenty Three Lakhs Twenty Five Thousand Six Hundred and Sixty) divided into 1,22,32,566 Equity Share of Rs. 10/- per share.

2. Other Equity:

2.1. Securities Premium Account:

The balance in Securities Premium Account as on March 31, 2025 was Rs. 9670.30 Lakhs as compared to the balance in Securities Premium Account as on March 31, 2024 was Rs. 9670.30Lakhs.

2.2. Capital reserve:

On a Standalone and Consolidated Basis, the Balance as at March 31, 2025, amounted to Rs. 142.80 Lakhs which was the same as previous year.

2.3. General Reserve:

On a Standalone and Consolidated Basis, the balance as at March 31, 2025 stood at Rs. 1325.24 Lakhs which is the same as previous year.

2.4. Retained Earnings:

On a Standalone Basis, the balance as at March 31, 2025 stood at Rs. (5593.71) as compared to Rs. (5800.52) Lakhs in previous year. On a Consolidated Basis, the balance as at March 31, 2025 stood at Rs. (7521.11) as compared to Rs. (6732.91) as Lakhs in previous year.

3. Liabilities:

3.1. Non-current Liabilities:

Particulars	Standalone		Consolidated
	2025	2024	2025	2024
Other Financial liabilities	8.70	14.87	148.10	212.44
Employee benefit obligations	11.63	9.63	66.56	58.50
Total	20.33	24.50	214.66	270.94

The Company provides for gratuity for employees in India as per the Payment of the Gratuity Act, 1972. Employees who are in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/ termination is the employees last drawn basic salary per month computed proportionally for 15 days salary multiplied for the number of the years of service. The gratuity plan is unfunded.

3.2. Current Liabilities:

Particulars	Standalone		Consolidated
	2025	2024	2025	2024
Financial Liabilities
Borrowings	0	0	5587.78	6,340.30
Lease Liabilities	6.00	4.65	95.81	68.70
Trade payables	0	0	0	01.51
Other Financial liabilities	126.27	67.95	905.90	541.58
Other Current liabilities	98.23	2.64	124.39	26.66
Employee benefit obligations	2.51	0.32	3.63	1.33
Total Current Liabilities	233.01	75.56	6,717.51	6,980.08

On standalone basis, the Company has increased its total current liabilities to Rs. 233.01 Lakhs stood as on 31st March, 2025 as compared to Rs. 75.56Lakhs in the previous year.

On consolidated basis, the Company has decreased its total current liabilities to Rs. 671751 Lakhs stood as on 31st March, 2025 as compared to Rs. 6980.08 Lakhs in the previous year.

B. Application of Funds:

1. Non- Current Assets:

Particulars	Standalone		Consolidated
	2025	2024	2025	2024
Property plant & Equipment	2.43	2.60	110.81	145.32
Right of use of Assets	13.39	17.74	216.94	259.20
Goodwill (Consolidation)	0	0	0	0

 

Particulars	Standalone		Consolidated
	2025	2024	2025	2024
Intangible Assets	0	0	1.86	3.25
Financial Assets Investments Deposits	1100.00	1100.00	64.24	60.70
Other non- current assets	366.29	359.60	439.91	434.32
Total Non-Current Assets	1482.10	1479.94	833.75	902.79

Investments in Subsidiaries/ associates

Paired Electronics Private Limited (formerly known as Paired Online Technologies Private Limited):

During the period under report, the Company has not invested in Paired Electronics Private Limited.

The Company holds 78.17% stake in the said subsidiary.

Palred Technology Services Private Limited:

During the period under report, the Company has not invested in Paired Technology Services Private Limited.

The Company holds 100% stake in the said subsidiary.

Palred Retail Private Limited:

During the period under report, the Company has not invested in Palred Retail Private Limited.

The Company holds 83.71% stake in the said subsidiary.

2. Current Investments, Cash and Cash Equivalents:

On a standalone basis, balance in current investments is Rs. NIL Lakhs as at March 31, 2025 and March 31, 2024. The cash and bank balance stand at Rs. 5528.77 Lakhs as at March 31, 2025 as compared to Rs. 5174.26 Lakhs as at March 31, 2024.

On a consolidated basis, balance in current investments is Rs. NIL Lakhs as at March 31, 2025 and March 31, 2024. The cash and bank balance stand at Rs. 5582.77 Lakhs as at March 31, 2025 as compared to Rs. 5249.53 Lakhs as at March 31, 2024.

III. RESULTS OF OUR OPERATIONS:

1. Income:

On a standalone basis, the Company has earned Rs. 150.00 Lakhs as Income from Operations & Rs. 388.60 Lakhs as Other Income from Dividend and interest from non-trade investments.

On a Consolidated basis, the Company has earned revenues of Rs. 8566.56 Lakhs from operations and Rs. 410.06 Lakhs from other income sources.

As on date of this report, the Company did not invest anything in Palred Electronics Private Limited, Palred Retail Private Limited & Palred Technology Services Private Limited. The Investment in Subsidiaries has Net carrying Value Rs. 1100.00 Lakhs as on date.

Palred Electronics Private Limited (formerly known as Palred Online Technologies Private Limited) has earned a total revenue of Rs. 858729 Lakhs in FY 2024-25 as compared to Rs. 11,736.41 Lakhs in FY 2024-25 resulting in 26.83% decrease in net revenue year on year basis.

Palred Technology Services Private Limited has earned a total Revenue of Rs. NIL as compared to Rs. 6.76 Lakhs in FY 2024-25 resulting in 100% decrease in net revenue year on year basis.

Palred Retail Private Limited has earned a total Revenue of Rs.

0.87 Lakhs in FY. 2024-25 as compared to Rs. 10.08 Lakhs in FY 2023-24 resulting in to reduction of 6785% in Net Revenue.

Thus on a consolidated basis, the total revenue of the Company is Rs. 8,976.62 Lakhs compared to Rs. 12,044.33 Lakhs in previous year.

2. Expenditure:

On a Standalone Basis, the expenditure incurred towards employee benefit expenses is Rs. 73.88 Lakhs as against Rs. 71.66 Lakhs of previous year and Other Expenses are Rs. 76.97 Lakhs as against Rs. 79.14 Lakhs of previous year.

On a Consolidated Basis, the Total Expenditure is Rs. 9,838.70 Lakhs as against Rs. 12,554.03 Lakhs of previous year.

3. Operating Profit:

On a standalone basis, the company has earned operating profit of Rs.206.81 Lakhs as against profit of Rs. 90.30 Lakhs in previous year.

On a Consolidated Basis, the company has incurred operating loss of Rs. (1,033.19) Lakhs as compared to Loss of Rs. (513.33) Lakhs of previous Year.

4. Depreciation and Amortisation:

On a standalone basis, we provided Rs. 5.04 Lakhs and Rs. 6.16 Lakhs for the years ended March 31, 2025 and March 31, 2024 respectively.

On a consolidated basis, we provided Rs. 123.35 Lakhs and Rs. 165.62 Lakhs for the years ended March 31, 2025 and March 31, 2024 respectively.

5. Net Profit/Loss after tax:

On a standalone basis, the company has earned net profit of Rs. 203.78 Lakhs as against Profit of 89.68 lakhs in previous year. On a Consolidated Basis, the company has incurred net loss of Rs. (1033.19) Lakhs as compared to loss of Rs. (513.33) Lakhs of previous Year.

6. Liquidity:

On a standalone basis, the company has operations in F.Y. 202425. The Company has utilized Rs. 38.80 Lakhs from investing activities during 2024-2025 compared to generation of Rs. (66.41) Lakhs during 2023-2024. The Company has also gained Rs. (27.42) Lakhs from operating activities during 2024-2025 compared to Rs. 79.20 Lakhs utilized during 2023-2024.

On a Consolidated Basis, the net cash used in operations is Rs. 1,353.73 Lakhs as against (242.86) Lakhs net cash used in previous Year.

7. Related Party Transactions:

These have been discussed in detail in notes to the standalone Financial Statements in Annual report.

8. Events occurring after Balance Sheet Date- NIL

IV. STRATERGY, OUTLOOK, OPPORTUNITIES AND THREATS:

A. Objective and Strategy:

Palred Group aims to become a market leader in various products of Consumer Electronics business in India. The Company aims to achieve this unique position by combination of following factors:

issues for which the Paired Group is taking countermeasures. IT security risks are addressed through technical and organizational measures. Effective customer management minimize the impact of potential defaults on receivables.

Financial Performance

Prudent Financial Planning, effective resource allocation and tight financial control have ensured that the cash flows of the Company remain healthy. The ability of the Company to raise credit remains unimpaired.

V. INTERNAL CONTROL SYSTEMS AND ADEQUACY:

The Company has adopted strong and automated internal business controls and a process framework that is not only adequate for its current size of operations but can effectively support increases in growth and complexity across our business operations. A well established and empowered system of internal financial audits and automated control procedures ensures prudent financial control, flexibility in terms of process changes to enable course correction.

Internal auditors submits reports and updates to the audit committee of the Board, which conducts frequent reviews and provides direction and operational guidance on new processes to be implemented to further enhance efficiencies within the Company.

The Company is in the process of implementing Enterprise Resource Planning along with various business controls which would have automatic internal control systems to identify errors and also provide better MIS.

VI. HUMAN RESOURCES:

A. Objective and Strategy:

Capability building, Talent Management and Employee Engagement remain the key focus of your companys Human Resource Strategy. Your Company has continued to build on its capabilities in getting the right talent to support the different technology areas. They are backed by robust management training schemes, hiring of key management personnel, and sales training.

Human Resources are the most valuable asset for the Company and Palred Technologies continues to seek, retain and enrich the best available talent. The Human Resource plays an important role in the growth and success of the Organization. Your Company has maintained cordial and harmonious relations with all the employees.

The Company provides an environment which encourages initiative, innovative thinking and rewards performance. The Company ensures training and development of its personnel through succession planning, job rotation, on-the-job training and various trainings and workshops.

B. Culture, Values and Leadership

Your Company has a written code of conduct and ethics to make employees aware of ethical requirements and Whistle Blower Policy for reporting violations, if any.

Your Company has internal structured succession planning to take care of loss of any member of senior management or other key management personnel. Since inception your Company is committed to developing next generation leaders and conduct personality development and development work of skills acquired by them over the years. Your Company encourages

i. Creation of Innovative Products that are geared towards customer needs and that can be produced economically

ii. Focus on enhancing customer benefit in terms of products and services as well as on close consumer contact

iii. Proactive identification of future needs and technical applications

iv. High value addition through combination of technology, systems & processes

v. Simplification of a complex business involving continuously changing products and thousands of stock keeping units (SKU)/items.

vi. End-to-end integration and implementation of Systems, Processes and Automation for efficient and scalable operations.

vii. High quality Products backed by warranty

viii. Steady and continuous development of brand (PTron)

b. Outlook, Risks and Concerns:

The Consumer Products Industry has been experiencing very intense competition for many years and we are operating in a market that is changing very quickly. The Customers have many options to choose from large and established brands and this may result in loss of our market share affecting the profitability. We are dependent on number of contract manufacturers and component suppliers. There may be a situation where these manufacturers and component suppliers may fail to supply the required products / parts which may adversely impact our cash flows and profitability. We are also subject to risks associated with geographical tensions & foreign exchange fluctuations. The Company is taking all appropriate measures to mitigate and safeguard the Company from above risks.

B. Intellectual Property Infringement:

As product development depends on the intellectual property created by its employees, we need to ensure that the same do not infringe any other proprietary technology rights. We have intellectual property rights to take care of trade secrets, copyright and trademark laws and confidentiality agreements for our employees, third parties offering only limited protection. The steps taken by us as well as laws of most advanced countries do not offer effective protection of intellectual property rights. Third parties could claim infringement of property rights against the Company or also assert the same against our customers, which would require protracted defence and costly litigations on behalf of our customers.

C. Risks and risk management and their implementation:

The systematic analysis, evaluation and management of potential risks are decentralized within the Palred Group. Every organizational unit is responsible for detailing its own risk register, which it must then use to establish countermeasures for managing risks. The purpose is to identify and avert potential damage to the company at an early stage. All registers are centrally coordinated and aggregated so the Management Team has an overview at all times of the most significant risks and the measures being taken to manage them. Within the scope of independent audits, the Audit Department monitors the individual corporate entities with regard to early risk identification and compliance management by performing random inspections. The Management Team is informed directly and immediately of the findings.

The risks of procuring certain parts and components, product compliance and IT security are among the most important

Paired Technologies Limited

an "Equal Employment Opportunity Policy" which discourages discrimination for employment on account of sex, race, colour, religion, physical challenge and so on.

As the Company operates in a niche industry that requires high techno functional expertise. The employees constantly need to enhance their technical and functional knowledge and so regular training sessions on specific technical skills and domain knowledge were conducted.

VII. CAUTIONARY STATEMENT:

Statements in the "Management Discussion and Analysis" describing the companys objectives, estimates, expectations or projections may be "forward looking statements" within the meaning of applicable laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Companys operations; include Government regulations, patent laws, tax regimes, economic developments within India and countries in which the Company conducts business, litigation and other allied factors.

VIII. DETAILS OF SIGNIFICANT CHANGES (I.E., CHANGE OF 25% OR MORE AS COMPARED TO THE IMMEDIATELY PREVIOUS FINANCIAL YEAR) IN THE KEY FINANCIAL RATIOS, ALONG WITH DETAILED EXPLANATIONS THEREOF:

Particulars	Standalone basis		Remarks
	2024-25	2023-24
Debtors Turnover Ratio	0	0	There are no trade receivables as at the balance sheet date.
Inventory Turnover Ratio	0	0	There is no Inventory
Interest Coverage Ratio	0	0	There is no Finance Cost.
Current Ratio	23.74	68.53	Improvement in current ratio is due to creation of additional fixed deposits.
Debt Equity Ratio	-	0
Operating Profit Margin Ratio	0.71	0.65	Due to increase in other income and reduction in expenses
Net Profit Margin Ratio	0.38	0.20	impairment on Non-current assets has led to Decrease in profits in previous year

 

Particulars	Consolidated basis		Remarks
	2024-25	2023-24
Debtors Turnover Ratio	3.70	6.83	Increase in Trade Receivable at year end leads to Improvement in the ratio.
Inventory Turnover Ratio	3.09	5.75	Decrease Inventory at year end leads to Improvement in the ratio.
Interest Coverage Ratio	-0.53	0.20	Difference due reduction in profit and turnover
Current Ratio	1.60	1.72	There is no much change as compare to previous year.
Debt Equity Ratio	115	1.13	There is no much change as compare to previous year
Operating Profit Margin Ratio	-0.03	0.01	Difference due to decerase in turnover
Net Profit Margin Ratio	-0.12	-0.04	Difference due to Decrease in turnover.

Return on Net Worth:

Particulars	Standalone basis		Consolidated Basis
	2024-25	:2023-24	:2024-25	2023-24
Return on Net Worth	5.64	1.38	-0.20	(0.01)

There is an increase in Return in Return on Net Worth ratio as the loss has been reduced in FY.2024-25.

IX. DISCLOSURE OF ACCOUNTING TREATMENT:

During the preparation of Financial Statement of F.Y. 2024-25 the treatment as prescribed in an Accounting Standard has been followed by the Company. There is no discrepancy in Accounting Treatment as followed by the Company in current financial year as compared to previous financial year.