Pilani Investment & Industries Corporation Ltd Management Discussions

Annexure- G

This Management Discussion and Analysis Report is framed in compliance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations").

Non-Banking Financial Companies (NBFCs) bring in diversity and efficiency to the financial sector. In the recent past, NBFCs have played increasingly important role in resource mobilisation and credit intermediation, thereby helping commercial sector to make up for low bank credit growth. The Reserve Bank and the Government have taken several measures to address various challenges by enhancing systemic liquidity and strengthening the governance and risk management framework of NBFCs.

Indias economy in Financial Year 2025-26 has emerged as one of the most dynamic in the global landscape making it the fastest growing major economy by a significant margin. The year witnessed a real GDP growth estimated at 7.4% by the National Statistical Office as compared to growth rate of 6.5% during 2024-25.

India is emerging as the fastest growing major economy in the world. Despite various geopolitical tensions worldwide, the economic growth of India was ensured by the government through various financial stimulus packages and the focus on infrastructural development.

Your Company holds significant investments in Equity Shares of various diversified companies like Aditya Birla Real Estate Limited (formerly Century Textiles and Industries Limited), Grasim Industries Limited, Hindalco Industries Limited, UltraTech Cement Limited, Vodafone Idea Limited, Aditya Birla Fashion and Retail Limited etc. Therefore, the business prospects of the Company largely depend on the business prospects and performance of its investee companies. As a long-term strategy, the Company is looking forward for a sustainable growth in its investee companies in the coming years which would enhance the shareholders value.

The main business of the Company is investment and financing activity and all these activities are carried out within India. As such there are no separate reportable segments or product wise performance reports applicable to the Company.

During the year Financial Year 2024-25 the Company has submitted an application with Reserve Bank of India for conversion of the Company from Non-Banking Financial Company to Core Investment Company. The Companys application to Reserve Bank of India ("RBI") has since been approved by RBI and the Company has received the fresh Certificate of Registration on conversion of the Company from Non-Banking Financial Company (NBFC-ICC) to Core Investment Company (CIC) with effect from 27th May, 2025.

The Company continues to hold significant strategic investments in various diversified and renowned companies as stated above. The Company will continue to focus on making long-term strategic investments besides consolidating existing investments through further investments in the Group Companies. Besides, the Company is also expanding its horizon by entering into the field of financing activities.

Being an Investment and Finance Company, the risk of the Company is basically attached to the performance of investee companies which are engaged in diversified fields. The Company has robust risk management and monitoring systems in place to minimise the impact of such risks.

The Company believes that a strong internal control framework is an important pillar of Corporate Governance. The Company has in place adequate internal financial control system which ensure orderly and efficient conduct of its business, safeguarding of its assets and accuracy and completeness of accounting records, timely preparation of reliable financial information and various regulatory and statutory compliances.

The following review are intended to convey Managements perspective on the financial and operating performance of the Company during the Financial Year 2025-26. This Report should be read in conjunction with the Companys financial statements and other information included in this Annual Report.

Below is a brief quantitative overview of the financial and operational performance of your Company during the reporting period.

The Company has received during the year, Income by way of Dividend to the tune of Rs. 8,305.05 Lakhs, Interest of Rs.20,243.35 Lakhs, Profit from sale of Investments of Rs.108.43 Lakhs, and Rental Income of Rs.110.29 Lakhs. The total income is Rs. 29,348.59 Lakhs as against total income of Rs.32,320.04 Lakhs in the previous year. The Profit before depreciation and tax is Rs. 9,736.78 Lakhs. After providing for depreciation of Rs. 31.62 Lakhs and tax of Rs.2,519.40 Lakhs, the Net Profit is 7,185.76 Lakhs as against Rs. 16,940.61 Lakhs in the previous year, decrease of around 57.58 %.

On the consolidated front, the Company has received during the year, Income by way of Dividend to the tune of Rs.7,649.66 Lakhs, Interest of Rs.20,269.86 Lakhs, Profit from sale of Investments of Rs.116.04 Lakhs, and Rental Income of Rs.117.30 Lakhs. The total income is Rs.28,825.37 Lakhs as against total income of Rs.30,707.39 Lakhs in the previous year. The Consolidated Profit before depreciation and tax is Rs.9,118.91 Lakhs. After providing for depreciation of Rs.32.15 Lakhs and tax of Rs.2,549.72 Lakhs, the Consolidated Net Profit but before Share of profit from Associate is Rs.6,537.04 Lakhs. Share of Loss from an Associate is Rs.3,431.49 Lakhs and Consolidated Profit after tax is Rs.3,105.55 Lakhs as against Rs.9,848.28 Lakhs in the previous year, decrease of around 68.46 %.

Employees relations continued to be harmonious throughout the year with the management. Number of permanent employees on the roll of the Company was 15 as on 31st March, 2026.

Your Company believes that, its employees are its greatest strength and the most valuable asset. The management and staff have a mutual faith and trust. The Company provides equal opportunity to all employees and strives to inculcate high performance culture in the organisation.

Interest Coverage Ratio has decreased by 54.70 % due to increase in borrowings. Current Ratio has decreased by 74% due to increase in short term borrowings. Operating Profit Margin has decreased by 51.64 % due to increase in borrowings. Net Profit Margin has decreased by 53.15% due to increase in borrowings.

Return on Net Worth has decreased by 59.32% due to increase in borrowings.