Quadrant Televentures Ltd Management Discussions

ECONOMY AND INDUSTRY OVERVIEW Macro Economic Situation

The Government of India is aggressively supporting the telecom industry through various initiatives and policies aiming growth, innovation, and digital inclusion. Atmanirbhar Bharat initiative aims to renovate the nation into a global leader in telecom equipment development and manufacturing. The telecommunications is now an essential service for delivering high-speed connectivity to people, homes, offices and governments. Increased adoption of newer generations of mobile broadband technologies (4G/5G), multigigabit fiber broadband, bandwidth intensive applications and data center inter-connections are resulting in an expansion of the telecom equipment market. With internet becoming more omnipresent and use of high-bandwidth services such as high definition video streaming, social networking, online gaming and e-commerce becoming common place, there is a dramatic increase in data traffic in telecom networks. As a result, telecom operators are increasing capital investments in mobile infrastructure, optical transmission, broadband access and packet switching networks to ensure that mobile and fixed broadband services are delivered with the requisite quality, reliability and in a cost-effective manner.

The Government of India has undertaken several initiatives to maximize the opportunity and ensure the financial stability of the telecom industry, such as Telecom Reform Package, lowering the reserve price of spectrum in 5G auctions, amending the Right of Way Policy and working towards redefining the regulatory framework via Draft Telecom Bills.

The Telecom Industry provided key essential services to the nation during the testing times, becoming a lifeline for the whole economy. This was despite the Industry battling its own challenges, with the regulatory dues on back of unfavorable judiciary out coming adding the pressure on an already consolidated industry. Further, the Indian telecom pricing remains the lowest globally even post one round tariff hikes and having amongst the highest data usage globally. The Government has enabled easy market access to telecom equipment and a fair and proactive regulatory framework that has ensured availability of telecom services to consumer at affordable prices.

Digital initiatives have played an essential role in sustainable development and unlocking innovation and improving public service delivery. AI-enabled education and health tools, along with digital public infrastructure, have enhanced the quality of life and accessibility of services. The Digital initiatives are aimed at transforming the country into a digitally empowered society and knowledge economy. As digital landscape evolves rapidly, organizations are actively adapting to this transformation by rethinking their business models, strategies, and product offerings. To stay active in such a fast-paced environment, they are constantly developing new digital solutions. These solutions incorporate advanced technologies like Data Analytics, Cloud Computing, Artificial Intelligence (AI), Machine Learning (ML), Cyber security and Automation, which drive digital transformation across multiple functions, including marketing, sales, finance, and more.

Regulatory Developments/Changes:

1. 1600 Numbering Series:

This numbering series is adopted by the Indian Govt. and financial institutions to enhance communication security and reduce fraud. The Department of Telecommunications (DoT)

has assigned the 1600 series to government entities for making service and transactional voice calls to citizens. This initiative aims to help citizens recognize and trust calls related to services like passport applications, birth/death certificates, and tax reminders. It helps create a secure and citizen-friendly telecom ecosystem. The Telecom Regulatory Authority of India (TRAI) has also instructed telecom service providers to allocate this series promptly to authorized entities.

BFSI(Banking, financial, services and insurance) Sector:

• TRAI has introduced the 1600 series for calls originating from the banking, financial services, and insurance sectors.

• This helps citizens distinguish legitimate calls from potential fraudulent ones, as numbers in this series are reserved for authorized entities.

• The initiative aims to reduce spoofing, a tactic where fraudsters disguise their identity using fake caller numbers.

• By seeing a number starting with "1600", recipients can be reasonably assured the call is authentic.

• The move is intended to enhance investor protection and curb financial fraud.

2. Additional KYC instructions in respect of Business Connections

Business Connections, for those end users which are not identifiable in business connections such as SIMs obtained for R&D & Testing activities for a specified purpose.

Following regulatory changes have been made regarding this Business Connection for Enterprise: -

a. Restricted usage: - Previously these mobile connections were limited to no. of calls/SMS/Data usage with definite validity Period of maximum 1 year. But now the Limits are to be decided by Licensee.

b. Increase of Mobile Connection Cap from 100 to 2000 at a time: - Increase the mobile connections to 2000 from 100 but after following a complete scrutiny process by LSA and following extant KYC framework.

3. Online Process for Various Telecom Services (NLD/ILD/IP- 1) Through SARAL SANCHAR PORTAL

Various activities like Surrender/Termination application are to be done on line through Saral Sanchar Portal. Also Name/ address/Authorized Signatory Changes and Application Procedure for registration of Services can be done through

TRAI has issued following directions and Recommendations in the financial Year 2024-25:

Directions:

• Direction to all access service providers for submission of details of Base stations -dated 26-04-2024.

• Direction on regarding implementation of Voice DLT solution for commercial communications under Telecom Commercial Communications Customer Preference Regulations (TCCCPR), 2018 -dated 04-05-2024.

• Direction on regarding enhancing user friendliness of registration of UCC complaints, Preferences and Consents through Mobile Apps and Web portals of Access Providers under TCCCPR, 2018-dated 24-06-2024.

• Direction on regarding disconnection of all telecom resources and blacklisting of the sender under Telecom Commercial Communications Customer Preference Regulations (TCCCPR), 2018-dated 13-08-2024.

• Direction on the Standards of Quality of Service of Access (Wireline and Wireless) and Broadband (Wireline and Wireless) Service Regulations, 2024 dated 02nd August 2024, regarding submission of reports to the Authority, - dated 19-09-2024.

• Direction on regarding measures to curb misuse of Headers and Content Templates under Telecom Commercial Communications Customer Preference Regulations, 2018-dated 28-10-2024.

• Direction on Standards of QoS of Access (Wireline and Wireless) and Broadband (Wireline and Wireless) Service Regulations, 2024 dated 02nd August 2024, regarding publication of service wise geospatial coverage map-dated 22-11-2024.

• Direction regarding updating of Location Routing Number (LRN) on the DLT platform during the port out window as per the TCCCPR, 2018-dated 09-06-2025.

Recommendations:

• Recommendations on Encouraging Innovative Technologies, Services, Use Cases and Business Models through Regulatory Sandbox in Digital Communication Sector-dated 12-04-2024.

• Recommendations on Telecommunication Infrastructure Sharing, Spectrum Sharing and Spectrum Leasing-dated 24-04-2024.

• Recommendations on Inputs for formulation of National Broadcasting Policy-2024-dated 20-06-2024.

• Recommendations on Listing of television channels in Electronic Programme Guide and Upgradation of DD Free Dish platform to an Addressable System-dated 08-07-2024.

• Recommendations on the Tera Hertz Spectrum-dated 2108-2024.

• Recommendations on the Connectivity to Access Service VNOs From More Than one NSO-dated 13-09-2024.

• Recommendations on the Framework for Service Authorizations to be Granted Under the Telecommunications Act, 2023-dated 18-09-2024.

• Recommendations on the Definition of International Traffic-dated 10-12-2024.

• Recommendations on Assignment of Additional Spectrum to Indian Railways for its Safety and Security Applications- dated 20-12-2024.

• Recommendations on Regulatory framework for Ground- based Broadcasters-dated 15-01-2025.

• Recommendations on the Frequency Spectrum in 37-37.5 GHz, 37.5-40 GHz, and 42.5-43.5 GHz bands Identified for IMT-dated 04-02-2025.

• Recommendations on Revision of National Numbering Plan-dated 06-02-2025.

• Recommendations on the Terms and Conditions of Network Authorizations to be Granted Under the Telecommunications Act, 2023-dtaed 17-02-2025.

• Recommendations on Framework for Service Authorizations for provision of Broadcasting Services under the Telecommunications Act, 2023-dated 21-022025.

• TRAIs Response to the Back Reference dated 14.01.2025 received from DoT on TRAIs Recommendations on the Framework for Service Authorisations to be Granted Under the Telecommunications Act, 2023-dated 28-022025.

• TRAIs Response to the Back Reference dated 13.02.2025 received from DoT on Recommendations on The Definition of International Traffic-dated 18-03-2025.

• TRAIs Response to the Back Reference dated 13.02.2025 received from DoT on Recommendations on Telecommunication Infrastructure Sharing, Spectrum Sharing and Spectrum Leasing-25-03-2025.

Business Overview

Quadrant Televentures Limited (QTL) is a Unified License Services Licensee and an Internet Service Provider in the Punjab Telecom Circle comprising of the State of Punjab, the Union Territory of Chandigarh and the Panchkula town of Haryana. The Company started its operations as a fixed line service provider under the brand name "CONNECT" in the year 2000. Subsequently, the Company was granted the UASL License (Unified Access Services License) in the Punjab Telecom Circle in 2003, which was further migrated to Unified License in the year 2015. Apart from the UASL License, the Company also holds the ISP (Internet Service Provider) License Category - A (PAN INDIA) and the IP-1 (Infrastructure Provider- Category -1) License for providing services in the Punjab Telecom Circle.

Currently, the Company is providing Broadband Services on FTTH/ DSL/WBB/EOC technology, Fixed Voice (Landline) services, Internet Leased Line and P2P services in the Punjab Telecom Circle. As on March 31, 2025, the Company had a total subscriber base of 3.46 Lakhs customers.

The data consumptions and requirement of speed is increasing manifold which is one of the main reasons service providers and users are looking at fiber-to-the-home (FTTH) broadband connections as a potential solution. It is widely believed that FTTH is the only technology with enough bandwidth to handle projected consumer demands during the next decade reliably. Fiber has a virtually unlimited bandwidth coupled with a long reach, making it "future safe," or a standard medium that will be in place for a long time to come.

Keeping all these things in mind the main focus of the QTL team has been to expand the FTTH footprint across the state of the Punjab. However since FTTH rollout is an expenditure intensive ventures, thus QTL has roped in multiple partners who are doing investment on behalf of the QTL from node to the customer premises. The ONT i.e. CPE is also being provided by the partner.

In last one year 0.45 Lakhs new FTTH home passes/ports have been rolled out thus increasing the total FTTH capacity to 5.59 Lakhs. Total FTTH subscriber base has increased from 2.21 Lakhs in March 2024 to 2.27 Lakhs in March 2025.

OPPORTUNITIES AND THREATS Opportunities

The telecom industry is witnessing an increasing adoption of high speed mobile broadband technologies. Mobile networks are rapidly evolving from 2G/3G to 4G/5G technologies driving a strong demand for 4G and 5G equipment, comprising both baseband and radio units. Although 5G has been launched in several markets, 4G has significant room to grow in developing countries. Due to lack of adequate infrastructure, the growth of wired internet has been restricted to major cities as a result of which wireless remains the preferred means of connecting to the internet. However, there is significant headroom for broadband wireless penetration (as a percentage of population) to improve further as rest of India upgrades towards broadband connectivity. The growth in social media usage, rapidly increasing content consumption and growth in online commerce coupled with introduction of 5G will continue to drive demand for broadband services.

The Company is putting all initiatives to maintain the quality of services and retainability of the subscribers of the Company in view of the prevailing preferences of the subscriber and competition in the market.

Threats

Enterprises are moving towards cloud-based solutions as businesses are going digital and are moving away from on-premise solutions. Traditional voice services would get impacted adversely on account of the shift of focus towards cloud & unified collaboration solutions and disruption from newer digital technologies. Telecom Companies have also started offering unified, new age web-based work from home solutions like cloud telephony, virtual receptions etc., integrated with their traditional services.

Increasing trends towards cloud-based solutions as businesses are going digital and are moving away from on-premise solutions. Traditional Voice Services would get impacted adversely on account of the shift of focus towards cloud and conferencing solutions and disruption from newer breed of digital technologies.

Outlook

The Company continues invest in the brand and marketing assets and have lined up brand interventions in the coming period which will help create positive word-of-mouth, strengthen our brand recall and brand equity.

RISK & CONCERNS

Regulatory team along with legal and network keeps a close watch on compliances with regulations and laws and ensures the operations of the Company are within the prescribed framework, and have also implemented business continuity plan wherever required. The Risk Management framework of the Company ensures regular review by management to proactively identify the emerging risks, to do risk evaluation and risk prioritization along with development of risk mitigation plans and action taken to minimize the impact of the risk.

Due to lack of adequate infrastructure, the growth of wired internet has been restricted to major cities as a result of which wireless remains the preferred means of connecting to the internet. However, there is significant headroom for broadband wireless penetration (as a percentage of population) to improve further as rest of India upgrades towards broadband connectivity.

INTERNAL CONTROL SYSTEM AND ITS ADEQUACY

Company has in place adequate internal control systems commensurate with the size of its operations. The Company has in place adequate controls, procedures and policies, ensuring orderly and efficient conduct of its business, including adherence to the Companys policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records and timely preparation of reliable financial information.

Independent firm M/s Grant Thornton Bharat LLP conducts the internal audit for various functions/ aspects. It reviews and evaluates and presents their reports to the Audit Committee and the management at regular intervals. The Internal Auditors reports dealing with internal control systems are reviewed by the Audit Committee and appropriate actions are taken, wherever necessary. The Internal Control is set up in such a way so as to ensure that the Financials and the other records are reliable for preparing the financial statements of the Company.

SEGMENT WISE AND PRODUCT WISE PERFORMANCE

The Company operates in a single segment. The Product wise performance has been explained separately in subsequent paras.

ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The Company has expanded its wire line services to more than 150 cities / towns of Punjab and widened its wireless footprint to cover the whole of Punjab Circle.

The Companys operating revenue was Rs. 23,624.20 Lakhs during the financial year 2024-25 against Rs. 26,945.65 Lakhs for the financial year 2023-24 and also the Company have sustained an operating loss of Rs. 27629.06 Lakhs during the financial year 2024-25 against Rs. 13160.38 Lakhs for the financial year 2023-24.

Revenue at a glance is as follows:

FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE:

Key Financial Indicators

Telecom Business

On Gross Basis

Major Expenses at a glance are as follows:

SHARE CAPITAL

The Authorised Share Capital of the company is Rs.150000 Lakhs. Against this, the Paid up Share Capital is Rs.28607.15 Lakhs comprising of Rs.6122.6 Lakhs by way of Equity Shares and Rs.22484.54 Lakhs by way of Cumulative Redeemable Preference Shares (CRPS).

KEY FINANCIAL RATIOS

There are significant changes (i.e. changes of 25% or more as compared to the immediately previous financial year) in key financial ratios. Further, there is no change in return on Net worth during the year.

MATERIAL DEVELOPMENTS IN HUMAN RESOURCE

Continued deployment of Reward and Recognition, consistent communication by leadership, on aspects impacting work-life and focus on key HR programs such as Internal Job Postings, Appraisals, Learning & Development. We are committed to remaining among the industrys leading employers. Companys planning for people has been built on the principles of being a consumer centric Company with technology as the base. The organization has equipped itself for high change vigilance and embedded trust at the foundation of its people agenda and has adopted digital as the first port of call for all solution building.

The Company had a total 1075 Employee on its rolls as on March 31, 2025. The company has a professionally qualified work force including B-Tech, MBAs, C.As / C.S.s etc. The key aspects of our HR practice include recruitment, training and development, and compensation.

CAUTIONARY STATEMENT

Statements in the Management Discussion and Analysis describing the Companys objectives, projections, estimates, expectations may constitute a "forward-looking statement" within the meaning of applicable securities 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 economic conditions affecting demand/ supply and price conditions in the domestic markets in which the Company operates, changes in the Government Regulations, tax laws and other statutes and other incidental factors. Further, the Company retains the flexibility to respond to fast-changing market conditions and business imperatives. The Company may therefore need to change any of the plans and projections that may have been outlined in this report, depending on the actual market conditions.