ram info ltd Management discussions

Indian Economy

In 2022-23, India renewed its tryst with the recovery that had commenced in previous financial years with abatement of the Covid 19. Supported by continuing fiscal measures and congenial financialconditions engendered by monetary, regulatory and liquidity initiatives undertaken by the Reserve Bank, Indias GDP growth accelerated to 6.1% in the January to March 2023 quarter, lifting the economys uptick in 2022-23 to 7.2% from the 7% estimated earlier, according to the provisional national income data released by the National Statistical Office (NSO), the Gross Value Added (GVA) in the economy is reckoned to have risen 7% in 2022-23, compared to 8.8% in 2021-22, with manufacturing GVA growth sliding to just 1.3% from 11.1% a year ago, despite a 4.5% rebound in the final quarter after six months of contraction. The agricultural GVA grew 4% up from 3.5% in the previous year. The financial, real estate and professional services sectors saw their GVA grow 7.1%, compared to 4.7% in 2021-22. The GVA of the trade, hotels, transport, and communication sectors, as well as services related to broadcasting grew 14%, marginally faster than in the previous year. “Exports of goods and services accounted for 23.5% of GDP, the highest since 2014-15, while private consumption hit the highest level since 2006-07 at 58.5% and gross fixed capital information, reflecting a sustained increase, is at the highest point since 2013-14 at 34% of GDP” by the Chief Economic Advisor. GVA from the employment-intensive construction sector grew 10% in 2022-23 from 14.8% in 2021-22. Mining and quarrying GVA growth slowed to 4.6% from 7.1%. Electricity, gas, water supply and other utility services GVA rose 9% only slightly slower than 9.9% in 2021-22. Public administration, defence and other services GVA grew 7.2% in 2022-23, compared to 9.7% in the previous year.

The IT & BPM industry in India

The IT and BPM industry in India has experienced rapid growth and has been a major contributor to the countrys GDP. It has consistently registered strong growth rates and has been a significant source The industry offers a wide range of services including software development, IT consulting, system integration, application management, infrastructure services, testing and quality assurance and business process outsourcing (BPO). India is globally recognized for its IT and BPM capabilities. The country has a large pool of skilled IT professionals who are proficient in various technologies and programming languages. Indian companies have been successful in delivering high-quality IT services at competitive prices, making them preferred partners for global clients. India is primarily export-oriented, with a significant portion of its revenue coming from overseas clients. It serves clients from diverse sectors such as banking and financial services, healthcare, retail, manufacturing, telecommunications, and more. India has several prominent IT hubs, with cities like Bengaluru, Hyderabad, Chennai, Pune, and Gurugram (near Delhi) being major centres for IT and BPM activities. These cities have a robust technology infrastructure, presence of IT companies, and a supportive ecosystem for innovation and growth, the Indian government has implemented policies and initiatives to support the growth of the IT and BPM industry. This includes incentives for IT exports, tax benefits, infrastructure development, skill development programs, and initiatives like Digital India and Make in India, which aim to promote digital transformation and technology adoption across sectors. India has a large pool of skilled IT professionals including software engineers, data scientists and IT project managers. The industry actively focuses on continuous skill development to stay updated with the latest technologies and trends. Many IT companies have their own training programs and collaborate with academic institutions to bridge the skill gap. The Indian IT and BPM industry has witnessed a growing focus on innovation and entrepreneurship. Startups and tech incubators have emerged, fostering innovation in areas like artificial intelligence, blockchain, cloud computing, and cybersecurity. The industry faces certain challenges, such as increasing competition from other countries, rising labor costs, data security concerns, and the need to continually upgrade skills to stay relevant in a rapidly evolving technological landscape.

Key Trends

Artificial Intelligence

AI that focuses on neural networks with significantprogress in various AI multiple layers, has been driving applications. In 2023, we can expect further advancements in deep learning techniques, architectures, and algorithms, enabling improved performance in areas such as computer vision, natural language processing, and speech recognition. AI becomes more prevalent in society, there is an increasing emphasis on ethical considerations and responsible AI practices. In 2023, we can expect more focus on developing AI systems that are transparent, explainable, fair, and accountable. Regulatory frameworks and guidelines may evolve to address ethical concerns related to AI deployment and data privacy. integration of AI and robotics holds promise across various industries. In 2023, we may see advancements in robotic automation, autonomous vehicles, drones, and collaborative robots (cobots) that can work alongside humans. AI algorithms will play a crucial role in enabling robots to perceive, reason, and make intelligent decisions in complex environments.

Data Analytics

The Big Data Analytics market in India is currently valued at $2 Billion and is expected to grow at a CAGR of 26 percent reaching approximately $16 Billion by 2025, making Indias share approximately 32 percent in the overall global market. India is currently among the top 10 countries in Big Data analytics market and already has around 600 data analytics firms with this number only expected to grow in future. This industry will prove disruptive and lead to a paradigm shift in future. India being amongst the top 5 social media and mobile consumers in the world, generation of vast amount of data is indispensable. In the light of approx. 2.9 zeta bytes of data generation by the year 2020, Big Data analytics would synthesize into a booming market providing abundant opportunities to firms and investors wanting to explore this space.

IoT

In 1999, British technologist Kevin Ashton coined the term Internet of Things (IoT) to define a network connecting people and objects around them. The Internet of Things is one of the technologies driving Industry 4.0 and its not a surprise that the market is seeing a CAGR of over 16% over a 10-year-period (2018-2028). The IoT market shows a drastic revenue growth projected to reach US$27.31 bn in 2023 from a focus on mainly technology adoption, the pandemic period witnessed IoT adoption to focused implementation across various sectors of business in conjunction with other technologies such as intelligent tracking systems in transportation, industrial wireless automation, public safety, personal health monitoring and health care, etc. Indias digital economy is one of the largest and fastest-growing markets for digital consumers. Revenue is expected to show an annual growth rate (CAGR 2023-2028) of 17.05%, resulting in a market volume of US$60 Bn by 2028.

Cybersecurity

. With the increased shift to working from home, many Cybersecurity India has seen significant organisations will switch to a zero-trust network architecture (ZTNA).

Evolution of Cyber security and Risks Anti-virus, Firewall in 1990s, Intrusion, detection & prevention of worms in 2000s, DLP, Application aware firewalls, SIM of late 2000s to find Botnets and eradicate, Currently on Network flow Analysis with APR and Insiders, to avoid the cybersecurity issues internal control systems shall be designed to restrict for entry into the systems. 75% of CXOs admit that they lack confidence in companies cybersecurity processes. The AI and ML allows us to develop Smart Security Solutions.

Population

The population of India stood at 1.42 Billion in CY 2023, accounting for 17.7% of the total world population. It is further expected to increase to 1.64 Billion by CY 2050, The population density in India is 464 per Km2 (1,202 people per mi2), 35.0 % of the population makes their livelihood in urban areas, thus driving the need of technological advancements to cater to the varied needs of such a huge population.

Urbanisation

Indias urbanisation rate stood strong at 35%, “Urbanisation is going to be the key. By 2047, 50 per cent of the population will live in urban areas, this is expected to consistently drive the need of improved information technology.

Internet Penetration

According to a report published in Statistas Key Market Indicators (KMI) the number of internet users in India was forecast to continuously increase between 2023 and 2028 by in total 265.1 million users (+26.29 %). After the fifth consecutive increasing year, the number of users is estimated to reach 1.3 billion users and therefore a new peak in 2028. Growing digitalization efforts combined with low data prices enabled a significant of people to use the internet actively across India. Of these, about 467 million were active social media users. WhatsApp and Instagram accounted for the largest penetration, at nearly 76 percent and 74 percent respectively in the third quarter of 2022.

Smartphone Penetration

Indias smartphone market is projected to grow rapidly until 2025. The growth is driven by availability of cheap mobile data. A total of 1.10 Billion cellular mobile connections were active in India in early 2023, with this figure equivalannt to 77.0 % of total population. Smartphone shipment in India is projected to grow 10% year-on-year (YoY) in 2023 after an estimated decline of 5% this year, according to a new report by Counterpoint Research published he total number of smartphone shipments in 2023 is expected to reach 175 million.

Digital Payments

During the FY 2022-23, Indias volume of digital payment transactions increased to 89.5 Million. Digital transactions in the year 2022 has topped the list of five countries in digital payments, according to data from MyGovIndia. India accounted for 46% of the global real-time payments, adding that the digital payment transactions in India are more than the other four leading countries combined. “India is number one in digital payments”.

Digital Census

With the country trying to combat the disruptions caused by the COVID-19 pandemic, the census for the CY 2021 has been decided to be carried out digitally. The Government has earmarked a capital in its Union Budget. For the first time in about 150 years, India could not conduct the national Census, a process done every ten years, amid concerns related to the spread of COVID-19 infection.

Smart Cities

Back in 2015, the Government of India thought of transforming the countrys urban landscape by launching the Smart Cities Mission. The objective is to promote cities that provide core infrastructure and give a decent quality of life to its citizens, a clean and sustainable environment and application of ‘Smart Solutions. The focus is on sustainable and inclusive development and the idea is to look at compact areas, create a replicable model which will act like a light house to other aspiring cities. The Smart Cities Mission of the Government is a bold, new initiative.

Under this mission, till FY 2022-23, 45,915 ($5.584 billion) crore has been allocated for the Mission, accounting for 96 percent of anticipated Government of India funds for the same.

Business Review

Raminfo Limited (referred to as ‘the Company or ‘Raminfo hereafter) is one of the leading and renowned technology solutions providers across various sectors such as healthcare, energy, agriculture and logistics, fintech, government and engineering services. The Company started its journey 29 years back as a software developing company and has evolved as a technology solutions provider, over the years. The Company has been a partner in the digital evolution of India, helping the Government in transitioning from legacy and conventional systems and technology to the latest technology-driven solutions. The Companys achievement over the years has been validated by an array of rewards and accolades received by it. Over the recent course of time, the Company has been expanding its presence across multiple verticals and expanding the products and services under each vertical. The Company has gradually shifted its focus on creating a diversified and multi-vertical business, with major focus on energy solutions, healthcare, agri-tech and logistics.

Our strategic focus is now on Drone Technology to revolutionize the agriculture sector. Through cutting-edge solutions, we aim to enhance crop monitoring, precision agriculture, and resource optimization, contributing to safer farming practices and increased yields. Our commitment to leveraging drone technology underscores our dedication to driving positive change in sustainable IT solutions.

Financial Performance

The Companys revenue during FY 2022-23 stood at 8,098.20 Lakhs compared to 10,530 Lakhs in FY 2021-22. The EBITDA of Raminfo stood at 1,156.44 Lakhs in FY 2022-23 compared to 1,204.50 Lakhs in FY 2021- 22. Further, the Companys profit after tax (PAT) stood at 611.40 Lakhs in FY 2022-23 compared to 827.08 Lakhs in FY 2022-23. The Companys debt-equity ratio is 0.12x in FY 2022-23 to 0.12x in FY 2021-22, driven by consistent efforts to deleverage the balance sheet.”

Key Financial Ratios

Particulars	March 31, 2023	March 31, 2022
Current Ratio (in times)	1.27	1.23
Debt- Equity Ratio (in times)	0.12	0.12
Debt Service Coverage Ratio (in times)	17.75	13.49
Return on Equity Ratio (in %)	13.40%	36.56%
Trade Receivable Turnover Ratio (in times)	1.47	3.06
Trader Payable Turnover Ratio (in times)	0.19	0.20
Net Capital Turnover Ratio (in times)	4.02	6.63
Net Profit Ratio (in %)	7.55%	7.84
Return on Capital Employed (in %)	25.33%	35.80%
Return on Investment (in %)	6.17%	2.58%
Inventory Turnover Ratio (in times)	15.94	4.89

Human Resources:

Being an employee-centric company, Raminfo focuses on treating the employees with utmost fairness and works upon aligning their goals with the Company. In doing so, the Company has provided them adequate opportunities for professional and personal growth, alongside providing training and enhancing their skills and capabilities. To create the workaholic nature among employees the company has created the Performance Linked Incentives which will develop both employee and company. Employee development strategy is important at multiple levels and when well executed, it can accrue multiple benefits like performance improvement, handling unexpected situation, good at dealing with conflict, improve Loyality, help grow potentially good employees, The Company strives to create and maintain a safe, conducive, and engaging work environment to enhance employee morale and boost their productivity.

RISKS AND ITS MITIGATION

Risk	Probability	Impact	Mitigation
Change in Government Policies	Medium	Moderate	1. Clear terms and conditions signed before start of any Government project
			2. Strong relations build in last 20 years with Government officials
Compliance Risk	Low	Minor	1. Third party audits
			2. Effective checks and controls
Competition Risk	Medium	Minor	1. Know-hows of Government procedures and structure
			2. Won several awards for our best service standards
			3. Achieve lowest bids through our business partners
Operational Risk	Low	Moderate	1. Strong process driven (SOP) approach weathered the risks
			2. CMMI and ISO 27001 certified processes
			3. Effective controls and measures
Legal Risk	Medium	Minor	1. All contracts are vetted by legal council
			2. Attentions for adhering to each clauses
			3. Disputes are resolved in time

RISKS AND ITS MITIGATION

Risk	Probability	Impact	Mitigation
Risk of conflict with Business Partners	Low	Moderate	1. Build strong, long-term and mutually beneficial business relations with all business partners
			2. Clear terms of collaboration with business partners
Risk of Losing Key	Moderate	Moderate	1. Employee friendly company policies
Employees			2. Focus on process driven approach
Security Risk including Cyber security	Low	Minor	1. Being tech company, special focus on data and cyber security
Currency fluctuation	Low	Minor	1. Most of businesses are in Indian currency

Notes/Additional Items Probability: It is defined as chance of that particular risk to occur Low (Less than 10% chance) I Medium (10% to 50% chance) I High (> 50% chance) Impact: It is severity of the impact on business - Minor I Moderate I Significant

Internal Control System:

Reliable information is vital for a companys strategic decision, A system of internal controls shall be an appropriately detailed and periodically performed risk assessment that identifieswhich critical processes might be susceptible to errors, thereby potentially creating quantitativelyandqualitativelysignificantrisks for the company.

The Company has a well-maintained internal control framework that covers various aspects of governance, compliance, audit, control and reporting. These internal controls play an integral role in adhering to various regulatory compliance, preventing frauds, safeguarding finances, and maintaining the reliability of financial reporting. The Companys internal audit team periodically conducts an audit of internal control systems and shares the findings with the Companys management who in turn initiates prompt corrective/mitigating measures to maintain accuracy and adequacy of the internal controls.

Cautionary Statement:

The Management Discussion and Analysis contains statements describing the Companys objectives, projections, estimates and expectations, which may be forward-looking in nature. These statements are made within the meaning of applicable laws and regulations and are based on informed judgements and estimates. There cannot be any guarantee of previous performance continuity as future performance also involves risks and uncertainties. These may include but are not limited to the general market, macroeconomic, interest rates movements, competitive pressures, technological and legislative developments, and other key factors that may affect the Companys business and financial performance.

For and on behalf of the Board

	L. Srinath Reddy	V. Anil Kumar Ambati
Place: Hyderabad	Managing Director	Director
Date: 15.07.2023	DIN: 03255638	DIN: 06535455