Ramsons Projects Ltd Management Discussions

NBFC - INDUSTRY STRUCTURE AND BUSINESS DEVELOPMENT

The Indian economy remained resilient in the face of the challenging global environment. A range of pragmatic and transformational policies of the government, which continued during the pandemic, has helped to catalyze to a sharp economic recovery and resilience in the growth of the Indian economy. Apart from the capex push by the government, the resilience in the domestic economy comes from the healthy balance sheet of the corporates and a well- capitalized financial system. Despite slow global growth and multiple shocks, the Indian economy has managed to see some encouraging numbers. The real GDP of the country is expected to grow by an overall 7.2% for FY25, beating many earlier estimates and continues to be the fastest growing major economy.

As per the Monetary Policy Committee of RBI, GDP growth for 2025-26 is projected at 6.5 percent. Looking ahead, overlapping shocks engendered by the rising incidence of adverse climate events impart considerable uncertainty to the food inflation trajectory. Market arrivals of key rabi crops, particularly pulses and vegetables, need to be closely monitored in view of the recent sharp upturn in prices. Normal monsoons, however, could lead to softening food inflation pressures over the course of the year. Pressure from input costs has started to edge up and early results from enterprises surveyed by the Reserve Bank expect selling prices to remain firm. Volatility in crude oil prices and financial markets along with firming up of non-energy commodity prices pose upside risks to inflation. Taking into account these factors, CPI inflation for 2025-26 is expected at below 4.0 percent.

Company Overview Industry Structure and developments

During the period under review, the business of the Company is that of a Non-Banking Finance Company (NBFC).

Non-Banking Financial Companies (NBFCs) have become an integral part of Indias financial system. In recent times, NBFCs have emerged as lenders to both companies and individuals. When it comes to lending, NBFCs are generally regarded to be complementary to banks and are often able to offer better services and products to their customers. In spite of strong competition faced by the NBFCs, the inner strength of NBFCs viz local knowledge, credit appraisal skill, well trained collection machinery, close monitoring of borrowers and personalized attention to each client, are catering to the needs of small and medium enterprises in the rural and semi urban areas. NBFCs are playing a significant role in financing the road transport and infrastructure and have reached the gross root level through

Micro finance. In view of liberalized lending policy of Government, Banks are very aggressive in extending finance to industry at competitive rates. However, the company has not been able to offer competitive rates and thereby the business of our company has suffered. Considering the present scenario and volatile practices of the US, the Company has considered to exit the business of the NBFC and requested the Reserve Bank of India (RBI) to allow the Company to surrender the license.

Outlook on opportunities, threats, risks & concerns

The Company shall enter into new rewarding business after the NBFC licence is surrendered. Directors are considering various alternative activities including Real Estate Industry. For the present, the Company is making its best efforts to realize the maximum from the customers by taking recourse of legal remedies where warranted.

Internal Control Systems and their adequacy

The Company has adequate internal control procedures commensurate with the size and nature of the business. The internal control system is supplemented by regular reviews by the management and well-documented policies and guidelines to ensure reliability of financial and all other records and to prepare financial statements and other data. Moreover, your Company continuously upgrades these systems in line with the best accounting practices. The Company has independent audit systems to monitor the entire operations and the Audit Committee of the Board reviews the findings and recommends better audit procedures and systems as may be required. It is ensured that all assets are safeguarded and protected against any loss from unauthorized use or disposition and that transaction are authorized, recorded and reported correctly to keep constant check on the cost structures and to prevent revenue leakages.

Financial Performance

The Financial performance of the Company is given as under:

Opportunities

Non-Banking Financial Companies (NBFCs) are fast emerging as an important segment of Indian financial system. It is performing as financial intermediation in a variety of ways, like making loans and advances, leasing, hire purchase, consumer retail finance etc. They advance loans to the various wholesale and retail traders, small-scale industries and selfemployed persons. Thus, they have broadened and diversified the range of products and services offered by the financial sector. Gradually, they are being recognized as complementary to the banking sector due to their customer-oriented services; flexibility and timeliness in meeting the credit needs of specified sectors; etc.

Segment Information

The primary business segment of the Company is NBFC activities which include disbursement of loans to Retail Customers and Small Companies and Firms.

During the year under review, the Company voluntarily filed an application with the Reserve Bank of India (RBI) for the surrender of its Non-Banking Financial Company (NBFC) license. This decision is in line with the strategic shift in the Companys long-term business objectives.

Pursuant to this strategic shift, the Company has decided to discontinue its financial services operations and has transitioned its primary business focus to the real estate sector. This transition includes activities such as acquisition, development, and sale of real estate properties, real estate consultancy, leasing, and allied services.

Threats

• High cost of funds

• Slow industrial growth

• Stiff competition with NBFCs as well as with banking sector

• Non-performing assets

• Changes in Technology

• Entry of New players

• Government Policies

Risk and Concerns

Growth of the Business of the Company is linked to the overall economic growth. Macro risk to the business can be adverse changes to the economy and policies of Reserve Bank of India and policies of Government of India. Volatility in Non-performing assets can be other significant risk.

Outlook

The Company has initiated the process of surrendering its NBFC license by filing an application with the Reserve Bank of India, as it is no longer in a position to continue its operations in the NBFC sector. In line with its revised strategic direction, the Company is now exploring opportunities in the real estate sector, which presents significant potential across various areas including residential and commercial development, property management, and real estate investment strategies.

Human Resources

The company always regards human resources as its most valuable asset and continuously evolves policies and process to attract and retain its substantial and qualitative pool of managerial resources through friendly work environment that encourages initiatives by individuals and recognizes their performance. The total number of Key Employees employed at the Company is 02 (two).

Details of significant changes (i.e., change of 25% or more as compared to the immediately previous financial year) in key financial ratios: There is no change of more than 25% in the key financial ratios of the Company as compared to the previous financial year 2023-24.

Further, the Other Ratios such as Debtors Turnover Ratio, Inventory Turnover Ratio, Interest Coverage Ratio and Debt Equity Ratio are not applicable on the Company.

Disclaimer

Certain Statements in the management Discussion and Analysis describing the companys views about the industry, expectations, objectives, etc. may be understood within the meaning of applicable laws and regulations. Factors like changes in Government regulations, tax laws and other factors such as industrial relations and economic developments etc. may further influence the companys operations or performance.