Route Mobile Ltd Management Discussions

Managements Discussion and Analysis of Financial Condition and Results of Operations

Overview

We are a prominent global provider of cloud-based communication platforms, serving enterprises, over-the-top (OTT) services providers and mobile network operators and are now part of Proximus Global. Our portfolio spans a full spectrum of digital engagement solutions - ranging from messaging (A2P SMS, OTT messaging such as WhatsApp and Viber, RCS), voice, and email - delivered through a unified, full-stack omnichannel platform that supports enterprises worldwide in building seamless customer experiences across every channel from a single integration. Increasingly, this platform supports Al-enabled solutions, embedding GenAI- powered capabilities such as intelligent chat and personalized messaging workflows across channels.

We cater to a broad array of sectors, including banking and finance services, retail, aviation, e-commerce, logistics, healthcare, hospitality, pharmaceuticals, telecom, media, and entertainment. Our service suite has evolved to also include digital risk mitigation and identity tools such as fraud detection and antiphishing capabilities, as well as network API-based solutions like silent verification, SIM swap detection, and device location verification - built on Konera - Proximus Globals Network API initiative.

Our clientele features some of the most recognized global brands, including several Fortune Global 500 companies.

In addition to enterprise communication services, we support mobile network operators with solutions like AI-powered A2P SMS and voice firewalls, filtering and analytics, SMSC, MMSC, and monetization tools - helping them secure networks, prevent fraud, and generate incremental revenue.

Route Mobile featured in the Fortune India 500 list (2025) for the third consecutive year, reflecting the Companys sustained business growth, market leadership, and strong financial performance. Additionally, we have been honored with the Maharashtra State Best Employer Brand Award 2025 for our people-first culture, talent development initiatives, employee engagement practices, and commitment to building a high-performance workplace environment by the Employer Branding Institute.

Established in 2004 and headquartered in Mumbai, India, Route Mobile has grown into a trusted global

provider of cloud-based Communication Platform as a Service (CPaaS). In the fiscal year ended March 31, 2026, we serviced over 3,100 customers, ranging from large multinational companies to small and mid-sized businesses. As of March 31, 2026, our global operations included 9 direct and 24 step- down subsidiaries serving our clients through more than 20 locations across Africa, Asia Pacific, Europe, Middle East and the Americas.

In the fiscal year ended March 31, 2026, we witnessed continued momentum in the adoption of our latest product innovations as our portfolio reshaped toward higher-value, higher-margin business. These solutions are designed to help enterprises create richer, more engaging and increasingly AI- powered customer experiences. Details of the same are captured in the following description of our operations. Our operations are internally aligned into the following business verticals:

i. Enterprise and OTT

ii. Mobile Operator

iii. Digital Identity and Security Services

iv. Business Process Outsourcing (BPO)

Enterprise and OTT: Our Enterprise and OTT business vertical is focused on delivering cloud- communication platform services tailored to enterprise needs. This vertical includes a comprehensive suite of solutions such as:

- A2P messaging, covering SMS, 2-Way

messaging, and Acculync

- Enterprise email communication

- RCS messaging

- OTT messaging (also known as IP Based Messaging), including WhatsApp and Viber

- Voice application services, which allow enterprises to route incoming and outgoing voice calls via the cloud directly into their systems. Our voice solutions also include Interactive Voice Response (IVR), Click2CaM, missed call facility, outbound dialer.

We have seen strong adoption of our OTT messaging offerings which enable brands to create rich, interactive customer experiences using chatbots AI integration. We are progressively embedding GenAI-enabled capabilities across the

platform - to support intelligent chat and voice agents, personalized messaging workflows, and ready integrations with commonly used CRM, ERP and CDP systems - positioning Route Mobile as the trusted CPaaS delivery layer for enterprises adopting AI in their customer engagement. These capabilities are driving deeper engagement among consumers across both domestic and international markets.

Mobile Operator: We support Mobile Network Operators (MNOs) through our proprietary communications platform and managed service offerings. Our core service offerings in this segment include A2P SMS filtering, analytics, monetisation, and hubbing solutions. We deliver AI/ML powered A2P SMS firewall and filtering solutions, enabling intelligent traffic management, fraud prevention, and revenue optimization - creating a recurring high margin managed services revenue stream from operators. During the year, we continued to scale 365guard, our Al-powered SMS spam and fraud protection solution that safeguards Mobile Network Operators and their users from SMS fraud, spam, and smishing threats. Additionally, we offer SMSC and MMSC solutions providing a comprehensive suite that supports MNOs in fully monetizing their A2P SMS traffic. This end-to-end approach helps address the complete technical and commercial needs of operators across the messaging value chain.

Digital Identity and Security Services: Our service suite has evolved to include digital risk mitigation and identity solutions such as fraud detection and anti-phishing capabilities. Building on Konera, the Proximus Global network API initiative, we now offer network API-based solutions - including silent verification, SIM swap detection, and device location verification - that authenticate users and prevent fraud by leveraging direct integrations with mobile network operators. These solutions create high barriers to entry and are being actively offered to enterprises. During the year, we developed and deployed a network API-driven silent verification solution for Aakash Education, one of Indias largest ed-tech platforms, to help address requirements such as tracking student drop-offs during the online registration process - a solution we are now positioned to extend to customers globally.

Business Process Outsourcing (BPO): We offer a comprehensive suite of voice and non-voice services BPO services. Our voice-based offerings include customer care, technical support, booking assistance and payment collection services. Our non-voice services include client support through email and chat, IT helpdesk services, billing operations and data processing solutions.

We are members of GSMA, an industry organisation that represents the interests of mobile network operators worldwide. We are also members of MEF, CII, TEAM, BCCI and IAMAI, which provides us with representation at various international and national industry forums.

During FY 2025-26 our cloud communications platform processed over 175 billion transactions on a consolidated basis. We have built direct partnerships with MNOs to deliver global connectivity for our clients. As of March 31, 2026, we maintained direct relationships with more than 280 MNOs (consolidated level) and had access to over 900 networks worldwide at a consolidated level. As part of Proximus Global, we are able to extend this reach further, leveraging the groups connectivity through BICS to access carriers worldwide.

Focus on Next Generation Communication Solutions

Our strong commitment to innovating our product offerings and refining our go-to-market strategy continues to deliver positive outcomes for the Company.

In recent years, we have expanded our platform with new alternative communication channels such as Enterprise Voice, OTT/IP Messaging, Email, RCS Business Messaging, and Chatbots and more recently into Network API products that sit at the operator backend. This continued evolution from connectivity infrastructure toward AI-powered intelligence at the enterprise engagement layer will help diversify our revenue streams.

Driving Product momentum through Dedicated SBUs

Route Mobile has demonstrated the ability to consistently sign marquee deals with large enterprises and operators. Here is a summary of our recent customer acquisitions and deployments during the year:

- Deployed a network API-powered silent verification solution for Aakash Education,

one of Indias largest ed-tech platforms, with the capability now ready for commercialization across the Proximus Global footprint globally.

- Launched a customized WhatsApp selfserve bot for Indias largest commercial oil & gas company, enabling stakeholder-specific support for FAQs, enrollments, retail locators, and loyalty management across their extensive B2B network.

- Developed a custom RCS app connector for a leading global system integrator, facilitating cloud marketplace distribution and resale globally, with an initial focus on India, the US, and Brazil.

- Signed a contract with a major LATAM MNO to deploy an advanced firewall solution,

enhancing mobile network security across several countries in the region.

- Enhanced patient engagement for a renowned hospital with WhatsApp Voice Calling -

improving patient experience through instant voice support, encrypted calling, and OPD updates, while reducing helpline congestion and expanding healthcare access in Tier 2 and Tier 3 cities.

- Leveraged our partnership with Tech Mahindra to onboard one of the largest global logistics providers as a customer for our A2P SMS services across multiple geographies.

- Empowered one of South Asias leading eCommerce giants to process over 170 million email messages within a 24-hour window

through our scalable, enterprise-grade Email Communication Platform.

Enabled one of the globes largest hyperscalers to unlock premium RCS messaging services, driving next-generation customer engagement across India.

Launched a fully-fledged intelligent admissions chatbot for a leading multi-disciplinary university, ranked first in India for employer reputation, enhancing global student access to fees, scholarships, and application information.

Launched a WhatsApp-based trade-in customer journey for a leading global mobile phone company, enabling customers to evaluate and trade in older handsets against newer models and capturing instant sales through a seamless customer experience.

Launched Indias first ferry ticketing on WhatsApp for a state-owned waterways organisation, enabling travellers to select routes, pay via UPI, and receive instant e-tickets through a seamless, automated chat experience.

Focus on Expanding Product Portfolio

Opportunities and Threats Opportunities

- Rising Global Demand for Omnichannel CX

Increasing enterprise demand for integrated messaging (SMS, RCS, WhatsApp and other OTT channels), voice, email, and AI-driven customer engagement solutions across verticals such as BFSI, retail, e-commerce, and healthcare, offers strong tailwinds for growth. Our unified OCEAN

platform enables enterprises to orchestrate all these channels through a single integration, positioning us to capture this demand.

Shift from Legacy to Cloud Communications

Accelerated digital transformation across emerging and developed markets is driving migration from traditional telecom systems to agile, API-based CPaaS platforms - creating strong demand for cloud-native offerings.

- Migration to Rich, AI-Enabled Channels

As enterprises seek to extensively leverage rich, interactive formats such as RCS and WhatsApp, to create customer engagement solutions, we are well positioned to be the platform enterprises migrate to. These higher-engagement channels open new monetization avenues with both enterprises and mobile network operators, while plain transactional notifications continue to be served over SMS.

- Expansion in Digital Identity, Fraud Prevention and Telco Network APIs

Heightened focus on cyber-security, regulatory compliance (e.g., PSD2, KYC norms), and identity authentication presents cross-sell opportunities for the groups digital identity and anti-phishing suite. Building on the Proximus Global network API initiative, our network API-based solutions

- silent verification, SIM swap detection, and device location verification - create high barriers to entry and address surging enterprise demand for secure, frictionless authentication.

- Strengthening MNO Relationships via AI- Powered Firewalls and Monetization

Our Al/ML-powered A2P SMS and voice firewall, SMSC, and monetization services are well positioned to help MNOs curb grey routes, prevent fraud, and unlock new revenue streams

- particularly in under-penetrated emerging markets. These solutions are building into a recurring, high-margin managed-service revenue stream, with a healthy pipeline supported by the groups operator relationships through BICS.

- AI and Gen-AI Integration in Customer Engagement

Growing enterprise demand for smarter, personalized communication is driving adoption of AI-powered engagement - intelligent chatbots, conversational voice agents, and contextual messaging workflows. We are enhancing our platform to be the trusted CPaaS delivery layer for this demand, supported by ready integrations with commonly used CRM, ERP and CDP systems and an internal AI program that is improving cycle times and service quality.

Threats

- Structural Decline in International A2P SMS and Channel Substitution

International long-distance (ILD) A2P SMS - historically a significant revenue driver - is in secular decline. This shift, compounded by industry-wide clean-up of Artificially Inflated Traffic (AIT), has pressured volumes and revenue across the CPaaS industry, and the pace at which higher-margin new products scale is central to offsetting it.

- Price Compression and Margin Pressure

Intense competition among global CPaaS players continues to drive declining ARPUs and thinner margins, particularly in commoditized routes.

- Dependence on Large Enterprises and Global OTTs

Concentration risk from a few high-volume clients, including OTT platforms and Fortune 500 enterprises, makes revenue streams vulnerable to churn, channel substitution, or pricing renegotiations - a dynamic experienced acutely during the year.

- Regulatory and Data Compliance Risks

Complex and evolving telecom and data protection regulations across jurisdictions (e.g., GDPR, DPDPA in India) necessitate deep understanding and rapid implementation of security and data privacy related capabilities within the technology platform.

- Rising Carrier Charges and Grey Route Risks

Escalating termination charges by telecom carriers and persistent grey route traffic in some geographies can affect profitability and require constant investment in filtering infrastructure.

- Cybersecurity Threats and Service Disruptions

As a communications backbone provider, Route Mobile faces heightened exposure to cyber threats and potential DDoS or ransomware attacks, which could impact service continuity and client trust.

Consolidated Income Statement and Key Financial Metrics		All figure in crores, unless specified
Particulars	FY2026	FY2025	Increase/ (Decrease)
Revenue from Operations	4,408.21	4,575.62	(167.41)
Other Income	54.09	46.79	7.30
Total income	4,462.30	4,622.41	(160.11)
Gross Profit	1,007.31	950.90	56.41
Gross Profit Margin (%)	22.85%	20.78%	2.07%
EBITDA (Non-GAAP)	537.25	527.76	9.49
EBITDA Margin (%)	12.19%	11.53%	0.66%
Adjusted EBITDA (Non- GAAP)	525.91	523.93	1.98
Adjusted EBITDA % (Non- GAAP)	11.93%	11.45%	0.48%
Profit before exceptional item and Tax	488.91	444.56	44.35
Profit before exceptional item and Tax Margin (%)	11.09%	9.72%	1.37%
Profit before Tax (PBT)	353.04	426.11	(73.07)
PBT Margin (%)	8.01%	9.31%	(1.30%)
Profit after Tax (PAT)	256.94	333.93	(76.99)
PAT Margin (%)	5.83%	7.30%	(1.47%)

FY2025-26 was a pivotal year of transformation for Route Mobile Limited, marked by a reshaping of our portfolio toward higher-value, higher-margin business. Amid evolving CPaaS industry dynamics, including a secular decline in international A2P SMS and continued macroeconomic volatility, Route Mobile demonstrated resilience: while revenue from operations moderated to C4,408.21 crore, gross profit crossed C1,000 crore for the first time, translating to a 22.9% gross profit margin and enhanced EBITDA performance. As enterprises globally continue to invest in omnichannel and AI-powered engagement, Route Mobile is well-positioned to deliver scalable, secure, and intelligent communications solutions and to return to profitable revenue growth in FY2026-27.

Route Mobile posted consolidated revenue from operations of C4,408.21 crore in FY2025-26, C167.41 crores decrease from C 4,575.62 crore in FY2024-25. This revenue performance reflects the decline in lower-margin international A2P SMS volumes, partially offset by growth in our domestic business and higher adoption of new-age CPaaS products (RCS, OTT/IP-based messaging, email, voice, and network APIs).

Gross Profit margin increased from 20.78% in FY2024-25 to 22.85% in FY2025-26 primarily due to a favorable shift in revenue mix, as relatively lower-margin international A2P SMS (ILD) volumes declined and were partially replaced by higher-margin domestic and new-age CPaaS revenues.

Reconciliation of Consolidated Profit before tax (PBT) to Adjusted EBITDA (Non-GAAP)

All figure in crores, unless specified

Particulars	FY2026	FY2025
Profit before exceptional item and tax (Ind AS)	488.91	444.56
(-) Other income	54.09	46.79
(+) Finance costs	10.82	40.91
EBIT	445.64	438.68
(+) Depreciation and amortisation expense	91.61	89.08
EBITDA (Non- GAAP)	537.25	527.76
(+) Employee stock option expense (non cash)	1.01	3.11
(-) Intangible assets under development	12.35	10.82
(+) Non-cash impact related to refundable security deposit provided to MNO	-	3.88
Adjusted EBITDA (Non- GAAP)	525.91	523.93

EBITDA grew from C 527.76 crore in FY2024-25 to C 537.25 crore in FY2025-26 even as revenue from operations moderated, with the EBITDA margin expanding to approximately 12.2% from 11.5%. This improvement was driven by the favorable shift in revenue mix toward higher-margin business.

Depreciation and amortisation increased from C 89.08 crore in FY2024-25 to C 91.61 crore in FY 2025-26. Finance costs stood at C10.82 crore in FY 2025-26, compared to C40.91 crore in FY 2024-25. The decrease in the finance cost primarily relates to decrease in interest on borrowing from banks from C33.12 crore in FY 2024-25 to C4.92 crore in FY 2025-26.

In FY2025-26 and FY2024-25, one-time exceptional items negatively impacted PAT.

Exceptional Item pertains to: (a) for the year ended March 31, 2026, C135.87 crore has been written off the remaining net advance receivable from two vendors (refer Exceptional Item Note No. - 33 in consolidated Financial Statements). (b) for the year ended March 31, 2025 pertains to recognition of impairment loss of goodwill pertaining to a step down subsidiary, write off of an amount receivable from a Mobile Network Operator (MNO) and loss incurred towards non fulfillment of a short-term contract with the said MNO netted off with the fair value gain of the contingent consideration pertaining to acquisition of a subsidiary in previous years.

PAT decreased from C333.93 crore in FY 2024-25 to C256.94 crore in FY 2025-26.

Consolidated Balance Statement Summary and Key Financial Ratios

All figure in crores, unless specified

Particulars	FY2026	FY2025
Trade receivables	909.40	932.77
Days Sales Outstanding (on Revenue from Operations) (#)	76	80
Current Ratio (#)	3.85	2.11
Debt: Equity ratio (#)	N.A.	0.18
Return on Equity (%)	9.72%	14.41%
Interest Coverage Ratio (#)	N.A.	11

Focused initiatives to accelerate collection of outstanding receivables from customers resulted in a decrease in Trade Receivables in FY 2025-26. Days Sales Outstanding has reduced from 80 days in FY 2024-25 to 76 days in FY 2025-26.

Current Assets reduced from C2,736.06 crore in FY 2024-25 to C2,546.93 crore in FY 2025-26, whereas Current Liabilities decreased from C1,294.56 crore to C661.13 crore over the same period, primarily due to the repayment of current borrowings during the year.

EBITDA decreased from C120.59 crore in FY 2024-25 to C83.94 crore in FY 2025-26. EBITDA calculation are provided in the table below.

All figure in crores, unless specified

Particulars	FY2026	FY2025
Profit before exceptional item and tax (Ind AS)	179.78	200.12
(-) Other income	111.52	96.38
(+) Finance costs	1.44	1.67
EBIT	69.70	105.41
(+) Depreciation and amortisation expense	14.24	15.18
EBITDA (Non-GAAP)	83.94	120.59
EBITDA margin % on a Non-GAAP basis	10.90%	14.49%

Standalone Balance Statement Summary and Key Financial Ratios

All figure in crores, unless specified

Particulars	FY2026	FY2025
Trade receivables	241.36	252.69
Days Sales Outstanding (on Revenue from Operations) (#)	117	111
Current Ratio (#)	7.28	3.18
Debt: Equity ratio (#)	0.00	0.00
Return on Equity (%)	10.43%	10.70%

Human Resources

Route Mobile Limited employs 497 employees (on a standalone basis) as on March 31, 2026.

Risk and concerns

Human Resources

RML employs 1,615 employees (at a consolidated level) as on March 31, 2026. Of this, Call2Connect has a headcount of 837 RML has deployed 497 resources in India, and 281 resources across multiple global locations. The Technology team comprises 314 resources, focused primarily on developing new capabilities within the messaging platform, and creating next generation messaging solutions which address enterprises communication requirements and solutions to optimise monetisation for Mobile Network Operators. RML closed FY 2024-25 with a headcount of 1,576 employees (at a consolidated level), of which Call2Connect employed 735 resources as on March 31, 2025.

Standalone Income Statement and Key Financial Metrics

All figure in crores, unless specified
Particulars	FY2026	FY2025	Increase/ (Decrease)
Revenue from Operations	769.87	832.21	(62.34)
Other Income	111.52	96.38	15.14
Total Income	881.39	928.59	(46.20)
Gross Profit	228.76	244.40	(15.64)
Gross Profit Margin (%)	29.71%	29.37%	0.34%
EBITDA (Non-GAAP)	83.94	120.59	(36.65)
EBITDA Margin (%)	10.90%	14.49%	(3.59%)
Profit before exceptional item and tax	179.78	200.12	(20.34)
Profit before exceptional item and tax Margin (%)	23.35%	24.05%	(0.70%)
PAT	134.78	131.02	3.76
PAT Margin (%)	17.51%	15.74%	1.77%

Principal risks and uncertainties: There are a number of potential risks and uncertainties, which could have a material impact on the Companys long-term performance and could cause actual results to differ materially from expected results.

Liquidity risk

The Company seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs and to invest cash assets safely and profitably. External funding facilities are managed to ensure that both short-term and longer-term funding is available to provide short-term flexibility whilst providing sufficient funding to the Companys forecast working capital requirements.

Credit risk

The Company extends credit to customers of various durations depending on customer creditworthiness and industry custom and practice for the product or service. In the event that a customer proves unable to meet payments when they fall due, the Company will suffer adverse consequences. To manage this, the Company continually monitors credit terms to ensure that no single customer is granted credit inappropriate to its credit risk.

Competitor risk

The Company operates in a highly competitive market with rapidly changing product and pricing innovations. We are subject to the threat of our competitors launching new products in our markets (including updating product lines) before we make corresponding updates and development to our own product range. This could render our products and services out-of- date and could result in loss of market share. To reduce this risk, we undertake new product development and maintain strong supplier relationships to ensure that we have products at various stages of the life cycle.

Competitor risk also manifests itself in price pressures which are usually experienced in more mature markets. This results not only in downward pressure on our gross margins but also in the risk that our products are not considered to represent value for money. The Company therefore monitors market prices on an ongoing basis.

Internal Financial Controls, their adequacy and Internal Auditors

The Company has established a robust framework for internal financial controls. 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. During the year, such controls were assessed and no reportable material weaknesses in the design or operation were observed. Accordingly, the Board is of the opinion that the Companys internal financial controls were adequate and effective during FY 2025-26.

The Board has appointed Mr. Nicolas Lecomte, Internal Audit Manager, Proximus S.A. as Internal Auditor of the Company for the financial year 2025-26 to conduct the internal audit basis a detailed internal audit plan which is yearly reviewed with and approved by the Audit Committee.

Disclaimer - Management uses these Non-GAAP financial measures collectively to assess the performance of its ongoing operations and to facilitate internal planning and forecasting. Such Non-GAAP financial information is presented solely for supplemental informational purposes and should not be construed as a substitute for, or superior to, financial information prepared and presented in accordance with the Indian Accounting Standards (Ind AS). In addition, these measures may not be directly comparable to similarly titled Non-GAAP measures reported by other companies, as the methods of calculation may differ.