S Chand & Company Ltd Management Discussions

Indian Economic Overview

India maintained its position as the fastest-growing economy for the 4 th straight year in FY 2024-25, outshining other large and contemporary economies. As per the second advance estimates by the National Statistics Office (NSO), the Ministry of Statistics and Programme Implementation (MOSPI), Indias real GDP is estimated to have recorded 6.5% growth in FY 2024-25, driven by services, manufacturing and agriculture. This is compared to GDP growth of 9.2% in FY 2023-24, which was estimated to be the highest in the previous 12 years (barring FY 2021-22).

Headline inflation during the year was estimated at 4.1% visa-vis 5.4% in the earlier year, on account of high-frequency macro-economic indicators, indicating a promizing economic outlook over the coming years. Growth was mostly led by a significant uptick in government spending and prompted by a spike in exports, higher capex pick-up, and huge growth in consumption expenditure.

India GDP Current Growth and Future Projections (%) ESTIMATE	PROJECTIONS
FY 2023-24		FY 2024-25
FY 2025-26
9.2	6.5	6.5

Source: https://www.imf.org/en/Publications/WEO/ Issues/2025/01/17/world-economic-outlook-update-january-2025

Indias long-term growth story is believed to be intact. Despite global challenges, India emerged as an economic powerhouseand is moving up the global value chain. It continues to be the worlds 5 th largest economy in the worlds GDP rankings list, owing to its strong economic foundations and on the back of continued economic reforms, thriving domestic demand, careful financial management, high savings rate, and favorable demographic trends.

Despite the lowering GDP, India is projected to be one of the worlds top three economic powers over the next 10 years. Primarily domestic demand-driven, it has emerged among the worlds fastest-growing major economy. Geared to benefit from the demographic dividend, increased capital expenditure, proactive government policies, robust consumer demand, and improving rural consumption prospects, the economy is growing well. Domestic consumption and investments, that contribute ~70% of Indias economic activity, are seen amongst the key drivers of GDP in the years ahead.

Increased capital expenditure is facilitated significantly by proactive government policies such as GST collection, one of its major revenues. Revenue collection from GST received a major boost upon its GST implementation in July 2017, and grew further more after the release of GST 2.0 in Union Budget 2024-25, aiming rate rationalization, simplifying tax structure and compliance norms. Growth rate of GST collection has been exceeding 10% YoY in the past two years. Indias GST collection grew 9.4% year-on-year for FY 2024-25, reaching t 22.08 Lakhs Cr., as per data released by the government, up from t20.18 Lakhs Cr. collected in the financial year 2023-24.

Union Budget 2025-26 reflects an increase in capital expenditure from 13.18 Lakhs Cr. to 15.48 Lakhs Cr., indicating an increase of 17.4%, benefiting the setting up of capital expenditure for long-term physical assets.

The nations growth is expected to remain strong, supported by the macro-economic and financial stability. Despite the above challenges, emerging trends pointed to inert resilience such as robust rural consumption, strong service sector growth, high value manufacturing exports, and controlled fiscal deficit.

Digital infrastructure enabled the creation of digital identities, improved access to finance, access to markets, access to information, reduced transaction costs, and improved tax collection, setting the foundation for sustained and accelerated economic growth.

Future Outlook

According to the World Banks Global Economic Prospects (GEP) report, Indias economy is projected to expand at a robust 6.7% in both FY 2025-26 and FY 2026-27, far surpassing global and regional counterparts. India is poised to lead the global economic landscape, retaining its position as the fastest-growing major economy. With global growth expected to remain at 2.7% in 2025-26, Indias strong performance highlights its resilience and increasing influence in shaping the worlds economic future. A sustained growth reflects the countrys strong economic fundamentals and ability to maintain momentum despite global uncertainties, reinforcing its position as a key player in the global landscape.

Education Sector in India

Indias school education system is the largest in the world, catering to 260+ million young people every year. Jointly managed at the national and state levels, many initiatives have been undertaken to improve access to quality schooling - particularly for those who are economically or socially disadvantaged. Education is an investment in human capital formation, and hence, plays a crucial role in the economic growth and development of a nation.

Indias school education system comprises 1.5m schools, 9.8m teachers, and over 250m students across socio-economic backgrounds from pre-primary to higher secondary levels. With India being the most populous country globally, it has a demographic advantage with a large segment of its population (i.e., 580 million, approx. 40% of population) being in the age bracket of 5-23 years, presenting a massive growth opportunity for the sector.

In terms of percentage, 74% of the schools in India comprise Government or government-aided schools, while the remaining 26% are private unaided schools. Thus, almost fourth of the Indian education is backed by publicly funded institutions.

With thriving competition from private schools, there have been clear efforts from the government to offer parents and children what they most need and want - quality education, leadingto improved life opportunities. The Ministry of Education released the New Education Policy (NEP) in 2020, with a primary objective of spreading qualitative education for the target segment. Emphasis on early childhood education, robust training programs for teachers, creating a curriculum blended with universal standards and increasing digital education platforms promises to further enhance the education system in India.

India is at the crossroads with its approach to education policy and its implementation. Significant changes have been made to address the issues of quality and equity of provision. For example, the implementation of the Right to Education Act and widespread adoption of new technologies and approaches to improve teachers and learners access to resources and content for learning.

Key Initiatives by the Government

Some of the major government initiatives such as the National Accreditation Regulatory Authority Bill for Higher Educational, Foreign Educational Institutions Bill have been instrumental in benefiting the education system in India. The Central Government has set in motion the New India Literacy Programme to be implemented during FY 2022-27, aimed at covering all the aspects of adult education to be aligned with NEP

There is special focus by the National Commission on programs such as personality development for women (under graduates and post graduates). This includes providing special sessions on personal capacity building, professional career skills, digital literacy and the effective use of social media to prepare women students for the job market.

In addition, there is a three-year program called Education to Entrepreneurship floated by the Education Ministry of Skill Development and Entrepreneurship and Meta and the Prime Ministers Vidya Lakshmi scheme. These initiatives reflect huge development in the countrys education infrastructure.

As the government allows for 100% Foreign Direct Investment (FDI) in the education sector, it has witnessed an equity inflow of US$ 9.55 billion in the past four years, since 2020. In line with a host of economic reforms undertaken by the government, the outlook for the education sector remains positive, and has potentially transformed the country into a knowledge harbour.

The increasing middle class and an improved standard of living in India is expected to further increase the demand for the education sector. The growing demand for better quality education owing to a rising middle class population in India on a steady basis, and an increasing awareness on upskilling for more job opportunities present further challenges for the education system raising its benchmark constantly.

The NITI Aayog (National Institute of Transforming India) is working to improve school education in India by developing and implementing policies and programs. It has launched a first-of-its-kind report touching upon vital indicators of

quality, funding, governance, and employability, especially for the higher education by public universities to raise it to global excellence standards.

In the Union Budget 2025-26, a significant amount of 1.28 Lakhs Cr. has been allocated to the education sector, an increase of 6.22% over the previous budgetary allocation of Budget 2023-24.

Education Industry in India (US$ billion)

FY FY

2019-20 2024-25

Source: https://www.ibef.org/industry/education-sector-india

The K12 segment, catering caters to education of children of up to 14 years, estimates a 10+% growth rate of this segment, as it is expected to reach an impressive figure of US$ 125.8 billion by 2032. The higher education category, i.e., students falling in 15-23 years bracket is also projected to grow on similar lines. According to IBEF, the total number of colleges in India has substantially increased, crossing 50,800, while the number of universities crossed 1,300, as of November 2024. India is estimated to have overtaken China in terms of fourth-most number of universities, as per the Times Higher Education University Rankings 2024.

Source: https://www.timeshighereducation.com/world-university- rankings

Indias School Education System - Key Milestones

(Decade-wise)

Below are the key milestones achieved every decade, since the setting up of the Department of Education, in order to enhance the quality of education, and align with NEP.

^ 1951-1960

¦ Mudaliar Commission was set up.

y 1961-1980

¦ Kothari Commission in 1964-66 that led to National Policy on Education in 1968 - compulsory education up to age 14, three language formula.

y 1981-1990

¦ National Policy on Education (New) in 1986 - was aimed at expansion of adult education and open university system.

y 1991-2000

¦ Universal Primary education in 1993, Mid-day Meal Scheme in 1995 - mid-day meals for all primary students., National Curriculum Framework in 2005 towards more child-centered practices, Secondary education & hostel for Girls in 2008.

V J

2001-2010

¦ National Education Policy - 2020.

National Curriculum Framework for School Education (NCF SE), 2023.

Outlook for Indias Higher Education by 2030

The development of countrys education sector is rightfully going to be the key focus area in the current times, and is likely to see a considerable increase with a special focus on achieving the below-mentioned initiatives:

• Training methods involving a combination of online learning and games are expected to grow by 38%.

• I implementation of innovative approaches in higher education, with a strong focus on creative thinking and problem-solving.

• Keen focus towards taking Gross Enrolment Ratio (GER) to 50%.

• India is set to emerge as the single-largest provider of global talent, with one in four graduates in the world being a product of the Indian higher education system.

• Being among the worlds top five countries in terms of research output, with an annual R&D spend of US$ ~140 billion.

• Having 20+ universities among the list of global top 200 universities.

Source: https://www.ibef.org/industry/education-sector-india

National Education Policy and its Evolution NEP2020:

The first NEP was launched in 2020 by the Department of Education to provide quality education and higher education to all students, irrespective of their socio-economic background. The policy was implemented for the assessment of important skills such as creativity, critical thinking, problem-solving, visualization, idea generation and to achieve 100% literacy rate amongst the base.

NEP 2023:

The revised policy emphasized the importance of education framework around digital literacy, skill development and holistic learning for at par approach with global standards. A new structure addressing the challenges of the existing system with the following stages - Foundational, Preparatory, Middle and Secondary, i.e., 5+3+3+4 years, was introduced against the traditional 10+2 system in place for a flexible learning experience.

NEP2024:

The revised policy was aimed at improving the quality of education further by breaking down the barriers between subjects and streams, thus allowing students to choose subjects across Arts, Science & Commerce streams. It emphasizes on development of social, emotional and personal skills of students over and above the academics. This targets at increasing GER to 50% by 2035, up from 28.4% in 2024.

Transformation of the National Curriculum Framework School Education (NCF SE)

NCF SE 2005:

Developed by the National Council for Educational Research and Training, the National Curriculum Framework (NCF) stronglyadvocated teaching techniques to be more child-centered, unlike the traditional method of memorization techniques. This aims to work towards aspects such as critical thinking, communication, collaboration and developing practical skills by introducing the concepts of field trips and internships for students.

NCFSE2023:

This integrated framework encompassed 5+3+3+4 curriculum for children from ages 3 to 18 years, aimed towards restructuring of the education system by laying emphasis on values, creative teaching methods, targeted towards making the students future ready with a problem-solving approach.

Significant role played by the government in the Indian education sector:

• S amagra Shiksha Abhiyan - An integrated scheme for school education sector from April 1, 2021 to March 31, 2026, aiming holistic school education for all students from pre-school to class 12, with no element of differentiation.

• SM - SHRI (Pradhan Mantri Schools for Rising India)

- Launched in 2022 aiming to prepare more than 14,500 exemplar schools with safe and stimulating learning environment as well as good physical infrastructure and appropriate resources conducive to learning.

• RISE (Revitalizing Infrastructure and System in Education) - Launched in 2018 for modification of financing norms for higher education to accommodate the infrastructural needs of all educational institutions.

• S QUIP (Education Quality Upgradation and Inclusion Programme) - Launched in 2019 with a five-year vision aiming at doubling GER and positioning Indian educational institutions to be at least 5% of the top 1,000 global universities.

• R IETS (District Institutes of Education & Learning)

- Union Minister of Education and Skill Development & Entrepreneurship launched the DIETS programs to strengthen teacher training.

• S BDE (Capacity Building on Design and Entrepreneurship) - The Department of Higher Education under Ministry of Education launched CBDE targeting to build a problem-solving approach that encourages creative and innovative solutions among the students.

K-12 Education in India

The K-12 education sector is a rapidly evolving sector in India that engages education from kindergarten to Class 12. This is a multi-faceted landscape, featuring a diverse array of school types, affiliating boards, various models of ownership and management, and curricular frameworks. In India, K-12 schools are broadly categorized as Government schools, Private-aided schools, and Private-unaided schools.

Source: Ministry of Education

Nearly ~47% of the ~265 million students enrolled in K-12 are enrolled in private schools, while the remaining ~53% are in government schools. Accounting for a majority of schools, enrolment, and teachers in India, government schools reinforce the vital role they play in educating a significant portion of Indias population. However, with the steady growth of private schools in India, the share of government schools in total schools, enrollment, and teachers is slowly decreasing. School enrollment has increased at the upper primary, secondary and higher secondary levels. This points towards an improvement in the Indian education systems ability to retain more children.

Indias Higher Education System - In numbers

Non-STEM:

Non-STEM courses include Arts, Commerce, Nursing, Business Management, Humanities, Social Sciences, Optometry, Veterinary, Architecture and other niche courses such as Yoga, Buddhist Studies, Indian Music, Vocational & Certificate courses, among others. Career options for non-STEM courses include counselors, educators, clinical psychologists, art directors, and others.

Number of Teachers (In Lakhs)

Pupil-Teacher Ratio

23						27 27 26 24
21		19 18 18		18		in
		\u25a0 HU		18 17 \u25a0 \u25a0\u25a0
Primary	Upper primary			Secondary	Higher Secondary

¦ 2021-22 ¦ 2022-23 2023-24

Source: UDISE Report for FY2023-24

Education Tech System in India

Indias education technology (Ed-Tech) sector, a rapidly growing industry with revolutionized traditional learning methods, is set for future growth. As per IBEF, the Ed-Tech sector is projected to grow nearly four times to reach US$ 29 billion by 2030, growing by a CAGR of 25.8% from the current estimated valuation of US$ 7.5 billion in 2024. The rising usage of Internet facilitates the growth of Indias Edtech sector. According to the Internet in India Report 2024, active internet users reached 886 million in 2024, reflecting an 8% YoY growth.

Rural India, with 488 million internet users, led this surge as it accounted for 55% of the total internet population. This resulted in the Edtech sector registering last-mile growth and benefiting the rural sectors too. EdTech also effectively resolves the obstacle by democratising quality education irrespective of the medium of instruction. Skill development, K12, test preparation, and online certification are some of the fastest growing sub-segments in Indias Edtech sector.

Source: https://www.investindia.gov.in/blogs/opportunities-indias- edtech-industry-driving-innovation-and-accessibility9

Ed-Tech Industry - Key Emerging Trends Al-Powered Learning:

Leveraged to create content and offer additional support to students, generative AI models are being tested by various EdTech companies as a co-teaching aid for educators. Generative AI and Converzational AI can transform education by helping educators provide tailored attention to individual students. In a Team Lease EdTech survey of 6,000 educators nationwide, over 65% advocated using AI to enhance learning experiences and personalize education.

Extended Reality (Virtual Learning):

Virtual labs are gaining momentum among educators, providing students with a realistic lab experience and letting them perform experiments in a risk-free learning environment. Players like EdTech, Virtual Labs by IIT Delhi and IIT Kharagpur, the Governments Digital Infrastructure for Knowledge Sharing (DIKSHA) and other initiatives are making learning interactive and accessible.

Upskilling Demand:

EdTech platforms facilitate the job seekers and other professionals to enhance their skills through affordable online courses. It also provides hands-on knowledge, flexibility, and shorter completion times, which is a benefit to the job seekers.

Source: https://www.investindia.gov.in/blogs/opportunities-indias- edtech-industry-driving-innovation-and-accessibility9

Company Overview

With a rich legacy of over 86 years, S Chand and Company Limited is a trusted provider of high-quality education content offering a wide range of products including content solutions and services across the education lifecycle. The Company leads the Indian education content market through three business segments - Early Learning, K-12 and Higher Education across the education life cycle, competitive examinations and digital platforms. The Company has a strong foothold in the CBSE/ ICSE affiliated schools, with an increasing presence in the state board affiliated schools across India.

12,500+ 4,000+ 1,900+ 2,800+

No. of Titles No. of No. of No. of Authors

Distributors Employees

A Portfolio of 12,500+ Book Titles encompassing:

• School books.

• Higher academic books.

• Reference books.

• Competitive exams.

• Technical and professional publications.

S Chands key competitive advantage is that of being able to deliver quality content and innovations, and to nurture and fortifying relationships with its customers. It has an established reputation of being a leader in hybrid learning solutions serving the changing needs of schools, professional colleges, educational institution and vocational training institutes.

With its wide and ever-growing distribution network of over 4,000 distributors and channel partners, dealers and through online platforms, the Company has sold over 50+ million copies to customers in India and to 20+ countries. Further, its digital content also has its customer base spread across countries in Asia, Middle East and Africa.

With the goal of becoming the leading company in transition to digital knowledge industry, the Company focuses on developing interactive digital learning solutions across the K-12 and higher education business segments.

Marketing Initiatives undertaken in FY 2024-25

• Channel Partners Product Briefing - Almaty.

• Singapore Study Tour for leading school owners and principals.

• World Book Fair Participation - New Delhi.

Knowledge Quest Quiz (2 nd edition), 2024.

Hindi Diwas - Leading event of Vikas Publishing House for Hindi Teachers across the country

Scratch & Win Prize, 2024.

Mathematics Summit, 2024.

• Bhasha Mela, 2024.

• Saraswati Shikshak Samman.

Teachers Conclave, 2024.

Key Financial Highlights of FY 2024-25:

FY 2024-25 was a defining and remarkable year on several key parameters. During the year, the Company demonstrated healthy revenue growth and achieved the highest level of Gross

Margins, EBITDA Margins, Operating Income and Profit After Tax in the past five years. One of the years strongest features was its liquidity position and strong cash flows.

Continued improvement in Gross Margin and EBITDA Margin led to a sustained increase in Operating Profit at 798 million.

Increased Dividend to 4 per share during Financial Year 2024-25 vis-a-vis Final Dividend of 3 per share declared for FY 2023-24.

Operational Performance, FY 2024-25

FY 2024-25 sales season witnessed a relatively minor impact from the new NCERT books based on the NCF syllabus, as new books were launched only for 2 classes (3 rd and 6 th ). The adoption of new curriculum in classes was higher and translated into increased volumes. Curriculum sales adoption grew faster for Mylestone, MyZen and Solid Steps.

In terms of higher education, the Company continued to witness challenges on the back of lower student purchases in colleges, piracy and uneven roll-out of the NEP curriculum. Further, the Companys strategic partnerships and collaborations enabled it to expand its offerings and meet the changing needs ofthe customers.

Highlights of Digital offerings:

• Launch of TestCoach for CUET preparations

During the year, the Company launched TestCoach for CUET preparations key features of Expert Led Live Classes, Comprehensive Study Material, Periodic Performance Analysis and Flexible Adaptive Learning. Within a span of two months since launch, the app reported 100k downloads and 60k sign-ups.

• Strength of S Chand Academy on YouTube

The YouTube channel of S Chand Academy houses modules comprising 1,900+ videos prepared to supplement S Chand Test Prep and College Content. The channel reported strong growth crossing ~300k subscribers and 26 million views by March 31, 2025.

Digital Business and Investments - Hidden value in our

Balance Sheet

Smartivity

• Founded in 2015 with focus on STEM, with Learning and DIY Kits, S Chand holds 16% stake.

• EBITDA and PAT positive; Revenue growth of 45% and EBITDA growth of 176% vis-a-vis the previous financial year.

IxamBee

• Founded in 2016 in Delhi NCR, S Chand holds 4.3% stake

• Key objective of ixamBee is to help graduates and undergraduates prepare effectively for Government examinations, such as Banks, Insurance, Railways, and others.

• In FY 2024-25, IxamBees Revenue increased 4%, and PBT losses reduced by 85% compared with FY 2023-24.

Management Outlook for FY 2025-26

The Company remains optimistic for an improved and positive future in Financial Year 2025-26. This is especially after CBSE released a circular stating that the new NCERT books will be launched for 4 classes - 4 th , 5 th , 7 th and 8 th - during the year. On the back of this development we estimate that over the next two financial years (FY 2025-26 and FY 2026-27) complete adoption of new syllabus books for the K-12 segment would be done. The Company expects this to strongly support the growth trajectory over the next two years.

For FY 2025-26, the Company is working to deliver Operating Revenues above 8,000 million and upgrade EBITDA margin band to 18-20% vis-a-vis 17-19% in FY 2024-25. It is also evaluating M&A (mergers and acquisitions) opportunities to fill the gaps in its portfolio, besides also leveraging the Groups key strengths in such acquisitions to deliver superior value to its customers and stakeholders. It also has plans to further build on Content Licensing opportunities of its text, question banks and videos repositories.

The Company remains committed to continuing the positive trend and enhance its financial strength over the long term. It believes that an unwavering commitment towards operational excellence and delivering value to its customers will continue to drive success in the coming years. It continues to remain focused on building sustainable long-term value for all the stakeholders.

The companys focus has been clear: resist the hype, avoid over extensions and double down on content that works across formats - print and digital alike.

We understand that Education is a staircase business, not an elevator business. The companys approach stands in contrast to the aggressive expansion and high burn rates that defined much of Indias edtech sector in recent years. S Chand chose to stay conservative by cutting inefficiencies, expanding its digital content library and preparing its back-end systems for modular deployment. We have emerged from the Covid years leaner, more profitable and more agile.

The companys digital content library has expanded by nearly 30% over the last two years, with new content across national- level education boards CBSE, ICSE and NEP-aligned curricula. Test-prep material, tie-ups with educational YouTubers and QR-enabled Google Lens (image recognition technology) integrations are also part of the growing ecosystem.

The company is also looking to fill white spaces in its portfolio via selective acquisitions at reasonable valuations. The company positions itself as a content-first, platform-neutral player. Were an education content company that delivers across formats.

Planned Future Capex

Setting up an Integrated Plant and Warehouse Facility • Operations :

Making state-of-the-art warehouse fully operational during FY 2025-26 for the Group.

N ew printing facilities to be operational by FY 2026-27.

Moving printing and warehouse facilities to an integrated facility to improve efficiencies and enhance production capacity and quality.

• Investments:

o Plans to invest 350-400 million over FY 2026-27.

Benefits expected to be accrued out of Capex

• Improving quality of books printed, helping in increasing customer satisfaction.

• Improving efficiency during the peak season.

• Implementation of best practices for warehousing.

• Improved efficiency in loading and unloading.

• Faster TAT for order processing.

• Installation of solar power for clean energy.

Key Focus Areas for FY 2025-26

• Operating Revenues above 8,000 million.

• Delivering EBITDA Margin Band of 18-20% vs 17-19% in FY 2024-25.

• Evaluating inorganic opportunities to enhance the product portfolio.

• Focusing on CUET Examination through Test Coach.

• Continuing with multiple AI platform deals for content monetization.

• Continuing to set new benchmarks on working capital efficiency and cash flows.

Human Resources

As of March 31, 2025, the Company had over 1,900 employees, including a nationwide product/services sales and marketing team of over 740 as well as a content development team of more than 220 employees, including subject matter experts, instructional designers, and graphic designers.

The Company values the pivotal role of human resources in its growth trajectory. It remains dedicated to cultivating a conducive work environment where employees can thrive and advance professionally. It fosters motivation and performance orientation among employees through its rewards and recognition program and robust growth opportunities. Furthermore, the Company provides an incentive program for executives and managers to receive additional financial compenzation on certain financial performance threshold being achieved.

S Chand places a strong emphasis on workplace safety standards. To ensure compliance with all statutory laws and regulations governing environment, health, and safety, the Company has implemented a comprehensive environmental, health, and safety program. Additionally, S Chand has established protocols for electrical safety, equipment and material handling, management of hazardous chemicals, fire safety, monitoring of workplace conditions (including air quality, ambient noise, and drinking water quality), provision of first aid, disposal of hazardous waste, and maintenance of housekeeping standards.

The Company has implemented a system of accident reporting and investigation, ensuring that all accidents, both fatal and non-fatal, are promptly reported to health and safety authorities. Employees are actively encouraged to report near miss accidents as well.

Risks & Concerns Seasonality in K12 markets:

S Chands business is closely linked to the central curriculum academic cycle of April to March in the K-12 market, which is inherently seasonal. This seasonality directly influences the Companys operating revenues, margins, and cash flows every quarter. Furthermore, the Company has diversified its revenue streams by emphasizing digital solutions catering to both educational institutions and students. The Company also operates in segments such as Higher Education, Test Preparation, Distance Learning, and Skill Education, each with distinct sales cycles.

Rapid growth in EdTech and digital technologies:

The swift evolution of EdTech poses a potential threat to the Companys print division. However, S Chand believes that the National Education Policy 2023 (NEP 2023) and National Curriculum Framework for School Education (NCF-SE) will unlock numerous opportunities and significantly boost the Companys print business. Furthermore, the Company perceives the emergence of disruptive digital technologies and the rise of open-source content more as a business opportunity than a threat.

Regulatory and curriculum compliance risks:

The Company may encounter other external challenges, such as directives from State Governments to reduce school bag weight, pressure to adopt NCERT books, and the reduction of certain non-core subjects in junior classes, etc. To mitigate these threats, the Company has developed monthly and semester books, digital products, and value-added services. Additionally, it has focused on conducting workshops and seminars with schools to enhance engagement.

Dependency on key authors:

A substantial portion of the Companys revenue relies on the titles of a select few top authors. The Company prioritizes fair compenzation for these authors to foster ongoing harmonious relationships. It emphasizes maintaining mutually beneficial partnerships and employs a robust feedback mechanism to safeguard the longevity and reputation of S Chands diverse brands.

Intellectual property and copyright issues:

Dependence on specific authors increases the risk of intellectual property disputes or copyright challenges. The Company consistently broadens and grows its content and author network. To safeguard its content ownership and distribution, S Chand Company implements rigorous copyright management practices and maintains a dedicated legal team that strictly manages its Intellectual Property Rights.

Piracy:

Piracy, both physical and online, remains a significant threat to all publishing companies. S Chand faces ongoing challenges with key titles being pirated across different locations, prompting continuous raids conducted in collaboration with government agencies. Additionally, the Company actively monitors online piracy, which includes unauthorized use of content by education aggregators, individuals on platforms like YouTube, and uploads on various sharing sites. Swift actions are taken to safeguard the Companys and its authors copyrights from infringement.

Internal Risk Controls

The following list outlines S Chands comprehensive Internal Control Framework:

• Key policies are formulated, circulated, approved, and reviewed annually, and are also published online.

• Regular Internal Audit is conducted for the Company and its subsidiaries throughout the year.

• Related Party Transactions are approved by the Audit Committee and Board where necessary.

• The Authorization Matrix is clearly defined with segregation of duties to ensure internal controls.

• Internal Control Testing is conducted by Internal Auditors, with minimal failures under the Risk Control Matrix process.

• Application authorizations are granted to employees based on their level and work profile.

• Txternal software and monitoring is used to track statutory compliances.

• A robust corporate governance approach is followed, with Independent Directors serving in the Company and all material subsidiaries.

• An arms-length approach is maintained, even between subsidiaries and the holding company.

• A Risk Management Committee is established to oversee risks and implement mitigation measures.

Cautionary Statement

The Management Discussion and Analysis contains statements about expected future events, financial and operating results of S Chand, which may be forward-looking statements within the meaning of applicable laws and regulations and are based on informed judgments, estimates and assumptions. These forward-looking statements are subject to certain risks and uncertainties. Several factors could cause assumptions and actual future results and events to differ materially from those expressed or implied in the forward-looking statement. Readers are cautioned not to place undue reliance on forward-looking statements. The Company assumes no responsibility to publicly amend, modify, or revise any forward-looking statements based on any subsequent development, information or events.