Safecure Services Ltd Management Discussions

The key issues ofthe Management Discussion and Analysis are given below.

Global Outlook:

The global private security and allied services industry outlook for FY 2027 is expected to evolve in response to several key trends and developments. Security services, being a fundamental requirement of commercial, industrial and institutional activity, remain closely linked to the pace of global economic activity, infrastructure creation, urbanisation and the growing convergence of manpower-based and technology-based security solutions. Here is a look at what might shape the industry:

(a) Steady Global Economic Growth and Urbanisation:

Stable Growth Environment: Global economic growth is projected to remain broadly steady over the medium term, supported by continued expansion in services, infrastructure creation and commercial real estate development. Continuing geopolitical conflicts, disruptions in trade routes and elevated public debt burdens pose challenges to the overall global outlook, but the underlying demand environment for protective services remains constructive.

Implications for Security Demand: Demand for private security services is closely correlated with the built environment · commercial complexes, retail and hospitality assets, industrial estates, logistics parks, data centres, educational and healthcare institutions and transport infrastructure. As urbanisation deepens and asset density increases, the requirement for organised, accountable and compliance-oriented security service providers increases correspondingly.

(b) Global Private Security Market Fundamentals:

Market Size and Trajectory: The global private security market is estimated at approximately USD 262 billion in 2025 and is projected at about USD 278 billion in 2026, growing at a compound annual growth rate of the order of 5% to reach approximately USD 394 billion by 2034. The Asia-Pacific region accounts for the largest share of the market, estimated at close to 33% in 2025 and valued at about USD 86 billion, and is projected at approximately USD 92 billion in 2026.

Manned Guarding Remains the Core: Manned security continues to account for the largest share ofthe global market by service line, while the industrial and commercial segments together constitute the largest end-user categories. Notwithstanding the rapid adoption of electronic security systems, trained security personnel remain indispensable for access control, response, escalation and on-site judgement, and the prevailing industry model is one of technology-enabled manpower rather than substitution of manpower by technology.

Fragmentation and Consolidation: The industry worldwide is characterised by a small number of large multinational operators alongside a highly fragmented base of regional and local providers. Consolidation through mergers and acquisitions continues among the larger players, while smaller operators increasingly compete on specialisation, service quality and regulatory compliance rather than on price alone.

(c) Convergence of Manned Guarding and Electronic Security:

Integrated Security Solutions: Customers increasingly seek integrated solutions that combine deployed personnel with electronic surveillance, access control, intrusion detection, alarm monitoring and centralised command and response infrastructure. This convergence enables improved coverage at lower marginal cost, better incident documentation and measurable service levels, and it favours service providers capable of offering both manpower and technology under a single contract.

Managed Services Model: Globally, managed security services that bundle monitoring, maintenance, system updates and analytics into a recurring service contract are among the fastest growing segments of the market, as customers convert capital expenditure into operating expenditure and outsource specialised functions to established providers.

(d) Regulation, Compliance and Formalisation:

Rising Regulatory Standards: Licensing regimes, mandatory training hours, background verification of personnel, data protection obligations and workplace safety requirements continue to be strengthened across jurisdictions. While these requirements increase the compliance burden, they operate decisively in favour of organised operators with established statutory registrations, documented training programmes and robust payroll and statutory compliance systems.

Statutory Cost Pass-Through: Since security services are manpower intensive, statutory revisions to minimum wages and social security contributions have a direct bearing on service costs. The ability to contract for and recover such revisions from customers is a defining commercial characteristic of the industry and a key differentiator between organised and unorganised operators.

(e) Facility Management and Bundled Services:

Single-Vendor Preference: Institutional customers increasingly prefer to consolidate security, housekeeping, cleaning, pest control, technical maintenance and allied site services with a single accountable vendor. This preference has driven the global growth of integrated facility management, and has enabled security service providers to extend their presence across the broader site-services value chain.

Outsourcing Trend: The share of outsourced integrated service contracts continues to grow faster than the overall facility services market, as organisations concentrate on core activities, seek measurable service levels and transfer compliance risk in relation to contract labour to specialised service providers.

(f) Technology, Analytics and Response Infrastructure:

Electronic Security Adoption: Falling hardware costs, improved network availability and advances in video analytics have materially expanded the addressable market for electronic security devices, alarm monitoring and remote response. Centralised monitoring centres now permit a single response infrastructure to serve a widely dispersed portfolio of customer sites, improving both service economics and response times.

Data Protection Considerations: The growth of surveillance and monitoring services is accompanied by increasing regulatory attention to the collection, storage and processing of personal data, including video footage and access records. Compliance with data protection requirements is emerging as an important element of service design and contracting in the electronic security segment.

(g) Economicand Geopolitical Influences:

Global Economic Recovery: A steady recovery in the global economy would support construction, commercial occupancy, retail footfall, events and industrial activity across sectors, each of which is a direct driver of security deployment. Persistent inflationary pressures, elevated wage costs or slowdowns in key regions might, however, temper growth.

Security Environment: Heightened concerns regarding physical security, asset protection, crowd management at public events and the safety of personnel at commercial premises continue to sustain demand, and periods of uncertainty have historically been associated with resilient, rather than declining, demand for protective services.

Outlook Summary:

Stable Growth with Structural Tailwinds: The global private security and allied services industry is expected to experience stable growth in FY 2027, driven by urbanisation, infrastructure creation, the formalisation of service delivery and the integration of manpower with electronic security. Companies that can navigate the challenges of wage inflation, manpower availability, statutory compliance and evolving customer specifications will be well positioned to thrive.

Overall, FY 2027 is likely to be a year of consolidation and value addition for the industry, with a clear shift in emphasis from undifferentiated manpower supply towards integrated, technology-enabled and compliance-assured service solutions.

Private Security and Allied Services Industry in India:

The outlook for the private security and allied services industry in India for FY 2027 is shaped by several key trends and opportunities across various sectors. Here is an analysis of the prospects:

(a) Indias Position in the Global Private Security Industry:

Scale and Standing: India is among the largest and fastest growing private security markets in the world. The industry is estimated to deploy in excess of 8 million security personnel, a workforce larger than the countrys police force, and industry associations place total employment in the sector, direct and indirect, at over 12 million persons as against about 7 million a decade earlier. The sector is widely regarded as one of the largest generators of formal and semi-formal employment in the country, and plays a significant role in facilitating the transition of the workforce from agricultural to nonagricultural occupations.

Market Size and Composition: The Indian private security services industry is estimated at a market size of the order of Rs 1.5 lakh crore, with the organised segment constituting approximately 20% of the market by number of operators while contributing close to 80% of industry revenue. The organised segment has been growing at a materially faster rate than the industry as a whole, reflecting the steady migration of institutional business from unorganised operators to licensed and compliant service providers.

Structural Advantage: The industry benefits from a large, trainable workforce, comparatively low labour costs, an expanding base of commercial and industrial assets requiring protection and a regulatory framework that has progressively raised entry standards. India is among the few large markets in which manpower-based security, electronic security and integrated facility management are simultaneously scaling.

(b) Regulatory Framework and Formalisation:

PSARA and Licensing: The Private Security Agencies (Regulation) Act, 2005 and the rules framed thereunder by the respective State Governments govern the licensing of private security agencies, the eligibility, verification and training of security personnel and the supervisory obligations of agencies. Licensing is State-specific, and the requirement to obtain and maintain licences across multiple States constitutes a significant barrier to entry for smaller operators while conferring a durable advantage on established multi-State agencies.

Labour and Social Security Compliance: Service providers are required to comply with a substantial body of labour legislation, including provisions relating to minimum wages, provident fund, employees state insurance, contract labour, payment of bonus and gratuity. Increasingly, institutional customers conduct compliance audits of their service providers and require documented evidence of statutory remittances, which materially favours organised operators and accelerates the formalisation of the industry.

Skilling Framework: The sector is supported by a dedicated Sector Skill Council, and structured training and certification of security personnel has become a differentiator in institutional tendering, particularly for high-value commercial, industrial and banking sector deployments.

(c) Demand Drivers Across End-Use Sectors

Breadth of Demand: Demand for private security and allied services in India arises from commercial office complexes and information technology parks, retail malls and hospitality assets, banking and financial services including branches and ATM networks, manufacturing and industrial estates, logistics and warehousing facilities, residential complexes and gated communities, educational and healthcare institutions, transport infrastructure and large-scale public and private events.

Sustained Real Estate and Infrastructure Cycle: Continued growth in Grade A office absorption, the expansion of global capability centres, sustained warehousing and logistics development, the growth of organised retail and hospitality and the ongoing build-out of transport and urban infrastructure collectively expand the installed base of assets requiring protection and site services on a continuing basis.

(d) Facility Management Services in India:

Growth Trajectory: The facility management services market in India is projected to grow at a compound annual growth rate of the order of 7% to 9% over the medium term, supported by rapid urbanisation, commercial real estate development and growing corporate demand for integrated services. Facility operations and security management together constitute the single largest solution segment ofthe market.

Shift to Outsourced and Integrated Contracts: While in-house service models continue to account for the larger share of the market, outsourced integrated contracts are growing at a materially faster rate, and soft services · comprising cleaning, housekeeping, pest control and allied site services · continue to account for the predominant share of outsourced facility management revenue. This shift directly expands the addressable market for established security service providers seeking to bundle allied services.

(e) Electronic Security, Alarm Monitoring and Surveillance:

Market Size and Growth: The Indian electronic security market is estimated at approximately USD 3.4 billion in 2026 and is projected to grow at a compound annual growth rate of about 11% to reach roughly USD 5.7 billion by 2031. The video surveillance segment alone is estimated at about USD 4.4 billion in 2025 and is projected to reach approximately USD 7.1 billion by 2030. Managed security services that bundle monitoring, maintenance and analytics are among the fastest growing subsegments, expanding at a rate in excess of 12% per annum.

Regulatory Pull: Regulatory requirements are a significant driver of installed base. The Reserve Bank of India prescribes continuous recording, image clarity and tamper alarm requirements for ATM installations, while State education and public safety norms mandate surveillance coverage with prescribed retention periods across an expanding range of premises. Smart city and public safety programmes spanning more than 300 urban centres identify surveillance, traffic management and emergency response as core deliverables.

Convergence Opportunity: For service providers already deploying personnel at customer sites, the electronic security segment offers a natural adjacency, permitting the sale of installation, monitoring and response services into an existing customer base at incremental cost.

(f) Banking Sector and ATM Management Services:

Outsourced ATM Operations: The banking sector continues to outsource the operation and upkeep of its ATM networks, comprising site maintenance, repair, electronic security, alarm monitoring and response. Regulatory prescriptions relating to ATM security, together with the geographic dispersal ofATM networks into semi-urban and rural locations, sustain demand for organised service providers capable of delivering standardised service levels across a wide footprint.

(g) Event Security and Crowd Management:

Growth of Organised Events: The expansion of organised entertainment, sporting, exhibition and corporate events in India, together with heightened regulatory and public attention to crowd safety, venue access control and emergency evacuation planning, has created a distinct and growing market for specialist event security management services requiring rapid mobilisation of trained personnel and temporary electronic security infrastructure.

(h) Interior Fit-Out and Allied Project Services:

Adjacency to the Built Environment: Sustained commercial real estate absorption, the expansion ofglobal capability centres and periodic refurbishment cycles across offices, retail and hospitality assets support demand for interior fit-out projects. This activity is closely linked to the same customer base and decision-makers as security and facility services, permitting cross-selling and deeper account penetration.

(i) Challenges and Opportunities:

Challenges: Wage inflation, attrition and the availability of trained personnel remain persistent challenges in a manpower-intensive industry. Competition from a large unorganised segment exerts pressure on pricing, while the working-capital-intensive nature of manpower deployment contracts and delays in customer collections affect liquidity. Statutory revisions to wages and social security contributions may not always be capable of immediate pass-through under existing contracts.

Opportunities: Continuing formalisation of the industry, the shift of institutional business towards licensed and compliant operators, growing customer preference for integrated single-vendor solutions, the convergence of manpower with electronic security, and the expansion of demand into Tier-ll and Tier-Ill cities together offer significant headroom for growth. Companies that can offer trained manpower, documented statutory compliance, consistent service quality and integrated technology are best placed to capture this demand.

Outlook Summary:

Positive Growth Prospects: The private security and allied services industry in India is poised for significant growth in FY 2027, driven by infrastructure and real estate development, the expansion of organised commercial activity, regulatory formalisation and the adoption of technology-enabled service models. The sector is expected to see robust demand across commercial, industrial, banking, institutional and eventapplications.

Strategic Focus Areas: To capitalise on these opportunities, companies should focus on recruitment, training and retention of personnel, statutory compliance assurance, cost competitiveness, service quality and the integration of electronic security with deployed manpower, while extending their geographic footprint and broadening the range of allied services offered to existing customers.

Overall, FY 2027 is expected to be a year of growth and value addition for the private security and allied services industry in India, with opportunities spanning across multiple sectors and applications.

Government Initiatives

The Government of India has launched several initiatives that directly and indirectly support the private security, facility management and electronic security industry, focusing on formalisation of employment, expansion of infrastructure, strengthening of public safety and fostering domestic manufacturing. Given below is an overview ofthe key initiatives:

(a) Private Security Agencies (Regulation) Act, 2005:

Objective: The Act provides a statutory framework for the licensing and regulation of private security agencies, prescribing eligibility criteria for agencies and personnel, verification and training requirements and supervisory obligations.

Impact on the Industry: The Act has driven the progressive formalisation and standardisation ofthe industry, raising entry barriers, improving service standards and shifting institutional business decisively towards licensed and compliant operators.

(b) Labour Reforms and Social Security Coverage:

Objective: The consolidation of central labour legislation and the continuing expansion of provident fund and employees state insurance coverage aim to extend formal social security protection to a wider section ofthe workforce.

Impact on the Industry: Greater emphasis on statutory compliance in relation to wages, social security and contract labour operates in favour of organised service providers with established payroll and compliance infrastructure, and accelerates the migration of business away from the unorganised segment.

(c) Skill India and the Security Sector Skill Development Council:

Objective: National skilling programmes, together with the dedicated Sector Skill Council for the security industry, aim to standardise training curricula, certify security personnel and enhance the employability ofthe workforce.

Impact on the Industry: A certified and better-trained workforce enables service providers to command better realisations, participate in higher-value institutional tenders and reduce attrition and incident rates at customer sites.

(d) Smart Cities Mission and Public Safety Programmes:

Objective: Urban development programmes spanning more than 300 urban centres identify surveillance, traffic management, integrated command and control centres and emergency response as core deliverables.

Impact on the Industry: These programmes expand the installed base of electronic security infrastructure and create sustained demand for installation, integration, monitoring, maintenance and response services.

(e) Infrastructure Creation and Public Capital Expenditure:

Objective: Successive Union Budgets have sustained a high level of public capital expenditure on roads, railways, urban infrastructure, power, logistics and transport, alongside continued implementation of the PM Gati Shakti National Master Plan for integrated infrastructure planning.

Impact on the Industry: Large-scale infrastructure creation directly expands the universe of assets, sites and installations requiring manned guarding, electronic surveillance and site services, thereby supporting volume growth for service providers.

(f) Reserve Bank of India Norms for Banking Infrastructure:

Objective: Regulatory prescriptions govern the physical and electronic security of bank branches, currency chests and ATM installations, including requirements relating to surveillance recording, image clarity, tamper alarms and incident response.

Impact on the Industry: These requirements underpin sustained, regulation-driven demand for ATM management, electronic security, alarm monitoring and response services across an extensive and geographically dispersed network.

(g) Make in India and Production Linked Incentive Schemes:

Objective: These initiatives aim to expand domestic manufacturing capacity across identified sectors, including electronics, through investment incentives and import substitution measures.

Impact on the Industry: The creation of new manufacturing capacity expands the base of industrial premises requiring security and facility services, while the growth of domestic electronics manufacturing improves the availability and cost of electronic security devices deployed by service providers.

(h) Digital Personal Data Protection Framework:

Objective: The data protection framework governs the collection, storage and processing of personal data, including surveillance footage, access control records and biometric information.

Impact on the Industry: Compliance obligations in relation to data handling are becoming an integral element of electronic security and monitoring contracts, favouring service providers with documented data governance practices and appropriate contractual frameworks.

These government initiatives collectively support the growth and development of the private security and allied services industry in India by promoting formalisation, expanding infrastructure, strengthening public safety and fostering skill development across the sector.

Road Ahead

The private security and allied services industry, both globally and in India, is entering a

transformative phase. Over the next five years, growth will be shaped by:

* Sustained infrastructure, real estate and commercial construction activity expanding the base of assets requiring protection and site services.

* Continued migration of institutional business from the unorganised segment to licensed, compliant and quality-certified operators.

* Convergence of manned guarding with electronic surveillance, access control, alarm monitoring and centralised response infrastructure.

* Growing customer preference for integrated single-vendor solutions spanning security, facility management and allied site services.

* Regulation-driven demand across banking, education, transport and public safety applications.

* Expansion of organised demand into Tier-ll and Tier-Ill cities and into newer end-use segments such as data centres, logistics parks and large-format events.

* Rising customer expectations on training standards, statutory compliance assurance, incident documentation and measurable service levels, favouring organised operators.

Overall, FY 2027 is expected to mark a pivotal year of growth, consolidation and value addition. Companies that successfully align with these industry trends, compliance expectations and evolving customer demands will not only enhance shareholder value but also secure a resilient growth trajectory over the next five years.

Our Business:

The Company is engaged, directly and through its subsidiary, in the business of providing security and allied services. The Companys direct operations comprise manned guarding and security training, event security management and interior fit-out projects. Through its subsidiary, the Company is engaged in emergency response services, including loss prevention, asset protection and mobile patrolling; facility management services, including cleaning, housekeeping and pest control management; ATM management services, including repair and maintenance; and alarm monitoring and response services, including the installation of electronic security devices and systems.

The Companys service delivery model combines trained and verified personnel with supervisory oversight, structured training and documented statutory compliance, supported by the ability to offer electronic security and allied site services to the same customer base. This combination enables the Company to serve institutional customers seeking a single accountable service provider across multiple service lines.

During the year under review, the Company recorded total revenue of Rs 5,506.95 Lakhs on a standalone basis as compared to Rs 6,104.96 Lakhs during the financial year ended March 31, 2025 ("Previous Financial Year"), representing a decline of approximately 9.80%. The moderation in revenue reflected the completion and non-recurrence of certain contracts during the year, and the Companys continued emphasis on quality of revenue over volume.

Total expenses for the year stood at Rs4,972.54 Lakhs as against Rs5,512.74 Lakhs in the previous financial year, reflecting the benefit of continued cost rationalisation and disciplined deployment of resources. Since the Companys operations are manpower intensive, employee benefits and allied deployment costs continued to constitute the major component of expenditure, and the containment of these costs in line with the scale of operations was a principal contributor to the preservation of margins during the year.

On the profitability front, the Company reported a profit before tax of Rs 534.41 Lakhs as against Rs 592.22 Lakhs in the previous year, and a profit after tax of Rs 535.07 Lakhs as compared to Rs 516.23 Lakhs in the previous year, registering a growth of approximately 3.65%. The net profit margin improved from 8.46% in the previous financial year to 9.72% during the year under review, notwithstanding the moderation in revenue, reflecting improved operational efficiency and better cost absorption. The total comprehensive income for the year stood at Rs 542.45 Lakhs as against Rs 509.82 Lakhs in the previous financial year. Earnings per equity share (basic and diluted) for the year stood at Rs 6.54 as against Rs 7.24 in the previous year, the reduction being attributable to the increase in the weighted average number of equity shares consequent upon the fresh issue made during the year.

On a consolidated basis, the total revenue for the year stood at Rs 6,707.03 Lakhs as against Rs 7,326.86 Lakhs in the previous financial year. The consolidated profit before tax stood at Rs 625.27 Lakhs as compared to Rs 725.66 Lakhs, and the consolidated profit after tax stood at Rs 603.06 Lakhs as against Rs 615.87 Lakhs in the previous financial year. The moderation in consolidated earnings is primarily attributable to lower revenue realisation across the groups service verticals during the year under review.

During the year under review, the Company successfully completed its Initial Public Offering comprising a fresh issue of 30,00,000 equity shares of face value of Rs 10 each at an issue price of Rs 102 per equity share, including a securities premium of Rs 92 per equity share, aggregating to Rs 3,060.00 Lakhs, and the equity shares of the Company were listed and commenced trading on the SME Platform of BSE Limited on November 06, 2025. The net proceeds of the Issue are being utilised towards the objects stated in the Prospectus. The listing represents a significant milestone in the Companys growth journey and is expected to further enhance the Companys visibility, credibility and access to the capital markets.

The overall performance of the Company during the year under review remained satisfactory, with sustained profitability and an improvement in margins notwithstanding the moderation in revenue. The management remains focused on strengthening operational capabilities, deepening customer relationships, expanding the service portfolio across the groups verticals and exploring opportunities for sustainable growth in the security and allied services segment.

Opportunities for our business:

* Continuing formalisation of the security services industry, favouring licensed operators with established compliance systems and statutory registrations.

* Ability to cross-sell across the groups service verticals · manned guarding, security training, event security management, interior fit-out projects, facility management, ATM management and electronic security · to a common institutional customer base.

* Growing customer preference for integrated single-vendor solutions combining deployed manpower with electronic security systems and alarm monitoring.

* Enhanced visibility, credibility and access to capital following the listing of the Companys equity shares on the SME Platform of BSE Limited, supporting participation in larger institutional tenders.

* Regulation-driven demand in the banking sector for ATM management, electronic security and alarm monitoring and response services.

* Expansion of the customer base across new geographies, including Tier-ll and Tier-Ill cities, and into newer end-use segments such as data centres, logistics parks and large- format events.

* Scope to scale the subsidiarys technology-led service offerings and to convert one-time installation engagements into recurring monitoring and maintenance contracts.

* In-house security training capability, supporting service quality, retention and differentiation in institutional tendering.

Threats:

* Manpower-intensive operations resulting in exposure to wage inflation, attrition and the availability oftrained and verified personnel.

* Statutory revisions in minimum wages, provident fund, employees state insurance and allied labour legislation, which may not always be capable of immediate pass-through to customers under existing contracts.

* Intense competition from established organised operators as well as from a large unorganised segment, exerting pressure on service pricing and contract renewals.

* Concentration of revenue in certain geographies and customer accounts, and the tender-driven nature of contract renewals.

* Working capital intensity and the risk of delays in collection from customers, given the requirement to fund payroll in advance of billing cycles.

* Operational and liability exposure inherent in the provision of security services at customer premises, including the risk of incidents, loss or damage.

* Evolving regulatory requirements relating to licensing, training, data protection and workplace safety, which may necessitate additional investment.

* Macroeconomic uncertainty and cyclicality in the commercial real estate, retail, hospitality and events sectors.

Segment-wise or Product-wise Performance:

The Company is principally engaged in the business of providing security and allied services and, accordingly, operates in a single reportable business segment and in a single geographical segment, being India.

The Companys services are delivered across a range of end-use applications, including manned guarding and security training for commercial, industrial and institutional premises; event security management for organised events and exhibitions; interior fit-out projects; and, through its subsidiary, emergency response services comprising loss prevention, asset protection and mobile patrolling, facility management services comprising cleaning, housekeeping and pest control management, ATM management services comprising repair and maintenance, and alarm monitoring and response services including the installation of electronic security devices and systems.

During the year under review, the Company continued to strengthen its market position by enhancing customer engagement, improving supervisory oversight at deployment sites, strengthening statutory compliance systems and improving operational efficiencies across service contracts.

In line with its strategy of business diversification, the Company continued to develop its presence in electronic security, alarm monitoring and allied facility management applications through its subsidiary, thereby broadening its service portfolio and reducing dependence on a limited range of service lines. The diversification initiative is expected to provide sustainable growth opportunities and improve business resilience over the medium to long term.

Outlook:

The outlook for the private security and allied services industry remains positive, supported by sustained infrastructure and real estate development, the continuing formalisation of service delivery, regulation-driven demand across banking and public safety applications, and the increasing preference of institutional customers for integrated and accountable service providers.

Over the medium to long term (FY 2027 - FY 2031), the Company has charted a growth roadmap aimed at building a scalable, diversified and resilient business model. The Company expects sustained demand across key segments including commercial and industrial premises, banking and financial services, retail and hospitality, institutional customers, transport and logistics infrastructure and organised events.

The key elements of this outlook are:

* Revenue Growth: Sustained topline growth driven by deeper penetration of existing customer accounts, expansion of the customer base and the scaling up of newer service verticals.

* Capability Enhancement: Strengthening recruitment, verification, training and retention systems so as to build a stable and certified deployment base capable of supporting growth in scale.

* Technology Integration: Extending the integration of electronic security, alarm monitoring and response infrastructure with deployed manpower to improve service outcomes and contract economics.

* Operational Efficiency: Leveraging supervisory systems, process improvements and economies of scale to optimise costs, improve margins and enhance profitability.

* Market Expansion: Widening the geographic footprint across States and extending the range of allied services offered to existing customers.

* Compliance Assurance: Maintaining documented statutory compliance across licensing, wages and social security obligations as a source of competitive differentiation.

* Shareholder Value Creation: A balanced focus on growth and profitability to deliver consistent returns, backed by a resilient business model.

The management remains confident that these initiatives will enable the Company to strengthen its competitive position and create sustainable value for all stakeholders over the next five years.

The management further believes that the Companys diversified service portfolio, established operating track record, trained manpower base, experienced leadership team and customer- focused approach will support long-term sustainable growth.

Risk Management:

The Board of the Company has adopted a Risk Management Policy to identify, analyse and assess the potential risks associated with the business operations of the Company. The internal controls and procedures established in the organisation are aligned with the risk management policy for timely and quick response to all identified risks, and the Audit Committee exercises additional oversight over financial risks and controls. The policy is reviewed and updated by the Board at regular intervals for ensuring its effectiveness. At present, the management has identified the following key risks:

* Securing critical resources, including capital, trained manpower and supervisory talent.

* Managing wage inflation, attrition and the statutory cost of deployment, and securing contractual mechanisms for their recovery.

* Ensuring cost competitiveness in a price-sensitive and tender-driven market.

* Maintaining licensing and statutory compliance across multiple States and service lines.

* Maintaining and enhancing service quality, incident response standards and customer service levels.

* Managing customer concentration, contract renewal cycles and the collection of receivables.

* Creating service differentiation through training, technology integration and compliance assurance.

Internal control systems and their adequacy:

The Company has duly established and maintained its internal controls and procedures for financial reporting and has evaluated the effectiveness of its internal control systems. The internal control systems are commensurate with the nature of the Companys business and the size, scale and complexity of its operations, and are monitored continuously and updated to ensure that assets are safeguarded, established regulations are complied with and pending issues are promptly addressed.

The Internal Auditors monitor the efficiency and effectiveness of the internal control systems in the Company. The reports presented by the Internal Auditors are reviewed by the Audit Committee on a routine basis. The Committee takes note of the audit observations and corrective actions taken thereon, and maintains a constant dialogue with the statutory and internal auditors to ensure that the internal control systems are operating effectively.

Material Developments in Human Resources / Industrial Relations Front Including Number of People Employed

Employee wellbeing and the building of a strong workplace culture continued to be focus areas for the financial year 2025-26. The Company believes that its employees are key to the success of its business, and that in a manpower-intensive service industry the quality, training and retention of deployed personnel are the primary determinants of service delivery and customer retention. The Company adopted sound people practices that enabled it to attract and retain talent in an increasingly competitive market, and to foster a work culture committed to providing employees with the opportunity to realise their potential.

As on March 31, 2026, the Company had 21 employees. Further, below is the bifurcation of the employees:

No. ofon-roll employees: 21

Out ofwhich, male employees were 16 and female employees were 5.

The Human Resource team undertook focused initiatives to launch employee-centric welfare programmes and actively engaged with business leaders to address workplace concerns and future talent needs. Structured security training, supervisory development and periodic refresher programmes remain key pillars of the Companys people strategy, enabling deployed personnel to meet job requirements effectively while staying aligned with customer expectations and statutory standards. The Company also places emphasis on workplace safety, on the verification of personnel prior to deployment and on adherence to statutory obligations relating to wages, provident fund, employees state insurance and workplace welfare. Industrial relations during the year under review remained cordial at all locations.

Details of significant ratios:

Details of the ratios and the changes therein are provided in Note No. 28 of the financial statements of the Company for the financial year ended March 31, 2026.

Significant Changes in the return on net-worth:

The details of the return on net-worth are as follows:

Particulars	FY 2026	FY 2025	%of variance
Return on Net-Worth (%)	17%	34%	-50.51%

The change in the return on net-worth during the financial year ended March 31, 2026 is primarily on account of the increase in the net-worth of the Company pursuant to the fresh issue of equity shares under the Initial Public Offering completed during the year under review.

Cautionary Statement:

The statements made in this section describe the Companys objectives, projections, expectation and estimations which may be forward looking statements within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied, depending upon economic conditions, government policies, statutory revisions in wages and labour legislation, demand and supply conditions and other incidental factors.

By the order of the Board of Directors
For Safecure Services Limited
(formerly known as Safecure Services Private Limited)
Sd/-
Shailendra Mahesh Pandey
Chairman and Managing Director
DIN:06403434
Place: Thane	Date: August 31, 2026