Sawaca Enterprises Ltd Management Discussions

Your Directors have pleasure in presenting the management discussion and analysis report for the year ended on March 31,2026.

1. INDUSTRY STRUCTURE, DEVELOPMENT:

During the period under the review, the Company had been operating in the Business of Trading. The main products for Trading include Various Perfumery Chemicals, cotton bales etc.

The performance of the Company was satisfactory during the entire Financial Year 2025-2026. The year witnessed a challenging business environment marked by persistent inflationary pressures, fluctuations in global commodity prices, rising input and imported fuel costs, moderating economic conditions in certain sectors, and geopolitical uncertainties. These factors contributed to volatility and increased pressure on businesses across various industries.

Despite these challenges, the Indian economy demonstrated strong resilience and continued to maintain a robust growth trajectory during FY 2025-2026. India remained among the fastest-growing major economies in the world, supported by strong domestic consumption, infrastructure development, investment activity, and continued policy reforms. The Companys performance during the year reflects its ability to navigate the evolving economic environment and sustain its operations effectively.

2. OPPORTUNITIES & THREATS:

The Government is committed to encourage the healthy growth of Capital Market for development of the Economy. While the government seems committed to reforms to address the challenges, political compromises and high populist spending in an election year will mean that tough decisions are more likely to be deferred. However, steps by RBI to stabilize the exchange rate by reducing liquidity support to the banking system will create a challenging environment for investments.

3. SEGMENT-WISE PERFORMANCE:

The Companys main business activity is trading of Perfumery & Organic Chemicals, Textile and information Technology Consulting & Support service during the year under review the Company has also invested in started business of matrimony website in the name of nextgenshaadi.com

4. OUTLOOK:

The Company continues to explore the possibilities of expansion and will make the necessary investments when attractive opportunities arise.

5. RISK & CONCERNS:

The Company is exposed to specific risks that are particular to its business, including interest rate volatility, economic cycle, market risk and credit risk. The management continuously assesses the risks and monitors the business and risk management policies to minimize the risk.

6. INTERNAL CONTROL SYSTEMS & THEIR ADEQUEACY:

The Companys operating and business control procedures ensure efficient use of resources and comply with the procedures and regulatory requirements. There are adequate internal controls to safeguard the assets and protect them against losses from unauthorized use or disposition and the transactions are authorized, recorded and reported correctly.

The Audit Committee periodically reviews the internal controls systems and reports their observations to the Board of Directors.

The Directors have appointed Mr. Tejas Shah of M/s. Shah& Shah, Chartered Accountants as the Internal Auditors of the Company for the FY 2026-2027 on 29.05.2026

7. DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE:

During the financial year ended 31st March, 2026, the Company recorded total revenue from operations of Rs. 3,796.79 Lakhs, as compared to Rs. 8,225.12 Lakhs in the previous financial year, representing a decrease of approximately 53.84% over the corresponding period of the previous year.

The total expenses incurred by the Company during the year under review stood at Rs. 4,002.10 Lakhs, as against Rs. 8,369.71 Lakhs in the previous financial year.

After considering depreciation, provision for tax and other adjustments, the Company reported a Net Loss of Rs. 41.16 Lakhs for the financial year ended 31st March, 2026, as compared to a Net Loss of Rs. 34.89 Lakhs

in the previous financial year. This represents an increase in the loss of approximately 18.00% over the corresponding period of the previous year.

The Earnings Per Share (EPS) of the Company for the financial year 2025-2026 stood at Rs. (0.01).

8. HUMAN RESOURCE DEVELOPMENT:

The Company believes that the human resources are vital in giving the Company a competitive edge in the current business environment. The Companys philosophy is to provide congenial work environment, performance-oriented work culture, knowledge acquisition / dissemination, creativity and responsibility. As in the past, the Company has enjoyed cordial relations with the employees at all levels.

The Company continues to run an in-house training programme held at regular intervals and aimed at updating their knowledge about issues.

9. ACCOUNTING POLICIES:

The accounting policies have been consistently applied by the Company and are consistent with those used in the previous year. The financial statements have been prepared under the historical cost convention on an accrual basis. The management accepts responsibility for the integrity and objectivity of the financial statements, as well as for the various estimates and judgment used therein

10. DETAILS OF SIGNIFICANT CHANGES (I.E. CHANGE OF 25% OR MORE AS COMPARED TO THE IMMEDIATELY PREVIOUS FINANCIAL YEAR) IN KEY FINANCIAL RATIOS:

Particulars	As at March 31, 2026	As at March 31, 2025	% change from March 31, 2025 to March 31, 2026	Reasons for % change from March 31, 2025 to March 31, 2026
Current ratio	2.55	4.86	-47.57	The Net Decline in the ratio is mainly due to a proportionately higher decrease in current assets than the decrease in current liabilities
Debt- Equity Ratio	0.06	0.05	38.30	The increase in the Debt-Equity Ratio is primary attributable to an increase in total debt resulting from the availing of a new secured loan.
Debt Service Coverage ratio	3.25	4.64	-29.86	The Decrease in the ratio is primarily attributable to a higher increase in earnings available for debt servicing compared to the corresponding increase.
Return on Equity ratio	-0.71	-0.98	-27.59	The Decrease in the ratio is due to increase in average shareholders equity as compared to corresponding decrease in loss.
Inventory Turnover ratio	-	-	-	-
Trade Receivable Turnover Ratio	2.49	10.47	-76.20	The net decrease in the ratio is due to decrease in Sales as well as average trade receivables as compared to previous year.
Trade Payable Turnover Ratio	5.08	17.83	-71.50	The net decrease in the ratio is due to decrease in purchase as well as average trade payables as compared to previous year.
Net Capital Turnover Ratio	2.48	2.37	4.60	-
Net Profit ratio	-1.08	-0.42	157.75	The decrease in the ratio is due to decrease in the turnover as compared to previous year.
Return on Capital Employed	0.55	0.25	118.14	The net increase in the ratio is due to increase in Earning before interest and Taxes as compared to previous year.

11. DISCLOSURE OF ACCOUNTING TREATMENT IN PREPARATION OF FINANCIAL STATEMENT

The Company has followed all relevant Accounting Standards laid down by the Institute of Chartered Accountants of India (ICAI) while preparing Financial Statements.

12. CAUTIONERY STATEMENT:

Statements in this report on Management Discussion and Analysis describing the Companys objectives, projections, estimates, expectations or predictions may be “forward-looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied.

Place : Ahmedabad	For and on behalf of the Board
Date : August 14, 2026	For, Sawaca Enterprises Limited
	(Formerly Known as Sawaca Business Machines Limited)
	Sd/-
	Shetal Shah
	Managing Director
	(DIN: 02148909)