SEAMEC Ltd Management Discussions

1. INDUSTRY STRUCTURE AND OUTLOOK

The Middle East War has disrupted Oil and Gas Industry. The War has adversely impacted International Gas flow because of Strait of Hormuz Closure and the strikes on energy infrastructure in the Persian Gulf, which were Irans retaliation for US and Israeli Strike. The disruption has caused significantly to reduce crude flows and even higher output from less affected suppliers is unlikely to offset the shortfall of this scale.

The short-term shock risk has grown structural and a prolonged war may permanently change demand trends and postpone or eliminate anticipated worldwide gas shortages.

India, Worlds Third largest Oil buyer, normally sources about half of its crude through Strait of Hormuz, a vital underway that has seen only a trickle of traffic since USA has launched attack on Iran.

India imports a large share of crude oil, Liquified Natural Gas (LNG) and Liquified Petroleum Gas (LPG) through a region that remains vulnerable to geopolitical disruption, with its energy security heavily exposed to instability in West Asia.

India relies on Gulf region for about 60% of its LPG consumption. The Middle East conflict has prompted urgent government intervention to secure alternative supplies and encourage use of Kerosene and Coal in less priority sectors to ease supply pressure. The domestic production meets about the 40% of the LPG demand while remaining volumes are imported

LPG supply continues to be affected by prevailing geo-political situation. The supply of LPG to domestic household has been prioritized. USA has authorized the delivery and sale of Russian Crude and Petroleum products for one month in the midst of continuation of Middle East War. The temporary extension of Russian Sanction is expected to help boost short-term crude supply by enabling offtake on sea volumes by refineries.

An extension of USA waiver permitting purchase of Russian Crude is supported, but rising competition from the other Asian buyers will keep the market tight.

India ensured higher level of refinery operations for higher LPG production to avoid any panic in the domestic market. The country has an average LPG yield of about 7.5%, while LPG typically accounts for upto 10% - 11% of total refining output.

The state-run refineries like Indian Oil Corporation, Bharat Petroleum and Hindustan Petroleum are operating well above the normal monthly level. In private refinery segment, Reliance has operated at about 95% of its capacity while ROSNEFT led NOYARA Energy recorded a 100% run rate. On a prevailing scenario, it is estimated that the conflict has pushed the world to recover in six months to a year. However, if war continues for more than six months, those knee - jerk changes could become more structural leading to restoration of normalcy more than two years.

The Global connection of Oil & Gas market is entering a transformative decade as Operators across HydroCarbon Value chain accelerated digitization to improve operational efficiency, reduction in downtime and meet tightening environmental regulations. By 2035, the market is projected to reach an index value of 220 relative to 2025, reflecting a compound annual growth rate of 8.2% over the forecast period 2026-2035. This expansion is supported by rapid deployment of IOT Sensors, edge computing devices, AI-driven predictive analytics platform that enable real-time decision making from wellhead to refinery.

The baseline scenario for the connected Oil & Gas Market from 2026 to 2035 assume steady global economic expansion with moderate oil prices averaging USD 65 - USD 85 per barrel, continued investment upstream and midstream infrastructure and progressive tightening of environmental and safety regulations across major producing region. Under this scenario, market is expected to grow at a CAGR of 8.2% for all projections, geo-political stability will play a crucial and decisive result.

DRY BULK SHIPPING

In 2026, the global Dry Bulk Shipping Market is estimated to grow with consistent expansion

OFFSHORE SUPPORT VESSELS

The Offshore Support Vessel Market size has grown strongly in recent years. The growth can be attributed to growth of Offshore Oil and Gas exploration, expansion of Offshore drilling activities, increasing need for logistic and platform support, development of deep water fields reliance on conventional offshore vessels. The growth in the forecast period of 2026 to 2030 can be attributed to growth of Offshore Wind installations, increasing offshore maintenance activities, rising demand for advance support vessels and multi support vessels.

Offshore Support Vessels, commonly referred to as Offshore Supply Vessels are specialized Ships tailored for Oceanic Operations. The Global Support Vessels market is segmented by Vessel type, application and geography. By Vessel type, the market is segmented into platform supply vessels, AHT, MSV, and other types. By application, the market is segmented into offshore oil & gas of various dimensions, including repairs, maintenance and construction support activities, offshore rigs, offshore decommissioning and other applications.

The growth in offshore projects and demand for skilled professionals, including drilling engineers, ROV operators, and health, safety, and environmental specialists will act as complementary to each other.

In India, more emphasis is given on Automation Underwater Vehicles (AUV) & Remotely Operated Vehicles (ROV) which are critical for operating underwater diving, pipeline insertion & maintenance in the water & ultra deep water environment. To match scaling up domestic production including in the remote areas, importance of storage facilities as well as logistic are also being addressed.

The government of India is consistently pursuing for effective exploration and utilization of marine potential India is having with a vast coastline over 7,500 kms.

On a prospective note, Indias energy demand and economic development is poised to go hand in hand resulting likely greater demand for oil and gas in the coming years as well. This will undoubtedly make the sector attractive to new investors.

2. OPPORTUNITIES AND THREATS

SEAMEC continues as a formidable Player in DSV Sector in India backed by strong vision, strategic planning increasing its fleet strength of diverse nature such as MSV,OSV, Barge. Its untiring efforts resulted utilizing its assets significantly and making its presence prominently both in India and overseas.

The adverse geo-political situation is a concern and threat for overseas deployment and availing the drydock services. This has been experienced by the Company. The pre-emptive and pragmatic approach has become a core

focal point on the part of the Company as a mitigating feature.

The combination of Fleets of diversed nature has strengthened the Companys position in different area.

3. BUSINESS SEGMENT ANALYSIS

The business segment for the Company during the year under review has been the offshore segment in domestic market.

The performance of the Company and details of segment reporting are presented in the financial statements and notes annexed thereto.

4. FINANCIAL PERFORMANCE

For meaningful comparison, the pertinent standalone financial parameters are provided below:

Note: With respect to details of significant changes in the key financial ratios with explanations, please refer to Note 42 of the Standalone Financial Statements forming part of this Annual Report.

Comments on Current Years Financial Performance:

5. HUMAN RESOURCES AND INTERNAL CONTROL ADEQUACY

Human Resources and Internal Control System and adequacy thereof have been stated in the Directors Report that forms part of this Report.