Seemax Resources Ltd Management Discussions

1. Global Economy and Outlook:

Global growth is projected at 3.0 percent for 2025 and 3.1 percent in 2026. The forecast for 2025 is 0.2 percentage point higher than that in the reference forecast of the April 2025 World Economic Outlook (WEO) and 0.1 percentage point higher for 2026. This reflects stronger-than-expected front-loading in anticipation of higher tariffs; lower average effective US tariff rates than announced in April; an improvement in financial conditions, including due to a weaker US dollar; and fiscal expansion in some major jurisdictions. Global headline inflation is expected to fall to 4.2 percent in 2025 and 3.6 percent in 2026, a path similar to the one projected in April. The overall picture hides notable cross-country differences, with forecasts predicting inflation will remain above target in the United States and be more subdued in other large economies.

The global economy has continued to hold steady, but the composition of activity points to distortions from tariffs, rather than underlying robustness. Global growth in the first quarter of 2025 was 0.3 percentage point above that predicted in the April WEO. International trade and investment drove activity, while private consumption was more subdued across major jurisdictions. Real GDP decreased in the United States, at an annualized rate of 0.5 percent, marking the first quarterly contraction in three years. Consumer spending rose only by 0.5 percent, but this came after remarkably fast growth of 4.0 percent in the fourth quarter of 2024. Imports and business investment surged especially in information processing equipment. Taken together, these patterns were consistent with aggressive front-loading by US firms and households ahead of expected higher prices induced by tariffs. In the euro area, GDP accelerated to 2.5 percent, driven by investment and net exports, even as private consumption lost steam. Ireland largely led the spurt, with growth shrinking to 1.4 percent when Ireland is excluded. Chinas real GDP growth, at an annualized rate of 6.0 percent, exceeded expectations. This was mainly driven by exports, propped up by a depreciating renminbi closely tracking the dollar and with declining sales to the United States more than offset by strong sales to the rest of the world (Figure 2), and, to a smaller extent, by consumption, supported by fiscal measures. Japans economy contracted by an annualized 0.2 percent, as soft private consumption and weak net exports weighed on growth while strong private investment helped cushion the decline. Global trade grew robustly in the first quarter, but high frequency indicators point to an unwinding of front-loading in the second quarter.

2. Overview of the Indian Economy:

Indias economic journey over the past few years has been marked by remarkable growth and a steady rise in its position on the global stage. After overtaking the United Kingdom (UK) to become the fifth largest economy in Q1 FY23, India has continued this upward trajectory to surpass Japan in June 2025 to become the fourth largest economy in the world. With a nominal Gross Domestic Product (GDP) of Rs. 3,31,03,000 crore (US$ 3.78 trillion), Indias growth reflects a combination of strong domestic demand and policy reforms positioning the country as a key destination for global capital.

Further, India is projected to reach a GDP of Rs. 4,26,45,000 crore (US$ 5 trillion) by 2027 and is on course to surpass Germany by 2028. Rising employment and increasing private consumption, supported by rising consumer sentiment, will support GDP growth in the coming months.

3. Industry structure and development:

The India material handling equipment market size reached USD 10.57 Billion in 2024. Looking forward, IMARC Group expects the market to reach USD 22.48 Billion by 2033, exhibiting a growth rate (CAGR) of 8.08% during 2025-2033. The India material handling equipment market is driven by rapid industrialization, expanding manufacturing activities, government initiatives like the Production-Linked Incentive (PLI) scheme, rising e-commerce logistics, and increasing infrastructure development, all contributing to higher demand for advanced automation, efficient warehousing solutions, and technologically upgraded handling systems across industries.

Material handling equipment market is estimated to be valued at USD 242.51 Bn in 2025 and is expected to reach USD 369.73 Bn by 2032, exhibiting a compound annual growth rate (CAGR) of 6.2% from 2025 to 2032.

The Indian government has been effective in developing policies and programmes that are not only beneficial for citizens to improve their financial stability but also for the overall growth of the economy. Over recent decades, Indias rapid economic growth has led to a substantial increase in its demand for exports. Besides this, several of the governments flagship programmes, including Make in India, Start-up India, Digital India, the Smart City Mission, and the Atal Mission for Rejuvenation and Urban Transformation, is aimed at creating immense opportunities in India.

4. Opportunities And Threats: Opportunities:

Growing investments in infrastructure, roads, railways, mining and urban development are expected to increase demand for construction equipment. Geographic diversification reducing dependence on single export market. Expansion of export markets provides significant opportunities to strengthen the Companys global presence. Increasing preference for refurbished and cost-effective construction equipment creates new business opportunities. Growing demand for equipment leasing and customized solutions supports long-term business growth. Strong customer relationships, technical expertise and an established international network provide a competitive advantage. Adoption of digital technologies and operational improvements can further enhance efficiency and profitability Overseas inventory positioning closer to customers Growing international dealer network. Increased global acceptance of refurbished construction equipment. Increasing mining and infrastructure investments worldwide.

Threats:

Fluctuations in global economic conditions may impact demand for construction equipment. Foreign exchange rate volatility may affect export revenues and profitability. Changes in Government policies, import-export regulations and taxation laws may impact business operations. Manpower retention. Volatility in freight, logistics and procurement costs may adversely affect operating margins. Supply chain disruptions and delays in equipment availability may impact timely execution of orders. Intense competition from domestic and international players may exert pressure on pricing and margins. Geopolitical uncertainties and global trade disruptions may affect international business operations Rapid technological advancements may require continuous investment in upgrading products and services.

5. Segment-wise or Product-wise performance:

The Company is operating in only one segment i.e. Revenue from Hiring Business. Therefore, there is no requirement of Segment wise reporting.

6. Future Outlook:

Looking ahead, we will focus on the following strategies to sustain growth and capitalize on emerging opportunities:

Focus on analytics

Global trade and geopolitical factors Online Expansion Premiumisation and access to global brands Technological advancements Further Growth of Private Brands Sustainability and eco-friendly practices

7. Risk and concerns:

The Company operates in a dynamic business environment and is exposed to various business and operational risks. The management continuously identifies, evaluates and implements appropriate mitigation measures to minimize the impact of these risks: The key risks and concerns include:

Economic Risks: Slowdown in domestic or global economic conditions may impact demand for construction equipment and related services.

Market Competition: Intense competition from domestic and international players may exert pressure on pricing and profit margins.

Foreign Exchange Risk: Fluctuations in foreign exchange rates may impact export revenues and import costs.

Supply Chain delays: Disruptions in the procurement of equipment, spare parts and logistics services may affect business operations.

Regulatory Risk: Changes in government policies, taxation, import-export regulations and other statutory requirements may impact the Companys business.

Operational Risk: Delays in refurbishment, logistics or execution of customer orders may affect operational efficiency and customer satisfaction.

Technology Risk: Rapid technological advancements in construction equipment may require continuous investment in product enhancement and technical capabilities.

Geopolitical disruptions: Global geopolitical developments, trade restrictions and international market uncertainties may affect export business and supply chains.

Credit Risk: Delays or defaults in customer payments may impact the Companys cash flows and working capital requirements.

International regulatory changes: Changes in international trade policies, import-export regulations, customs duties, or compliance requirements across different countries may impact the Companys export operations and business performance.

Capital market volatility affecting investment valuation: Fluctuations in capital markets may result in temporary changes in the fair value of investments, impacting the Companys reported profitability.

Longer export working-capital cycle: The Companys export business involves longer working capital cycles due to shipment timelines, overseas inventory positioning, refurbishment activities, and extended customer credit periods. The Company manages this risk through efficient working capital planning and disciplined inventory management.

The Company has a well-defined risk management framework to identify, assess and monitor these risks. The management regularly reviews risk mitigation strategies and takes appropriate measures to ensure business continuity, operational resilience and sustainable long-term growth.

8. Internal Control System and Their Adequacy:

The Company has established adequate internal control systems commensurate with the size, nature and complexity of its business operations. These controls are designed to ensure the orderly and efficient conduct of business, safeguarding of assets, prevention and detection of fraud and errors, accuracy and completeness of accounting records, and timely preparation of reliable financial information.

The Company has implemented appropriate policies, procedures and standard operating practices to ensure compliance with applicable laws, regulations and internal guidelines. The internal control framework is periodically reviewed and strengthened to address changing business requirements and emerging risks.

The Internal Auditor conducts periodic audits of various operational and financial functions, and the audit findings along with recommendations are placed before the Audit Committee for review. The Audit Committee regularly evaluates the adequacy and effectiveness of the internal control systems and monitors the implementation of corrective actions, wherever required.

The management believes that the existing internal control systems are adequate and effective and provide reasonable assurance regarding the reliability of financial reporting, operational efficiency and compliance with applicable statutory requirements.

9. Material developments in Human Resources / Industrial Relations front including number of people employed:

The cordial employer - employee relationship also continued during the year under the review. The Company has continued to give special attention to human resources.

10. Discussion on financial performance with respect to operational performance:

The financial performance of the Company for the Financial Year 2025-26 is described in the Directors Report of the Company.

11. Caution Statement:

Statements made in the Management Discussion and Analysis describing the various parts may be “forward looking statement” within the meaning of applicable securities laws and regulations. The actual results may differ from those expectations depending upon the economic conditions, changes in Govt. Regulations and amendments in tax laws and other internal and external factors.