SGL Resources Ltd Management Discussions

The Management Discussion and Analysis ("MDA") forms part of the Annual Report of SGL Resources Limited ("the Company") for the financial year ended March 31, 2026. It should be read in conjunction with the Audited Financial Statements, the Directors Report and other disclosures forming part of this Annual Report.

The discussion below covers the Companys business, operating environment, financial and operational performance, opportunities, risks, outlook, internal controls and other material developments relevant to the financial year under review. The statements relating to future developments, expectations and outlook are based on the information and assumptions available to the Company as on the date of this Report and are subject to risks and uncertainties. Actual results may differ materially from those expressed or implied.

Industry Overview

The Company operates in the geospatial technology and software solutions industry, with its principal capabilities centred around Geographic Information System ("GIS"), image processing, geospatial data and application-oriented solutions.

Geospatial technology has evolved significantly beyond conventional mapping and surveying and has become an important enabler of digital infrastructure, planning, monitoring, asset management, analytics and decision-making. Increasing adoption of GIS, satellite imagery, remote sensing, digital mapping, location intelligence and spatial analytics is creating applications across urban development, land management, agriculture, infrastructure, utilities, defence, forestry, law enforcement, natural-resource management and other sectors.

The increasing convergence of geospatial technologies with artificial intelligence, cloud computing, automation, remote sensing, drones and advanced analytics is further expanding the potential applications of the sector. This is creating opportunities for technology companies capable of combining geospatial capabilities with sector-specific applications and practical business solutions.

At the same time, the industry remains technology-intensive and competitive. Rapid technological developments, evolving customer requirements, pricing pressures and the need for continuous enhancement of technical capabilities require companies operating in this sector to remain responsive and commercially focused.

Indian Industry

India is witnessing increasing adoption of geospatial technologies as part of its broader digital transformation, infrastructure development and governance initiatives. The National Geospatial Policy, 2022 provides a framework aimed at strengthening the Indian geospatial ecosystem, promoting wider access and use of geospatial data and encouraging innovation and private-sector participation. The Policy recognises geospatial technology and data as important enablers across areas including agriculture, infrastructure, urban and rural development, land administration, water, disaster management and other economic activities.

The Governments continued focus on geospatial infrastructure is expected to support the development of the sector. The National Geospatial Mission announced in the Union Budget 2025-26 envisages development of foundational geospatial infrastructure and data, with applications including modernisation of land records, urban planning and infrastructure projects.

The Indian geospatial ecosystem therefore presents opportunities for indigenous technology companies with domain expertise and application-oriented solutions. Greater availability of geospatial data, increasing digitisation of public services, infrastructure development and adoption of location-based decision-making are expected to support long-term demand for geospatial solutions.

The sector nevertheless remains competitive and rapidly evolving. Successful participation requires continuous technology enhancement, understanding of sector-specific requirements, effective project execution and the ability to convert technological capabilities into commercially sustainable solutions.

Global Geospatial Industry and Outlook

Globally, geospatial technology is increasingly becoming an integral component of digital transformation across governments and enterprises. The convergence of location intelligence with artificial intelligence, cloud platforms, satellite-based earth observation, remote sensing, digital twins, automation and advanced analytics is broadening the application of geospatial technologies beyond traditional mapping.

Demand for geospatial solutions is being supported by applications in infrastructure planning, smart and connected cities, logistics, agriculture, utilities, environmental monitoring, natural-resource management, defence, public safety and disaster management. Increasing reliance on data-driven decision-making is also creating opportunities for location intelligence and geospatial analytics.

The global environment presents opportunities for Indian technology companies possessing specialised capabilities and cost-effective, application-oriented solutions. However, participation in international markets also requires compliance with customer-specific technical standards, data-security requirements, regulatory frameworks and competitive commercial expectations.

The Company will evaluate opportunities arising from the global geospatial ecosystem in a measured manner, while continuing to strengthen its existing capabilities and focusing on opportunities that are commercially viable and aligned with its areas of expertise.

Company Overview

SGL Resources Limited is engaged in the development and deployment of indigenous geospatial software and solutions. The Companys principal technology platform is IGIS (Integrated GIS and Image Processing Software), developed through its joint development partnership with the Space Applications Centre, Indian Space Research Organisation ("SAC-ISRO").

The Companys technology capabilities support the development of application-oriented solutions for areas including urban development, land records, agriculture, defence, forestry, law enforcement, utilities and other geospatial applications.

The Company continues to focus on leveraging its technology base and domain expertise and on identifying opportunities where its geospatial capabilities can provide sustainable business value.

During FY 2025-26, the Company also broadened the objects of its Memorandum of Association to provide greater flexibility to pursue opportunities in areas including IT, Geomatics, GIS, data and analytics, artificial intelligence, automation, digital solutions, cloud-based services and other allied technology-enabled activities. The expanded objects are intended to facilitate potential future diversification and do not represent commencement of all such activities.

Business Performance

The Company continued to focus on its core geospatial technology and software solutions business during the financial year ended March 31, 2026.

The financial performance of the Company for the year under review, as compared with the previous financial year, is summarised below:

(Rupees in lakh)

Particulars	Standalone FY 2025-26	Standalone FY 2024-25	Consolidated FY 2025-26	Consolidated FY 2024-25
Revenue from Operations	3,486.87	4,871.29	-	-
Other Income	1,416.79	152.64	-	-
Total Income	4,903.66	5,023.93	4,903.65	5,034.09
Profit Before Tax	10.84	145.23	-	-
Profit After Tax	11.14	140.40	10.70	145.25
Total Comprehensive Income	14.77	137.89	14.33	142.74

The Company recorded total income of 4,903.66 lakh during FY 2025-26 as against 5,023.93 lakh in the previous year on a standalone basis. Profit after tax stood at 11.14 lakh as compared with 140.40 lakh in the previous year, while total comprehensive income stood at 14.77 lakh as against 137.89 lakh in the previous year.

On a consolidated basis, the Group recorded total income of 4,903.65 lakh during FY 2025-26 as against 5,034.09 lakh in the previous year. Consolidated profit after tax stood at 10.70 lakh as compared with 145.25 lakh in the previous year, while consolidated total comprehensive income stood at 14.33 lakh as against 142.74 lakh in the previous year.

Revenue from operations declined by approximately 28.42% during the year. However, the decline in total income was comparatively moderate, primarily supported by higher other income during the year.

Operating profit stood at 827.83 lakh as against 1,135.69 lakh in the previous year. Finance costs reduced significantly from 122.74 lakh to 5.61 lakh during the year.

The Company remains focused on improving the contribution from its core operating activities, strengthening execution and customer relationships, improving operational efficiency and building a more sustainable operating revenue base.

Segment-Wise / Product-Wise Performance

The Company operates predominantly in the geospatial technology and software solutions business and accordingly has one reportable business segment. The Companys principal offerings are based on its IGIS platform and related geospatial applications. The Company continues to evaluate opportunities for wider deployment of its technology across sectors where GIS, image processing, geospatial information and location-based intelligence can provide meaningful value.

The Companys business remains primarily technology and solution driven, and its performance is dependent on successful execution of projects, customer requirements, commercialisation of solutions and the ability to maintain technological relevance.

Key Financial Ratios

The key financial ratios of the Company for FY 2025-26, compared with FY 2024-25, are set out below. The variance has been computed based on the underlying ratio values.

(ratios except percentages)

Particulars	FY 2025-26	FY 2024-25	Variance (%)	Reason for Variance
Current Ratio	1.42	2.67	(46.93%)	The decrease was primarily due to a relatively higher increase in current liabilities compared with current assets during the year.
Debt-Equity Ratio	0.44	0.09	408.35%	The increase was primarily due to an increase in total debt during the year, while shareholders equity remained broadly stable.
Debt Service Coverage Ratio	0.13	4.72	(97.34%)	The significant decrease primarily reflects lower earnings available for servicing debt during the year.
Return on Equity Ratio	0.06%	1.04%	(94.19%)	The decrease was primarily due to the significant reduction in profit after tax during the year.
Trade Receivables Turnover Ratio	0.99	1.27	(22.26%)	The decrease primarily reflects lower revenue from operations in relation to the average trade receivables during the year.
Trade Payables Turnover Ratio	2.99	2.18	37.32%	The increase primarily reflects changes in the Companys operating expenses/purchases and average trade payables during the year.
Net Capital Turnover Ratio	0.72	0.77	(6.13%)	The movement primarily reflects changes in revenue from operations and the Companys working capital position.
Net Profit Ratio	0.32%	2.88%	(88.91%)	The decrease was primarily due to the significant reduction in profit after tax during the year.
Return on Capital Employed	0.06%	1.34%	(95.36%)	ROCE declined primarily due to the significant reduction in EBIT from 267.97 lakh to 16.45 lakh, while capital employed increased from 20,072.62 lakh to 26,560.42 lakh, resulting in substantially lower returns generated on the capital employed.
Return on Investment	6.98%	4.75%	47.09%	The increase reflects higher income generated from invested funds during the year in relation to the average investment base.

Opportunities

The increasing adoption of digital technologies across government and enterprise functions presents a growing opportunity for geospatial technology providers. The use of GIS, digital mapping, satellite imagery, location intelligence and geospatial analytics is expanding across areas such as urban planning, land and asset management, infrastructure, utilities, agriculture, defence and public-sector applications.

The Company believes that its indigenous technology platform, domain knowledge and application-oriented capabilities provide a foundation to participate in the evolving geospatial ecosystem. Increasing focus on digital transformation, data-driven decision-making, integrated infrastructure planning and location-based services may create further opportunities for specialised geospatial solutions.

The Company also has the flexibility to evaluate opportunities in allied technology areas pursuant to the expanded objects of its Memorandum of Association. Such opportunities will be considered selectively, taking into account their commercial viability, resource requirements, strategic fit, execution capability and potential to create sustainable value.

Threats and Challenges

The geospatial technology industry is characterised by rapid technological change and evolving customer requirements. The Company operates in a competitive environment where domestic and international technology providers may offer competing GIS, mapping, analytics, location intelligence and related solutions.

The Companys performance may also be affected by project execution requirements, pricing pressures, technology changes, availability and retention of specialised manpower, customer requirements, the pace of commercial adoption and changes in regulatory or policy conditions.

The Company also operates in an environment where certain projects may have extended execution cycles and where delays in customer decisions, project implementation or receivables can affect operating performance and working capital. The Company continues to monitor these factors and take appropriate measures to manage their potential impact.

Outlook

The Companys immediate focus remains on strengthening its core operating performance and improving the quality and sustainability of its operating revenues. The management intends to leverage the Companys existing geospatial capabilities, IGIS technology platform and domain expertise to pursue suitable opportunities across relevant application areas. The Company will also evaluate opportunities arising from the expanded objects of its Memorandum of Association in a measured and commercially prudent manner.

The Company believes that the increasing adoption of geospatial technologies in India, supported by digitalisation, infrastructure development and the evolving policy environment, provides a favourable long-term opportunity.

The management will remain focused on converting such opportunities into sustainable business while maintaining appropriate commercial and financial discipline.

Risk Management

The Companys operations are exposed to various business, operational, financial, technological and market-related risks. These include competition, technological changes, project execution risks, customer requirements, availability of skilled manpower, working capital requirements, financial risks and changes in the regulatory environment.

The Company has processes for identification and monitoring of significant risks. The management periodically reviews the risks associated with its business and operations and takes appropriate mitigation measures based on their nature and materiality. The Company seeks to balance business opportunities with appropriate risk assessment and prudent management of its financial and operational resources.

Internal Control Systems and Their Adequacy

The Company has an adequate internal control framework commensurate with the size and nature of its operations. The controls are designed to safeguard assets, ensure accuracy and reliability of financial reporting, prevent and detect frauds and errors, promote operational efficiency and ensure compliance with applicable laws and internal policies.

The Company has an internal audit mechanism for reviewing the adequacy and effectiveness of its internal controls. Significant observations are reviewed by the management and, wherever necessary, corrective actions are undertaken.

The Audit Committee periodically reviews the internal audit reports, significant observations and the effectiveness of the internal control framework.

The Company has also established adequate internal financial controls over financial reporting to provide reasonable assurance regarding the reliability of financial reporting and preparation of financial statements. Based on the assessment undertaken during the year, the management is of the view that the Companys internal controls, including internal financial controls over financial reporting, were adequate and operating effectively as at March 31, 2026.

Human Resources and Industrial Relations

The Company recognises that skilled and committed human resources are important to the development, implementation and continued improvement of its geospatial solutions. The Company seeks to maintain an appropriate workforce aligned with its business requirements and to retain the technical and managerial capabilities necessary for its operations. The Company also seeks to foster a professional, collaborative and performance-oriented working environment. The industrial relations remained cordial during the year under review. The number of persons employed by the Company as at March 31, 2026 is disclosed in the relevant section of the Annual Report, wherever applicable.

Technology and Research & Development

Technology remains central to the Companys business. The Company continues to leverage its IGIS platform and associated geospatial capabilities for developing application-oriented solutions.

The Companys technology framework combines GIS and image-processing capabilities and is intended to support diverse geospatial applications. The Company remains focused on keeping pace with developments in the geospatial sector and evaluating opportunities to enhance the applicability and commercial utilisation of its existing technology capabilities.

The Company also continues to evaluate the integration of emerging technologies with its existing geospatial capabilities where such integration can improve functionality, efficiency or customer value.

Internal and External Business Environment

The Companys performance is influenced by both internal operating factors and external developments in the geospatial technology ecosystem.

Internally, performance depends on effective project execution, customer engagement, technology capabilities, availability of skilled personnel, commercialisation of solutions and efficient utilisation of resources.

Externally, demand is influenced by government and enterprise digitisation, infrastructure development, adoption of GIS and location intelligence, technological developments, competitive intensity, regulatory developments and the broader economic environment.

Management continues to monitor these factors while determining the Companys business and operating priorities.

Cautionary Statement

Statements in this Management Discussion and Analysis describing the Companys objectives, expectations, estimates, projections or predictions may constitute "forward-looking statements" within the meaning of applicable securities laws and regulations.

Actual results could differ materially from those expressed or implied due to various factors, including changes in economic conditions, market demand, competition, technology, regulatory environment, customer requirements, project execution, availability of skilled manpower, financial conditions and other risks and uncertainties beyond the control of the Company.

The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of future events or otherwise.

By Order of the Board of Directors For, SGL Resources Limited

Date: September 7, 2026 Place: Ahmedabad

SD/- Kantilal Ladani Chairman & Whole-time Director & CFO (DIN: 00016171)