Shree Vasu Logistics Ltd Management Discussions

The Management of Shree Vasu Logistics Limited (SVLL) Presenting “Management Discussion and Analysis Report” covering the operational and financial performance of the company for the financial year (“FY”) 2024-2025.

OVERVIEW

During FY 2024 25, the global and domestic economy witnessed steady growth despite persistent challenges from inflationary trends, volatile fuel prices, and geopolitical uncertainties. The logistics and warehousing sector benefited from rising trade volumes, increasing e-commerce penetration, and continued focus on supply chain resilience.

The year saw significant momentum in the demand for organized warehousing, multimodal transportation, and value-added logistics services. Companies increasingly adopted automation, digital platforms, and sustainable practices to enhance operational efficiency. In India, government initiatives in infrastructure development, logistics parks, and digital trade facilitation further supported industry growth.

Overall, FY 2024 25 proved to be a period of consolidation and growth for the logistics and warehousing sector, setting a strong foundation for long-term expansion driven by technology, infrastructure, and structural demand.

GLOBAL ECONOMIC OVERVIEW

The global economic outlook for 2025 was characterized by modest growth prospects overshadowed by significant risks stemming from trade disputes and inflationary pressures. Coordinated policy responses and a commitment to multilateral cooperation were deemed essential to navigate the economic landscape and foster a more resilient global economy.

The global economic landscape faced heightened uncertainty, primarily due to escalating trade tensions and shifting monetary policies. The International Monetary Fund (IMF) revised its global growth forecast downward from 3.3% to 3.2% for 2025, citing the adverse effects of U.S. tariffs and retaliatory measures from China and the European Union. IMF emphasized that while a global recession was not anticipated, the current environment of protectionism and policy unpredictability poses significant risks to economic stability.

S&P Global echoed these concerns, highlighting that the impact of rising tariffs had become more widespread, leading to upward revisions in global and North American consumer price inflation forecasts for 2025 and 2026. The monthly consumer price inflation rate for core goods in the Group of Five (G5) economies had been increasing since late 2024, indicating that inflationary pressures were intensifying.

In the United States, the IMF had earlier projected a growth rate of 2.7% for 2025, driven by strong labor markets and increased investment. However, recent financial indicators suggested a potential slowdown, with recession risks rising due to the impact of protectionist trade policies.

The IMFs World Economic Outlook had also noted that services inflation was complicating monetary policy normalization, raising the prospect of prolonged higher interest rates. This, coupled with escalating trade tensions and increased policy uncertainty, had increased the upside risks to inflation.

Amidst these challenges, the IMF underscored the importance of continued economic reforms, flexible monetary policy, and global cooperation to mitigate risks. Georgieva had called for renewed efforts to reduce trade barriers and restore fairness to the multilateral trading system, emphasizing that protectionism undermined innovation and productivity, especially in smaller economies.

INDIAN ECONOMIC OVERVIEW

The global economic environment in FY 2024 25 was marked by mounting geopolitical tensions and a renewed wave of protectionist policies. The imposition of tariffs by the United States on major economies, and retaliatory measures by key trading partners such as China and the European Union, resulted in significant headwinds for global trade. According to the World Trade Organization, global merchandise trade volumes declined by 0.2%, reflecting weakening demand and growing fragmentation in global supply chains. The long-term risk of economic decoupling, especially between the U.S. and China, remained a concern, with the WTO cautioning that such a scenario could shave off as much as 7% from global GDP.

In parallel, the Indo-Pak trade landscape witnessed a complete breakdown of bilateral engagement, adding to regional instability. As of May 2, 2025, India imposed a comprehensive ban on all imports from Pakistan, including goods routed through third countries. This move was justified on grounds of national security and public policy. India also intensified scrutiny of indirect imports and exports amid concerns that Indian goods are entering Pakistan via third countries. Additionally, E-commerce platforms in India were directed by local trade bodies to remove Pakistani products, with the boycott even extending to Turkish brands due to Turkeys political support for Pakistan. This reflects a broader cultural and commercial disengagement, not just a trade freeze.

These developments unfolded at a time when global economic fragmentation was already reshaping trade and investment flows. The Indo-Pak trade standoff further contributed to the regional complexity, weakening South Asias integration potential and adding strain to cross-border commerce and supply chain resilience.

Amidst this global backdrop, India stood out as a relatively resilient performer. The Asian Development Bank (ADB), in its latest forecast, estimated Indias GDP growth at 6.7% for FY 2024 25. This growth was supported by strong urban consumption, improved rural demand, and continued government capital expenditure on infrastructure. The manufacturing and services sectors registered robust activity, aided by improved business sentiment and favorable credit conditions.

Inflation in India remained within the Reserve Bank of Indias target band for most of the fiscal year, supported by declining food inflation and effective monetary management. ADBs analysis highlighted the continued easing of headline inflation, which fell from 5.7% in FY 2023 24 to an estimated 4.9% in FY 2024 25, enhancing household spending power and business margins.

Taken together, the economic landscape of FY 2024 25 underscored the increasing divergence between developed and emerging economies. India, despite the external uncertainties, continued to demonstrate underlying economic resilience and a capacity to absorb global shocks through domestic growth drivers and policy prudence.

GLOBAL LOGISTIC INDUSTRY

During FY 2024 25, the global logistics industry experienced a period of adjustment amidst a backdrop of moderating economic growth, persistent geopolitical uncertainties, a nd evolving trade dynamics. The industry, which encompasses freight transportation, warehousing, supply chain management, and value-added logistics services, remained a critical enabler of global commerce despite near-term headwinds.

In Europe, road freight markets witnessed a measurable decline in both spot and contract rates, reflecting subdued consumer demand and weaker industrial activity. The European Road Freight Spot Rate Index declined by 3.8 points quarter-on-quarter to

134.1, while the Contract Rate Index fell by 2.3 points to 131.1. This downward trend was indicative of softer trade flows and heightened macroeconomic pressures across key economies.

Notwithstanding these challenges, industry analysts suggest that freight markets may have reached a cyclical trough, with stabilization expected in the latter half of 2025. Gradual recovery is anticipated as demand conditions improve, supported by more resilient supply chain structures, efficiency-enhancing technologies, and increasing focus on sustainability initiatives.

The broader outlook for the logistics sector remains constructive in the medium to long term. Strategic imperatives such as supply chain diversification, digital integration, and the transition toward environmentally sustainable logistics solutions are expected to underpin future growth and resilience, positioning the industry as a vital driver of global trade and economic activity.

LOGISTIC INDUSTRY IN INDIA

The Indian logistics industry continued to demonstrate robust growth during FY 2024 25, supported by structural reforms, infrastructure development, and strong demand across key sectors. According to industry reports, the logistics and industrial segment in India witnessed strong expansion in the first half of 2024, driven by rising demand for Grade A warehousing, increased investments in logistics parks, and the sustained momentum of e-commerce and manufacturing activity.

India has also strengthened its global positioning in logistics performance. As highlighted in the Economic Survey 2024, India made significant progress in global logistics rankings, reflecting improvements in infrastructure, digital adoption, and regulatory efficiency. The countrys advancements are aligned with the PM Gati Shakti National Master Plan and the National Logistics Policy, both of which aim to reduce logistics costs, enhance multimodal connectivity, and improve overall supply chain efficiency. Further, favourable global trade dynamics and the reduction of tariffs in key markets are expected to enhance Indias role as a manufacturing and export hub. Logistics players have noted that low U.S. tariffs and evolving global supply chain strategies could drive global manufacturers to increasingly leverage India as a preferred production and distribution base.

Government initiatives such as enhanced investments in road, rail, port, and airport infrastructure, coupled with policy support for integrated logistics, are expected to accelerate sectoral growth. The Press Information Bureau (PIB) reported in 2024 that these measures are already yielding tangible outcomes in terms of reduced turnaround times, improved multimodal integration, and cost efficiencies.

Overall, the logistics industry in India is on a strong growth trajectory, positioned to play a pivotal role in enabling the countrys economic expansion, strengthening trade competitiveness, and supporting the long-term vision of making India a global logistics hub.

OUTLOOK

The Company has recently expanded its Logistics Business by expanding its reach across various states in India such as West Bengal, Maharashtra, Telangana, Gujrat, Delhi, Karnataka, Tamil Nadu and Assam. It is a strategic move that allows your Company to tap into new markets and take advantage of the growing opportunities in those regions. By expanding our reach, we can cater to a larger customer base and potentially increase our market share.

This expansion has evidently resulted in a significant increase in the Companys turnover. With a wider presence, we can generate more revenue by serving a larger number of customers and meeting their logistics needs efficiently. This growth is a positive sign for your Companys financial performance and overall business development.

Furthermore, venturing into the retail business by setting up Exclusive Brand Outlets for Jockey, which is a renowned brand owned by Page Industries Limited, is another strategic move. By partnering with a well-established and recognized brand, your Company can leverage Jockeys reputation and customer base to drive sales and expand its retail presence. This diversification into retail allows your Company to explore new revenue streams and capitalize on the demand for Jockey products.

Overall, these expansions and ventures demonstrate your Companys proactive approach to growth and seizing opportunities in different sectors. It positions your Company to benefit from the potential of new markets and capitalize on the strengths of established brands like Jockey.

FINANCIAL PERFORMANCE

The summarized financial performance of the Company as compared to last year is shown as under:

Particulars	March 31, 2024	March 31, 2025	% Change
Net Sales/Income from Business operations	12,306.60	4611.28		118.72
Other Income	133.51	133.29	0.16
Total income	12,440.11	14,744.57	1	8.52
Profit before Tax	410.59	2	80.57	3 1.67
Net Profit/ (Loss) after Tax	3	12.06	218.76	29.9

The Company has identified two reportable Operating segments i.e Logistics, Warehousing and allied services and Retail Trade. Therefore, segment wise reporting is applicable and is given in Note 40 of the Notes to Financial Statements for the year ended March 31, 2025.

The significant changes in the financial ratios of the Company which are more than 25% as compared to the previous year are summarized below:

Sr. No.	Particulars of Key Financial Ratio	2023-2024	2024-25	% Change
	Debt Service Coverage ratio
1.		0.77	1.23	59.19
2.	Return on Equity ratio	0.11	-39.30	0.07
3.	Inventory Turnover ratio	2.66	2.63	-0.94
4.	Net Capital Turnover Ratio	-22.58	-127.79	466
5.	Net Profit ratio	0.03	0-43	0.274

1. Debt Service Coverage ratio has increased during the year on account of decreased finance cost and repayment of borrowings during the year

2. Return on Equity ratio has reduced on account of lower profitability.

3. Net Capital Turnover Ratio has decreased in the current year on account of negative working capital.

4. Net profit ratio has reduced on account of lower profitability.

OPPORTUNITIES

In the current scenario, building more warehouses to cater to the demands of e-commerce, consumer, and retail sectors is a strategic move, especially considering the industry-specific requirements. With the strategic location of our warehouses and the high occupancy rate, it seems like we have successfully attracted various e-commerce Companies to avail your services. This is a positive sign for our business.

Expanding our transportation network by opening branches across Central India and implementing reverse logistics will not only improve our overall service offerings but also provide us with an opportunity for backward integration.

The COVID-19 pandemic has indeed emphasized the importance of localized approaches in supply chain management. By focusing on local storage and distribution, you can enable expedited and hassle-free deliveries to the local market. This localized approach aligns well with the current trends in the e-commerce industry, as businesses increasingly seek to optimize their last-mile delivery operations.

By conceptualizing and implementing a plan that caters to these industry trends, you position your business for more opportunities in the near future and the long run. Its crucial to continue monitoring the evolving needs of the market and adapting your strategies accordingly to stay competitive in the dynamic logistics sector.

Our services will improve agility, credential stability, transparency, and speed, adding to the overall development in Indias logistics space.

RISKS, THREATS AND CONCERNS

Our business is significantly influenced by the performance of the automotive industry and also by demand and supply ratio in market. We operate in a highly competitive industry, with many different and unorganized players. Many segments within the logistics industry are highly commoditized and have low barriers to entry, leading to a market with a very high degree of fragmentation. In the recent past, start-ups and international logistics Companies have entered the Indian market. Competition from these segments is likely to increase. Digital marketplace platforms and data analysis provided by these start-ups to serve customers directly by removing middlemen from logistics operations are able to reduce the total costs of transportation and improve reliability and operational efficiencies.

The logistics and warehousing sector, while poised for long-term growth, continues to face several risks and challenges that could impact its performance:

1. Macroeconomic Uncertainty: Volatility in global trade, inflationary pressures, currency fluctuations, and geopolitical tensions may adversely affect demand for logistics services.

2. Fuel Price Volatility: Logistics operations are highly sensitive to fluctuations in crude oil prices, which directly influence transportation and freight costs.

3. Regulatory and Policy Risks: Frequent changes in taxation, compliance requirements, and international trade policies can create uncertainties in planning and execution.

4. Infrastructure Bottlenecks: Despite significant progress, issues related to congestion at ports, limited multimodal integration, and last-mile connectivity remain key operational challenges.

5. Technological Disruptions: Rapid digitalization is transforming the industry; however, cyber risks, data security concerns, and high technology adoption costs may pose challenges.

6. Environmental and Sustainability Pressures: Increasing global focus on reducing carbon emissions and transitioning to green logistics may require substantial investments in sustainable technologies, which could affect margins in the short term.

7. Competitive Intensity: With the entry of global players and rapid expansion of organized logistics providers, competition has intensified, potentially putting pressure on pricing and profitability.

We will need to stay ahead of our competition through consistent investments in modern technology and focus on service quality and value-added services. The Company continuously monitors these risks and implements appropriate mitigation strategies, including operational efficiency initiatives, technology adoption, diversification of services, and strong compliance frameworks, to ensure long-term resilience and sustainable growth.

The Company is committed to recognizing and managing the risks it is exposed to, both internal and external, and has put in place mechanisms to handle the same proactively and efficiently. The Company also recognizes that these risks could adversely affect its ability to create value for all stakeholders, and has taken steps to mitigate the same.

INTERNAL CONTROL SYSTEM AND ADEQUACY

The Company has a well-established and comprehensive internal control system. Documents, policies and authorization guidelines comply with the level of responsibility and standard operating procedures specific to the respective businesses. Observation made in internal audit reports on business processes, systems, procedures and internal control and implementation status of recommended remedial measures by Internal Auditors are regularly presented to and reviewed by the Audit Committee of the Board. The system of internal control is being improved to ensure that all assets are safe and protected against loss from unauthorized use or disposition, and that all transactions are authorized, recorded and reported correctly. The Company regularly conducts internal check, using external and internal resources to monitor the effectiveness of internal controlling the organization. It strictly adheres to corporate policy with respect to financial reporting and budgeting functions. The Audit Committee of the Board of Directors deals with significant control issues and instructs further areas to be covered.

HUMAN RESOURCE DEVELOPMENT

The Company focuses on creating an enriched environment for its employees, where it lays the opportunities for growth. There is complete focus on providing employees with a platform where they can continuously upgrade themselves and also stay upto date with the recent happenings in the industry. There are various Learning and Development programs that are carried on throughout the year, where employees can up-skill themselves. There are other engagement programs through which the organization supports physical and mental well-being of all its employees. These initiatives help enhance the skills and experiences of employees, ultimately enabling the Company to achieve its business objectives.

By promoting these standards, the Company creates an inclusive and supportive environment for all sections of society. Ensuring equal opportunities at all levels, providing safe and healthy workplaces, and protecting human health and the environment are important commitments that contribute to a positive work culture and sustainable practices. Your Company believes that the employees are the most valuable assets and key drivers of business success and sustained growth.

Moreover, by offering opportunities for employees to improve their skills and capabilities, the Company demonstrates a dedication to personal and professional growth. This commitment to employee development can lead to increased job satisfaction, motivation, and productivity among the workforce. Additionally, maintaining cordial industrial relations with various clients, vendors, financial lenders, and employees is crucial for a harmonious and productive work environment. Positive relationships with these stakeholders can foster collaboration, trust, and mutual success.

Overall, the Companys focus on creating a congenial atmosphere, respecting human rights, providing equal opportunities, prioritizing safety and health, promoting employee development, and maintaining strong industrial relations reflects a commitment to ethical and responsible business practices.

The Company is an equal opportunity employer and does not discriminate on the grounds of race, religion, nationality, ethnic origin, color, gender, age, citizenship, sexual orientation, marital status or any disability not affecting the functional requirements of the position held.

CAUTIONARY STATEMENT

Statements in this “Management Discussion and Analysis” describing the Companys objectives, projections, estimates, expectations, plans or predictions or industry conditions or events are “forward-looking statements” within the meaning of applicable securities laws and regulations. Actual results, performance or achievements could differ materially from those expressed or implied. Several factors could make a significant difference to the Companys operations. These include economic conditions affecting demand and supply, government regulations and taxation, natural calamities and so on over which Company does not have any direct control.

	SD/-
	ATUL GARG
Place: Raipur	Managing Director
Date: August 13, 2025	DIN: 01349747