Softsol India Management Discussions

Managements discussion and analysis of the financial condition and results of operations include forward- looking statements based on certain assumptions and expectations of future events. The Company cannot assure that these assumptions and expectations are accurate. Although the Management has considered future risks as part of the discussions, future uncertainties are not limited to Management perceptions.


The following discussion and analysis should be read in conjunction with the Companys financial statements included herein and the notes hitherto. The financial statements have been prepared in accordance with the Generally Accepted Accounting Principles in India (GAAP) to comply with the Accounting Standards specified under Section 133 of and other relevant provisions of the Companies Act, 2013 as applicable. The Companys management accepts responsibility for the integrity and objectivity of these financial statements, as well as for various estimates and judgments used therein. The estimates and judgments relating to the financial statements have been made on a prudent and reasonable basis, in order that the financial statements reflect in a true and manner the form and substance of transactions and reasonably present the Companys state of affairs and profits for the year. Investors are cautioned that this discussion contains forward-looking statements that involve risks and uncertainties.

The Company undertakes no obligations to publicly update or revise any forward- looking statements, whether as a result of new information, future events, or otherwise. Actual results, performances, or achievements could differ materially from those expressed or implied in such statements. Readers are cautioned not to place undue reliance on the forward-looking statements as they speak only as on their date of statement. Information provided in this Management Discussion and Analysis (MD&A) pertains to Softsol India Limited (the Company) and its subsidiary on a consolidated basis, unless otherwise stated. Global Economic Scenario and Industry Overview

The global economy is still recovering from the challenges caused by the COVID-19 pandemic. Though the larger population is now vaccinated, travel restrictions have eased, and businesses are returning to normalcy, the risks loom large for another wave with new variants emerging and governments imposing restrictions like partial/complete lockdown and renewed travel restrictions. The emergence of new COVID-19 variants could prolong the pandemic and induce renewed economic disruptions. The Ukraine

– Russia war makes the economic recovery even more challenging.

The global economy is forecasted to grow at around 4.7% this year. The post-Covid-19 pandemic recovery is hit by potentially huge global supply chain disruption leading to slow growth and pushing up inflation. High energy prices are likely to add to industry costs. With most countries lifting policy rates, risks to financial stability, emerging market and developing economies capital flows, currencies, and fiscal positions, especially with debt levels increased significantly in the past two years, may emerge.

Overview of Indian economy and IT Industry

While the global economy and majority of the industries grappled with the challenges posed by the extended pandemic, the Indian IT industry grew at a breakneck pace in FY2022. This was mainly due to the fact that technology became the fulcrum via which businesses were able to not only keep the lights on but also speed their journey towards becoming future-ready, resilient, and agile. The winning formula for the industry was a mix of digital and innovation with platforms and XaaS playing a key role in accelerating tech adoption. To address margin pressures, the industry increased its focus on operational efficiency. Among other sectors, eCommerce gained a deeper penetration of the O+O model (Offline + Online).

Another significant achievement for the industry was to cross the 5 million mark in total direct employees, the highest-ever net addition of 445,000. The industrys "people first employee-centric" approach saw tech firms quickly adapt to Hybrid work models and scale up the industrys digital capacity/capability building programs.

According to a recent Gartners report, the IT spending in India is estimated to reach USD 105.2 billion in 2022, an increase of 5.5% from 2021 mainly driven by increased demand for digital transformation from the traditional legacy business model. The key pillars that enabled technology firms to respond proactively to emerging customer demand throughout the pandemic were an obsession with customer-centricity, domain specific solutioning, agility to respond quickly to customer needs, a digital-first talent pool, and a laser-sharp focus on creating future-ready solutions.


Our employees are key to successful implementation of our strategy. We are convinced of the value of excellent employees, leaders and working conditions, and strive to give our employees the tools and skills necessary to be able to innovate and create products and platforms.

With this aim in our mind, we have adopted the following principles:

Opportunities for all, with flexibility to opt in/out, Dedicated physical space to foster collaboration, networking and learning ,adult learning principles leveraging field & forum approach and Leaders build leaders.

We want to further strengthen our innovative power with attractive working conditions and are making investments in this direction. We have partnered with leading global experts across domain to facilitate immersive sessions to build thought leadership and cascade learnings across team.


The company is attempting to transform the IT business and take a product centric approach with an internet to optimize the shareholder value. We hope to do this, while staying profitable . We will continue to make investments in our internal products, as well as other strategic external opportunities.

Risks and Concerns:

In pursuant to the provisions of the Section 134 (3)(n) of the Companies Act 2013, the Company as formulated risk management policy to mitigate and manage the risk including identification therein of elements of risk, if any, which in the opinion of the Board may threaten the existence of the company.

Internal Control Systems and their adequacies

The Company has set up a proper and adequate and sound internal control system to safeguard the Groups assets and to enhance shareholders investment, as well as reviewing its adequacy and effectiveness of the said system. The duty of reviewing the adequacy and effectiveness of the internal control system has been assigned to the Audit Committee ("AC"), to seek assurance on the adequacy and effectiveness of the internal control system through reports it receives from independent reviews conducted by the Internal Auditor.

The Company constantly reviews its processes and the systems with an aim to remain competitive and address the changing regulatory and business environment. The Control Systems provide a reasonable assurance of recording the transactions of its operations in all material aspects and of providing protection against misuse or loss of Companys assets. The external auditors as well as the internal auditors periodically review the internal control systems, policies and procedures for their adequacy, effectiveness, and continuous operation for addressing risk management and mitigation strategies.

Financial Performance of the company

Equity & Liabilities:

a. Equity Share capital: During the year, there was no change in Equity share capital compared previous year and stand at D17.23 Crores.

b. Other Equity: The Other Equity of the Company has gone up from D 138.43 crores to D 163.06 crores in 2021-22 and increase primarily on account of profit earned in 2021-22.

c. Net worth: The Companys net worth increased from D 155.66 crores to D 180.29 crores. The increase ofRs is primarily on account of internal generation of profits.


a. Investments: The investments increased by D 43.92 crores, from D 109.67 crores to D 153.59 crores during the year 2021-22.

b. Trade Receivables: The Companys trade receivables increased by D 1.51 crores in 2021-22 from D 8.78 crores to D 10.29 crores.

c. Other Financial Assets (Current & Non-Current): Loans and Other financial assets decreased from D

5.57 crores to D 5.04 crores during the year under review.

d. Other Current Assets: Other Current increased by D 0.21 crores from D 0.83 crores to D 1.04 crores during the year under review.

Operational Performance

a. Revenue from Operations: The Company has reported a Revenue from Operations of D 74.26 crores during the year 2021-22 as against D 39.76 crores in the previous year, resulting in a increase of 87%

b. Other Income: The other income of the company for the year is D 7.77 crores as against D 9.98 crores of previous year.

c. Direct cost: The direct cost for the year under review works out to 53.41% of the turnover as against 58.99% last year.

d. Overheads: Overheads, administrative expenses, is D 26.56 crores for the year under review as against D 7.32 crores in the previous year.

e. Finance cost: The Finance cost during the year increased to D 1.03 crores from D 0.33 crores.

f. Depreciation & Amortization: The Companys depreciation for the year has increased from D 2.48 crores from D 2.59 crores.

g. Tax Expense: The tax expense of the company for the year 2021-22 is D 2.88 crores as against D 2.30 crores of previous year.

h. Net profit: The Company has reported a Net Profit ofRs D 16.72 crores as against D 13.82 crores in the previous year.

Human Resources

Your company continues to enjoy cordial relationship with its personnel at all levels and focusing on attracting and retaining competent personnel and providing a holistic environment where they get opportunities to grow and realise their full potential. Your company is committed to providing all its employees with a healthy and safe work environment.

Your company is organizing online training programs wherever required for the employees concerned to improve their skill. Employees are also encouraged to participate in the seminars organized by the external agencies related to the areas of their operations.

Sexual Harassment

Regarding the Sexual Harassment of Women at the work place (Prevention, Prohibition & Redressal) Act, 2013, the company has an Internal Complaints Committee. No complaints were received or disposed off during the year under the above Act and no complaints were pending either at the beginning or at the end of the year..