Steel City Securities Ltd Management Discussions

ANNEXURE- 9

ECONOMY OVERVIEW:

The global economy continues to navigate a phase of uncertainty during FY 2025-2026, characterized by geopolitical tensions, trade realignments, and evolving monetary policies. The global outlook has abruptly darkened following the outbreak of war in the Middle East on February 2026. The closure of the Strait of Hormuz and serious damage to critical production facilities in a region central could cause an energy crisis on an unprecedented scale. The war interrupted what had been a steady growth trajectory. Prior to the war, we were poised to for global growth, reflecting continued momentum in the global economy supported by a tech investment boom, some moderation in trade policy tensions, fiscal support in some countries, and accommodating financial conditions. The Middle East conflict presents a significant counterforce to these tailwinds through its impact on commodity markets, inflation expectations, and financial conditions.

Under the IMF WEO reference forecast, global growth is projected to be 3.1 percent in 2026 and 3.2 percent in 2027, slower than its recent pace of about 3.4 percent in 2024-25, and to settle at about that rate in the medium term, slower than its historical (2000-19) average of 3.7 percent. The forecast for 2026 is revised downward by 0.2 percentage point and that for 2027 is unchanged, compared with those in the January 2026 WEO Update. Global headline inflation is expected to increase to 4.4 percent in 2026 and decline to 3.7 percent in 2027, marking upward revisions for both years.

INDIAN ECONOMY

India continues to demonstrate strong macroeconomic resilience and remains one of the fastest- growing major economies globally. While there are challenges to the near-term outlook, Indias growth remains stronger than that of other major economies. While global trade headwinds persist, growth is expected to continue at a measured pace, aided by policy reforms and a supportive interest-rate environment. India is seeking to navigate rising trade uncertainty through gradual market diversification and the pursuit of new trade partnerships.

• The growth momentum during FY 2025-2026 is supported by:

• Strong domestic consumption

• Government capital expenditure

• Stable inflation environment

• Robust foreign exchange reserves

The Indian economy is expected to grow in the range of 6.2% to 7.2% in the financial year 2026-27 (FY27). This wide projection reflects the ongoing resilience of domestic consumption countered by recent global headwinds. Policy initiatives aimed at enhancing infrastructure, boosting consumption, and promoting digital transformation are likely to further strengthen economic activity.

INDIAN EQUITY MARKET

The Indian equity market experienced a turbulent year in FY26 characterized by a sharp correction and a broad-based sell-off with benchmark indices BSE Sensex and NSE Nifty 50 both posted negative returns for the fiscal year. The NIFTY 50 slipped over 5% to settle at 22,331.40, while the BSE Sensex dropped by more than 7%, closing at 71,947.55.

. Initial Momentum: During much of the fiscal year, markets were supported by the strong macroeconomic backdrop, with FY26 real GDP growing at an estimated 7.6%.

. Foreign Outflows: The gains from the majority of the financial year were significantly impacted in late Q4 due to a massive selling by Foreign Institutional Investors (FIIs), which exceeded 60,000 crore in the March series.

. Geopolitical Headwinds: Renewed escalations of the West Asia conflict caused crude oil prices to surge, negatively impacting market sentiment and sectoral margins.

. Domestic Strength: While FIIs retreated, domestic inflows remained highly robust. Monthly SIP inflows into mutual funds reached 56,600 crore, highlighting a structural shift in household investments. Domestic Institutional Investors (DIIs) remained key stabilizing forces,

Outlook

Looking forward, financial institutions project that returns in 2026 will be largely earnings-led, with an anticipated corporate earnings growth in the 12-15% range. While geopolitical issues and FII flows remain risk factors, strong domestic demand and interventions by the Reserve Bank of India continue to underpin long-term market confidence.

INDUSTRY STRUCTURE AND DEVELOPMENTS

The Indian stock broking industry continues to evolve rapidly, driven by:

. Increasing retail participation

. Technological advancements

. Regulatory strengthening by SEBI

. Growth in digital trading platforms

The industry is expected to maintain a strong growth trajectory, supported by increasing financial inclusion and expansion of investment products. The broking industry is projected to grow steadily, and the momentum is expected to continue in FY27 with increasing market penetration and digital adoption.

The retail investor base continues to expand, supported by:

. Digital on boarding

. Increased financial awareness

. Ease of access to trading platforms

OPPORTUNITIES AND THREATS Opportunities

. Rising retail investor participation

. Growth in digital platforms and mobile trading . Expansion of financial products (MFs, Insurance, NPS, Loans)

. Government initiatives promoting financial inclusion . Increasing demand for e-governance services

Threats

. Market volatility and global uncertainties

• Regulatory changes impacting broking operations

• Intense competition from discount brokers

• Cybersecurity risks

• Dependence on capital market performance

SEGMENT-WISE PERFORMANCE

The Company continues to focus on:

• Stock broking operations

• Depository participant services

• E-governance services

• Distribution of financial products

Digital platforms and e-governance initiatives remain key growth drivers.

OUTLOOK

The outlook for FY 2025-2026 remains

cautiously optimistic.

As also indicated in the previous year outlook , the Indian markets are expected to remain influenced by both domestic strength and global uncertainties.

Key drivers for FY26 include:

• Stable macroeconomic fundamentals

• Potential easing of interest rates

• Revival in consumption demand

• Continued growth in retail participation

However, volatility is expected to persist due to:

• Global geopolitical developments

• Policy uncertainties

• External economic factors

OUTLOOK FOR STOCK BROKING INDUSTRY

The stock broking industry is expected to witness sustained growth in FY26, driven by:

• Increased trading activity

• Digital transformation

• Rising investor awareness

• Expansion of financial products

The Company expects continued growth in:

• Client acquisition

• Trading volumes

• Digital transactions

COMPANY STRATEGY AND INITIATIVES

The Company continues to focus on strengthening its business through:

1. Digital Transformation

. Enhancement of mobile trading platform (“Steel City Smart Plus”)

. Improved user experience and digital engagement

2. Expansion of E-Governance Services

. Continued focus on expanding service centers . Leveraging TIN centers for distribution

3. Geographic Expansion

. Expansion into Northern and Western regions

4. Product Diversification

. Promotion of NPS and financial products . Distribution of insurance, mutual funds, loans, and deposits

5. Client Acquisition

. Simplified digital onboarding (KYC / Re-KYC)

. Increased reach through digital channels

RISKS AND CONCERNS

The Company continues to monitor key risks including:

. Market volatility risk

. Regulatory risk

. Operational and technology risk

. Competition from low-cost brokers

Appropriate risk mitigation strategies are in place to address these challenges.

INTERNAL CONTROL SYSTEMS

The Company has adequate internal control systems commensurate with the size and nature of its operations. These systems ensure:

. Accuracy of financial reporting

. Compliance with applicable laws and regulations . Efficient utilization of resources

Regular internal audits and reviews strengthen the control framework.

HUMAN RESOURCES

The Company continues to focus on:

. Talent development

. Employee engagement

. Skill enhancement

Human resources remain a key pillar for sustained growth.

CAUTIONARY STATEMENT

Statements in this Management Discussion and Analysis describing the Companys objectives, projections, estimates, and expectations may be “forward-looking statements” within the meaning of applicable laws and regulations. Actual results may differ materially due to various risks and uncertainties.