Striders Impex Ltd Management Discussions

You should read the following discussion of our financial condition and results of operations together with our restated financial statements attached in the chapter titled "Financial Information of the Company" beginning on page 215. You should also read the section entitled "Risk Factors" beginning on page 32 and the section titled "Forward Looking Statements" on page 22 of this Draft Red Herring Prospectus, which discusses several factors, risks and contingencies that could affect our financial condition and results of operations. The following discussion relates to us, and, unless otherwise stated or the context requires otherwise, is based on our Restated Financial Statements.

The financial statements have been prepared in accordance with Indian GAAP, the Companies Act and the SEBI (ICDR) Regulations and restated as described in the report of our auditors dated May 29, 2025 which is included in this Draft Red Herring Prospectus under the section titled "Restated Standalone Financial Statement" and dated September 17, 2025 which is included in this Draft Red Herring Prospectus under the section titled "Restated Consolidated Financial Statement" beginning on page 215. The restated financial statements have been prepared on a basis that differs in certain material respects from generally accepted accounting principles in other jurisdictions, including US GAAP and IFRS. Accordingly, the degree to which our Restated Financial Information will provide meaningful information to a prospective investor in countries other than India is entirely dependent on the readers level of familiarity with Ind AS. Our financial year ends on March 31 of each year, and all references to a particular financial year are to the twelve-month period ended March 31 of that year.

BUSINESS OVERVIEW

Striders Impex Limited is engaged in the business of licensing, own brand development, and distribution of toys and kids consumer merchandise. The Company offers end-to-end solutions from product design and development to sourcing and distribution, catering to leading retail formats across India and select international markets.

In addition to licensed products, the Company has created and developed a portfolio of proprietary intellectual properties (IPs), including Pugs at Play, Furry Pals, Gurliez, Fanster, Beezy Kits, Minds at Play, SHDZ, Boujee, and Striders. These IPs are strategically designed based on market research and consumer insights, enabling the Company to build brand equity, improve margins, and diversify its product mix. Through an asset-light, scalable model and an expanding global footprint, Striders Impex aims to position itself as a key player in the toy and merchandise ecosystem.

The Company caters to a wide demographic, offering products suitable for children from 18 months up to 15 years of age. Through strong licensing arrangements, Striders Impex has access to multiple well-known international brands. These licensing partnerships enable the Company to design, manufacture through third parties and distribute products that feature popular characters and themes, thereby increasing market acceptance and consumer recall.

In addition to its operations in India, the Company has a business presence in the Middle East via Striders FZ LLC its wholly owned subsidiary company, through a network of distributors that supports its international distribution network and strengthens global distribution and client relationships. This global footprint has enabled the Company to scale its capabilities and cater to large-format retailers and trading partners across multiple regions.

The Companys business operations are designed to offer integrated solutions from concept and product design to sourcing, manufacturing, and delivery, ensuring a reliable and efficient supply chain for its partners. This end-to-end capability has made Striders Impex a preferred supplier for licensed merchandise and custom-developed toys across retail formats.

With a growing product range, expanding international presence, and focus on licensed intellectual properties, Striders Impex Limited aims to further enhance its market share and establish itself as a leading player in the toy and kids merchandise segment, both in India and overseas.

Financial Key Performance Indicators of our Company

The financial performance of the company for the last three years as per restated financial Statement:

Particulars	Consolidated	Standalone
	FY 2024-25	FY 2024-25	FY 2023-24	FY 2022-23
1 Revenue from Operations (Rs in Lakhs)	6,186.51	6,073.11	4,170.48	2,996.42
2 Growth in Revenue from Operations (%)	NA*	45.62%	39.18%	1,408.75%
3 EBITDA (Rs in Lakhs)	932.17	890.31	531.38	309.12
4 EBITDA Margin (%)	15.07%	14.66%	12.74%	10.32%
5 EBIT (Rs in Lakhs)	908.89	867.04	513.80	306.45
6 Profit After Tax (Rs in Lakhs)	840.74	802.03	438.56	203.12
7 PAT Margin (%)	13.59%	13.21%	10.52%	6.78%
8 ROAE (%)	78.08%	76.53%	102.53%	190.03%
9 ROCE (%)	57.96%	57.40%	74.93%	128.76%
10 Net worth (Rs in Lakhs)	1,506.57	1,449.04	647.00	208.45
11 Return on Net worth (%)	55.81%	55.35%	67.78%	97.44%
12 Debt/Equity Ratio	1.36	1.42	2.26	2.02

* As this is the first year of consolidation, growth in Revenue from Operations is not ascertainable.

Notes:

1. Revenue from operation means revenue from sale of goods and other operating revenues.

2. Growth in revenue Operations is calculated by the current periods revenue and subtract the previous periods revenue and then divide by the previous periods revenue.

3. EBITDA is calculated as Profit before tax + Depreciation + Interest Expenses - Other Income.

4. EBITDA Margin is calculated as EBITDA divided by Revenue from Operations.

5. EBIT is calculated as Profit before tax + Interest Expenses.

6. PAT is calculated as Profit before tax - Tax Expenses.

7. PAT Margin is calculated as PAT for the year divided by revenue from operations.

8. ROAE: Return on average equity is calculated as profit after tax divided by Average Equity.

9. ROCE: Return on Capital Employed is calculated as EBIT divided by capital employed, which is defined as shareholders equity plus long-term debt.

10. Net Worth means the aggregate value of the paid-up share capital and reserves and surplus of the company.

11. Return on Net Worth is calculated as PAT divided by closing shareholders equity.

12. Debt Equity Ratio is calculated as total debt divided by total equity.

Statement of Significant Accounting Policies

For Significant accounting policies kindly refer to Annexure IV of chapter titled "Restated Financial Statements" beginning on

page [*] of this Draft Red Herring Prospectus.

Significant Developments Subsequent to Last Audited Balance Sheet:

After the date of March 31, 2025 there is no significant development occurred in the Company except mentioned below:

i. The company converted its name form "Striders Impex Private Limited" to "Striders Impex Limited" as new Certificate of Incorporation received from Registrar of Companies on July 28, 2025.

ii. Our Company has increased the paid up share capital of the Company by issuance of Bonus Shares by passing the shareholders resolution on June 02, 2025.

iii. Our company has passed a special resolution in the meeting of shareholders dated August 29, 2025 approving the proposal for Initial Public Offer.

iv. Our company has approved the audited standalone and consolidated financial statements for the period ended March 31, 2025, in the Board meeting dated May 29, 2025.

v. Our company has allotted 3,37,838 equity shares on private placement basis in the Board meeting dated July 15, 2025. Further 3,37,842 equity shares were allotted on preferential cum private placement basis in the Board meeting dated August 22, 2025.

vi. Our Company has approved the Restated Standalone Financial Statements for the financial year ended March 31, 2025, March 31, 2024 and March 31, 2023 and Restated Consolidated Financial Statements for the financial year ended March 31, 2025 and in the Board meeting dated May 29, 2025 and September 17, 2025 respectively.

vii. Our Company has changed the Companys registered office address due to the requirement for additional office space to support expansion within the local limits from ‘SS-121, Sector No.2 Vashi, Navi Mumbai, Thane - 400 703 to ‘ 14th Floor, Office no. 1406 & 1407, Ajmera Sikova, Sikova Industrial Marg, LBS Marg, Opp Damodar Park, Nr Ashok Mill, Ghatkopar (W) Mumbai - 400 086 passing the shareholders resolution on May 24, 2025.

Factors Affecting our Future Results of Operations

Our business is subjected to various risks and uncertainties, including those discussed in the section titled "Risk Factors"

beginning on page [*] of this Draft Red Herring Prospectus. Our results of operations and financial conditions are affected by

numerous factors including the following:

• General economic and business conditions in the markets in which we operate and in the local, regional, national economies;

• Changes in laws and regulations that apply to the industries in which we operate;

• Increased competition in industries/sector in which we operate;

• General economic, political and other risks that are out of our control;

• Companys ability to successfully implement its growth strategy and expansion plans;

• Global distress due to pandemic, war or by any other reason;

• Global inflation, interest rates, currency fluctuations, and consumer demand cycles directly affect sales, margins, and supply chain costs;

• Tariffs, sanctions, regional conflicts, and shifting trade agreements can disrupt sourcing, exports, and pricing power;

• As we operate across multiple currencies, fluctuations in exchange rates can impact both revenue recognition and cost of goods.

• Global shipping delays, container shortages, raw material price hikes, or supplier could delay deliveries and inflate costs.

• Different countries impose varying safety standards, import restrictions, tax regimes, and ESG mandates—non- compliance risks penalties and reputational damage.

• Intensifying global competition from established brands, private labels, and low-cost Chinese manufacturers may squeeze margins and reduce market share.

• Rapid changes in demand for sustainable products, digital/AI-enabled toys, or branded IP merchandise could make certain SKUs obsolete.

• Dependence on large retailers, e-commerce giants, and regional distributors exposes you to their terms, returns policies, and bargaining power.

• Our ability to raise funds at favourable terms will influence expansion speed, working capital availability, and overall profitability.

Discussion on Result of Our Operations

The following discussion on results of operations should be read in conjunction with the Restated Financial Statements.

(Amount in Rs Lakhs)

	Consolidated		Standalone
Particulars	FY 2024-25	% of Total Income	FY 2024-25	% of Total Income	FY 2023 24	% of Total Income	FY 2022 23	% of Total Income
Revenue From Operations	6186.51	99.86%	6073.11	99.86%	4170.48	99.84%	2996.42	99.99%
Other Income	8.65	0.14%	8.65	0.14%	6.88	0.16%	0.17	0.01%
Total Income	6195.16	100%	6081.76	100%	4177.36	100%	2996.59	100%
Expenses:
Cost of Material Consumed	4407.69	71.15%	4339.14	71.35%	3040.09	72.78%	2170.46	72.43%
Employee benefits expense	99.41	1.60%	99.41	1.63%	75.79	1.81%	32.65	1.09%
Finance costs	70.90	1.14%	70.90	1.17%	76.04	1.82%	31.18	1.04%
Depreciation and amortization expense	31.93	0.52%	31.91	0.52%	24.46	0.59%	2.84	0.09%
Other expenses	747.24	12.06%	744.25	12.24%	523.22	12.53%	484.18	16.16%
Total Expenses	5357.17	86.47%	5285.61	86.91%	3739.60	89.52%	2721.32	90.81%
Profit before exceptional , extraordinary items and tax	837.99	13.53%	796.15	13.09%	437.76	10.48%	275.27	9.19%
Less: Exceptional Items	-		-	-	-		-
Profit before extraordinary items and tax (A-B)	837.99	13.53%	796.15	13.09%	437.76	10.48%	275.27	9.19%
Prior Period Items	-		-	-	-	-	-
Extra ordinary items	-		-	-	-	-	-
Profit before tax	837.99	13.53%	796.15	13.09%	437.76	10.48%	275.27	9.19%
Tax expense:
Current tax	3.14	0.05%	0.00	0.00%	0.00	0.00%	72.22	2.41%
Tax Related to Earlier year	0.00	0.00	0.00	0.00%	0.00	0.00%	0.00	0.00%
Deferred Tax	-5.89	-0.10%	-5.89	-0.10%	-0.80	-0.02%	-0.06	0.00%
Profit/(Loss) for the period After Tax	840.74	13.57%	802.03	13.19%	438.56	10.50%	203.12	6.78%

Main Components of our Profit and Loss Account (Based on Restated Consolidated Financial Statements)

Total Income:

Our total income was Rs 6,195.16 lakhs for the period ended on March 31, 2025 which comprises of revenue from operations and other income.

Revenue from operations:

Our revenue from operations was Rs 6,186.51 lakhs for the period ended on March 31, 2025 constituting 99.86% of our Total Income mainly consists of revenue generated from Sale of Goods.

Other Income:

Our other income was Rs 8.65 lakhs for the period ended on March 31, 2025 constituting 0.14% of our Total Income comprises of interest on fixed deposit and other non-operating income.

Total Expenses:

Our Companys Total Expenses for the period ended on March 31, 2025 was Rs 5,357.17 lakhs constituting 86.47% of our Total Income. Total Expenses comprise of Cost of Material Consumed, Employee benefits expense, Finance costs, Depreciation and Amortization expenses and Other expenses.

Cost of material Consumed:

Our Companys Cost of materials consumed for the period ended on March 31, 2025 was Rs 4,407.69 lakhs constituting 71.15% of our Total Income which includes Purchases and Direct expenses.

Employee benefits expense:

Our employee benefits expense for the period ended on March 31, 2025 was Rs 99.41 lakhs constituting 1.60% of Total Income. Employee benefits expense primarily comprises of Salaries, Contribution to Provident and other funds and Staff Welfare Expenses.

Finance Costs:

Our Finance cost for the period ended on March 31, 2025 was Rs 70.90 lakhs constituting 1.14% of Total Income. Finance cost comprises of Interest expenses.

Depreciation and Amortization Expenses:

Depreciation & Amortization expenses for the period ended on March 31, 2025 was Rs 31.93 lakhs constituting 0.52% of Total Income. Depreciation & Amortization expense comprises of depreciation on Computer, Plant and Equipment, Furniture and Fixtures, Vehicles, Office Equipment and Other Intangible Assets.

Other Expenses:

Other expenses for the period ended on March 31, 2025 was Rs 747.24 lakhs constituting 12.06% of Total Income. Other expenses mainly comprise of Rent Rates & Taxes (Rs 49.75 lakhs constituting 0.80%), Auditors Remuneration (Rs 2.51 lakhs constituting 0.04%), Bank Charges (Rs 8.49 lakhs constituting 0.14%), Discount expenses (Rs 20.15 lakhs constituting 0.33%), Business Promotion Expenses (Rs 23.34 lakhs constituting 0.38%), Printing and Stationery (Rs 6.24 lakhs constituting 0.10%) and Travelling and Transportation expenses (Rs 239.15 lakhs constituting 3.86%), Foreign exchange gain and loss (Rs6.28 lakhs constituting 0.10%), Warehouse Expenses (Rs149.92 lakhs constituting 2.42%), legal & Professional Fees (Rs175.53 lakhs constituting 2.83%), Insurance expenses (Rs1.21 lakhs constituting 0.02%), Selling and Distribution (Rs31.77 lakhs constituting 0.51%) and Other Expenses (Rs32.89 lakhs constituting 0.53%) of total income.

Profit before tax (PBT):

Profit before tax for period ended on March 31, 2025 stood at Rs 837.99 lakhs. During this period, our Company recorded Profit before tax margin of 13.53% of Total Income.

Profit after tax (PAT):

Profit after tax for period ended on March 31, 2025 stood at Rs 840.74 lakhs. During this period, our Company recorded Profit after tax margin of 13.53% of Total Income.

Main Components of our Profit and Loss Account (Based on Restated Standalone Financial Statements)

Total Income:

Our total income was Rs 6,081.76 lakhs for the period ended on March 31, 2025 which comprises of revenue from operations and other income.

Revenue from operations:

Our revenue from operations was Rs 6,073.11 lakhs for the period ended on March 31, 2025 constituting 99.86% of our Total Income mainly consists of revenue generated from Sale of Goods.

Other Income:

Our other income was Rs 8.65 lakhs for the period ended on March 31, 2025 constituting 0.14% of our Total Income comprises of interest on fixed deposit and other non-operating income.

Total Expenses:

Our Companys Total Expenses for the period ended on March 31, 2025 was Rs 5,285.61 lakhs constituting 86.91% of our Total Income. Total Expenses comprise of Cost of Material Consumed, Employee benefits expense, Finance costs, Depreciation and Amortization expenses and Other expenses.

Cost of material Consumed:

Our Companys Cost of materials consumed for the period ended on March 31, 2025 was Rs 4,339.14 lakhs constituting 71.35% of our Total Income which includes Purchases and Direct expenses.

Employee benefits expense:

Our employee benefits expense for the period ended on March 31, 2025 was Rs 99.41 lakhs constituting 1.63% of Total Income. Employee benefits expense primarily comprises of Salaries, Contribution to Provident and other funds and Staff Welfare Expenses.

Finance Costs:

Our Finance cost for the period ended on March 31, 2025 was Rs 70.90 lakhs constituting 1.17% of Total Income. Finance cost comprises of Interest expenses.

Depreciation and Amortization Expenses:

Depreciation & Amortization expenses for the period ended on March 31, 2025 was Rs 31.91 lakhs constituting 0.52% of Total Income. Depreciation & Amortization expense comprises of depreciation on Computer, Plant and Equipment, Furniture and Fixtures, Vehicles, Office Equipment and Other Intangible Assets.

Other Expenses:

Other expenses for the period ended on March 31, 2025 was Rs 744.25 lakhs constituting 12.24% of Total Income. Other expenses mainly comprise of Rent Rates & Taxes (Rs 49.75 lakhs constituting 0.82%), Auditors Remuneration (Rs 2.50 lakhs constituting

0.04%), Bank Charges (Rs 8.49 lakhs constituting 0.14%), Discount expenses (Rs 20.13 lakhs constituting 0.33%), Business Promotion Expenses (Rs 23.34 lakhs constituting 0.38%), Printing and Stationery (Rs 6.24 lakhs constituting 0.10%)and Travelling and Transportation expenses (Rs 239.08 lakhs constituting 3.93%), Foreign exchange gain and loss (Rs6.28 lakhs constituting 0.10%), Warehouse Expenses (Rs149.92 lakhs constituting 2.47%), legal & Professional Fees (Rs175.18 lakhs constituting 2.88%), Insurance expenses (Rs1.21 lakhs constituting 0.02%), Selling and Distribution (Rs31.62 lakhs constituting 0.52%) and Other Expenses (Rs30.50 lakhs constituting 0.50%) of total income.

Profit before tax (PBT):

Profit before tax for period ended on March 31, 2025 stood at Rs 796.15 lakhs. During this period, our Company recorded Profit before tax margin of 13.09% of Total Income.

Profit after tax (PAT):

Profit after tax for period ended on March 31, 2025 stood at Rs 802.03 lakhs. During this period, our Company recorded Profit after tax margin of 13.19% of Total Income.

Comparison of FY 2024-25 with FY 2023-24 (Based on Restated Standalone Financial Statements)

Total Income:

Total income for the financial year 2024-25 stood at Rs 6,081.76 lakhs whereas in financial year 2023-24 the same stood at Rs 4,177.36 lakhs representing an increase of 45.59%. Total income is composed of revenue from operations and other income. The rise in total income is mainly attributed to the increase in revenue from operations, this increase is due to a rise in sales of Goods.

Revenue from Operations:

During the financial year 2024-25 the revenue from operations of our Company increased to Rs 6,073.11 Lakhs as against Rs 4,170.48 lakhs in the Financial Year 2023-24 representing an increase of 45.62%. This increase in revenue from operations is due to a rise in sales of Goods.

Other Income:

During the financial year 2024-25, Other income increased by 25.73%, from Rs 6.88 lakhs in financial year 2023 -24 to Rs 8.65 lakhs in financial year 2024-25, primarily on account of Interest Income and Non-operating Income.

Total Expenses:

The Total expense for the financial year 2024-25 increased to Rs 5,285.61 lakhs from Rs 3,739.60 lakhs in the financial year 202324 representing an increase of 41.34%. Such increase was due to increase in the volume of business operations of the Company.

Cost of Materials Consumed:

Cost of Materials consumed of the company increased by 42.73% from Rs 3,040.09 Lakhs in FY 2023 -24 to Rs 4,339.14 Lakhs for FY 2024-25. Cost of material consumed includes Purchases and Direct Expenses. This increase is in line with the increase in business volume in FY 2024-25 as compared to FY 2023-24.

Employee benefits expense:

Our Company has incurred Rs 99.41 lakhs as Employee benefits expense during the financial year 2024-25 as compared to Rs 75.79 lakhs in the financial year 2023-24. The increase of 31.16% was due to increase in salaries, contribution to Provident and other funds. Employee benefit expenses in FY 2024- 25 comprises of salary and wages amounting for Rs 96.86 lakhs, contribution to Provident and other funds for Rs 1.70 lakhs and Staff welfare expense for Rs 0.85 lakhs whereas in FY 2023-24 comprises of salary and wages amounting for Rs 72.53 lakhs, contribution to Provident and other funds for Rs 1.37 lakhs and Staff welfare expense for Rs 1.89 lakhs.

Finance costs:

The Finance cost decreased to Rs 70.90 lakhs in the Financial Year 2024-25 against that of Rs 76.04 lakhs in Financial Year 202324. The decrease of the finance cost is on account decrease of interest expenses by Rs 5.14 lakhs in the FY 2024 -25.

Depreciation and Amortization Expenses:

Depreciation and Amortization Expenses for the financial year 2024-25 stood at Rs 31.91 lakhs as against Rs 24.46 lakhs during the financial year 2023-24. The increase in depreciation was around 30.46% in comparison to the previous year due to addition in Computers, Vehicles, Office Equipment and Other Intangible Assets.

Other Expenses:

Other Expenses of the company has increased from Rs 523.22 lakhs in FY 2023 -24 to Rs 744.25 lakhs in FY 2024-25. This increase of 42.24% was mainly due to

(i) increase in payment to auditor from Rs 1.20 lakhs in FY 2023 -24 to Rs 2.50 lakhs in FY 2024-25,

(ii) increase in bank charges from Rs 0.14 lakhs in FY 2023 -24 to Rs 8.49 lakhs in FY 2024-25,

(iii) increase in discount expenses from Rs -9.89 lakhs in FY 2023-24 to Rs 20.13 lakhs in FY 2024-25,

(iv) decrease in business promotion expenses from Rs 38.21 lakhs in FY 2023 -24 to Rs 23.34 lakhs in FY 2024-25,

(v) increase in printing and stationery from Rs 1.96 lakhs in FY 2023 -24 to Rs 6.24 lakhs in FY 2024-25, and

(vi) increase in Travelling and Transportation Expenses from Rs 164.39 lakhs in FY 2023 -24 to Rs 239.08 lakhs in FY 2024-25,

(vii) increase in Rent Rates & Taxes from Rs 39.65 lakhs in FY 2023-24 to Rs 49.75 lakhs in FY 202425,

(viii) increase in Foreign exchange gain and loss from Rs 0.13 lakhs in FY 2023-24 to Rs 6.28 lakhs in FY 2024-25,

(ix) increase in warehouse expenses from Rs 86.10 lakhs in FY 2023-24 to Rs 149.92 lakhs in FY 2024-25,

(x) increase in legal & professional fees from Rs 157.83 lakhs in FY 2023-24 to Rs 175.18 lakhs in FY 2024-25,

(xi) decrease in insurance expenses from Rs 2.32 lakhs in FY 2023-24 to Rs 1.21 lakhs in FY 2024-25, (xii) increase in selling and distribution expenses from Rs 16.52 lakhs in FY 202324 to Rs 31.62 lakhs in FY 2024-25 and

(xiii) increase in other expenses from Rs 24.66 lakhs in FY 2023-24 to Rs 30.50 lakhs in FY 2024-25.

Restated profit before tax:

Profit before tax for the financial year 2024-25 increased to Rs 796.15 lakhs as compared to Rs 437.76 lakhs in financial year 202324. The PBT was 13.09 % of total revenue in financial year 2024-25 compared to 10.48% of total revenue in F.Y. 2023-24. The profit is increased on account of due to increase in total revenue.

Restated profit after tax:

Net profit after tax for the financial year 2024-25 increased to Rs 802.03 lakhs as compared to Rs 438.56 lakhs in financial year 2023-24. The PAT was 13.19% of total revenue in financial year 2024-25 compared to 10.50% of total revenue in F.Y. 2023-24. This increase was mainly due to increase in Profit before Tax as mentioned above.

Comparison of FY 2023-24 with FY 2022-23 (Based on Restated Standalone Financial Statements)

Total Income:

Total income for the financial year 2023-24 stood at Rs 4,177.36 lakhs whereas in financial year 2022-23 the same stood at Rs 2996.59 lakhs representing an increase of 39.40%. Total income is composed of revenue from operations and other income. The rise in total income is mainly attributed to the increase in revenue from operations, this increase is due to a rise in sales of goods.

Revenue from Operations:

During the financial year 2023-24 the revenue from operations of our Company increased to Rs 4,170.48 Lakhs as against Rs 2996.42 lakhs in the Financial Year 2022-23 representing an increase of 39.18%. This increase in revenue from operations is due to a rise in sales of goods.

Other Income:

During the financial year 2023-24, Other income increased from Rs 0.17 lakhs in financial year 2022- 23 to Rs 6.88 lakhs in financial year 2023-24, primarily on account of primarily on account of Interest Income and Non-operating Income.

Total Expenses:

The Total expense for the financial year 2023-24 increased to Rs 3,739.60 lakhs from Rs 2,721.32 lakhs in the financial year 202223 representing an increase of 37.42%. Such increase was due to increase in the volume of business operations of the Company.

Cost of Materials Consumed:

Cost of Materials consumed of the company increased by 40.07% from Rs 2,170.46 Lakhs in FY 2022 -23 to Rs 3,040.09 Lakhs for FY 2023-24. Cost of material consumed includes Purchases and Direct Expenses. This increase is in line with the increase in business volume in FY 2022-23 as compared to FY 2023-24.

Employee benefits expense:

Our Company has incurred Rs 32.65 lakhs as Employee benefits expense during the financial year 2022-23 as compared to Rs 75.79 lakhs in the financial year 2023-24. The increase of 132.13% was due to increase in salaries, contribution to Provident and other funds and staff welfare expense. Employee benefit expenses in FY 2022-23 comprises of salaries amounting for Rs 31.87 lakhs, contribution to Provident and other funds for Rs 0.19 lakhs and Staff welfare expense for Rs 0.58 lakhs whereas in FY 2023 -24 comprises of salaries amounting for Rs 72.53 lakhs, contribution to Provident and other funds for Rs 1.37 lakhs and Staff welfare expense for Rs 1.89 lakhs.

Finance costs:

The Finance cost incurred of the company increased by 143.87% from Rs 31.18 Lakhs in FY 2022 -23 to Rs 76.04 Lakhs for FY 2023-24.

Depreciation and Amortization Expenses:

Depreciation and Amortization Expenses for the financial year 2023 -24 stood at Rs 24.46 lakhs as against Rs 2.84 lakhs during the financial year 2022-23. The increase in depreciation was around 761.27% in comparison to the previous year due to addition in Computers, Plant and Equipment, Furniture & Fixtures and Office Equipment.

Other Expenses:

Other Expenses of the company has increased from Rs 484.18 lakhs in FY 2022-23 to Rs 523.22 lakhs in FY 2023-24. This increase of 8.06% was mainly due to

(i) increase in payment to auditor from Rs 0.90 lakhs in FY 2022 -23 to Rs 1.20 lakhs in FY 2023-24,

(ii) decrease in bank charges from Rs 2.72 lakhs in FY 2022-23 to Rs 0.14 lakhs in FY 2023-24,

(iii) decrease in discount expenses from Rs 12.21 lakhs in FY 2022-23 to Rs -9.89 lakhs in FY 2023-24,

(iv) increase in business promotion expenses from Rs 1.42 lakhs in FY 2022-23 to Rs 38.21 lakhs in FY 2023-24,

(v) increase in printing and stationery from Rs 1.31 lakhs in FY 2022-23 to Rs 1.96 lakhs in FY 2023-24, and

(vi) increase in Travelling and Transportation Expenses from Rs 51.65 lakhs in FY 2022 -23 to Rs 164.39 lakhs in FY 2023-24,

(vii) increase in Rent Rates & Taxes from Rs 11.64 lakhs in FY 2022-23 to Rs 39.65 lakhs in FY 2023-24,

(viii) increase in Foreign exchange gain and loss from Rs -10.25 lakhs in FY 2022-23 to Rs 0.13 lakhs in FY 2023-24,

(ix) increase in warehouse expenses from Rs 15.07 lakhs in FY 2022-23 to Rs 86.10 lakhs in FY 2023-24,

(x) decrease in legal & professional fees from Rs 212.09 lakhs in FY 2022-23 to Rs 157.83 lakhs in FY 2023-24,

(xi) availing of insurance of Rs 2.32 lakhs in FY 202324,

(xii) increase in selling and distribution expenses from Rs 0.64 lakhs in FY 2022-23 to Rs 16.52 lakhs in FY 2023-24 and

(xiii) decrease in other expenses from Rs 184.79 lakhs in FY 2022-23 to Rs 24.66 lakhs in FY 2023-24.

Restated profit before tax:

Profit before tax for the financial year 2023-24 increased to Rs 437.76 lakhs as compared to Rs 275.27 lakhs in financial year 202223. The PBT was 10.48 % of total revenue in financial year 2023 -24 compared to 9.19% of total revenue in F.Y. 2022-23. The profit is increased on account of due to increase in total revenue.

Restated profit after tax:

Net profit after tax for the financial year 2023-24 increased to Rs 438.56 lakhs as compared to Rs 203.12 lakhs in financial year 2022-23. The PAT was 10.50% of total revenue in financial year 2023-24 compared to 6.78% of total revenue in F.Y. 2022-23. This increase was mainly due to increase in Profit before Tax as mentioned above.

Discussion on Restated Cash Flow Statement

(Amount in Rs Lakhs)

Particulars	Consolidated	Standalone
	For FY 202425	For FY 2024-25	For FY 2023-24	For FY 2022-23
A. Cash Flow from Operating Activities	81.28	311.97	(781.62)	(281.08)
B. Cash Flow from Investing Activities	(496.38)	(920.65)	(121.28)	(39.22)
C. Cash Flow from Financing Activities	519.08	519.08	967.42	295.75
Net increase in cash and cash equivalents	103.98	(89.60)	64.51	(24.56)
Opening Balance - Cash & Cash Equivalent	105.33	105.33	40.81	65.37
Closing Balance - Cash & Cash Equivalent	209.32	15.74	105.33	40.81

Net Cash Flow from Operating Activities

Net cash flow from operating activities comprises cash consumed / generated from operations, increase / decrease in working capital and increase / decrease in non-current / current liabilities.

Financial Year 2024-25 (Based on Restated Consolidated Financial Statements)

During the FY 2024-25, net cash flow from operating activities was Rs 81.28 lakhs. Profit before tax stood at Rs 837.99 lakhs. Primary adjustments were on account of depreciation and amortisation expense of Rs 31.93 lakhs, Interest expense of Rs 70.90 lakhs, Interest income of Rs 6.65 lakhs, provision for Gratuity of Rs 1.54 lakhs and impact of Foreign Currency translation of Foreign Subsidiary of Rs 13.86 lakhs. Operating profit before working capital changes was at Rs 949.57 lakhs during the FY 2024 -25. Primary adjustments for current assets & liabilities included increase in other current Liabilities of Rs 633.54 lakhs, increase in trade payable of Rs 36.35 lakhs, decrease in short term provisions of Rs 9.40 lakhs, increase in trade receivable of Rs 1,189.28 lakhs, increase in non-current assets of Rs 9.00 lakhs, decrease in short term loans & advances Rs 83.28, increase in long term loans & advances of Rs 146.50 lakhs, Increase in other current assets of Rs 182.55 lakhs, Increase in inventories of Rs 71.35 lakhs and income tax paid of Rs 13.37 lakhs.

Financial Year 2024-25 (Based on Restated Standalone Financial Statements)

During the FY 2024-25, net cash flow from operating activities was Rs 311.97 lakhs. Profit before tax stood at Rs 796.15 lakhs. Primary adjustments were on account of depreciation and amortisation expense of Rs 31.91 lakhs, Interest expense of Rs 70.90 lakhs, Interest income of Rs 6.65 lakhs and provision for Gratuity of Rs 1.54 lakhs. Operating profit before working capital changes w as at Rs 893.85 lakhs during the FY 2024-25. Primary adjustments for current assets & liabilities included increase in other current Liabilities of Rs 597.36 lakhs, decrease in trade payable of Rs 41.42 lakhs, decrease in short term provisions of Rs 25.71 lakhs, increase in trade receivable of Rs 983.33 lakhs, increase in non-current assets of Rs 6.00 lakhs, decrease in short term loans & advances Rs 120.35, increase in long term loans & advances of Rs 146.50 lakhs, Increase in other current assets of Rs 74.91 lakhs, Increase in inventories of Rs 21.71 lakhs.

Financial Year 2023-24 (Based on Restated Standalone Financial Statements)

During the FY 2023-24, net cash flow used in operating activities was Rs 781.62 lakhs. Profit before tax stood at Rs 437.76 lakhs. Primary adjustments were on account of depreciation and amortisation expense of Rs 24.46 lakhs, Interest expense of Rs 76.04 lakhs, Interest income of Rs 2.64 lakhs and provision for Gratuity of Rs 1.22 lakhs. Operating profit before working capital changes w as at Rs 536.83 lakhs during the FY 2023-24. Primary adjustments for current assets & liabilities included decrease in other current Liabilities of Rs 10.61 lakhs, decrease in trade payable of Rs 120.48 lakhs, decrease in short term provisions of Rs 90.79 lakhs, increase in trade receivable of Rs 353.60 lakhs, increase in short term loans & advances Rs 82.09, increase in long term loans and advances of Rs 69.08 lakhs, Increase in other current assets of Rs 91.80 lakhs, Increase in inventories of Rs 500.00 lakhs.

Financial Year 2022-23 (Based on Restated Standalone Financial Statements)

During the FY 2022-23, net cash flow used in operating activities was Rs 281.08 lakhs. Profit before tax stood at Rs 275.27 lakhs. Primary adjustments were on account of depreciation and amortisation expense of Rs 2.84 lakhs, Interest expense of Rs 31.18 lak hs, Interest income of Rs 0.17 lakhs and provision for Gratuity of Rs 0.19 lakhs. Operating profit before working capital changes w as at Rs 309.32 lakhs during the FY 2022-23. Primary adjustments for current assets & liabilities included increase in other current

Liabilities of Rs 92.02 lakhs, increase in trade payable of Rs 695.42 lakhs, increase in short term provisions of Rs 240.57 lakh s, increase in trade receivable of Rs 724.74 lakhs, increase in short term loans & advances Rs 57.59, Increase in other current assets of Rs 16.11 lakhs, Increase in inventories of Rs 747.75 lakhs.

Net Cash Flow from Investing Activities

Net cash flow from investing activities comprises proceeds from Purchase of Property, Plant and Equipment including intangible Assets, investment in subsidiaries, interest income on fixed deposits with bank and Fixed deposits placed with bank.

Financial Year 2024-25 (Based on Restated Consolidated Financial Statements)

During the FY 2024-25, Net cash used in investing activities stood at Rs 496.38 lakhs, primarily on account of acquisition of subsidiaries of Rs 366.98 lakhs, interest income on fixed deposits with bank of Rs 6.65 lakhs, Fixed deposits placed with bank of Rs 92.11 lakhs and Purchase of Property, Plant and Equipment including intangible Assets of Rs 43.93 lakhs.

Financial Year 2024-25 (Based on Restated Standalone Financial Statements)

During the FY 2024-25, Net cash used in investing activities stood at Rs 920.65 lakhs, primarily on account of investment in subsidiaries of Rs 792.89 lakhs, interest income on fixed deposits with bank of Rs 6.65 lakhs, Fixed deposits placed with bank of Rs 92.10 lakhs and Purchase of Property, Plant and Equipment including intangible Assets of Rs 42.30 lakhs.

Financial Year 2023-24 (Based on Restated Standalone Financial Statements)

During the FY 2023-24, Net cash used in investing activities stood at Rs 121.28 lakhs, primarily on account of interest income on fixed deposits with bank of Rs 2.64 lakhs, Fixed deposits placed with bank of Rs 46.38 lakhs, Purchase of Property, Plant and Equipment including intangible Assets of Rs 77.77 lakhs and Sale or Disposal of Property, Plant and Equipment of Rs 0.22 lakhs.

Financial Year 2022-23 (Based on Restated Standalone Financial Statements)

During the FY 2022-23, Net cash used in investing activities stood at Rs 39.22 lakhs, primarily on account of interest income on fixed deposits with bank of Rs 0.17 lakhs, Fixed deposits placed with bank of Rs 17.76 lakhs and Purchase of Property, Plant an d Equipment including intangible Assets of Rs 21.63 lakhs.

Net Cash Flow from Financing Activities

Net cash flow from financing activities comprises impact due to proceeds of proceeds / repayment of borrowing, interest and financial charges.

Financial Year 2024-25 (Based on Restated Consolidated Financial Statements)

During the FY 2024-25, net cash flow from financing activities was Rs 519.08 lakhs, primarily on account of interest on Loan Borrowed from Bank/NBFC of Rs 70.90 lakhs and Loan borrowed from Bank/NBFC of Rs 589.98 lakhs.

Financial Year 2024-25 (Based on Restated Standalone Financial Statements)

During the FY 2024-25, net cash flow from financing activities was Rs 519.08 lakhs, primarily on account of interest on Loan Borrowed from Bank/NBFC of Rs 70.90 lakhs and Loan borrowed from Bank/NBFC of Rs 589.98 lakhs.

Financial Year 2023-24 (Based on Restated Standalone Financial Statements)

During the FY 2023-24, net cash flow from financing activities was Rs 967.42 lakhs, primarily on account of interest on Loan Borrowed from Bank/NBFC of Rs 76.04 lakhs and Loan borrowed from Bank/NBFC of Rs 1043.46 lakhs.

Financial Year 2022-23 (Based on Restated Standalone Financial Statements)

During the FY 2022-23, net cash flow from financing activities was Rs 295.75 lakhs, primarily on account of interest on Loan Borrowed from Bank/NBFC of Rs 31.18 lakhs and Loan borrowed from Bank/NBFC of Rs 326.93 lakhs.

Information required as per Item (II) (C) (iv) of Part A of Schedule VI to the SEBI Regulations:

An analysis of reasons for the changes in significant items of income and expenditure is given hereunder:

1. Unusual or infrequent events or transactions

Except as described in this Draft Red Herring Prospectus, during the periods under review there have been no transactions or events, which in our best judgment, would be considered unusual or infrequent.

2. Significant economic changes that materially affected or are likely to affect income from continuing operations.

Our business has been subject, and we expect it to continue to be subject to significant economic changes arising from the trends identified above in ‘Factors Affecting our Future Results of Operations and the uncertainties described in the section entit led "Risk Factors" beginning on page [*] of this Draft Red Herring Prospectus. To our knowledge, except as we have described in this Draft Red Herring Prospectus, there are no known factors which we expect to bring about significant economic changes.

3. Known trends or uncertainties that have had or are expected to have a material adverse impact on sales, revenue or income from continuing operations.

Apart from the risks as disclosed under Section "Risk Factors" beginning on page 32 of the Draft Red Herring Prospectus, in our opinion there are no other known trends or uncertainties that have had or are expected to have a material adverse impact on revenue or income from continuing operations.

4. Future changes in relationship between costs and revenues.

Other than as described in the sections "Risk Factors", "Our Business" and "Managements Discussion and Analysis of Financial Condition and Results of Operations" on pages 32, 153 and 220 respectively, to our knowledge, no future relationship between expenditure and income is expected to have a material adverse impact on our operations and finances.

5. Extent to which material increases in net sales or revenue are due to increased sales volume, introduction of new products or increased sales prices.

Other than as disclosed in this section and in chapter titled "Our Business" beginning on page 153 of this Draft Prospectus, we have not announced and do not expect to announce in the near future any new business segments.

6. Total turnover of each major industry segment in which our Company operates

The Company is mainly engaged in the business of licensing, own brand development, and distribution of toys and kids consumer merchandise and all the activities of the business revolve around this main business. Therefore, there are no separate reportable segments. Relevant industry data, as available, has been included in the chapter titled "Industry Overview" beginning on page 125 of this Draft Red Herring Prospectus.

7. Status of any publicly announced New Products or Business Segment

Except as disclosed in the chapter titled "Our Business" beginning on page 153, our Company has not announced any new services or business services.

8. Seasonality of business

Except as disclosed in the chapter titled "Risk Factors" beginning on page 32, our Company has not announced any new services or business services.

9. Dependence on single or few customers or suppliers

The % of contribution of our Companys suppliers vis-a-vis the total purchases from operations respectively as of for the FY 2025, 2024 and 2023 is as follows:

(except percentages, Rs in lakhs)

Particulars	Consolidated		Standalone
	Financial Year		Financial Year		Financial Year		Financial Year
	2024-25		2024-25		2023-24		2022-23
	Purchases	(%)*	Purchases	(%)*	Purchases	(%)*	Purchases	(%)*
Top Supplier	944.10	22.91%	944.10	23.31%	980.05	35.05%	822.31	33.49%
Top 5 Suppliers	3,271.93	79.40%	3,271.93	80.79%	2,215.21	79.21%	1,905.73	77.60%
Top 10 Suppliers	3,830.30	92.95%	3,830.30	94.58%	2,693.79	96.33%	2,272.04	92.53%

*as a percentage of total purchases from Restated Financial Information.

The % of contribution of our Companys customers vis-a-vis the total revenue from operations respectively for the FY 2025, 2024 and 2023 is as follows:

(except percentages, Rs in lakhs)

Particulars	Consolidated		Standalone
	Financial Year		Financial Year		Financial Year		Financial Year
	2024-25		2024-25		2023-24		2022-23
	Sales (Rs)	(%)*	Sales (Rs)	(%)*	Sales (Rs)	(%)*	Sales (Rs)	(%)*
Top Customer	2,240.87	36.22%	2,240.87	36.90%	1,065.54	25.55%	1,218.14	40.65%
Top 5 Customers	3,435.17	55.53%	3,458.20	56.95%	2,788.93	66.88%	2,244.58	74.90%
Top 10 Customers	4,219.76	68.21%	4,306.57	70.92%	3,267.26	78.35%	2,495.52	83.28%

*as a percentage of Revenue from Operations from the Restated Financial Information.

10. Competitive conditions

Competitive conditions are as described under the Chapters titled "Industry Overview" and "Our Business" beginning on pages 101 and 115, respectively of this Draft Red Herring Prospectus.