Svam Software Ltd Management Discussions

The global economy during 2025-26 exhibited resilient but uneven growth, shaped by easing trade tensions for part of the year, renewed geopolitical flashpoints and continued monetary policy divergence across regions. The IMFs 2026 projections placed global GDP growth at around 3.0% to 3.3% for 2026, moderating marginally from 3.3% in 2025, with growth expected to firm up to around 3.2-3.4% in 2027.

Advanced economies are estimated to grow modestly in the range of 1.5% to 1.8%, while emerging markets and developing economies are expected to expand faster, around 3.8% to 4.0%, led once again by India (real GDP growth of over 7% for FY 2025-26) with China moderating to around 4.2-4.8%.

Global trade flows saw a partial recovery as tariff-related uncertainty eased for parts of the year, though the outbreak of conflict in the Middle East during 2026 renewed volatility in energy prices and reintroduced downside risks to the outlook. Global headline inflation, having declined steadily through 2024-25, ticked up modestly during 2026 on account of these disruptions, before being expected to resume its downward trajectory in 2027, though the pace and extent of disinflation continue to vary widely across regions.

Monetary policy continued to diverge across major economies during the year, with several central banks, including the Reserve Bank of India, moving further into an easing cycle to support growth, even as others remained cautious given persistent, if moderating, inflationary pressures. Technological advances, especially in AI, continued to offer potential productivity gains while also raising labour market and equity concerns.

Overall, while resilient consumption, technology-led investment and selective regional growth continue to provide support, risks such as geopolitical conflict, renewed trade tensions, high public debt levels and financial market volatility continue to weigh heavily on the global economy.

Indias economy in 2025-26 continued to demonstrate strong resilience, retaining its position as the fastest-growing major economy in the world. Real GDP growth for the year is estimated by the Reserve Bank of India at around 7.4% to 7.6%, supported by robust private consumption, strong festive season demand and sustained government capital expenditure. Inflation moderated sharply during the year, with retail inflation projected at around 2.1% for FY 2025-26, among its lowest levels in years, allowing the Reserve Bank of India to continue easing monetary policy through rate cuts, while holding rates steady in early 2026 amid a favourable growth-inflation mix.

Fiscal consolidation remained a policy priority, supported by a Union Budget aimed at boosting government spending. Exports, especially in services, continued to grow, and trade agreements with key partners including the United States, United Kingdom and the European Union improved investor sentiment and foreign direct investment (FDI) flows. On the employment front, formal job creation continued to improve, though youth and urban female unemployment remain areas requiring policy attention. The financial sector continued to strengthen with improved asset quality and healthy credit growth.

While the outlook for 2026-27 remains optimistic, with the Reserve Bank of India projecting growth of around 6.9% as cyclical tailwinds gradually fade, challenges such as slow private investment, global trade tensions, geopolitical uncertainty and food price volatility persist and will need careful policy management to sustain momentum.

As of mid-2026, the global economy is navigating a complex landscape marked by moderating growth, a renewed uptick in inflation and heightened geopolitical uncertainty following the outbreak of conflict in the Middle East. Major central banks, including the U.S. Federal Reserve and the European Central Bank, have continued to calibrate policy carefully, balancing the need to support slowing growth against the risk of reigniting price pressures.

The United States remains relatively resilient, supported by consumer spending, strong labour markets and continued technology-led investment, while the Eurozone continues to face sluggish growth amid weak industrial output. Chinas economy shows further signs of stabilisation following stimulus efforts, but structural challenges like real estate debt and demographic shifts remain a drag.

Emerging markets are seeing varied performance, with commodity exporters benefiting from firmer prices, while others struggle with capital outflows and currency volatility. Looking ahead, the global outlook remains cautiously optimistic, with modest growth expected through 2026 and 2027, but downside risks persist due to geopolitical conflict, supply chain disruptions, and climate related shocks.

Svam Agritech Limited (formerly known as Svam Software Limited) was originally incorporated in the year 1992 and has, over the years, been engaged in the Information Technology sector, offering turnkey software projects, communication and networking, system re-engineering, software conversion/migration/redesign, customised software development and related IT-enabled services.

During the year under review, pursuant to the approval of the Board of Directors and thereafter the members of the Company at the Extra-Ordinary General Meeting, the Company altered the Object Clause of its Memorandum of Association to enable it to undertake the business of Agritech solutions, agricultural technology development, digital farming, precision agriculture, smart farming systems, agri-input management and agricultural advisory services, dealing in seeds, agricultural produce, fertilizers, pesticides and allied agricultural inputs, as well as the business of farming, cultivation and allied agricultural activities. The members also approved the addition of an object enabling the Company to undertake the business of real estate development, construction and redevelopment of residential, commercial and industrial properties, land development and allied infrastructure activities. Consequent to the above, the members also approved the change in the name of the Company from Svam Software Limited to Svam Agritech Limited, to better reflect the Companys expanded business activities.

The Indian agritech industry continues to witness robust growth, driven by increasing adoption of digital and technology-enabled solutions across the agricultural value chain, growing government thrust on precision farming, agri-input digitisation and farmer welfare schemes, and rising private investment in the sector. The Companys foray into agritech solutions is aligned with this larger structural shift in Indian agriculture. Similarly, the real estate and construction sector in India remains an important contributor to economic growth and employment generation, supported by regulatory reforms, urbanisation and rising demand for residential, commercial and industrial infrastructure. The Company believes that its expanded object clause positions it to participate in these growth opportunities, while it continues to service its legacy IT/software business.

• Government Thrust on Agritech: Continued policy support through schemes promoting digital agriculture, precision farming, agri-input management and farmer welfare is widening the addressable market for technology-enabled agricultural solutions.

• Growing Adoption of Digital Farming: Rising penetration of smart farming systems, data-driven agriadvisory and precision agriculture tools among Indian farmers presents an opportunity for the Company to build a presence in a nascent but fast-growing segment.

• Diversification into Real Estate and Construction: The enabling object added for construction, redevelopment and land development allows the Company to evaluate opportunities in a sector supported by continued urbanisation, infrastructure push and demand for residential, commercial and industrial properties.

• Leveraging Existing IT Capabilities: The Companys legacy experience in software development and systems integration can be leveraged to build technology platforms for its new agritech initiatives, creating potential synergies across business verticals.

• Favourable Macroeconomic Environment: Moderating inflation, an accommodative interest rate environment and sustained government capital expenditure are supportive of investment activity across the agritech, IT and real estate sectors in which the Company now operates.

• Execution Risk in New Business Lines: As agritech and real estate/construction are newly added business objects, the Companys ability to build the necessary operational capability, talent and infrastructure in these areas within a reasonable timeframe remains a key execution risk.

• Dependence on Monsoon and Agricultural Cycles: Agritech-linked business activities remain indirectly exposed to monsoon variability, crop cycles and commodity price volatility, which could affect demand for agri-input and advisory solutions.

• Regulatory and Compliance Requirements: Real estate and construction activities are subject to RERA and other state-level regulatory approvals, while agri-input trading may attract sector-specific licensing requirements, all of which require continuous compliance monitoring.

• Competition: The Company will face competition from established players in the agritech, real estate/construction and IT sectors, several of whom have greater scale, resources and market presence.

• Capital and Working Capital Requirements: Scaling up operations in agritech and real estate/construction is likely to be capital intensive, and the Companys ability to raise adequate and timely funding will be important to its growth plans.

The Company operates in a single Segment i.e. Trading during F.Y. 2025-26. The Turnover of the Company for the Financial Year 2025-26 is 22.02 Lakhs

Having expanded its Object Clause to include agritech solutions and real estate/construction related activities, the Companys future outlook is centred around building a diversified business model spanning Information Technology, agritech solutions and real estate/construction, while carefully managing the transition and associated execution risks. The Company intends to leverage its existing corporate and compliance framework to scale up its agritech initiatives, explore suitable opportunities in agri-input distribution, digital farming and agricultural advisory services, and evaluate real estate and construction opportunities as and when suitable. The Company will continue to service its legacy IT/software clientele while it builds capability in the newly added business verticals. The pace of growth will depend on the Companys ability to mobilise capital, build requisite expertise/partnerships and navigate the regulatory landscape applicable to each of these sectors.

The Company, having recently diversified its object clause, is exposed to a range of risks across its business verticals. In the agritech segment, risks include dependence on monsoon and agricultural cycles, commodity price volatility, and the evolving and largely unproven nature of digital farming adoption in India. In the real estate and construction vertical, risks include regulatory approvals (including under RERA), project execution and cost overruns, and cyclicality of real estate demand. The Companys legacy IT/software business continues to face risks of technological obsolescence and intense competition. Additionally, as the Company builds out new business lines, it will need to manage execution risk, talent acquisition, capital requirements and internal control systems commensurate with the scale and nature of the new businesses. Regulatory compliance across multiple sectors, cybersecurity in respect of its IT operations, and general macroeconomic and geopolitical uncertainties also remain areas of ongoing monitoring.

During the year, the Company continued to maintain cordial employer-employee relations. With the addition of new business objects in agritech and real estate/construction, the Company has begun evaluating its manpower requirements to build the necessary functional capabilities for these new verticals, in addition to retaining the requisite talent for its existing IT/software operations. The Company continues to give special attention to its human resources and will augment its workforce as its new business initiatives progress.

The Company has in place internal control systems commensurate with the size and nature of its business, encompassing a framework of policies, procedures and monitoring mechanisms designed to safeguard its assets, prevent fraud and ensure the accuracy and reliability of its financial reporting. Regular audits, both internal and statutory, are conducted to assess the effectiveness of these controls, identify gaps and implement necessary improvements. With the Companys diversification into agritech and real estate/construction related activities, the Board and management will continue to review and strengthen the internal control framework to ensure it remains adequate and appropriate to the evolving scale and complexity of the Companys operations.

The financial performance of the Company for the Financial Year 2025-26 is described in the Directors Report forming part of this Annual Report.

The cordial employer-employee relationship also continued during the year under review. The Company has continued to give special attention to its human resources.

The Statements made in the Management Discussion and Analysis describing the various parts may be "forward looking statement" within the meaning of applicable securities laws and regulations. The actual results may differ from those expectations depending upon the economic conditions, changes in Govt. Regulations and amendments in tax laws and other internal and external factors.