Thinking Hats Entertainment Solutions Ltd Management Discussions

FY 2025 represents the fiscal year 2024-25, from 1 April 2024 to 31 March 2025, and analogously for FY 2024 and previously such labelled years.

GLOBAL ECONOMY

The global economy is holding steady, although the degree of grip varies widely across countries. Global GDP growth in the third quarter of 2024 was 0.1 percentage point below that predicted in the October 2024 WEO, after disappointing data releases in some Asian and European economies.

Growth in China, at 4.7 percent in year-over-year terms, was below expectations. Faster-than-expected net export growth only partly offset a faster-than-expected slowdown in consumption amid delayed stabilization in the property market and persistently low consumer confidence. Growth in India also slowed more than expected, led by a sharper-than-expected deceleration in industrial activity. Growth continued to be subdued in the euro area (with Germany’s performance lagging that of other euro area countries), largely reflecting continued weakness in manufacturing and goods exports even as consumption picked up in line with the recovery in real incomes. In Japan, output contracted mildly owing to temporary supply disruptions. By contrast, momentum in the United States remained robust, with the economy expanding at a rate of 2.7 percent in year-over-year terms in the third quarter, powered by strong consumption.

Where inflation is proving more sticky, central banks are moving more cautiously in the easing cycle while keeping a close eye on activity and labor market indicators as well as exchange rate movements. A few central banks are raising rates, marking a point of divergence in monetary policy. Global financial conditions remain largely accommodative, again with some differentiation across jurisdictions (see box below) Equities in advanced economies have rallied on expectations of more business friendly policies in the United States. In emerging market and developing economies, equity valuations have been more subdued, and a broad-based strengthening of the US dollar, driven primarily by expectations of new tariffs and higher interest rates in the United States, has kept financial conditions tighter.

Economic policy uncertainty has increased sharply, especially on the trade and fiscal fronts, with some differentiation across countries (see box below). Expectations of policy shifts under newly elected governments in 2024 have shaped financial market pricing in recent months. Bouts of political instability in some Asian and European countries have rattled markets and injected additional uncertainty regarding stalled progress on fiscal and structural policies.

Geopolitical tensions, including those in the Middle East, and global trade frictions remain elevated.

The Outlook

Energy commodity prices are expected to decline by 2.6 percent in 2025, more than assumed in October. This reflects a decline in oil prices driven by weak Chinese demand and strong supply from countries outside of OPEC+ (Organization of the Petroleum Exporting Countries plus selected non-member countries, including Russia), partly offset by increases in gas prices as a result of colder-than-expected weather and supply disruptions, including the ongoing conflict in the Middle East and outages in gas fields. Nonfuel commodity prices are expected to increase by 2.5 percent in 2025, on account of upward revisions to food and beverage prices relative to the October 2024

WEO, driven by bad weather affecting large producers.

Monetary policy rates of major central banks are expected to continue to decline, though at different paces, reflecting variations in growth and inflation outlooks. The fiscal policy stance is expected to tighten during 2025–26 in advanced economies including the United States and, to a lesser extent, in emerging market and developing economies. Global growth is expected to remain stable, albeit lackluster. At 3.3 percent in both 2025 and 2026, the forecasts for growth are below the historical (2000 19) average of 3.7 percent and broadly unchanged from October. The overall picture, however, hides divergent paths across economies and a precarious global growth profile (see the box below).

Among advanced economies, growth forecast revisions go in different directions. In the United States, underlying demand remains robust, reflecting strong wealth effects, a less restrictive monetary policy stance, and supportive financial conditions. Growth is projected to be at 2.7 percent in 2025. This is 0.5 percentage point higher than the October forecast, in part reflecting carryover from 2024 as well as robust labor markets and accelerating investment, among other signs of strength. Growth is expected to taper to potential in 2026.

In the euro area, growth is expected to pick up but at a more gradual pace than anticipated in October, with geopolitical tensions continuing to weigh on sentiment. Weaker-than-expected momentum at the end of 2024, especially in manufacturing, and heightened political and policy uncertainty explain a downward revision of 0.2 percentage point to 1.0 percent in 2025. In 2026, growth is set to rise to 1.4 percent, helped by stronger domestic demand, as financial conditions loosen, confidence improves, and uncertainty recedes somewhat.

In other advanced economies, two offsetting forces keep growth forecasts relatively stable. On the one hand, recovering real incomes are expected to support the cyclical recovery in consumption. On the other hand, trade headwinds—including the sharp uptick in trade policy uncertainty— are expected to keep investment subdued.

Source: World Economic Outlook, Update Growth: Divergent and Uncertain, International Monetary Fund

OVERVIEW OF THE INDIAN ECONOMY

India is poised to lead the global economy once again, with the International Monetary Fund (IMF) projecting it to remain the fastest growing major economy over the next two years. According to the April 2025 edition of the IMF’s

World Economic Outlook, India’s economy is expected to grow by 6.2 per cent in 2025 and 6.3 per cent in 2026, maintaining a solid lead over global and regional peers.

The April 2025 edition of the WEO shows a downward revision in the 2025 forecast compared to the January 2025 update, reflecting the impact of heightened global trade tensions and growing uncertainty Despite this slight moderation, the overall outlook remains strong. This consistency signals not only the strength of India’s macroeconomic fundamentals but also its capacity to sustain momentum in a complex international environment. As the IMF reaffirms India’s economic resilience, the country’s role as a key driver of global growth continues to gain prominence.

(Source: India: Fastest-Growing Major Economy, Ministry of Finance, Posted On: 23 APR 2025 4:40PM by PIB Delhi)

The recent GDP growth figures of 5.4% year over year1 for the second quarter of fiscal year 2024 to 2025 probably caught markets off guard (it was significantly below the Reserve Bank of India’s projection of 6.8%). Slower growth in the first half of the fiscal (6%) led the RBI to bring down the annual projection to 6.6% (down from an earlier projection of 7%). However, it’s essential not to let the headline numbers overshadow the nuanced story beneath:

GDP is just one lens to evaluate economic health, and this quarter reveals resilience in certain pockets that are worth noting.

Rural consumption has remained robust, supported by strong agricultural performance, while the services sector continues to be a key driver of growth. Manufacturing exports, particularly in high-value-added components (such as electronics, semiconductors, and pharmaceuticals), have displayed strength, underscoring India’s growing role in global value chains. We believe the slow growth in the secondary sector3 is temporary (due to disruptions caused by monsoons).

Deloitte has revised its annual GDP growth projection for India to between 6.5% and 6.8% in this fiscal year, and between 6.7% and 7.3% in the following one. A tempered global growth outlook and a delayed synchronized recovery in the industrial economies amid changing trade and policy regulations—compared to what was previously expected—will likely weigh on India’s exports and outlook for the next fiscal year. India will have to adapt to the evolving global landscape and harness its domestic strengths to drive sustainable growth.

Decoding the slowdown in the second quarter

On the expenditure side, the slowdown in investments and exports were key factors weighing on the economy. Gross fixed capital formation (GFCF), a key driver of economic growth, slowed down to 5.4%. This was partly due to slower government capex utilization, which was at 37.3% in the first half of this year, lower than last year’s 49%.

Geopolitical uncertainties and disruptions in global supply chains, particularly in the Red Sea region, continued to weigh on exports. Petroleum product exports experienced a consistent decline across all three months of the quarter, averaging an approximate 30% contraction. As a result, total export growth slowed to 2.8%. At the same time, imports were higher due to a rise in oil and gold imports.

On the production side, gross value added grew by 5.6% in the second quarter, down from 6.8% in the previous one, primarily due to poor performance in the secondary sector. The slowdown in the industrial sector was somewhat expected as the index of industrial production showed signs of slowing across multiple sectors, particularly in mining and electricity. Mining contracted by 0.1%, while electricity and other utilities grew by just 3.3% (a sharp decline from the previous quarter’s 10.4%). The construction sector grew 7.7% its lowest since the last quarter of fiscal 2021 to 2022. Growth in manufacturing was modest, at 2.2% (down from 7%).

We believe these sectoral declines are temporary due to monsoon-driven disruptions (8% above-normal rainfall)4 and restrictive spending during elections. What is concerning is we also suspect the possibility of higher dumping from neighboring countries. Imports of goods such as plastics, organic chemicals, iron and steel products, machinery, and electronic components have seen a sharp jump in recent months and pose a significant threat in the months ahead amid restrictive trade regulations in industrialized nations.

Amid this growth slowdown, there were a few emerging trends that pointed to inert resilience.

• Robust rural consumption: Agricultural growth hit a five-quarter high of 3.5%, aided by a strong monsoon season. Indicators like rising sales of fast-moving consumer goods and declining numbers of jobs demanded through the Mahatma Gandhi National

Rural Employment Guarantee Act (more commonly, MGNREGA) confirm strength in rural demand. With healthy kharif5 harvests and improved rabi sowing, rural consumption is expected to remain strong, further boosted by festive season spending.6

• Strong services sector growth: Services grew by 7.2%, driven by public administration and defense (9.1%) and finance, insurance, and real estate (7.2%). Services exports surged 21.3%. Between April and October 2024, total services exports stood at US$216 billion, compared to US$192 billion in 2023. This growth is crucial given the sector’s significant contribution to India’s GDP and employment, specifically for the urban middle-income population.

• High-value manufacturing exports: Exports of electronics, engineering goods, and chemicals have grown significantly, now comprising 31% of total merchandise exports. Given that micro, small, and medium enterprises are significant contributors to manufacturing supply chains and exports, rising performance of these enterprises points to healthy growth in this export segment.

Controlled fiscal deficit: The fiscal deficit stood at 4.4% of GDP in the second quarter of this fiscal year, accounting for 29.4% of the budget estimate, and standing 10% lower than last year. This gives government some room to ramp up spending to boost demand. With lower capital expenditure in the first half of this fiscal year, the government is poised to ramp up spending in the coming half, supporting demand and crowding in private investments. A significant in the second half of this fiscal year to meet budgetary targets, which may provide additional support to the economy and boost investment by crowding in private investments.

India’s near-term outlook

We now expect India to grow between 6.5% and 6.8% in fiscal year 2024 to 2025, in our baseline scenario. Although admittedly lower than previously estimated, because of a slower first half of the year, we expect strong domestic demand in the second half, driven by a significant uptick in government spending).

This will be followed by growth between 6.7% and 7.3% in fiscal year 2025 to 2026, with significant downside risks (hence a wider range; figure 1). India’s growth projections in the subsequent year will likely be tied to broader global trends, including rising geopolitical uncertainties and a delayed synchronous recovery in the West than anticipated. Disruptions to global trade and supply chain due to intensifying geopolitical uncertainties will also affect demand for exports.

(Source: https://www2.deloitte.com/us/en/insights/economy/ asia-pacific/india-economic-outlook.html)

INDIA’S GROWTH IN GLOBAL CONTEXT

India is projected to remain the fastest-growing large economy for 2025 and 2026, reaffirming its dominance in the global economic landscape. The country’s economy is expected to expand by 6.2 per cent in 2025 and 6.3 per cent in 2026, outpacing many of its global counterparts. In contrast, the IMF projects global economic growth to be much lower, at 2.8 per cent in 2025 and 3.0 per cent in 2026, highlighting India’s exceptional out performance.

The IMF has also revised its growth estimates for other major global economies. China’s GDP growth forecast for 2025 has been downgraded to 4.0 per cent, down from 4.6 per cent in the January 2025 edition of the World Economic

Outlook.

Similarly, the United States is expected to see a slowdown, with its growth revised downward by 90 basis points to 1.8 per cent. Despite these revisions, India’s robust growth trajectory continues to set it apart on the global stage.

(Source: India: Fastest-Growing Major Economy, Ministry of Finance, Posted On: 23 APR 2025 4:40PM by PIB Delhi)

Global Growth Projections

Industry Overview

1. Industry Structure and Developments

The Indian Media and Entertainment (M&E) industry is a sunrise sector for the economy and is making significant strides. The increasing availability of fast and cheap internet, rising incomes, and increasing purchases of consumer durables have significantly aided the industry.

India’s media and entertainment industry are unique as compared to other markets. The industry is well known for its extremely high volumes and rising Average Revenue Per User (ARPU).

India is rapidly emerging as a global creative powerhouse, driven by its talent pool, cultural richness, and technological advancements. According to the EY report titled "A Studio Called India", the country’s media infrastructure is expanding, with animation and VFX costs in India being 40% to 60% lower than in the West, supported by a workforce of around 2,60,000 skilled professionals. This significantly aided the country’s industry and made India leading in terms of digital adoption and provided companies with uninterrupted rich data to understand their customers better. India has also experienced growing opportunities in the VFX sector as the focus shifted globally to India as a preferred content creator.

Proving its resilience to the world, Indian M&E industry is on the cusp of a strong phase of growth, backed by rising consumer demand and improving advertising revenue.

RECENT DEVELOPMENTS IN THE MEDIA AND ENTERTAINMENT INDUSTRY

FDI inflows in the information and broadcasting sector (including print media) stood at Rs. 74,369 crore (US$ 11.56 billion) between April 2000- December 2024.

India’s gaming market grew 23% YoY to US$ 3.8 billion in revenue in FY24.

Pocket FM, an audio series platform, has raised $103 million in its Series D funding round, led by Lightspeed with participation from Stepstone Group

Disney-owned Star India secured the TV broadcasting rights for the Indian Premier League from 2023 to 2027 through an online bid. During the same period,

Viacom 18 won the bid for the digital streaming rights of the Twenty20 League.

Major tech and e-commerce firms, including Google, Meta, Amazon, and Flipkart, saw their collective ad revenues rise 9% to over Rs. 60,000 crore (US$ 7.13 billion) in FY24.

The Star-Viacom18 merger deal signed on February 28 will create an US$ 8.5 billion media goliath with a dominating presence in both TV and digital segments.

Media company Shemaroo Entertainment did plan to spend Rs. 75 crore (US$ 9.1 million) in FY24 to bolster its broadcast and over-the-top (OTT) businesses.

Newly merged multiplex giant PVR Inox is ready with a plan to add up to 175 new screens and retrofit a host of existing ones at an investment of Rs. 700 crore (US$ 85.1 million) during FY24.

In April 2023, Prime Minister Mr. Narendra Modi commissioned Low Power FM Transmitters of capacity of 100 watt at 91 locations. These transmitters have been installed in 84 districts of 20 states. With this, the network of transmitters with All India Radio has increased from 524 to 615. The addition will further boost the coverage of AIR to 73.5% of the population of the country.

A partnership was announced in April 2023 between the Ministry of Information & Broadcasting and Amazon India in the field of media, entertainment, and public awareness.

Music from South Indian languages such as Kannada, Malayalam, Tamil, and Telugu have witnessed the fastest growth in the vernacular in the last four years. The highest contributor to OTTA with the non-film genre was Punjabi music (39%) across all states.

MARKET SIZE

Between 2 to 2.5 million digital creators are influencing Rs. 29,60,300 crore (US$ 350 billion) in annual consumer spending, a number expected to surpass Rs. 84,58,000 crore (US$ 1 trillion) by CY30. In the Union budget of FY26 the Ministry of Information and broadcasting received Rs. 4,358 crore (US$ 515.5 million).

The Indian entertainment sector could unlock an estimated Rs. 50,724 crore (US$ 6 billion) in unrealised value by FY30, according to a recent industry report. This growth potential is attributed to international collaboration, technology adoption, and strategic changes in content creation. Indian advertising revenues is projected to grow at a CAGR of 9.4% to reach Rs. 1,58,000 crore (US$ 19.2 billion) in FY28, which is 1.4x the global average of 6.7%.

The online gaming and sports sector in India is growing at a CAGR of 19.2% and is projected to reach Rs. 39,583 crore (US$ 4.8 billion) by FY28.

The total music (live, recorded and digital) revenue grew from Rs. 2,416 crore (US$ 293 million) in FY19 to Rs. 6,686 crore (US$ 811 million) in FY23. It is expected to cross Rs. 10,899 crore (US$ 1.3 billion) by FY28, growing at a CAGR of 10.3%.

By 2025, the number of connected smart televisions are expected to reach ~40-50 million. 30% of the content viewed on these screens will be gaming, social media, short video, and content items produced exclusively for this audience by television, print and radio brands. By 2025, ~600-650 million Indians, will consume short-form videos, with active users spending up to 55 to 60 minutes per day.

OTT video services market (video-on-demand and live) in India is likely to grow US$ 4.1 billion in 2024 and reach US$ 7 billion by 2027, driven by rapid developments in online platforms and increased demand for quality content among users.

INDIAN EVENT INDUSTRY

The India Events & Exhibition Market is Segmented by Type (B2B, B2C, Mixed/Hybrid), Revenue Stream (Exhibitor Fee, Sponsorship Fee, Entrance Fee, Services), End User (Consumer Goods and Retail, Automotive and Transportation, Industrial, Entertainment, Real Estate and Property, Hospitality, Healthcare, and Pha Pharmaceutical).

The Market Sizes and Forecasts are provided in Terms of Value (USD) for all the Above Segments.

RISE OF MEDIA AND ENTERTAINMENT

The Indian Media and Entertainment (M&E) sector has seen a major shift, with digital media overtaking television as the largest segment. This change has redefined content creation, distribution and monetization, focusing on information, escapism, materialism and self-actualization.

In 2024, the M&E sector grew by 3.3% to INR2.5 trillion (US$29.4 billion), with digital media contributing 32% of revenues. The sector is expected to grow by 7.2% in 2025, reaching INR2.68 trillion (US$31.6 billion).

The Indian M&E sector grew 3.3% in 2024, reaching INR2.5 trillion (US$29.4 billion).

Digital media in India became the largest segment, contributing 32% of M&E sector revenues.

The M&E sector is expected to grow 7.2% in 2025 to reach INR2.7 trillion (US$31.6 billion) and continue growing at a CAGR of 7% to reach INR3.1 trillion (US$36.1 billion) by 2027.

New media, including digital media and online gaming, grew 12% and now make up 41% of the M&E sector’s revenues.

The landscape of the Indian Media and Entertainment (M&E) has undergone a significant transformation, with digital media finally breaking television’s 20-year stronghold to become the largest segment in the industry. This historic milestone marks the dawn of a new era, one where digital platforms redefine not only the creation, distribution, and monetization of content but also the very core of what the M&E sector represents.

In the past, M&E was synonymous with providing knowledge and a means of escapism. Today, it has evolved into a multifaceted provider of value, catering to the diverse needs of consumers through four key tenets: information, escapism, materialism, and self-actualization. This comprehensive approach has become the new benchmark for media and content companies, as consumers increasingly evaluate the utility they receive across these dimensions.

Key Industry Drivers GOVERNMENT INITIATIVES

The Telecom Regulatory Authority of India (TRAI) is set to approach the Ministry of Information and Broadcasting, Government of India, with a request to Fastrack the recommendations on broadcasting, in an attempt to boost reforms in the broadcasting sector. The Government of India has agreed to set up National Centre of Excellence for Animation, Gaming, Visual Effects and Comics industry in Mumbai. The Indian and Canadian Government have signed an audiovisual co-production deal to enable producers from both the countries exchange and explore their culture and creativity, respectively.

In February 2021, Prasar Bharati (India) and PSM (the official State Media of Maldives) inked an agreement to facilitate collaboration and capacity building in the field of broadcasting.

In June 2021, the Union Ministry of Information and Broadcasting notified the Cable Television Network

(Amendment) Rules, 2021, which aims to establish a three-layer statutory mechanism for citizens to raise grievances with respect to broadcasted content.

As part of the expansion to include all digital platforms and digital (OTT) players under a single roof, in May 2021, the Indian Broadcasting Foundation (IBF) announced the move to be renamed as the Indian Broadcasting and Digital Foundation (IBDF).

As per the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021, IBDF would also form a self-regulatory body (SRB) soon.

To ease filming in railways, the Film Facilitation Office (FFO) set up in the National Film Development Corporation (NFDC) collaborated with the Ministry of Railways to develop an integrated single window filming mechanism to streamline the permission process for filming across railway premises.

In November 2021, the government announced that it is working towards creating a National Centre of Excellence for AVGC (animation, visual effects, gaming, and comics).

On February 25, 2021, the government outlined the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules 2021 to establish a progressive institutional mechanism and a three-tier grievance redressal framework for news publishers and OTT platforms on the digital media.

In February 2021, the digital entertainment committee of the Internet and Mobile Association of India (IAMAI) finalised a code of conduct to form the basis for self-regulation code for OTT content. The code has been endorsed by 17 OTT platforms including Netflix, Amazon

Prime Video, Disney+ Hotstar, ZEE5 and Voot. In February 2021, Prasar Bharati (India) and PSM (the official State Media of Maldives) inked an agreement to facilitate collaboration and capacity building in the field of broadcasting.

Digital audio–visual content including films and web shows on over-the-top (OTT) streaming platforms, as well as news and current affairs on online platforms, have been brought under the Ministry of Information and Broadcasting in November 2020.

ROAD AHEAD

The Indian M&E industry is on an impressive growth path.

The industry is expected to grow at a much faster rate than the global average rate. This can be majorly credited to rising incomes, increasing internet penetration and a growing push toward digital adoption.

In the long run, growth is the M&E industry is expected in retail advertisement on the back of several players entering the food and beverages segment, E-commerce gaining more popularity in the country, and domestic companies testing out the waters. India’s rural regions are expected to be the next regions for growth. India has also gotten on board with 5G and is already planning for 6G well ahead of the future. This push towards digital adoption especially in the rural regions will provide advertisers and publishers with an immense opportunity to capture untapped markets and help grow India’s media and entertainment industry forward.

OPPORTUNITIES AND THREATS Opportunities:

Rising marketing budgets and personalization trends

Regional content production for OTT platforms

Expansion into Tier 2/3 cities for event and brand activation

Expanding to scale up the content volume with new age

Media such as YouTube, music steaming app and similar

Expanding into tech enabled events and retail visual

Merchandising solutions

Forming strategic partnerships with streaming platform and other content providers to increase exposure and Access to new markets

Expanding into international markets, where there may be higher demand for certain types of content

Threats:

Rising interest rates and financing costs

Delayed client payments affecting working capital

Dependency on discretionary client spending

Intense competition from large players

Rapidly evolving technology, which requires continuous investment to stay competitive

Changes in consumer preferences or trends, which can impact demand for specific types of event and digital contents

Regulatory changes or legal challenges, which can impact the ability to distribute content or access certain markets

COMPANY OVERVIEW

Thinking Hats has evolved from a premier concept development, event design and production company that specializes in live events, corporate, MICE (Meetings, Incentives, Conferences and Exhibitions), social and virtual events to an OTT content production and experiential marketing company with a strong focus on content development, intellectual property curation and tech centric product development.

With more than a decade of experience in creating events and experiences, Thinking Hats is a team of visionaries who convert clients dreams into reality. Our creative and personalized approach executes every event with the utmost professionalism and provides our clients with dependable solutions and the finest attention to detail. Thinking Hats began its event management and retail visual merchandising since incorporation and has been offering event management services related to Corporates Events, Corporate Meetings, Conference Management, Brands and Product Launches, Lifestyle and Fashion Events, Exhibitions & Fairs, Entertainment Show Management, Pan-India Ground Activations and Artist Management among others in India. Our Event Management services are offered from Media, Retail, Financial, Food, Education, Healthcare and Technology industries. We also provide prominent display and retail visual merchandise with a broad spectrum of offerings and in-store solutions to various retail stores.

With exclusive content made for platforms such as Netflix, Amazon, Sony Liv, MX Player, Disney+Hotstar, Voot, Zee5, etc. OTT Platforms have become increasingly popular in recent years due to their convenience and flexibility, allowing consumers to watch their favourite shows and movies on a variety of devices, including smartphones, tablets, laptops, and smart TVs. They also offer a wider range of content options compared to traditional cable TV. The contracts for OTT are typically 6 to 10 episodes for 45- 60-minute episodes, which then gets extended to multiple seasons based on the popularity of the series. Realising the opportunity in OTT space and the expertise of management team, our Company has ventured into production of OTT contents in the year 2019. Creativity and courage are the core values at Thinking Hats’ work culture. As a part of our storytelling expertise, Thinking Hats has produced two web series for OTT platforms i.e., "Aapkey Kamrey Me Koi Rehta Hai" and "Kathmandu Connection 2", and one Bengali Movie "Onek Diner Pore". Apart from movies and OTT web series, we also make short films for YouTube content and corporate event movies.

We recognize that Artificial Intelligence (AI), Augmented Reality (AR), Visual Reality (VR), photos, content licencing including music & videos, animation and others are key growth areas, and we are committed to expanding our business in these areas.

Financial and Operational Highlights (FY 2024–25)

(Rs. In lakhs)

Particulars	2024-25	2023-24
Revenue from Operations	4766.80	2663.18
Other Income	73.22	6.94
Profit before Tax	522.92	430.31
Profit after Tax	366.50	309.17
Earnings Per Share (In Rs.)	3.42	3.94

KEY RATIOS

Particulars	FY 2025	FY2024
Revenue (Rs. in Lacs)	4766.80	2663.18
Net Profit After Tax (Rs. in Lacs)	366.50	309.16
Earnings per share (in Rs.)	3.42	3.94
EBITDA (Rs. in Lacs)	522.92	499.58
Net Profit Margin (%)	7.57	11.57
Return on Net worth	13.1	28.11
(times CurrentRatio	1.7	1.84
Debtors Turnover(times)	4	2.8
Debt-equity (times)	1.68	2.18
Interest Coverage Ratio(times)	9.7	7.19

The growth was primarily attributed to:

Higher execution of premium experiential events

New client acquisitions in the retail and digital content verticals

Streamlined operational efficiencies and resource utilization

Segment Performance

Events & Activations: Strong demand across FMCG,

BFSI, and tech sectors for high-impact events.

Visual Merchandising: Continued demand from retail chains and luxury brands for seasonal and permanent displays.

OTT & Content: short-format series delivered on national OTT platforms; ongoing contracts for 2025.

Thinking Hats Entertainment Solutions Limited operates primarily through three verticals:

1. Experiential Event Management and Brand Activation

2. Retail Visual Merchandising

3. Content Production (OTT and Digital Media)

Each segment contributed significantly to the Company’s performance in FY 2024–25. The detailed performance is as follows:

1. Experiential Event Management and Brand Activation

This segment continues to be the core revenue driver for the Company. The demand for customized and large-scale on-ground activations from clients in the FMCG, BFSI, tech, and automotive sectors remained strong throughout the year.

2. Retail Visual Merchandising and Display Solutions

Retail VM services continued to support offline brand engagement strategies. The Company provided design, fabrication, and installation of in-store and window displays for premium and mid-tier retail brands.

3. OTT and Digital Content Production

This segment, though relatively nascent, showed significant momentum. The Company continued to expand its presence as a creative producer for short-form digital series and brand-sponsored content.

RISKS AND CONCERNS

While the Company has demonstrated consistent growth across its business segments, several internal and external risks may impact its future performance. The management proactively identifies, assesses, and mitigates key risk areas. The major risks and concerns are as follows:

1. Client Concentration Risk

A significant portion of revenue is derived from a few large clients in the events and retail sectors. A loss or reduction in business from any major client could impact revenue.

Mitigation: Expanding into new client verticals and geographies; offering bundled creative and digital services to increase client retention.

2. Execution and Operational Risk

Given the live nature of events and tight delivery timelines for retail and content projects, any lapse in execution (logistics, vendor delays, quality issues) may result in financial loss or reputational damage.

Mitigation: Robust project management systems, qualified in-house teams, and backup vendors for critical deliverables.

3. Content Approval and Platform Dependency (OTT Segment)

The OTT content production business is subject to approval delays and content rejection by streaming platforms. There is also growing regulatory oversight on digital content.

Mitigation: Pre-production alignment with platform guidelines and co-production models to reduce risk exposure.

4. Regulatory and Compliance Risks

As a public limited company, the Company is subject to SEBI, MCA, and other regulatory requirements. Non-compliance or delays in statutory filings could lead to penalties.

Mitigation: Strong internal compliance team supported by external legal and financial advisors.

5. Talent Retention and Creative Capability Risk

The Company’s operations depend heavily on creative professionals, designers, and content creators. Attrition or difficulty in attracting talent could affect quality and timelines.

Mitigation: Incentive-based retention policies, continuous training, and a collaborative work culture.

6. Technology and Cybersecurity Risk

The Company uses digital tools for design, project management, and client coordination. Cyber threats or data breaches can disrupt operations and cause data loss.

Mitigation: Secure cloud infrastructure, periodic IT audits, and multi-layered data protection measures.

7. Macroeconomic and Market Risk

Factors like inflation, recession, interest rate hikes, and geopolitical instability may affect marketing budgets of clients, especially in the discretionary spending categories.

Mitigation: Cost control, agile budgeting, and maintaining service diversity to navigate downturns.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company maintains adequate internal financial controls, supported by an in-house finance team and periodic third-party audits. All financial transactions are recorded with transparency and accuracy, supported by an ERP-based system.

It is based on five main components:

- Risk assessment

- Control environment

- Control activities

- Information and communication

- Monitoring at all organisational levels

Internal audit operates autonomously to review the completeness and accuracy of records, processes and performance relative to predetermined objectives. It acts as a value-added function for the Board in its concentration on:

- Effectiveness and efficiency of operations

- Safeguarding company assets

- Internal and external reporting reliability

- Compliance with legislation, regulation and internal policy Internal audit drives change through delivery of fact-based information and practical recommendations.

These activities are monitored at the Board-level Audit Committee to ensure transparency and accountability. Throughout the year, focus was given to independent decision-making, recording process weaknesses, and taking corrective action. Regular reviews are carried out by an external Chartered Accountant firm under defined policies and procedures. Important audit findings are reported to management and the Audit Committee directly.

Human Resources

Our Company believe that our employees are key contributors to our business success and its ability to maintain growth depends to a large extent on our strength in attracting, training, motivating and retaining employees.

We focus on attracting and retaining the best possible talent. Our Company looks for specific skill-sets, interests and background that would be an asset for its kind of business.

As on 31^st March, 2025, our Company has 35 employees on payroll.

Cautionary Statement

Statements in this Management Discussion and Analysis report detailing the Company’s objectives, projections, estimates, expectations or predictions may be "forward looking statements" within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Company’s operations include global and Indian demandsupply conditions, raw material prices, finished goods prices, cyclical demand and pricing in the Company’s products and their principal markets, changes in Government regulations, tax regimes, economic developments within India and the countries with which the Company conducts business and other factors such as litigation and / or labor negotiations.

14. Distribution of shareholding as on March 31, 2025

Range	No. of Shareholders	% of Total Shareholders	No. of Shares	% of Total Shares
1 - 5000	0	0	0	0
5001 – 10000	2	0.438	2000	0.016
10001 – 20000	0	0	0	0
20001 – 30000	339	74.179	1017000	8.144
30001 – 40000	2	0.438	8000	0.064
40001 – 50000	0	0	0	0
50001 – 100000	58	12.691	400230	3.205
100001 & Above	56	12.254	11059920	88.570
Total	457	100	12487150	100