Toss The Coin Ltd Management Discussions

A) Global Economy:

The global economy in 2026 is characterized by resilient yet slow growth of around 3.0%, navigating persistent supply-chain pressures, energy market shocks from geopolitical conflicts, and stalls in global disinflation. Artificial intelligence integration provides an upside for tech-aligned value chains, while emerging markets face tighter financing conditions.

Heres a more detailed breakdown:

a) Positive Factors:

i) Resilient Private Sector Adaptability: The capacity of businesses and commercial markets to anticipate, absorb, and recover from systemic shocks such as climate change, economic shifts, or supply chain disruptions, while rapidly transforming operations to maintain continuity and capture new opportunities.

ii) Robust Capital Spending in Artificial Intelligence: Global artificial intelligence capital spending is surging to unprecedented levels, with worldwide AI-related investments projected to exceed $1 trillion in 2026. Major US hyperscalers (Alphabet, Amazon, Microsoft, and Meta) alongside global counterparts are aggressively expanding data centers and semiconductor capacity, though tightening cash flows and rising memory costs are forcing sharper investor scrutiny on monetization timelines.

iii) Steady Household Financial Backings: Steady household financial backing has been achieved by establishing a solid foundation by securing an emergency fund covering 3 to 6 months of expenses, clearing high-interest consumer debt, and purchasing adequate health and term life insurance before committing to long-term market investments.

iv) Dynamic Expansion across Emerging Asian Markets: It is driven by supply chain shifts (China Plus One), AI infrastructure demands, and an expanding middle class. Key growth hubs include India (digitization and manufacturing scaling), ASEAN nations like Vietnam and Indonesia (electronics and EV supply chains), and North Asian tech powerhouses.

b) Negative Factors and Risks:

i) Persistent Geopolitical Fragmentation: It is the structural shift where global economic, technological, and political systems decouple into competing blocs. Driven by strategic rivalries (such as U.S.-China competition) and national security priorities, nations increasingly favor supply chain resilience and protectionism over free-market economic efficiency.

ii) Rising Trade Interventions and Tariffs: Global trade intervention has surged to historic highs in 2026, driven by a new wave of U.S. tariffs on dozens of trading partners, localized industrial policies like "Make in India", and heightened use of state subsidies. While major economies navigate shifting tariff walls and labor-linked trade rules, businesses face increasing supply chain fragmentation and cost pressures.

iii) Re-accelerating Inflation Spikes: Indias retail inflation (CPI) accelerated to 3.93% in May 2026, up from 3.48% in April, driven largely by rising food and transport costs. This mid-year uptick brought price pressures close to the Reserve Bank of Indias (RBI) medium-term target of 4% before ticking higher to 4.38% in June.

iv) High Sovereign Debt Burdens: Global public debt has risen to near 94% of GDP, driven by major economies and high interest costs. Crushing debt-servicing burdens crowd out critical spending on healthcare, education, and climate action, leaving developing nations particularly vulnerable to external shocks, currency volatility, and restricted capital market access.

v) Surging Energy Bottlenecks from AI Data-Center Expansion: Rapid AI data-center expansion is triggering critical energy bottlenecks, with global data-center electricity consumption surging 17%, driven by high-density server racks. The primary constraint is no longer chips or capital, but the multi-year lag in building utility-scale power generation, securing grid interconnection, and overcoming local community backlash over rising electricity bills and resource strain.

B) Indian Economy:

Indias real GDP grew by a strong 7.7% for the 2025-26 financial year, remaining a top fast-growing major global economy. Growth for the upcoming 2026-27 period is projected to moderate safely to around 6.5% to 6.6% amid global trade and energy headwinds.

a) Key Highlights:

i) GDP Expansion: Real GDP growth holds strong at 7.4% with Gross Value Added (GVA) at 7.3%, making India the top-performing major economy for the fourth consecutive year.

ii) Controlled Inflation: Headline retail inflation (CPI) eased significantly, averaging a historic low around 1.75%-2% across parts of the fiscal year due to stable food output.

iii) Fiscal Consolidation: The government stays firmly on its fiscal deficit glide path toward the target of 4.5% of GDP while improving revenue quality.

b) Factors Driving Growth:

i) Private Spending: Final private consumption remains high, making up over 61% of the GDP as real purchasing power rises.

ii) Hinterland Recovery: Rural and semi-urban markets show resilient demand, supported by stable agricultural performance and steady employment conditions.

iii) Discretionary Purchases: Increased sales in consumer goods and automotive sectors reflect healthy middle-class confidence.

c) Potential Challenges:

i) Crude Oil Volatility: Ongoing conflicts in the Middle East threaten supply chains and push import bills higher, impacting both the fiscal deficit and domestic inflation metrics.

ii) Global Trade Frictions: Slowing external demand from major partners like China and the US, alongside shifting tariff regimes, test the resilience of Indias merchandise exports.

iii) Currency Pressures: Global dollar strength and structural trade gaps place continuous downward pressure on the Indian Rupee, raising imported input costs.

By Order of the Board of Directors

For M/s. Toss The Coin Limited

Place: Chennai

Date: 14.08.2026

-Sd-

Narayanan Jayan

Chairman cum Managing Director

DIN: 08893678

-Sd-

Reshma Budhia

Whole Time Director cum CFO

DIN: 08893679