Vama Industries Ltd Management Discussions

Opportunities and Threats are two sides of the same coin. The said two facets co-exists in every walk of our life. This assumes further significance in this hyper dynamic world of innovations and growing complexities that we keep pace with our business competitors.

Whether the entity is large, whether it is medium or if it is small, every entity is a competitor to the other, irrespective of its size, its standing and its strengths. Large entities face structural problems whereas small entities face existential challenges. In the specific case of an IT services company, procuring new customers is significant for its very survival. Considering the fact that IT consulting firms primarily work on a contract basis, it is always important for them to focus on gaining new clients.

A contract isnt permanent. Because of this, while working with one or more clients, efforts are always being put into findingnew ones, which can become quite a nerve-wracking effort.

Threat of new entrants looms large on the IT industry. However, small-to-medium consulting services firms are challenging the bigger, more established firms with their ability to innovate and their agile pricing and service models.

The enablers and drivers of growth of the IT consulting industry have been several. First, innovation in frameworks and methodologies along with trained professionals have provided value-added services uniquely available from the consulting firm. Novelty and complexity have been a second driver.

Further, any outbreak of mass epidemic, like the Covid-19 or outbreak of war, like the Russia-Ukraine war may force the business entities to suspend and restragegise their business policies.

1 Internet of Things Cloud Technologies and Openstack Cloud Projects BI and Analytics Manual and Automation Testing Software Development Database Services CAD and Engineering Data Management Product Design and Development Product Sales and Support Data Center Implementation High Performance Computing (HPC) Remote Infrastructure Management Services IT Infrastructure Consulting Infrastructure Management Services IOT Machine to Machine Communication Projects Engineering Product Design Projects

The Companys operations may be clubbed together under one operating segment, i.e., IT related services. Thus it becomes the reportable segment for the Company. The Companys business operations are divided into following heads and the revenue generated from each head is indicated below:

Standalone basis

2025-26 Segment-wise performance

VAMA is engaged in providing solutions to Space and Defense customers and also supporting Cloud Projects to niche clients. Further, VAMA has also been implementing projects all over India for Defense, Space, C-DAC, sectors and is taking up turnkey projects.

Further, your Company has also been supporting High Performing Computing Services and cloud services which are in high demand globally. With India becoming a dominant player in the Space sector, ISRO has been launching multiple satellites and the need for Data Centre infrastructure is increasing rapidly. ISRO is trying to increase its capacity to deliver by scaling up the frequency of launches by building more satellites and lowering the cost of access to space. VAMA is bidding for infrastructure projects. With the growth in Space and Defense sectors we are confident that we will continue to get opportunities to work on major turnkey projects.

VAMA has increased the sales and marketing activities for the international market especially for the Engineering Services and ITES business. Vama is working on IOT Projects and support services for IOT. We are confident that

with the increase in sales and marketing activities, our domestic as well as international business will report better performance.

To manage data confidentiality To curb data breaches To retain good talent and contain attrition among employees To adapt to rapid technological changes and innovations Cost competitiveness To address and arrest assaults on internet infrastructure by hackers Government policies and priorities Fiscal policies and Industrial policies Force majeure events and circumstances The pandemics and wars Political unrest within the country and in the countries, where the Company trades Economy collapses in nations, where India a trade partner

The Board has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to your Companys policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records, and timely preparation of reliable financial disclosures. The Board has ensured that there are adequate Internal Financial Controls commensurate with the size, nature of operations and requirements.

We conduct regular management reviews in order to ascertain the effectiveness of our Internal Financial Controls. Further, it is also obtained through our management reviews, control self-assessment, continuous monitoring by functional experts as well as testing of the Internal Financial Control systems by the Internal Auditors during the course of audits. We believe that these systems provide reasonable assurance that our Internal Financial Controls are commensurate with the requirements of our organization.

(g) Discussion on financial performance with respect to operational performance

2025-26 2024-25 Material Consumed 1134.93 4455.00 Changes in Inventories -104.69 1310.76 Employee Benefit Expenses 275.66 271.05 Finance Cost 95.82 21.02 Depreciation and Amortisation Expenses 40.06 38.68 Other Expenses 94.31 214.79 Total Expenditure 1536.09 6311.3 Chart Title 8000 6446.68 6311.3 6000 4000 1336.78 1536.09 2000 0 Total Revenue Total Expenses 2025-26 2024-25

It is a universally accepted fact that, retaining good talent pool is the biggest challenge in the technology sector. Attrition among employees, especially at entry level is usually higher than other sectors. Employees have the generally tendency to shift their jobs and job profiles in pursuit of higher ambitions. Commensurate compensation packages is a related challenge in this Industry, driven by higher demands for good talent.

Our pro-human resources policy helps us in mitigating the employee attrition rate and maintain cordial relations across the organization. Further, our human resource strategy has enabled us to attract, integrate, develop and retain the best talent required for driving business growth.

No.of Employees

V. Achyuta Rama Raju is the Managing Director of the Company and also designated as KMP but counted under the category of "Executive Director" only.

(i) Details of significant changes (as compared to the immediately previous financial year) in key financial ratios, along with detailed explanations therefor, including:

1. Details of any change in Return on Net Worth as compared to the immediately previous financial year along with a detailed explanation thereof.

On a standalone basis, the Company reported a net profit of Rs. 2.06 lakhs for the FY 2025-26, resulting in a Return on Net Worth of 0.12%. In contrast, the Company had a net Profit of Rs. 198.03 lakhs for FY 2024-25. Compared to the previous year, this represents a negative turnaround in Return on Net Worth. A detailed analysis can be found in the Directors Report.

The Company has prepared financial statements which comply with IndAS applicable for periods ending on 31st March 2026, together with the comparative period data as at and for the year ended 31st March 2025, as described in the summary of significant accounting policies.

Primarily a treatment different from that prescribed in an Accounting Standard has not been followed in the preparation of financial statements. However, as regards amendments to certain accounting standards, the applicability / effect on the financial statement has been evaluated and been treated accordingly as explained in Note 1 of the standalone Financial Statements.

Further, the financial statements represent a true and fair view of the underlying business transactions.

This report contains forward-looking statements extracted from reports of Government Authorities / Bodies, Industry Associations etc. available on the public domain which may involve risks and uncertainties including, but not limited to, economic conditions, government policies, dependence on certain businesses and other factors. Actual results, performance or achievements could differ materially from those expressed or implied in such forward-looking statements. This report should be read in conjunction with the financial statements included herein and the notes thereto. We assume no responsibility to publicly amend, modify or revise any such statements on the basis of subsequent developments, information or events.