Vani Commercials Ltd Management Discussions

As input prices and therefore production costs remain high, due to global uncertainties among other factors, companies in most industries are passing on higher spending to nal consumers to preserve earnings margins.

The RBI, meanwhile, is attempting to rein in the in ation with policy rate hikes.

The Consumer Price Index (CPI) in ation, which averaged 4.6 per cent during H1:2024-25, increased to 6.2 per cent in October 2024 but has since been easing with February 2025 in ation print at a seven month low of 3.6 per cent, driven by sharp decline in vegetable prices in ation. Core in ation which averaged 3.3 percent in H1:2024-25, however, inched up to an average of 3.8 per cent in H2:2024-25 (up to February).

On the contrary, food in ation which remained elevated at an average of 8.5 per cent during October- December 2024, decelerated to 3.8 per cent in February 2025. The de ation in fuel in ation, however, moderated.

After retaining the policy repo rate at 6.5 per cent since February 2023, the Monetary Policy Committee (MPC) has embarked on monetary easing in H2:2024- 25. It changed the stance from withdrawal of accommodation to neutral in October 2024, and cut the policy repo rate by 25 basis points (bps) to 6.25 per cent in its February 2025 meeting. In December 2024, the Reserve Bank reduced the cash reserve ratio (CRR) maintained by banks by 50 bps.

As the government pursues redistributive policies, results need to be delivered on equitable access to healthcare, quality education, and jobs. Often, numbers get in ated during time of release near elections and budget season as welfare programs incentivize short term gigs.

Still, in absolute terms, India remains a bright spot on the world stage, as it grows steadily from a relatively low base. Last year, India overtook the UK to become the worlds fth biggest economy, after the US, China, Japan. and Germany.

Multiple initiatives to ease doing business and expand the manufacturing share of the economy as well as the push for skill development offers promise to convert Indias human capital into a talent base that feeds higher quality development. According to its central bank, the Reserve Bank of India, at current prices and exchange rates, India is not expected to be a $5 trillion economy in 2025-26, as the Economic Survey does not cite that. Instead, its projected to be a $4.187 trillion economy in 2025, making it the fourth-largest economy in the world, ahead of Japan according to NITI Aayog and the IMF.

O OPPORTUNITIES AND THREATS

Our long-standing relationship with our major customers has been one of the most significant factors contributing to our growth. Our commitments to quality and customer service practices have been strong contributing factors to our robust customer relations. Over the years, we have steadily developed a robust base of customers for our products in national level.

To overcome the challenges and competition, we have taken various initiatives to reduce the operational costs, to develop new value added products, improve the performance and quality of existing value-added products as well as to explore new markets domestically and globally.

The digitization, unparalleled expertise and an excellent corporate strategy has resulted in an unprecedented growth of the company over the years. We have an experienced and dedicated team of professionals, catering to the needs of clients, delivering products at reasonable interest rates and timely.

l Change in Policy and Regulations.

l New entrants in the market and intense competition by existing players

l Technology may become obsolete due to Innovation in Technology

O RECENT TREND AND FUTURE OUTLOOK

NBFCs have become important constituents of the financial sector and have been recording higher credit growth than scheduled commercial banks (SCBs) over the past few years. NBFCs are leveraging their superior understanding of regional dynamics and customized products and services to expedite financial inclusion in India. Lower transaction costs, quick decision making, customer orientation and prompt service standards have typically differentiated NBFCs from banks. Considering the reach and expanse of NBFCs, they are well-suited to bridge the financing gap in a large country like India. NBFCs have demonstrated agility, innovation, and frugality to provide formal financial services to millions of Indians.

This is an enviable track record despite the business models of the NBFCs being severely tested by four large external events in the last few years, namely, (i) demonetization, (ii) GST implementation, (iii) failure of few large NBFCs, and (iv) the pandemic. The fact that many NBFCs have managed to overcome these stresses without significant impact on financial position is a testimony to their resilience and agility.

Financial institutions play a crucial role in ensuring economic stability for households and businesses at critical junctures. The pivotal role of NBFCs in driving sustainable scal growth is well recognized, given their last-mile connectivity and agile system. The sector has played a decisive role in accelerating last-mile funding and understanding the credit requirement of the Unbanked and Underserved. Aided by the governments thrust towards a digital economy, the sector has also undertaken significant digital transformation and invested heavily to become tech-agile institutions offering personalized products and services, ensuring faster credit disbursement.

As India strategizes post-pandemic economic recovery through scal measures and businesses aim to expand capacities, NBFCs have an enormous opportunity to assist in achieving the noble goal of Aatmanirbhar Bharat through the fast-tracked flow of credit to businesses and households.

We believe that NBFCs with superior capital adequacy, better margins, frugal cost management, prudent risk management and those incorporating above four key cornerstones in their business models will continue to deliver sustainable growth in the foreseeable future.

O INTERNAL FINANCIAL REPORTING AND CONTROL

The Supply chain of the Company has improved as compared to the last financial year. New customers have been identified by the Company after making on- eld visits at customers place for the collection of various documents; and various other measures in order to establish the creditworthiness and genuineness of the prospective borrower.

Though the demand for availing loan products has not declined, yet, considering the present financial crunch in the economy, we are following a cautious approach in fresh financing to new customers. The Company has been trying to reduce the probability of non-repayment of outstanding dues by the customers which had arisen due to financial crisis that was witnessed by many people on account of stagnant business activities across the globe caused by Civil wars outbreaking throughout the world in the previous years.

Existing contracts/agreements where non-ful lment of the obligations by any party will have significant impact on the listed entitys business:

The Company endeavors to perform its duties as agreed to in various executed operational contracts / agreements. There has been no failure in performance by the Company of its obligations envisaged in contract / agreement entered into by it. Presently, there are no such existing contracts / agreements where non-ful llment of the obligations by any party will have significant impact on the Companys business.

Other relevant material updates about the listed entitys business:

There are no other relevant material updates at present. The Companys opinion on various matters as envisaged above, are forward-looking statements which are based on certain assumptions, risks, uncertainties and expectations of future events. The actual results, performance or achievements can thus differ from those projected, depending on various factors over which, the Company does not have any direct control.

In todays complex business environment, almost every business decision requires executives and managers to balance risk and reward. E ective risk management is therefore critical to an organizations success. Globalization, with increasing integration of markets, newer and more complex products and transactions and an increasingly stringent regulatory framework has exposed organizations to newer risks. As a result, todays operating environment demands a rigorous and integrated approach to risk management. Timely and effective risk management is of prime importance to our continued success. Increased competition and market volatility has enhanced the importance of risk management. The sustainability of the business is derived from the following:

v Identi cation of the diverse risks faced by the company.

v The evolution of appropriate systems and processes to measure and monitor them.

v Risk management through appropriate mitigation strategies within the policy framework.

v Monitoring the progress of the implementation of such strategies and subjecting them to periodical audit and review.

v Reporting these risk mitigation results to the appropriate managerial levels.

O RISKS AND CONCERNS

In todays complex business environment, almost every business decision requires executives and managers to balance risk and reward. E ective risk management is therefore critical to an organizations success. Globalization, with increasing integration of markets, newer and more complex products & transactions and an increasingly stringent regulatory framework has exposed organizations to newer risks. As a result, todays operating environment demands a rigorous and integrated approach to risk management. Timely and effective risk management is of prime importance to our continued success. Increased competition and market volatility has enhanced the importance of risk management. The sustainability of the business is derived from the following:

v Identi cation of the diverse risks faced by the company.

v The evolution of appropriate systems and processes to measure and monitor them.

v Risk management through appropriate mitigation strategies within the policy framework.

v Monitoring the progress of the implementation of such strategies and subjecting them to periodical audit and review.

v Reporting these risk mitigation results to the appropriate managerial levels.

O DISCUSSION ON FINANCIAL PERFORMANCE WITHRESPECT TO OPERATIONAL PERFORMANCE

The brief on Financial Performance of the Company is alreadyprovided in the Boards Report of the Company.

O MATERIAL DEVELOPMENTS IN HUMAN RESOURCES / INDUSTRIAL RELATIONS FRONT, INCLUDING NUMBER OFPEOPLE EMPLOYED

The Companys relations with the employees continued to be cordial. It emphasized engagements with employees by providing an enriched workplace, challenging job pro le and regular dialogues with the management.

During the year, two employees, including one Key ManagerialPersonnel were employed by the Company.

O KEY FINANCIAL RATIOS:

EBITDA/Interest Expenses

Net Pro t/ Total Revenue

O DETAILS OF ANY CHANGE IN RETURN ON NET WORTH ASCOMPARED TO THE IMMEDIATELY PREVIOUS FINANCIALYEAR

The Net Worth for the Financial year 2024-25 is INR 1376 Lacs as compared to that of financial year 2023-24 which was INR 1339 Lacs. There is a slight increase in the Return on Net Worth of the Company which was 10.22% in financial year 2024-25.

O SEGMENT-WISE OR PRODUCT WISE PERFORMANCE

The company operates in only single segment i.e. in business of Non-Banking Financial Company. Hence segment wise performance is not applicable.

O INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has strong internal control procedures in place that are commensurate with its size and operations. The Board of Directors, responsible for the internal control system, sets the guidelines and veri es its adequacy, effectiveness and application. The Companys internal control system is designed to ensure management efficiency, measurability and veri ability, reliability of accounting and management information, compliance with all applicable laws and regulations, and the protection of the Companys assets. This is to timely identify and manage the Companys risks (operational, compliance-related, economic and nancial).

O CAUTIONARY STATEMENT

This report describing the companys activities, projections about future estimates, assumptions with regard to global economic conditions, government policies, etc. may contain "forward looking statements" based on the information available with the company. Forward-looking statements are based on certain assumptions and expectations of future events. These statements are subject to certain risks and uncertainties. The company cannot guarantee that these assumptions and expectations are accurate or will be realized. The actual results may be different from those expressed or implied since the companys operations are affected by many external and internal factors, which are beyond the control of the management. Hence the company assumes no responsibility in respect of forward-looking statements that may be amended or modified in future on the basis of subsequent developments, information or events.

O DISCLOSURE ON ACCOUNTING TREATMENT

Company follows all Mandatory Accounting Standards and the financial statements of the Company have been prepared in compliance with the requirements of the Companies Act, 2013, Regulation 33 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Our Management accepts responsibility for the integrity and objectivity of these financial statements, as well as for the various estimates and judgments used therein. The estimates and judgments relating to the financial statements have been made on a prudent and reasonable basis, so that the financial statements reflect in a true and fair manner the form and substance of transactions, and reasonably present our state of a airs, profits and cash flows for the year.