Variman Global Enterprises Ltd Management Discussions

Industry structure and developments

Global and Indian IT Industry Overview

The Indian traditional PC market, comprising desktops, notebooks and workstations, witnessed strong growth during FY 2025-26. According to the International Data Corporation (IDC) Worldwide Quarterly Personal Computing Device Tracker, the Indian traditional PC market recorded a 10.1% YoY growth, with shipments reaching approximately 4.9 million units, the highest-ever performance for the market, compared with 4.5 million units shipped in FY 2024-25.

Growth was broad-based across all major PC categories:

?‚? Notebooks, the largest segment, registered a 9.5% YoY growth, supported by sustained demand from consumers, enterprises and small and medium businesses.

?‚? Desktops recorded an 11.6% YoY growth, driven by enterprise, government and institutional procurement.

?‚? Workstations recorded the highest growth among the three categories at 14.2% YoY, reflecting increasing demand for high-performance computing systems.

?‚? Premium notebooks, priced above US$1,000, grew by 8.5% YoY, supported by demand for high-performance devices across consumer and enterprise segments.

?‚? AI-enabled notebooks continued to witness rapid adoption, with shipments increasing by 126.5% YoY. Basic AI notebooks accounted for approximately 85.9% of total AI notebook shipments, supported by competitive pricing, discounts and cashback offers.

?‚? Next-generation AI notebooks also gained momentum and crossed the 100,000-unit shipment mark for the first time in a single quarter, indicating increasing adoption of advanced AI-enabled computing devices.

The commercial segment remained an important growth driver, registering 11.4% YoY growth, supported by enterprise refresh cycles and increasing demand from small and medium businesses. At the same time, the consumer segment achieved a record quarterly performance, with PC shipments reaching approximately 2.8 million units. The e-tail channel also recorded its strongest quarter, with approximately 997,000 notebook units shipped,

reflecting increasing consumer preference for online purchasing and festive-season promotions.

The Indian PC market continued to benefit from enterprise replacement cycles, digital transformation initiatives, government and institutional procurement, and increasing adoption of AI-enabled devices. Consumer demand also remained resilient, particularly during major e-tail and festive sales periods, with vendors increasingly aligning online and offline pricing strategies.

The increasing integration of artificial intelligence capabilities into personal computing devices represents a significant structural development in the industry. AI-enabled notebooks and next-generation AI PCs are expected to support demand for higher-performance processors and devices capable of performing AI workloads locally. This trend is likely to influence product innovation, pricing, customer preferences and replacement cycles in the coming years.

In India, the traditional PC market grew by 2.6% YoY in Q1 2024, shipping 3.07 million units. For the full year, India recorded total shipments of 14.4 million units, driven by strong consumer demand and enterprise procurements: Consumer segment grew strongly in 2025, with the consumer segment accounting for 47.1% of total PC shipments, while consumer demand continued to be supported by eTailers and premium/AI-enabled notebooks. The commercial segment continued to be the larger contributor to Indias PC market in Q4 2025, supported by enterprise refresh cycles, Windows 10 replacement activity and institutional procurement. Overall India PC shipments reached 4.1 million units in Q4 2025, registering 18.5% YoY growth. Government and institutional procurement continued to support commercial demand in Q4 2025, while enterprise demand benefited from refresh cycles and replacement of ageing systems.

The Asia-Pacific PC market grew 11.6% YoY in 2025, reaching 106.6 million units, driven by replacement demand, Windows 10 end-of-support, education and institutional spending. However, IDC expects the market to decline 13.7% in 2026 due to memory shortages, rising component prices and supply constraints.

AI PCs remained a major growth driver in 2025-26, with 40+ TOPS NPUs enabling on-device AI capabilities. Microsofts Copilot+ PCs, along with Intel Core Ultra and AMD Ryzen AI platforms, are accelerating the adoption of AI-enabled PCs across consumer and enterprise markets.

Top 5 Global & Indian PC Vendors (2025)

?‚? HP Inc. retained the leadership position with a 26.6% overall market share, supported by strong performance in the commercial segment, where it held a 34.6% share. However, its consumer segment declined by 10.4% YoY amid intense competition in premium a nd entry-level price bands and the transition from the Pavilion series to the OmniBook range.

?‚? Lenovo maintained the second position with an 18.0% market share. Its consumer segment grew by 14.3% YoY, supported by competitive pricing, discounts and festive promotions, while its commercial segment grew 14.5% YoY. Lenovo also recorded strong moment um in the small-office segment.

?‚? Acer Group ranked third with a 15.0% market share, supported by an aggressive e-tail strategy and strong demand for entry-level notebooks. Its commercial segment grew by 4.1% YoY, while it maintained leadership in the commercial desktop category with a 33.1% share.

?‚? Dell Technologies ranked fourth with a 14.6% market share. Its consumer segment improved, reaching a 10.3% share, supported by channel initiatives and disciplined inventory management. The commercial segment also recorded 6.9% YoY growth, driven by ente rprise demand.

?‚? Asus held the fifth position with a 10.2% market share. The company maintained a balanced presence across online and offline channels and ranked second in the consumer segment with a 15.9% share. Its commercial business also achieved a strong quarter, w ith shipments exceeding 64,000 units, primarily supported by demand from the SMB segment.

Premium notebook shipments (>USD1,000) grew 13.8% YoY in 2025, while gaming notebook demand recorded double-digit growth, fuelled by AI-ready processors and consumer interest in high-performance systems. IDC also highlights the rise of DSPM (Data Security Posture Management) as a key cybersecurity category, focused on securing sensitive enterprise data across hybrid environments.

IDC Outlook The outlook for the Indian PC market remains positive but more cautious in 2026. The market recorded its strongest-ever performance in 2025, with 15.9 million units shipped, growing 10.2% YoY, supported by enterprise refresh cycles, digital transformation, SMB demand and institutional procurement. In 2026, rising DRAM and GPU costs, higher PC prices, supply constraints and potential inventory corrections are expected to create near-term challenges. Consumer demand may come under pressure from higher

prices, while enterprise and SMB procurement are expected to provide continued support. IDC also expects government and education demand to face some budgetary and pricing pressures in the second half of 2026. The growing adoption of AI-enabled PCs is expected to remain a key growth opportunity. AI notebook shipments in India increased 129.3% YoY in 2025, reflecting rising enterprise and consumer adoption. Continued adoption of AI applications and digital transformation is expected to support demand for higher-performance computing devices, although affordability and component availability could influence the pace of adoption in 2026

Opportunities: The Company has significant opportunities arising from the continued growth of the Indian IT and PC market, particularly with the increasing adoption of AI-enabled PCs and digital transformation initiatives. The growing demand from government departments, defence organisations, PSUs and enterprises, supported by technology modernisation and replacement cycles, provides scope for the Company to expand its business. The Company also plans to strengthen its presence in Andhra Pradesh, Maharashtra and Tamil Nadu and leverage opportunities in government and institutional IT projects. Further, the increasing demand for managed IT services and technology-led solutions provides an opportunity to diversify and strengthen recurring business revenues.

Threats: The Company operates in a highly competitive and rapidly evolving IT industry, where intense competition from established players and changing customer preferences may put pressure on margins and market share. Rapid technological advancements also create the risk of technology obsolescence and require continuous investment in newer products and solutions. Rising costs of components such as DRAM and GPUs, together with supply-chain disruptions and availability constraints, may adversely affect product pricing and margins.

Variman Global Enterprises Limited Performance

Segment-wise or product-wise performance Variman Global Enterprises Limited (VGEL), a leading IT infrastructure solutions provider in Telangana, reported total revenue of ?‚?103.65 crore in FY 2025-26 compared to ?‚?59.94 crore in FY 2024-25, representing a robust growth of 72.9% YoY. Net profit after minority interest stood at ?‚?0.61 crore, down from ?‚?1.13 crore in the previous year. Despite pressures on profitability, the company remains focused on expanding its footprint across Andhra Pradesh, Maharashtra, and Tamil Nadu, while aggressively targeting government, defence, and PSU digital transformation contracts.

Outlook Management remains cautiously optimistic for FY 2026-27, expecting revenue growth supported by government IT spending, enterprise refresh orders, and stronger traction in managed services

Risks and concerns Key risks include heightened market competition, rapid technology changes, reliance on non-operating income, supply chain vulnerabilities, cybersecurity threats, and regulatory compliance requirements. The company continues to implement robust risk mitigation strategies.

Internal control systems and their adequacy The system of internal control has been established to provide reasonable assurance of safeguarding assets and maintenance of proper Accounting Records and its accuracy. The business risks and its control procedures are reviewed frequently. Systems audit is also conducted regularly to review the systems with respect to Security and its Adequacy. Reports are prepared and circulated to Senior Management and action taken to strengthen controls where necessary.

Discussion on financial performance with respect to operational performance The Management Discussion and Analysis given below relates to the Audited Financial Statements of Variman Global Enterprises Limited. The discussion should be read in conjunction with the financial statements and related notes for the year ended 31st March 2026.

Material developments in Human Resources / Industrial Relations front, including number of people employed There are no material developments in the Human Resources area. The Industrial relations have been considered to be satisfactory. The Company constantly reviews the manpower requirements and effective steps are being taken to meet the requirements. Your company follows a strategy of attracting and retaining the best talent and keep employees engaged, motivated and innovative. The company continues to have cordial relations with its employees and provide personnel development opportunities for all round exposure to them.

FINANCIAL RATIOS STANDALONE:

Disclosure of Accounting Treatment: The Company has complied all the requirements of accounting standards applicable to the Company and during the year company has not changed any accounting policies.

NOTE: Readers are advised to kindly note that the above discussion contains statements about risks, concerns, opportunities, etc., which are valid only at the time of making the statements. A variety of factors known/unknown expected or otherwise may influence the financial results. We do not expect these statements to be updated or revised to take care of any changes in the underlying presumptions. Readers may therefore appreciate the context in which these statements are made before making use of the same.

Cautionary Statement/Disclaimer Clause: We cannot guarantee that the forward-looking statements made in Management Discussion and Analysis will be realized, although we believe we have been prudent in our assumptions. The achievement of results is subject to risks, uncertainties and even inaccurate assumptions. Should known or unknown risks or uncertainties materialize, or should underlying assumptions prove inaccurate, actual results could vary materially from those anticipated, estimated or projected. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information.

For and on behalf of the Board Variman Global Enterprises Limited

Place: Hyderabad Date: 12.08.2026

Sirish Dayata Managing Director DIN: 01999844

Raja Pantham Whole Time Director & CFO DIN: 07547750