Vertoz Advertising Ltd Management Discussions.

(a) Industry structure and developments:

Programmatic advertising is a highly automated form of digital advertising, whereby advertising space is bought, and advertisements are placed through an auction across campaigns from a large number of advertising platforms, and where bids are calculated in real time per individual advertisement placement, using a set of advanced algorithms, historic data, and a number of parameter sit dramatically reduces the margin of human error and the labor-intensive process of media buying and replaces them with technology- based techniques that target the right customer with the right advertisement at the right time.

The key advantages of programmatic buying include: (i) Liquidity, which optimizes pricing, benefiting both publishers and advertisers, (ii) Automation, which allows marketers to streamline the process by using a technology platform to purchase impressions in an automated way, typically on an exchange, and (iii) Impression-by-impression targeting, which enables buyers to bid on specific impressions and target users believed to be most receptive to the advertising. While programmatic buying was initially focused on display advertising, they have since expanded to mobile, video, native and social.

(b) Opportunities and Threats:

Our Real Time Bidding technology (RTB) evaluates at peak 10,00,000 (10 Lakh/ 1 Million) ad opportunities per seconds. Our core bidding architecture is easily adaptable to a variety of ad formats, allowing our technology to communicate with a variety of inventory sources.

In todays dynamic business environment which is filled with rapid change of technology, government policies, mounting competitive threats and constant new entrants into market, makes it challenging to sustain and handle the intricacies and provide competitive solutions to its clients. We face competition from domestic and international Companies. We foresee this competition to continue to grow as the demand for advertising and monetizing solutions increases. Further we believe that our competition also depends on several factors which include currency fluctuations, changing business framework, information technology policies, difficult to retain skilled staff etc. We currently operate globally from our offices in four countries. We believe we can extend our marketplace platform through international expansion to help automate and improve advertising for buyers and sellers globally. We intend to grow our market share in our existing

international markets. We also plan to expand our business operations into new territories including Asia, Eastern Europe and Latin America by organic and inorganic ways.

(c) Segment-wise or product-wise performance:

The Company has only one Segment i.e. Programmatic Advertising Business.

(d) Outlook:

Our technology is a key factor affecting our performance. We plan to continue to make substantial investments in our technology and research and development to enhance the effectiveness of our solution. We sell our solution to advertisers and publishers through our global direct sales team, which operates from our locations in India, US, UK and UAE. This team leverages its market knowledge and expertise to demonstrate the benefits to advertisers and publishers of advertising automation and our solution. We are focused on managing our brand and increasing market awareness to do so, we often present at global industry conferences/exhibitions, create custom events and invest in public relations.

(e) Risks and concerns:

The digital advertising market is relatively new, and our solution may not achieve or sustain high levels of demand and market acceptance. While display advertising has been used successfully for many years, marketing via new digital advertising channels, such as mobile and social media and digital video advertising, is not as well established. The future growth of our business could be constrained by the level of acceptance and expansion of emerging digital advertising channels, as well as the continued use and growth of existing channels, such as digital display advertising, in which our capabilities are more established. It is difficult to predict the future growth rate and size of the digital advertising solutions market or the entry of competitive solutions. Any expansion of the market for digital advertising solutions depends on a number of factors, including the growth of the digital advertising market, the growth of social, mobile and video as advertising channels and the cost, performance and perceived value associated with digital advertising solutions. If demand for digital display advertising and adoption of automation does not continue to grow, or if digital advertising solutions or advertising automation do not achieve widespread adoption, or there is a reduction in demand for digital advertising caused by weakening economic conditions, decreases in corporate spending or otherwise, our competitive position will be weakened, and our revenue and results of operations could be harmed.

(f) Internal control systems and their adequacy:

Internal Control system is adequate in our Company our Company has appointed Mr. Kashish Shah as an Internal Auditor of the company to look after the issues like discovering fraud, managing internal control system.

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

Companys Financial is quite satisfactory and further company ensure compliance with all applicable laws and rules made thereunder. The Companys consolidated revenue from operations was ^ 5,903.80 Lakhs during year 2020-2021.

(h) Material developments in Human Resources front, including number of people employed:

There have been no changes in Human Resource Policy of our Company. We provide stress free and healthy environment to our employees. There are almost69employees working in our Company.

(i) Details of significant changes (i.e. change of 25% or more as compared to the immediately previous financial year) in key financial ratios, along with detailed explanations therefor, including:

Sr. No Particulars As on 31.03.2021 As on 31.03.2020 Changes
1. Debtors Turnover Ratio 148.63 Days 84.43 Days 76.04%
3. Interest Coverage Ratio 11.75 Times 9.29 Times 26.48%
4. Current Ratio 1.16 Times 0.88 Times 31.82%
5. Debt Equity Ratio 0.45 Times 0.21 Times 114.29%
6. Operating Profit Margin (%) 36.82% 41.27% (10.78%)
7. Net Profit Margin (%) 14.36% 10.28% 39.69%

Explanations on Change 25% or more in Key Indicator Ratios over previous year:

a) Debtors Turnover Ratio: Due to Covid-19 Pandemic started in January 2021 across globe have impacted heavily on receivables and due to unstable situation and amid outbreak and lockdowns receivable collection was low which have impacted to increase in this ratio.

b) Interest Coverage Ratio: The immediate reason for change in this ratio is because Mr. Hirenkumar Shah, Whole-time Director of the Company has provided the Unsecured Loan to the Company and the Company have provided for Rs. 24.39 Lakhs Interest on his loan. Also, the Company has borrowed unsecured working capital fundings from various banking and nonbanking institutions which have led to increase of this ratio.

c) Current Ratio: The immediate reason for change in this ratio is because of change in working capital cycle and realization trade receivables and other current assets.

d) Debt Equity Ratio: During the year under consideration, the Company have faced some working capital gaps due to late payment receipt from receivable due to bad market condition and to suffice the requirement of routine working capital and thus had borrowed unsecured loan from various banking and non-banking institutions which have led to increase in this ratio.

e) Operating Profit Margin: During this year, slight change of lower Operating Profit margins are observed mainly because of amid Covid-19 impact over topline and effectively on direct expenses.

f) Net Profit Margin: The Company have gained and secured the good PAT margin this year over and above the last year. This is majorly due to optimizing and leveraging of expenses over revenue.

g) Details of any change in Return on Net Worth as compared to the immediately previous Financial Year along with a detailed explanation thereof.

Details pertaining to Net-worth of the Company:

Particulars As on 31.03.2021 As on 31.03.2020
Net-worth 5,773.10 4,979.10*

(*Restated figure of last year net-worth due to adoption of Ind-AS and is accounting impact on the same.)

h) Disclosure of Accounting Treatment: Company has adhered all Accounting Policies applicable to it as per the Securities Laws and applicable provisions of Companies Act, 2013 and Rule made thereunder.

i) Cautionary Statement: Statements in the Management Discussion & Analysis Report describing the Companys expectations, opinion, and predictions may please be considered as "forward looking statements" only. Actual results could differ from those expressed or implied. Companys operations should be viewed in light of changes in market conditions, prices of raw materials, economic developments in the Country and such other factors.

For & on behalf of Vertoz Advertising Ltd.
and its Board of Directors
Harshad Shah
Place: Mumbai Chairman & Non-Executive Director
Date: 31st August 2021 DIN:07849186