Visco Trade Associates Ltd Management Discussions

INDUSTRY STRUCTURE & DEVELOPMENTS, OPPORTUNITIES & THREATS, SEGMENTWISE PERFORMANCE

Indian economic review

Overview:The Indian economy grew at 6.5% in FY 2024-25, compared to a revised 9.2% in FY 2023-24. This represented a four-year low due to a moderate slowdown within the Indian economy (marked by slower manufacturing growth and a decline in net investments). Despite the slowdown, India retained its position as the worlds fifth-largest economy.

Indias nominal GDP (at current prices) was H330.68 trillion in FY 2024-25 (H301.23 trillion in FY 2023-24). The nominal GDP per capita increased from H2,15,936 in FY 2023-24 to H2,35,108 in FY 2024-25, reflecting the impact of an economic expansion.

The Indian rupee weakened 2.12% against the US dollar in FY 2024-25, closing at H85.47 on the last trading day of FY25. In March 2025, the rupee recorded the highest monthly appreciation since November 2018, rising 2.39% (arising out a weakening US dollar).

Inflationary pressures eased, with CPI inflation averaging 4.63% in FY 2024-25, driven by moderating food inflation and stable global commodity prices. Retail inflation at 4.6% in FY 2024-25, was the lowest since the pandemic, catalysing savings creation.

Indias foreign exchange reserves stood at a high of $676 billion as of April 4, 2025. This was the fourth consecutive year when rating upgrades outpaced downgrades on account of strong domestic growth, rural consumption, increased infrastructure investments and low corporate leverage (annualized rating upgrade rate 14.5% exceeded the decade-long average of 11%; downgrade rate was 5.3%, lower than the 10-year average of 6.5%).

Gross foreign direct investment (FDI) into India rose 13.6% to $81 billion during the last financial year, the fastest pace of expansion since 2019-20. The increase in the year was despite a contraction during the fourth quarter of 2024-25 when inflows on a gross basis declined 6% to $17.9 billion due to the uncertainty caused by Donald Trumps election and his assertions around getting investments back into the US.

Growth of the Indian economy

	FY22	FY23	FY24	FY25
Real GDP growth (%)	8.7	7.2	9.2	6.5

Growth of the Indian economy quarter by quarter, FY 2024-25

	Q1 FY25	Q2 FY25	Q3 FY25	Q4 FY25
Real GDP growth (%)	6.5	5.6	6.2	7.4

E: Estimated

(Source: The Hindu, National Statistics Office)

The banking sector continued its improvement, with gross non-performing assets (NPA) for scheduled commercial banks (SCBs) declining to 2.6% as of September 2024, down from 2.7% in March 2024. The capital-to-risk-weighted assets ratio for SCBs stood at 16.7% as of September 2024, reflecting a strong capital position.

Indias exports of goods and services reached $824.9 billion in FY 2024-25, up from $778 billion in the previous fiscal year. The Red Sea crisis impacted shipping costs, affecting price-sensitive exports. Merchandise exports grew 6% YoY, reaching $374.1 billion.

Indias net GST collections increased 8.6%, totalling H19.56 Lakh crore in FY 2024-25. Gross GST collections in FY 2024-25 stood at H22.08 Lakh crore, a 9.4% increase YoY.

On the supply side, real gross value added (GVA) was estimated to expand 6.4% in FY 2024-25. The industrial sector grew by 6.5%, supported by growth in construction activities, electricity, gas, water supply and other utility services.

Indias services sector grew at 8.9% in FY25 (9.0% in FY24), driven by public administration, defence and other services (expanded at 8.8% as in the previous year). In the infrastructure and utilities sector, electricity, gas, water supply and other utility services grew a projected 6.0% in FY25, compared to 8.6% in FY24. Meanwhile, the construction sector

expanded at 9.4% in FY25, slowing from 10.4% in the previous year.

Indian equity market overview

In the fiscal year 2024-25 (FY25), the Indian equity markets experienced moderate growth amid periods of volatility. The BSE Sensex and NSE Nifty 50 indices concluded the year with gains of approximately 5.1% and 5.34%, respectively. In March 2025, the Nifty 50 recorded a 6.3% increase, marking its strongest monthly performance in 15 months.

Throughout FY25, investors wealth expanded by H25.90 Lakh crore, reflecting the overall positive trend in equities. However, the indices remained about 10% below their record highs from late September 2024.

The financial sector played a pivotal role in the markets recovery, with financial services stocks gaining nearly 20% and banking stocks rising by 9% during FY25. Analysts project a 12-13% credit growth for the banking sector in FY26, driven by demand from services and retail segments.

Despite these gains, the market faced challenges, including substantial outflows from foreign portfolio investors (FPIs), who withdrew $15.57 billion during the fiscal year. Factors such as lacklustre earnings, U.S. tariff concerns, geopolitical tensions, a strong dollar, and Chinese economic stimulus measures influenced this trend.

Looking ahead, market sentiment for FY26 appears cautiously optimistic. Factors such as reasonable valuations and favorable risk-reward ratios in sectors like banking, oil and gas, and real estate are expected to support growth. However, uncertainties related to global trade tensions and potential U.S. tariffs may pose challenges.

On the overall, the Indian equity markets in FY25 demonstrated resilience amid global and domestic challenges, with strategic sectoral growth and renewed investor confidence contributing to their performance.

Outlook

India is expected to remain the fastest-growing major economy. Initial Reserve Bank of India estimates have forecast Indias GDP growth downwards from 6.7% to 6.5% based on risks arising from US tariff levies on India and other countries. The following are some key growth catalysts for India in FY26.

Tariff-based competitiveness: India identified at least 10 sectors such as apparel and clothing accessories, chemicals, plastics and rubber where the US high tariffs give New Delhi a competitive advantage in the American market over other suppliers. While India faced a 10% tariff after the US suspended thep>

26% additional duties for 90 days, the levy remained at 145% on China, the biggest exporter to the US. Chinas share of apparel imports into the US was 25%, compared with Indias 3.8%, a large opportunity to address differential (Source: Niti Aayog).

Union Budget FY 2024-25: The Union Budget 2025-26 laid a strong foundation for Indias economic trajectory, emphasizing agriculture, MSMEs, investment, and exports as the four primary growth engines. With a fiscal deficit target of 4.4% of GDP, the government reinforced fiscal prudence while allocating H11.21 Lakh crore for capital expenditure (3.1% of GDP) to drive infrastructure development. The February 2025 Budget marked a shift in approach, with the government proposing substantial personal tax cuts. Effective April 1, 2025, individuals earning up to H12 Lakh annually will be fully exempt from income tax. Economists estimate that the resulting H1 Lakh crore in tax savings could boost consumption by H3-3.5 Lakh crore, potentially increasing the nominal private final consumption Expenditure (PFCE) by 1.5-2% of its current H200 Lakh crore.

Financial overview

Analysis of the profit and loss statement Revenues: Revenues from operations registered a decline from H21155.27 Lakh in FY 2023-24 to H5096.94 Lakh in FY 2024-25.

Margins: EBITDA for the year is H1539.68 Lakh as against H4570.77 Lakh in FY 2023-24. EBITDA margin of the Company decreased to 30.21% in FY 2024-25 from 30.58% in FY 2023-24. The profit after tax excluding exceptional items of the Company was H516.28 Lakh in FY 2024-25 compared to H3312.72 Lakh in FY 2023-24.

Analysis of the balance sheet

Sources of funds: The capital employed by the Company increased to H18,800.66 Lakh as of 31^st March 2025 from H11,238.98 Lakh as of 31^st March 2024. The debt-equity ratio of the Company stood at 2.33 in FY 2024-25 compared to 1.23 in FY 2023-24.

Key ratios and numbers

Particulars	FY 2024-25	FY 2023-24
EBITDA/turnover	30.21	21.61%
Debt-equity ratio	2.33	1.23
Net profit margin (%)	10%	16%
Book value per share (H)	10.50	23.4
Earnings per share (H)	0.96	6.13 *

*Adjusted for share split and bonus share issued during the FY 2024-25

Opportunities

Potential rural markets: Expanding into vast,

underserved industry pockets presents growth opportunities for NBFCs.

Urban opportunities: Growing urbanization and rising demand for diverse financial services present significant opportunities for expansion.

Digital shift: Adopting digital technologies boosts efficiency, enhances customer experience, and unlocks new service opportunities.

Ease of compliance: A strong regulatory framework enhances credibility, fosters trust, and strengthens business and customer relationships.

Threats

Growing competition: The sector encounters strong competition from banks and financial institutions, potentially impacting market share and profitability.

Rising borrowing costs: NBFCs face higher capital acquisition costs than traditional banks, impacting their financial stability and profitability.

Policy constraints: Strict and evolving regulations add operational costs and create compliance challenges.

Market volatility: Economic fluctuations can affect credit demand and elevate default risks, creating financial challenges.

Strategy

The Company plans to expand into financial services such as factoring, lease finance, venture capital finance, and road transport financing. It also aims to offer securities-based lending, including loans against shares, margin funding, IPO financing, and promoter funding. Going forward, it seeks to diversify its lending portfolio and explore new opportunities in the financial sector.

Risks and concerns

The companys risk management framework is continuously monitored and assessed by internal management. Credit risks are mitigated through stringent credit norms that evaluate borrower identity, intent, and repayment capacity. Interest rate and liquidity risks are managed by monitoring the maturity profile, while operational risks—such as errors, fraud, or system failures—are controlled through a robust internal system with regular assessments.

Internal control systems and their adequacy

The company continually upgrades its internal control systems to align with best practices suitable for its size and operations. The Audit Committee, along with the Internal Audit team, regularly evaluates these systems to ensure effectiveness in a dynamic business environment. This enhances transparency, accountability, and overall management efficiency. As a small-sized listed NBFC under the Bombay Stock Exchange (BSE), the company remains committed to strong governance and operational integrity.

Human resources

The company values its human resources as key assets and prioritizes their development for sustained growth. It emphasizes skill enhancement through training aligned with business and market needs while recognizing and rewarding employees based on merit. Employee relations have remained positive throughout the year. As of March 31, 2025, the companys employee strength stood at 8.

Cautionary statement

Statements in the Management Discussion and Analysis Report describing the Companys objectives, projections, estimates, expectations or predictions may be "forward looking statements" within the meaning of the applicable laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could influence the Companys operations include economic and political conditions in which the Company operates interest rate fluctuations, changes in Government / RBI regulations, Tax laws, other statutes and incidental factors.

	For and on behalf of the Company GAMCO LIMITED
	Sd/-	Sd/-
	(Dipak Sundarka)	(Rajeev Goenka)
Place: Kolkata	Whole-time director	Chairman
Date: 21st August, 2025	DIN: 05297111	DIN: 03472302