Onward Technologies Ltd Management Discussions

Macro Economy Review

Global Economy

The global economy exhibited remarkable resilience in FY 2023-24, rebounding strongly after experiencing a year of declining inflation. The resilience was evident in steady employment and income growth, supported by robust demand fuelled by increased government spending and household consumption, as well as expansions in labour force participation.

Despite substantial central bank interest rate hikes to restore price stability, households in major advanced economies tapped into significant pandemic-era savings, contributing to the unexpected economic strength.

Global economy has grown by 3.2% in 2023 and is forecasted to maintain this growth pace throughout 2024 and 2025. Short-term factors like high borrowing costs and fiscal support withdrawal, coupled with geopolitical tensions, and weak productivity growth, contributed to this restrained global growth trajectory. Although headline inflation is projected to gradually, structural barriers impeding capital and labour mobility persist, hindering the convergence towards higher living standards for middle- and lower-income countries.

In 2024, advanced economies are expected to grow by 1.7%, with a slight uptick to 1.8% in 2025, compared to the 1.6% growth seen in 2023. While the emerging markets and developing economies are predicted to expand by 4.2% in both 2024 and 2025, a slight decrease from the 4.3% growth observed in 2023.

The global economic outlook has been characterised with balanced risks along with concerns including potential price spikes from geopolitical tensions, declining inflation high government debt prompting disruptive fiscal policies. Prioritising medium-term fiscal consolidation and tailored policy responses, alongside multilateral cooperation, are imperative for steering the global economy towards sustainable growth amidst evolving risks.

Indian Economy

Indias economic growth has been fueled by strong domestic demand and robust expansion across various sectors. According to the National Statistics Office (NSO), the Indian economy is anticipated to experience accelerated growth, reaching 7.6% for FY 2023-24, surpassing the previous years expansion rate of 7.0%. The expansion momentum was driven by several positive macroeconomic indicators, including improved labor market conditions, heightened urban demand, and increased government emphasis on capital expenditure. Indias economic growth is propelled by various factors, including a significant emphasis on digitization. The adoption of digital technologies and services has streamlined processes, increased efficiency, and opened new avenues for business.

Source: NSO estimates dated 29th February 2024, RBI (Reserve Bank of India) MPC (Monetary Policy Committee) report dated 7thJune 2024

On the demand side, household consumption is expected to strengthen. Prospects for fixed investment are also bright due to the upturn in the private capital expenditure cycle, improved business sentiments, healthy balance sheets of banks and corporations, and the governments continued focus on capital expenditure. The economys strength and resilience, coupled with recent reforms, have laid a strong foundation for long-term growth. The Indian GDP is anticipated to achieve a growth rate of 7.2% in FY 2024-25. High-frequency indicators like automobile sales and GST (Goods and Services Tax) revenues have shown strong growth. Additionally, the improving global trade outlook and greater integration into the global supply chain will boost net external demand. However,ratesamongmajoreconomies,and potential challenges from geopolitical tensions, international financial market volatility, and geoeconomic fragmentation could pose risks to this outlook.

Industry Overview

Indian Information Technology (IT) Sector

India remains the top choice for the tech industry across the globe and has also consistently held the number one position as an offshore location for business services in the AT Kearney Global Services Location Index. Even during uncertainty, the Indian tech industry has shown resilience, highlighting its adaptability and inherent strength. It experienced increased momentum, marked by a surge in large tech deals, stable net profit margins, reduced attrition rates, heightened utilisation, and sustained market trust. Indias IT industry revenue, including hardware, reached US$ 254.0 billion in FY 2023-24, reflecting a year-on-year growth of 3.8%, according to the Nasscom Strategic Review 2024 report. The year experienced a decline in incremental revenue addition, from US$ 19.0 billion in FY 2022-23 to US$ 9.3 billion in FY 2023-24. The Indian IT industrys exports appeared promising, by reaching the significant billion representing a YoY growth rate of 3.3% in FY 2023-24.

The domestic technology sector surpassed US$ 54 billion, demonstrating a healthier growth rate of 5.9% YoY during the same period, primarily fueled by significant investments in tech transformation by Indian enterprises. Moreover, the expanding consumer market, driven by the growing purchasing power of middle-income groups, coupled with the rising adoption of Digital Public Infrastructure (DPI) to develop India-specific solutions, adds further momentum to the growth narrative in India. India held a crucial position as the worlds leading technology sourcing hub, contributing 7% to the nations GDP. The IT sector contributed about 47-50% of the entire service export of the country and about 57-58% share in global sourcing in FY 2023-24. During the year under review, the country had 38,000 tech firms, along with 31,000 tech startups and over 1,630 Global Capability Centers (GCCs).

Indias Technology Market (in US$ billion) reflected

Source: NASSCOM

Every sector of the industry has witnessed healthy growth in FY 2023-24.

? IT Services: IT services grew by 2.0% YoY, driven by the rising demand for infrastructure management and networking services in distributed environments, alongside cloud-based software testing and consulting services. ? Business Process Management (BPM): BPM sector has also been evolving, incorporating specialised capabilities in data monetisation, cloud-based Artificial Intelligence (AI), and analytics, with a growth rate of 2.7% during the year. ? Engineering Research and Development (ER&D): The ER&D segment remained the fastest growing at 7.4% YoY, fuelled by increasing emphasis on ER&D intensity across sectors, particularly with digital imperatives and the resurgence of AI and maintaining its focus on digital engineering. ER&D continued to shine milestone of US$ 200.0 as the paradigm for tech services, particularly as numerous industries undergo substantial digitisation, leading to heightened emphasis on engineering. Industries such as Aerospace and Defence, as well as Automotive, have experienced significant factors like sustainability, efficiency, autonomous technologies and technology, electrification, among others, which are promoting innovation through substantial engineering investments. ? Software Products: Software products grew by 1.8% YoY, as customer enterprises continue their investments in communication and collaboration, cybersecurity, and content management solutions.

Digital Engineering

The global ER&D industry witnessed a significant recovery following the aftereffects of the pandemic, with companies enhancing their investments to address the evolving market demands. This improvement in spending has been a proactive approach by businesses to align their offerings with changing market dynamics and bridge any existing gaps. New technologies spurred a heightened demand for innovative engineering solutions as companies sought to adapt their offerings to meet the needs of consumers who were increasingly engaging from home. The inception of digital product and service adoption across various sectors acted as a catalyst for the growth of ER&D industry. Global ER&D spending has been estimated to have grown to US$ 1.5 to US$ 1.8 trillion in 2023 from US$ 1.1 to US$ 1.5 trillion in 2020. In addition, the technological advancements across sectors are anticipated to substantially elevate the global business ER&D intensity, resulting in an expenditure rise to over US$ 3.3 trillion by 2030 from the current levels of US$ 1.8 trillion.

Global Business ER&D Spending (in US$ Trillion

India has been strongly positioned to capture a substantial portion of the global ER&D sourcing market, leveraging its unique strengths as a top five innovative middle-income powerhouse and its capacity to offer talent at scale. Indias share in ER&D sourcing is projected to surge from US$ 46.0 billion in 2023 to US$ 170.0 billion by 2030, positioning it to increase its share of the Global ER&D sourcing market to 22.0% by 2030, up from 17.0% in 2023. The software sector will continue to hold the largest share in the global sourcing of Indian ER&D services, with the automotive sector closely following, reflecting the ongoing global sourcing trend. The semiconductor sector is also expected to see the most substantial growth, with its share in the global sourcing of Indian ER&D services rising from 9.0% to 12.0%, positioning it as the third-highest contributing sector by 2030. This growth is propelled by the global initiative to utilize India as a base for semiconductor manufacturing, further accelerating the development of a consolidated design and manufacturing ecosystem in the country. In addition, infrastructure development and policy support are poised to drive innovation and enhance competitiveness within the country.

Source: Gartner Inc. (https://www.gartner.com/en/articles/ gartner-top-10-strategic-technology-trends-for-2024)

Digital Transformation

The technology-led transformation of traditional services has been prompting significant portfolio shifts throughout the industry, with a growing emphasis on Robotic Process Automation (RPA), digital analytics, application modernization, intelligent automation, and data engineering. These shifts are redirecting client spending towards emerging tech domains in IT modernization, including cloud computing, DevOps, data analytics, AI, Internet of Things (IoT), and security. In the future of digital transformation, business leaders are increasingly embracing the essential eight emerging technologies. These cutting-edge innovations, including AI, IoT, Blockchain, Virtual Reality (VR), Augmented Reality, Advanced Robotics, Quantum Computing, and Neuromorphic Computing, hold the key to unlocking unprecedented levels of efficiency, innovation, and competitiveness. AI has already reached a tipping point and are reshaping business models and operations, others such as

Quantum Computing and Neuromorphic Computing are still in the nascent stages but show immense promise for driving future growth. The convergence of these technologies amplifies seamless collaboration, data-driven decision-making, and the automation of complex processes.

AI became omnipresent in CY 2023, experiencing a remarkable 2.7x surge in activity. Around 80% of AI-related activity stemmed from industry collaborations, partnerships, and product/service launches, along with announcements of enterprise Generative AI (GenAI) strategies. Gen AI, driven by widespread adoption strategies among enterprises, witnessed a staggering 9x increase in activity, constituting over 70.0% of the total AI activity. RPA, Blockchain, and IoT stand out as the pivotal technologies propelling DeepTech adoption, which has exhibited steady growth among enterprises over the years. A remarkable sixfold increase in DeepTech intensity was observed, underscoring the significance of these technologies in shaping the future of business operations. A recent survey by PWC indicates that most of the investments in emerging technologies are anticipated to focus on

AI, with IoT and VR followingcloselybehind. ial intelligence (AI),

Where investments will flow: AI tops the list

Source: https://www.pwc.com/us/en/tech-effect/emerging-tech/emtech-survey.html

Industry Outlook

The IT industry is poised to reach its ambitious goal of achieving a total revenue of US$ 350.0 billion by 2026. Robust growth momentum has been expected for CY 2024, particularly in sectors such as BFSI, telecom, media and entertainment, and hi-tech, which are leading digital spending efforts. Notably, the concept of Gen AI remains a focal point for over 95.0% of organizations in the coming period, underscoring the importance of adapting to and leveraging advancements in artificial intelligence within their operations and strategies.

The outlook for technology providers looks even more promising, with anticipated higher growth in FY 2024-25 compared to the previous year. In FY 2024-

25, the industry is expected to prioritize capability building as the new normal. To navigate current challenges effectively, it is expected to focus on the

4Rs: Reshape by accelerating the transition to AI-first companies, Reskill to make talent the most significant competitive advantage, Rewire growth strategies, and Raise investments in IP creation and R&D.

Source: The Nasscom Annual Enterprise & Tech Services CXO Survey 2024

Company Overview

Company Background

Onward Technologies, (hereafter referred to as ‘the Company or ‘Onward Technologies), has been one of the key industry players in Engineering Research

& Development (ER&D), Digital Transformation, and IT Consulting. The Company excels in digital transformation, embedded systems, engineering technology, data analytics, and machine learning (ML). The Company operates through three diversified

Engineering services, Embedded Electronics services, and Mechanical Engineering services. Onward Technologies experienced substantial growth in its three focused verticals - Industrial Equipment & Heavy Machinery contributing 52.0% of total revenue, Transportation & Mobility contributing 37.0%, and Healthcare contributing 8.0% of total revenue. The Company serves clients in the United States, the United Kingdom, Germany, Netherlands, Canada, and India, with its Registered Worli, Mumbai. Its sales Toronto, London, Frankfurt, and Amsterdam, along with development and design centers in Mumbai, Pune, Chennai, Bengaluru, and Hyderabad, support prominent organizations globally.

The Companys highly qualified employees provide expert consulting and value-added services to clients across various industries, including multinational corporations. Onward Technologies serves 8 of the global top 11 automotive OEMs (Original Equipment Manufacturer) and 5 of the global top 10 industrial equipment manufacturers. As of March 31, 2024, the Company employed a diverse global workforce of over 2,529 employees.

Key Business Strategies and Developments ? Developing Line of Business (LOB) segments with higher margins

The Companys management team has extensive expertise across various industries. Most of its revenue is derived from two key industry verticals: transportation & mobility, including automotive

& rail transportation, and industrial equipment & heavy machinery. Its digital line of business, the primary and largest investment area, continues to garner significant traction and to the Companys revenues in FY 2023-24. The Company plans to leverage its digital capabilities across all client verticals, strategically focusing on complex and more profitable ER&D and Digital Transformation ventures.

? Deepening Client Relationships

Over time, the Company has cultivated strong relationships with esteemed clients, resulting in recurring orders. A significant revenue stems from Global 2000 clients. The Company places a priority on securing long-term contracts and recurring revenue, which strengthens its revenue streams significantly. The deliberate shift of the Company towards larger, strategically focused clients has had a significant impact on the overall business, establishing the groundwork for a sustainable and resilient business model in the foreseeable future. The Companys total client base has grown to 84, incorporating the net addition of new clients signed under Master Service Agreements (MSA).

? Talent Development

The Company maintains its dedication to educating and hiring top-tier digital specialists. It remains steadfast in its commitment to human resource policies and benefits, opportunities with industry standards to promote career development. During FY 2023-24, the Company maintained a total headcount of 2,529 skilled personnel within its organization.

? Profitability Enhancement and Shareholder Commitment

The Companys margin expansion strategy is propelled by its agile operations and an increased share of business with global OEMs. Over the past eight years, consistent dividends have been paid, demonstrating a commitment to enhancing shareholder returns. In recent years, the Company has undergone a transformative journey, by consistently maintaining steady cash flows and remaining debt-free.

Financial Overview

Financial and operational performance

Standalone: The Companys revenue from operations in FY 2023-24 stood at 34,595.2 lakhs, an increase from 31,516.5 lakhs in FY 2022-23. This growth primarily resulted from increased outsourcing by all the Companys major clients. During the year, the Company recorded a profit before taxes (PBT) of 3,724.8 lakhs. In FY 2023-24, the net profit after taxes (PAT) amounted to 2,773.1 lakhs, compared to 1,629.3 lakhs in FY 2022-23.

Consolidated: On a consolidated basis, revenue from aligning growth operations surged to 47,239.2 lakhs from 44,092.8 lakhs in the previous year, thereby growing by 7.1%. In FY 2023-24, PBT totaled 4,515.7 lakhs, witnessing a growth of 150.4%. PAT in FY 2023-24 amounted to 3,391.8 lakhs, compared to 1,148.0 lakhs in FY 2022-23, registering a growth of 195.5%.

Revenue breakdown indicates that 63.0% came from ER&D, 35.0% from digital, and 2.0% from IT services. Offshore revenues constituted 69.0% of the total revenue, with onsite revenues making up the remaining 31.0%. The subsidiaries continued to accelerate the Companys operations while adhering to operational discipline aligned with its customer-centric approach. In FY 2023-24, revenue from subsidiaries reached 21,164.7 lakhs.

Particulars	Standalone		Consolidated
	FY2023-24	FY 2022-23	FY2023-24	FY 2022-23
Revenue from Operations	34,595.2	31,516.5	47,239.2	44,092.8
Total Expenses	31,898.5	30,113.0	43,450.7	42,628.3
EBITDA	4130.5	2,839.5	5,220.2	2929.0
EBITDA Margin (%)	11.9	9.0	11.1	6.6
Other Income	1,028.0	769.9	727.2	338.7
Depreciation	1,289.7	1,270.3	1,297.5	1,298.2
Finance Costs	144.1	165.7	134.1	166.4
Profit Before Taxes (PBT)	3,724.8	2,173.5	4,515.7	1,803.2
Tax	951.7	544.2	1,123.9	655.2
Profit After Taxes (PAT)	2,773.1	1,629.3	3,391.8	1,148.0
PAT Margin (%)	8.0%	5.2%	7.2%	2.6%
PAT (After NCI)	2720.1	1,556	3,420.9	1,309.8
Diluted EPS (Rs.)	12.1	7.2	14.8	5.1

Key changes in significant Financial Ratios

Details of significant changes in key financial ratios (i.e., change of 25% or more as compared to the immediately previous financial year

Standalone Basis

Debtors Turnover	4.9	3.7	32.0%	Better collections have resulted in improved ratio.
Inventory Turnover	NA	NA	NA	--
Interest Coverage	1.5	1.7	-10.9	No material variance.
Ratio
Current Ratio	3.1	2.7	15.6%	No material variance.
Debt/Equity Ratio	0.0%	0.3%	-100.0%	During the year, Company repaid all borrowings.
Return on Equity	15.9%	10.5%	51.0%	Improved revenue and margins has resulted in increase in net profit.
Operating Profit Margin (%)	11.9%	8.45%	32.5%	Improved revenue and margins have resulted in increase in operating profit.
Net Profit Ratio	8.0%	9.0%	55.1%	Improved revenue and margins have resulted in increase in net profit.
Return on Capital Employed	20.9%	5.2%	41.7%	Improved revenue and margins have resulted in increase in net profit.
Consolidation Basis
Key Ratios	FY2023-24	FY 2022-23	Variance %	Reason for such change
Debtors Turnover	4.7	4.0	16.6%	No material variance.
Inventory Turnover	NA	NA	NA	--
Interest Coverage	1.8	1.6	10.7%	No material variance.
Ratio
Current Ratio	3.8	3.0	25.0%	No material variance
Debt/Equity Ratio	0.0%	0.3%	-100.0%	During the year, Company repaid all borrowings.
Return on Equity	17.8%	6.8%	161.4%	Improved revenue and margins have resulted in increase in net profit.
Operating Profit Margin (%)	11.1%	6.6%	66.4%	Improved revenue and margins have resulted in increase in operating profit.
Net Profit Ratio	7.2%	2.6%	175.8%	Improved revenue and margins have resulted in increase in net profit.
Return on Capital Employed	22.6%	11.4%	97.8%	Improved revenue and margins have resulted in increase in net profit.

Business Outlook

The Company maintains a strong focus on gaining significantopportunitiesandaidingprospectiveclients in shaping their digital future. Through initiatives such as employee upskilling, subcontracting, and strategic partnerships, Onward Technologies is consistently enhancing its proficiency technologies. Going forward, the Companys definitive growth strategy revolves around investing in talent, enhancing skills, and diving deep into complex high-tech digital transformations alongside its current "Global 2000" clients. The Company aims to prioritize Industry 4.0, AI/ML, ADAS (Advanced driver-assistance systems), cloud, and DevOps engineering. Moreover, the Companys future growth prospects are underpinned by a management team having over three decades of experience in the IT services industry.

As it moves forward, the Company will continue to experience robust demand for its diverse range of services from existing clients and across various emerging has secured new partnerships within the past 12-18 months. Onward

Technologies remains committed to expanding its digital and embedded capabilities through ongoing investments. The Company has consciously adopted a balanced growth approach, simplifying operations into three focused verticals and structuring its international business into nine regional business units (RBUs) to drive deeper client engagement. With the management team now strategically located in the USA and UK, closer to key clients, Onward Technologies is well-positioned to capitalize on growth opportunities and drive continued success in ??the coming years.

The Companys increased focus on the US and Europe markets ensures that Onward Technologies can leverage opportunities and drive innovation in these key regions. By maintaining a strategic presence and intensifying efforts in these markets, Onward

Technologies aims to further strengthen its position and deliver enhanced value to its clients globally.

Internal Controls

The Company acknowledges the necessity of a robust internal control framework, given its global presence and significant network of internal control systems are tailored to its size and scope of operations, aiming to ensure reliable and operational information, compliance with laws, asset protection, proper transaction execution, and ??policy adherence. A clearly defined delegation of authority for revenue and expenditure approvals for the Company.

For the FY 2023-24, the Company has engaged M/s. Ahuja Valecha & Co., LLP, Chartered Accountants, as its internal auditors. The audit, conducted by M/s. Ahuja Valecha & Co., LLP, follows a plan reviewed annually in consultation with statutory auditors, M/s. BSR & Co. LLP, Chartered Accountants, and the Audit Committee.

Risk Management

Onward Technologies has implemented a risk management policy to integrate risk management into its core strategic and operational activities. This approach ensures that risk management becomes a collective responsibility across the organization. The Company has established an enterprise-wide risk management strategy, covering planning, implementation, monitoring, review, and continuous ??improvement. It has identifiedkey risks and developed effective mitigation strategies to address them.

? Rivalry Risks: Indian IT companies, multinational IT organizations, and entrepreneurs operating in cost-effective locations and maintaining strong client relationships, in-house services, and captiveunitsface engineering services sector. Competitors are intensifying their efforts in key growth areas like cloud computing, cybersecurity, and workforce transformation.

Mitigation: The Company is enhancing its solutions leveraging new technologies.

Additionally, it is expanding its service portfolio by exploring new verticals and geographic markets, all while prioritizing partnerships and strategic investments.

Compliance Risks: Operating across multiple countries and sectors exposes the Company to the risk of non-compliance with essential regulatory standards, critical for its operations.

Mitigation: The Company has set up specialized units dedicated to assessing and monitoring regional and industry-specific regulatory requirements. Its global regulatory compliance framework aims to identify, evaluate, mitigate, and monitor regulatory risks that impact the

Company. This framework is designed to protect the Companys reputation, its employees, and its customers. The Company conducts regulatory assessments and maintains comprehensive protocols.TheCompanys to ensure compliance. If any non-compliance is discovered, mitigation plans are promptly implemented by the Company.

Attrition Risks: As the Company expands, talent management plangovernsthe and meeting the continuously growing demand for new talent persist as significant ongoing challenges. Mitigation: The Company aims to establish a workplace culture centered on transparency and collaboration. To achieve this goal, it has instituted a robust training program tailored to meet the developmental needs of employees across all levels. This initiative covers areas such as professional, technical, functional, and leadership development. The HR team works tirelessly to engage with each employee, offering support for their growth and creating internal pathways for career progression. This approach enables individuals to achieve their goals by creating thorough career and talent development strategies.

Geopolitical Risks: The IT industrys growth has historically been hindered by instability and uneven development in the global economy, a trend that may persist in the future. Potential economic or political uncertainties could result in

IT spending reductions, project delays, contract terminations, or postponements in client purchasing. Moreover, heightened geopolitical tensions among key economies may impede the

Companys international expansion efforts. Mitigation: The Company has instituted a geopolitical framework to continuously assess geopolitical factors. This initiative involves regular evaluation and enhancement of the

Companys global narrative for both clients and employees. Additionally, to mitigate reliance on any single nation for revenue growth and service delivery, the Company has been diversifying its operations across multiple countries. In addition, to mitigate potential disruptions stemming from restrictions on employee mobility, the Company maintains a strategy of hiring local talent through various internal programs. The Company invests strategically in a flexible workforce strategy, including on-site, onshore, nearshore, and offshore employees, to effectively tackle challenges and empower top talent to meet client needs.

? Tax-related Risk: Changes in tax regulations in India and other countries where the Company maintains a significant affect its effective tax rate.

Mitigation: The Company mitigates its tax risk by engaging professional tax advisors who stay updated on the latest tax developments globally.

They implement suitable tax planning strategies in response to changes in tax laws to ensure compliance and minimize tax liabilities.

? Currency Risk: Since approximately 50% of the Companys revenue originates from clients outside India, it is exposed to fluctuations in foreign exchange rates as its revenue is realised in foreign currencies.

Mitigation: The Company mitigates the risk of foreign exchange rate fluctuations associated with receivables and projected transactions in certain foreign currencies by utilizing foreign exchange forward contracts and options. The Boards policy and procedures determine the duration of hedges, the extent of risk to be covered, and the counterparty risk to be assumed.

? Business Continuity Risks: In a dynamic and intricate global risk environment, the Companys status as a leading technology enterprise hinge on its resilience to threats and its ability to efficiently address disruptive events. Failure to ensure operational continuity across clients, delivery sites, and support functions poses a significant risk to the Companys business continuity.

Mitigation: Over the years, Onward Technologies has diligently integrated resilience into its business continuity plan, focusing on outstanding

IT architecture across its work, workforce, workspace, business processes, technology, supply chain, and leadership. Past experiences have equipped the Company to navigate through various uncertainties, ensuring its readiness to face future challenges.

Human Resources

Human resources play a pivotal role in Onward Technologies sustained growth as a service Company with a sophisticated business model. The Company places a high priority on developing a discrimination-free environment that increases diversity and inclusion among its employees. The Company recognizes and respects the varied characteristics, experiences, needs, and aspirations within its workforce. In FY 2023-24, significant progress procedure enhancements, with a strong emphasis on prioritizing employee safety. Several digitization initiatives were introduced throughout the year to empower employees. presence could adversely The implementation of the Human Resource Management System automated core HR functions and enabled remote access. Additionally, the Company entrusted the Indian payroll process to a global leader in payroll practices. As of March 31, 2024, Onward Tech had a workforce of 2,529 employees, with women representing 19.0% of the total workforce.

Cautionary Statement

Certain statements in this Management Discussion

& Analysis Report concerning the future growth prospects are forward-looking statements, which involve several risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties. These include external factors intense competition in IT services including those that may affect the Companys cost advantage, wage increases in India, restrictions on immigration, reduced demand for technology in key focus areas, disruptions in telecommunication networks, withdrawal of governmental fiscal incentives, political instability, legal restrictions on raising capital or acquiring companies outside India, and general economic conditions affecting our industry. Internal factors include fluctuations in the Companys earnings, its ability to manage growth, ability to attract and retain highly skilled professionals, time and cost overruns on fixed-price, fixed-timeframe contracts, client concentration, ability to manage international operations, ability to successfully complete and integrate potential acquisitions, liability for damages on service contracts, the success of the companies in which it has made strategic investments, and unauthorized use of its intellectual property.