Vedant Asset Ltd Management Discussions

You should read the following discussion in conjunction with our restated financial statements attached in the chapter titled Financial Information of the Company beginning on page 113. You should also read the section titled Risk Factors on page 20 and the section titled Forward Looking Statements on page 15 of this Draft Prospectus, which discusses a number of factors and contingencies that could affect our financial condition and results of operations. The following discussion relates to us, and, unless otherwise stated or the context requires otherwise, is based on our Restated financial Statements.

Our financial statements have been prepared in accordance with Indian GAAP, the Companies Act and the SEBI (ICDR) Regulations and restated as described in the report of our auditor dated May 26, 2022 which is included in this Draft Prospectus under Financial Statements . The Restated Financial Information has been prepared on a basis that differs in certain material respects from generally accepted accounting principles in other jurisdictions, including US GAAP and IFRS. Our financial year ends on March 31 of each year, and all references to a particular financial year are to the twelve-month period ended March 31 of that year.

Business Overview

Our company was originally incorporated on July 07, 2015 as a Private Limited Company in the name and style of Vedant Asset Advisors Private Limited under the provisions of the Companies Act, 2013 with the Registrar of Companies, Jharkhand. Subsequently, the name of our company was changed from Vedant Asset Advisors Private Limited to Vedant Asset Private Limited vide a fresh certificate of incorporation dated November 29, 2017 by Registrar of Companies, Jharkhand. Further, our company was converted into Public Limited Company vide special resolution passed by our shareholders at the Extra ordinary General Meeting held on April 28, 2022 and the name of the company was changed from Vedant Asset Private Limited to Vedant Asset Limited pursuant to issuance of Fresh Certificate of Incorporation dated June 03, 2022 by Registrar of Companies, Jharkhand. The Corporate Identification Number of our company U74900JH2015PLC003020.

Our company is engaged in the business as a Corporate Business Correspondents (BC) of Bank of India, Jharkhand Rajya Gramin Bank (JRGB) and Madhya Pradesh Gramin Bank (MPGB) and as Mutual Funds Distribution through a partner base of more than 350 Vedant Mitra partners working in various rural and semi-urban locations and handling more than 100 crores of assets under our Mutual fund distribution business. Our Vedant Mitra Kendra acts as Banking - Customer services Point (CSPs) to fulfil all the necessary banking requirements of the people, Adhaar enabled payment system, Direct Money Transfer (DMT), investment in Mutual Funds - mPOS, PAN related services, Insurance services, Loan services and recharge services along with Air, rail and Bus ticketing etc. We are also looking towards expanding our services in the field of disbursing Government DBT subsidies, Adhaar linked subsidies and providing essential services through our network of Vedant Mitra Kendra. We believe in taking the financial services to the last mile and in creating an aggressive business model both for our partners and Clients.

Our company has been promoted by Mr. Lallit Tripathi and Mrs. Priyanka Maheshwari who have an overall experience of around 25 years and 18 years respectively in the field of providing financial services, mutual fund distribution and financial distribution services. Under the leadership of our promoters and the guidance of our management we have carved ourselves as a complete financial solution provider for urban and rural markets and we are continually expanding our reach and market. Over the year our success has been recognized by many institutes like CNBC Hall of Fame Award for the year 2019, CNBC TV18 Best financial advisors award for East 2016, CNBC TV 18 Best financial advisor (IFA Up country East) 2017, One of the largest mobilization of AUM (Asset under management in Jharkhand), Wealth Forum Award for Highest Business Mobilization in Rest of East in 2015 etc.

Over the years and with the experience of our promoters we have emerged as a Financial Service Provider serving our partners and client providing financial services. Under our Corporate Banking Correspondent services, we are providing various Banking services in the rural, Semi-urban and urban parts of Jharkand and Madhya Pradesh. Our promoter Mr. Lallit Tripathi has worked very closely with ICICI Bank Ltd as a DSA and DCID in this region from 2002 to 2007 with the name of our proprietor firm ALMA technology and have achieved many milestones for the bank during the same period. As of now our company is associated with the Jharkhand Rajya Gramin Bank (JRGB), Bank of India and Madhya Pradesh Gramin Bank (MPGB) for providing the financial services. Under our mutual fund distribution business, we are currently acting as a broker for 22 different fund house with the AUM of over 100 crores of which ICICI Prudential Mutual Fund, Kotak Mutual Fund, Aditya Birla Sun Life Mutual Fund, SBI Mutual Fund and Axis Mutual Fund are some prominent names.

With the increased Government focus towards digitalization and digital banking, we focus to enhance our value proposition and planned to launch the Micro ATM (mATM services) which will enable the banking services in the rural and remote areas. The same will be undertaken through the application of the VedantPay which will be connected to the small machines i.e. mATM, through which people in the remote and rural areas which donot have banking facilities will be able to do banking transaction using this technology of withdrawing money. The customer can using their ATM, Debit and Credit card withdraw the money using the mATM machines through our partners. In this way the partner attached with Vedantpay can earn through the commission and take the

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Banking facilities to these remote and rural locations. The money given to the customer will get transferred to the bank account of the Partner through the UPI mechanism.

STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

For details in respect of Statement of Significant Accounting Policies, please refer to Restated Financial Statements beginning on page 113 of this Draft Prospectus.

Factors Affecting our Results of Operations

1. General economic and business conditions in the markets in which we operate and in the local, regional, national and international economies;

2. Changes in consumer demand;

3. Failure to successfully upgrade our product portfolio, from time to time;

4. Any change in government policies resulting in increases in taxes payable by us;

5. Our ability to retain our key managements persons and other employees;

6. Changes in laws and regulations that apply to the industries in which we operate.

7. Our failure to keep pace with rapid changes in technology;

8. Our ability to grow our business;

9. Our ability to make interest and principal payments on our existing debt obligations and satisfy the other covenants contained in our existing debt agreements;

10. general economic, political and other risks that are out of our control;

11. Inflation, deflation, unanticipated turbulence in interest rates, equity prices or other rates or prices;

12. Company s ability to successfully implement its growth strategy and expansion plans ;

13. failure to comply with regulations prescribed by authorities of the jurisdictions in which we operate;

14. inability to successfully obtain registrations in a timely manner or at all;

15. occurrence of any Uninsured Losses;

16. conflicts of interest with affiliated companies, the promoter group and other related parties;

17. any adverse outcome in the legal proceedings in which we are involved; and

18. The performance of the financial markets in India and globally.

19. Impact of covid-19 on our business and operations.

Discussion on Result of Operations

The following discussion on results of operations should be read in conjunction with the Consolidated Restated Financial Statements for the financial years ended on March 31, 2022, March 31, 2021 and March 31, 2020.

						(Rs in Lakhs)
Particulars	FY 2021-22	% of Total Income	FY 2020-21	% of Total Income	FY 2019-20	% of Total Income
Income
Revenue From Operation	159.29	95.25	101.23	89.21	60.49	98.80
Other Income	7.94	4.75	12.24	10.79	0.73	1.20
Total Income	167.23	100.00	113.47	100.00	61.23	100.00
Expenditure
Purchase of Material	24.83	14.85	0.00	0.00%	0.00	0.00%
Change In Inventory	(21.07)	(12.60)	0.00	0.00	0.00	0.00
Employee Benefit Expenses	31.15	18.63	23.12	20.38	10.09	16.48
Finance Cost	0.25	0.15	0.05	0.05	0.39	0.64
Depreciation and Amortisation Expenses	8.04	4.81	6.52	5.75	6.07	9.92
Other Expenses	105.66	63.18	72.29	63.71	40.07	65.45
Total Expenditure	148.86	89.02	101.98	89.88	56.63	92.49
Profit/(Loss) Before Exceptional & extraordinary items & Tax	18.37	10.98	11.48	10.12	4.60	7.51
Exceptional Item	0.00	0.00%	0.00	0.00%	0.00	0.00%
Profit/(Loss) Before Tax	18.37	10.98	11.48	10.12	4.60	7.51
Tax Expense:
Tax Expense for Current Year	5.21	3.11	3.17	2.79	1.38	2.26
Short/ (Excess) Provision of Earlier Year	0.0	0.00%	0.00	0.00%	0.00	0.00%
Deferred Tax	(0.64)	(0.39)	(0.37)	(0.32)	(0.18)	(0.30)
Net Current Tax Expenses	4.56	2.73	2.80	2.47	1.20	1.96
Profit/(Loss) for the Year	13.81	8.26	8.68	7.65	3.40	5.55

Revenue from operations:

Revenue from Operations mainly consists of revenue from brokerage, BC Collection and BC Commission.

Other Income:

Our other income primarily comprises of Profit on redemption of Investments, PAN Coupon, Interest from Fixed Deposits, and other income etc.

Total Expenses:

Company s expenses consist of operating cost like Purchase of material, Changes in the inventory, Employee benefits expense, Finance costs, Depreciation and amortization expenses and other expenses.

Purchase of Material:

Our material comprises of purchase of stock in trade.

Changes in the Inventory:

Our changes in the inventory comprises of changes in the Stock in Trade.

Employee benefits expense:

Our employee benefits expense primarily comprises of Salaries & wages and Gratuity Provision.

Finance Costs:

Our finance cost comprises of bank charges.

Depreciation and Amortization Expenses:

Depreciation includes depreciation on Furniture & Fixtures, Computer & Plotters, Plant & Machinery and Office Equipments. Amortization expenses includes amortization on Software and Trade Mark.

Other Expenses:

Our Other Expenses consists of BC Commission, Commission Expenses, Advertisement Expense, Professional Charges, Contractual Expense,3Office Rent Paid etc.

Financial Year 2022 Compared to Financial Year 2021 (Based on Consolidated Restated Financial Statements)

Total Income:

Total income for the financial year 2021-22 stood at Rs.167.23 Lakhs whereas in Financial Year 2020-21 the same stood at Rs. 113.47 Lakhs representing an increase of 47.38%. The main reason of increase was increase in the business operations of the company.

Revenue from Operations

During the financial year 2021-22 the net revenue from operation of our Company increased to Rs.159.29 Lakhs as against Rs. 101.23 Lakhs in the Financial Year 2020-21 representing an increase of 57.36%. The main contribution was due to expansion in the business.

Other Income:

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During the financial year 2021-22 the other income of our Company decreased to Rs.7.94 Lakhs as against Rs.12.24 lakhs in the Financial Year 2020-21 representing a decrease of 35.16%.

Total Expenses

The total expense for the financial year 2021-22 increased to Rs.148.86 Lakhs from Rs.101.98 lakhs in the Financial Year 2020-21 representing an increase of 45.97%. Such increase was due to increase in business operations of the Company.

Purchase of Material:

As the company has started its new line of business for which the company has purchased stock in trade in the financial year 2021-2022 of Rs. 24.83 Lakhs.

Changes in the Inventory:

As the company has started its new line of business, there is increase in the inventory of the company in the financial year 2021-2022 of Rs. 21.07 Lakhs.

Employee benefits expense:

Our Company has incurred Rs.31.15 Lakhs as Employee benefits expense during the financial year 2021-22 as compared to Rs. 23.12 Lakhs in the financial year 2020-21. The increase of 34.71% was due to increase in salary and wages.

Finance costs:

These costs were for the financial Year 2021-22 increased to Rs.0.25 Lakhs as against Rs.0.05 Lakhs during the financial year 2020-21. The increase of 378.16% was due to increase in the bank charges.

Depreciation and Amortization Expenses:

Depreciation for the financial year 2021-22 stood at Rs. 8.04 Lakhs as against Rs.6.52 Lakhs during the financial year 2020-21. The increase in depreciation was around 23.29% in comparison to the previous year.

Other Expenses:

Our Company has incurred Rs.105.66 Lakhs during the Financial Year 2021-22 on other expenses as against Rs.72.29 Lakhs during the financial year 2020-21. There was an increase of 46.17% was mainly due to increase in BC Commission, Advertisement Expense, Business Promotion Expenses, Office expenses, office rent paid and Contractual Expense, etc.

Restated profit before tax:

Net profit before tax for the financial year 2021-22 increased to Rs.18.37 Lakhs as compared to Rs.11.48 Lakhs in the financial year 2020-21, which was majorly due to factors as mentioned above.

Restated profit for the year:

The Company reported Restated profit after tax for the financial year 2021-22 of Rs.13.81 Lakhs in comparison to Rs.8.68 lakhs in the financial year 2020-21 majorly due to factors mentioned above. The increase of 59.03% was mainly due to increase in the cost as mentioned above.

Financial Year 2021 Compared to Financial Year 2020 (Based on Restated Financial Statements)

Total Income:

Total income for the financial year 2020-21 stood at Rs. 113.47 Lakhs whereas in Financial Year 2019-20 the same stood at Rs.61.23 Lakhs representing an increase of 85.32%.

Revenue from Operations

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During the financial year 2020-21 the net revenue from operation of our Company increased to Rs. 101.23 Lakhs as against Rs. 60.49 Lakhs in the Financial Year 2019-20 representing an increase of 67.33%. The main contribution was due to expansion in the business.

Other Income:

During the financial year 2020-21 the other income of our Company has significantly increased to Rs. 12.24 Lakhs as against Rs. 0.73 lakhs in the Financial Year 2019-20 representing an increase of 1571.32%.

Total Expenses

The total expense for the financial year 2020-21 increased to Rs. 101.98 Lakhs from Rs. 56.63 lakhs in the Financial Year 2019-20 representing an increase of 80.09%.

Employee benefits expense:

Our Company has incurred Rs. 23.12 Lakhs as Employee benefits expense during the financial year 2020-21 as compared to Rs. 10.09 Lakhs in the financial year 2019-20 representing an increase of 129.12% mainly due to increase of Salary and wages.

Finance costs:

These costs were for the financial Year 2020-21 increased to Rs.0.05 Lakhs as against Rs. 0.39 Lakhs during the financial year 2019-20. The decrease of 86.74% was due to decrease in bank charges.

Depreciation and Amortization Expenses:

Depreciation for the financial year 2020-21 stood at Rs.6.52 Lakhs as against Rs. 6.07 Lakhs during the financial year 2019-20. The increase in depreciation was around 7.42% in comparison to the previous year.

Other Expenses:

Our Company has incurred Rs. 72.29 Lakhs during the Financial Year 2020-21 on other expenses as against Rs. 40.07 Lakhs during the financial year 2019-20. There was an increase of 80.39% was mainly due to increase BC Commission, IRCTC Charges, License Fee, Morpho Purchases, Office Rent Paid33333Professional Charges etc.

Restated profit before tax:

Net profit before tax for the financial year 2020-21 has significantly increased to Rs. 11.48 Lakhs as compared to Rs. 4.60 Lakhs in the financial year 2019-20. The increase of 149.70% which was majorly due to factors as mentioned above.

Restated profit for the year:

The Company reported Restated profit after tax for the financial year 2020-21 of Rs. 8.68 Lakhs in comparison to Rs.3.40 Lakhs in the financial year 2019-20. The increase of 155.44% which was majorly due to factors as mentioned above.

Information required as per Item (II)(C)(iv) of Part A of Schedule VI to the SEBI Regulations:

An analysis of reasons for the changes in significant items of income and expenditure is given hereunder:

1. Unusual or infrequent events or transactions

There has not been any unusual trend on account of our business activity. Except as disclosed in this Draft Prospectus, there are no unusual or infrequent events or transactions in our Company.

2. Significant economic changes that materially affected or are likely to affect income from continuing operations.

There are no significant economic changes that may materially affect or likely to affect income from continuing operations.

3. Known trends or uncertainties that have had or are expected to have a material adverse impact on sales, revenue or income from continuing operations.

Apart from the risks as disclosed under Section Risk Factors beginning on page 20 of the Draft Prospectus, in our opinion there are no other known trends or uncertainties that have had or are expected to have a material adverse impact on revenue or income from continuing operations.

4. Future changes in relationship between costs and revenues

Other than as described in the sections Risk Factors , Our Business and Management s Discussion and Analysis of Financial Condition and Results of Operations on pages 20, 75 and 141 respectively, to our knowledge, no future relationship between expenditure and income is expected to have a material adverse impact on our operations and finances.

5. Segment Reporting

Our business activity primarily falls within a single business and geographical segment, other than as disclosed in Restated Financial Statements on page 113, we do not follow any other segment reporting

6. Status of any publicly announced New Products or Business Segment

Except as disclosed in the Chapter Our Business , our Company has not announced any new product or service.

7. Seasonality of business

Our business is not subject to seasonality. For further information, see Industry Overview and Our Business on pages 69 and 75, respectively

8. Dependence on single or few customers

Given the nature of our business operations, we do not believe our business is dependent on any single or a few customers

9. Competitive conditions

Competitive conditions are as described under the Chapters Industry Overview and Our Business beginning on pages 69 and 75 respectively of this Draft Prospectus.

10. Details of material developments after the date of last balance sheet i.e. March 31, 2022

After the date of last Balance sheet i.e. March 31, 2022, the following material events have occurred after the last audited period

1) A special resolution passed by the shareholders at the Extra Ordinary General Meeting held on April 28, 2022, the name of our Company was changed from Vedant Asset Private Limited to Vedant Asset Limited and a fresh certificate of incorporation was issued by the Registrar of Companies, Jharkhand vide letter dated June 3, 2022.

2) Mr. Lallit Tripathi appointed as Chairman & Managing Director and Mrs. Rama Tripathi as Whole Time Director of the Company for a term of 2 year with effect from August 25,2022 by board in its meeting held on August 25,2022 and confirmed by shareholders vide Extra Ordinary General Meeting held on August 29,2022

3) Mr. Gautam Jain and Mr. Gaurav Bagroy were appointed as Additional Independent Director of the Company with effect from August 25,2022. Further, he was regularized from Additional Independent Director to Independent Director of the Company vide Extra Ordinary General Meeting held on August 29,2022.

4) We have passed a Board resolution in the meeting of Board of Directors dated August 25,2022 authorizing the Board of Directors to raise funds by making an Initial Public Offering.

5) We have passed a special resolution in the meeting of shareholders dated August 29,2022 authorizing the Board of Directors to raise funds by making an Initial Public Offering.

6) We have appointed Ms. Sradha Sengupta as a Chief Financial Officer of the Company with effect from September 5, 2022.

7) We have appointed Mr. Shobhan Gupta as a Company Secretary and Compliance officer of the Company with effect from September 5, 2022.

8) Our Company has formed the Audit Committee ( Audit Committee ), vide Board Resolution dated September 5, 2022, as per the applicable provisions of the Section 177 of the Companies Act, 2013.

9) Our Company has formed the Nomination and Remuneration Committee vide Board Resolution dated September 5, 2022 10) Our Company has formed the Stakeholders Relationship Committee vide Board Resolution dated September 5, 2022

11) Our Company has approved the Audited Financial Statements for financial year ended March 31, 2022 at Board Meeting dated September 7, 2022.

12) Our Company has approved the Restated Financial Statements for the financial year ended March 31, 2022, 2021 and 2020 in the Board meeting dated September 10, 2022.

13) Our Company has approved the Draft Prospectus vide resolution in the Board Meeting dated September 10, 2022.