Arihant Capital Markets Ltd

<dhhead>FROM CHAIRMAN'S DESK</dhhead>

ASHOK KUMAR JAIN

Chairman & Managing Director

Dear Valued Shareholders

At Arihant Capital, we operate with a simple approach to business - strive to make decisions that are in the best interest of our clients. Our responsibility is to help our clients make informed investment decisions that safeguard and grow their wealth. We aim to be their trusted partner, guiding them through uncertain times with prudence and expertise.

When looking back at the financial year 2022-2023,1 believe the year will be defined by two key points:

• Our ongoing investment in the digital transformation of the company.

• Navigating through the heightened volatility of the equity markets and a slew of regulatory changes.

When you glance at our FY2023 results, it's apparent that the operating environment was challenging. The heightened volatility in the stock markets, regulatory changes that changed our business landscape along with increased competition from discount broking players resulted in a drop in our revenues and profitability. At the same time, we continued to make strategic investments in our technology that, though important to the company's long-term strength, weighed on our financial performance in the short run.

The regulatory landscape is continuously evolving, with SEBI introducing a slew of major changes for securities brokers. While implementing these changes has been challenging, almost every change has been focused on prioritising transparency and investor protection. We wholeheartedly embrace these regulations to preserve the integrity of the financial system. These changes have also helped in making Indian capital markets one of the safest markets in the world for investors. I believe the foundation tha: SEBI is laying will also help in increasing participation from various investor segments.

India's Resilient Equity Markets: A Beacon of Opportunity

Despite global headwinds, India's equity markets continue to experience an uptrend. Our markets have shown resilience even in the face of the COVID-19 pandemic, geopolitical tensions, tightening liquidity and rising energy prices. This resilience reflects the robustness of India's economic fundamentals and the confidence investors have in our nation. While the stock markets saw a lot of volatility and the Indian rupee also declined by a sharp 8.4% against the US dollar over the last fiscal, the markets managed to end the year on a positive note.

India remains an attractive investment destination for surplus economies. Our country's inherent qualities, coupled with a strong and forward-looking governance framework, make it a preferred choice for long-term investments. Amidst global uncertainties, India's potential as an investment hotspot remains strong, offering compelling opportunities for sustainable growth and returns. Like every year, I would reiterate that I strongly believe in India's growth story and there's a huge opportunity for us to grow as a company.

Empowering Millennials with Arihant Plus

Our digitisation goal is to provide access to the financial system in a way that is simple and convenient for our customers and that would make our systems and processes more efficient, sustainable and cost-effective. We have been working relentlessly over the past few years on a new suite of investing products, powered by the best technology while creating scalable and secured infrastructure.

We believe investing should be accessible and understandable to newcomers and experts alike. The investing platform should be powered by the best technology, yet have a simple design and an intuitive interface, so that customers are empowered to achieve their goals. I am pleased to announce that, keeping this thought in mind, we launched the first phase of our new mobile trading application - Arihant Plus during the financial year.

Arihant Plus is the result of a continuous focus on our customers' needs and feedback, which has guided our product development decisions. We launched our proprietary client onboarding platform last year and have upgraded it to create an intuitive and seamless onboarding experience. Our digitalization initiatives have paved the way for greater reach and paperless processes.

We are set to expand our offerings to add products and features that will empower our clients to learn, participate, and grow and take control of their finances. We remain steadfast in our commitment to accompany our valued clients throughout their wealth creation journey over the next decades.

Looking ahead

Arihant Capital is approaching an exciting, perhaps transcendent, inflection point in our company's history.

The digital transformation and the decisions made over the last few years have set Arihant Capital up to thrive like never before. I think we're incredibly well-positioned to serve our clients.

As we go forward, we are focused on the success of our clients and our business partners so we can deliver for shareholders. Our leadership is focused on our key priorities to make the company stronger, more diversified and future-ready.

We take great pride in our strong governance policies, robust internal control systems, and effective stakeholder communication.

Looking ahead, we envision strong growth in the coming decade as equity penetration deepens and the investor landscape matures. We are poised to capitalise on this trend, offering ease of access and simple yet comprehensive financial products to leverage future growth opportunities.

Closing notes

Thank you for your continued support. I extend my heartfelt gratitude to the regulatory authorities, the Board Members, the Management Team, colleagues and their families, and the wider stakeholder community for their unwavering dedication and belief in our vision.

n is inrougn men invaiuaoie corm louuons ana collaboration that we have been able to navigate challenges and seize opportunities. We aspire to be India’s most preferred investing platform, united by our core va ues of integrity, client service, partnership, and excellence.

Together, we will continue to forge ahead, creating value and delivering excellence in the years to come.

Your Sincerely