Khandwala Securities Ltd

Dear Shareholders,

As I write to you, life and lifestyles across the world are undergoing a radical change. The coronavirus pandemic hasn't ended yet; these are difficult times and we must prepare to embrace the radical changes in our lives and the way we work.

The impact of COVID-19 pandemic on both the global and domestic economies has been unprecedented and largely disruptive. The overall business environment remained muted with demand slackening in almost all sectors.Financial markets also went through extreme volatility owing to stringent lockdowns. However, the second half of the year saw a quicker and remarkable recovery due to unlocking of restrictions, pick-up in economic activity, favorable government reforms, and mass disbursement of vaccines to halt the spread of the virus. Financial markets soared to all-time highs, reflecting improvement in investor sentiment. As the pandemic spread, our topmost priority was to ensure the safety of our employees and facilitating uninterrupted services and support to our customers. Our technology team played a vital role in providing adequate systems to employees so that they can operate smoothly out of the safety of their homes. We provided remote working technology and protocols, used video calling and virtual meeting platforms to keep our operations running. During the lockdown, our technology platform worked successfully and facilitated in servicing our customers efficiently.

When the global economy went into recession in 2020 due to the COVID-19 impact, central banks embarked on record monetary stimuli and governments across theglobe adopted a counter-cyclical fiscal policies by embarking on unprecedented fiscal spending to pull their respective economies out of the recession caused by the once-in-a-century crisis; these measures met with visible success. Growth recovered in the second half of Calendar Year 2020 and high frequency economic indicators such as global Purchasing Managers' Index (PMI) showed that the momentum in economic recovery continues.

At home too, the Indian government took series of measures to minimise the impact of the pandemic and to kick-start the economy. Measures like the stimulus package, the Atmanirbhar Bharat campaign, liberalisation of FDI rules, focused industry- specific incentives, and financial and food assistance to the needy helped to cushion the dire effects of the pandemic. Steps like support to MSMEs, permission for commercial mining, agri reforms etc. are expected to further help in achieving the broader goals of economic growth and self-reliance. Gradually, after the government eased Covid related restrictions on mobility, economic activity has started limping back and we closed the year with Q4FY2021 real GDP growth of 1.6%, which was the strongest quarter of the year. The IMF expects India to be the fastest growing economy in the world during CY2021 at 12.5% GDP growth. Structural reforms and pro-growth policies of the Government have the potential to extend the growth momentum for India beyond CY2021. The global GDP too is expected to grow by 6% in CY2021, after contracting by 3.3% in CY2020. Emerging economies are expected to grow faster at 6.7% than advanced economies at 5.1%.

The Indian equity markets had an eventful year: first, the bourses dipped into bear territory but soon reversed to a spectacular bull run, with the benchmark index NIFTY50 rallying 71% during FY2021. The rally was secular and broadbased, with small and midcaps outperforming headline indices. This was on the back of mirroring global markets as well as the expansionary FY2022 Union Budget which incorporated a countercyclical fiscal policy with focus on reviving growth. The year saw record number (up ~3x Y-o-Y) of new demat account holders entering the market. There was significant surge in trading volumes (average daily turnover almost doubled) led by historic levels of volatility arising out of the pandemic, lower interest rate regime in the market, and aided by the work-from-home environment.

Your Company has immense reserves of inherent strengths to capitalise on the opportunities. The biggest amongst these is its ability to constantly reinvent itself to remain relevant for the customer's changing and evolving needs. The Company has constantly innovated and added products, features and services to its arsenal, many of which have gone on to become industry standards.

I would like to reiterate that Khandwala Securities Limited is an over 90-yearold company but yet a young enterprise in mindset. It works with the maturity of an established firm and agility of a start-up. As a consumer-centric organisation, while we are proud of our legacy, we do not rest on our laurels. We have kept augmenting customer trust, refreshed our talent, invested substantially in technology, maintained high level of corporate governance, and constantly endeavoured to give back to the society. We continue to invest in people, processes, and technology towards greater stakeholder value creation.

I take this opportunity to thank all of you - and our customers, partners, associates, employees, communities, and the regulators - for the continued support and trust by all in our long-term story, and solicit your continued support going forward. And finally, along with all of you, we look forward to a brighter, stronger post-covid future for our country and its people.