Roadzen Inc. 10-K

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. Throughout this section, references to “Roadzen,” “we,” “us,” and “our” refer to Roadzen after the Business Combination, and Roadzen (DE) before the Business Combination, and their consolidated subsidiaries, as the context so requires. The following discussion and analysis of the financial condition and results of operations of Roadzen Inc. and its subsidiaries should be read in conjunction with our consolidated financial statements and the related notes included elsewhere in this Annual Report. The following discussion contains forward-looking statements that involve risks, uncertainties and assumptions. See the section titled “Cautionary Note Regarding Forward-Looking Statements.” Actual results and timing of selected events may differ materially from those anticipated in the forward-looking statements as a result of various factors, including those set forth or referred to under the section titled “Risk Factors” or elsewhere in this Annual Report. Overview Roadzen is a leading Insurtech company on a mission to transform global auto insurance powered by advanced artificial intelligence (“AI”). At the heart of our mission is our commitment to create transparency, efficiency, and a seamless experience for the millions of end customers who use our products through our insurer, OEM, and fleet (such as trucking, delivery, and commercial fleets) partners. We seek to accomplish this by combining computer vision, telematics and AI with continually updated data sources to provide a more efficient, effective and informed way of building auto insurance products, assessing damages, processing claims and improving driver safety. Insurers and other partners of Roadzen across the world use Roadzen’s technology to launch new auto insurance products, manage risk better and resolve claims faster. These products are built with dynamic underwriting capabilities, Application Programming Interface, or API-led distribution and real-time claims processing. Roadzen has built a pioneering technology platform that uses telematics, computer vision and data science to spearhead innovation across the insurance value chain, namely underwriting, distribution, claims and road safety. We call it the Roadzen “Insurance as a Service” (“IaaS”) platform. Our business generates commission-based revenue as an insurance broker focused on embedded and B2B2C (Business-to-Business-to-Customer) insurance distribution, and fee-based revenue as a provider of innovative cloud, telematics, and AI-based applications for the auto insurance ecosystem. Roadzen has four major client types: ● Insurance — including insurance companies, reinsurers, agents, brokers; ● Automotive — including carmakers, dealerships, online-to-offline car sales platforms; ● Fleets — including small and medium fleets, taxi fleets, ridesharing platforms, commercial and corporate fleets; and ● Other distribution channels such as financial services companies providing auto loans, and telematics companies. Our operations are global, and our partners consist of market-leading insurance companies, fleets and automotive original equipment manufacturers (“OEMs”) and carmakers, including AXA, SCOR, Arch, Société Générale, Jaguar Land Rover, Audi, Mercedes, Volvo and several others. Our subsidiary in the U.K., operates through a specialist Managing General Agent (“MGA”) based in Coventry, which provides auto insurance, extended warranties, and claims management services to insurers, automotive dealers, manufacturers, and fleet operators. This MGA leverages its regulatory license to underwrite and service policies locally while utilizing third-party licenses to deliver solutions globally. It acts as a delegated authority on behalf of insurers, managing policy sales and claims adjudication via its brokerage platform. Revenue is generated through commissions and administrative fees tied to Gross Written Premium (“GWP”), with specialty contracts typically structured over five-year terms. Roadzen’s subsidiary in the U.S., operates a licensed auto club based in Burlingame, California that specializes in commercial roadside assistance (“RSA”) and claims management. With a robust network of over 75,000 service providers nationwide, it offers towing, transportation, and first notice of loss (“FNOL”) services to government fleets, enterprises, insurers, and auto manufacturers. These capabilities support our comprehensive suite of mobility and insurance infrastructure services across North America. Roadzen’s subsidiary in India operates as a licensed insurance broker providing distribution and servicing of motor insurance products, including RSA, vehicle inspection, and claim facilitation. Our India operations also serve as the company’s global technology headquarters, where our product, engineering, and AI teams develop and scale the core platforms that power our insurance and mobility services worldwide. This integrated approach allows us to drive innovation and operational efficiency across all markets we serve. Roadzen’s AI Manifesto Our mission is to build the leading company at the intersection of artificial intelligence (AI), insurance and mobility. To further our mission, we have built a pioneering lab focused on fundamental and applied AI research. We work on core research areas in computer vision, generative AI, and traditional machine learning to develop product experiences that improve the safety, convenience, and protection of millions of drivers across the world. Roadzen is a founding member of the AI Alliance fostering safe, responsible, and open source development alongside industry leaders such as Meta, IBM, Hugging Face, Stability AI, AMD, Service Now, and others. Our approach to build precision AI models in insurance and mobility has won several industry accolades. Roadzen achieved significant industry recognition for its advancements in AI and technology during FY 2024-25. Honors included ‘Best AI in Deep Tech’ at the AI Awards Summit 2025 by Entrepreneur India and secured a spot on the Fintech40 Index by L’Observatoire de la Fintech. It was named the ‘World’s Top InsurTech’ by CNBC in 2024, ‘Most Innovative Use of AI’ by Financial Express at the FE Futech Awards 2024 and won the Gold Stevie Award for its xClaim insurance solution at the International Business Awards 2024. Additional recognitions included ‘Excellence in InsurTech’ by the India FinTech Forum (IFTA 2024), ‘Best Use of AI in Insurance’ at the Global AI Summit & Awards (GAISA 2024), and ‘Best Product and Business Team’ at the World Auto Forum 2024. Roadzen also won ‘Best Use of Technology’ at the Entrepreneur Awards 2024 and ‘Most Innovative Company’ at the World Finance Innovation Awards 2024. 51 On September 20, 2023, the Parent Company completed the Business Combination in which it acquired Roadzen (DE). Roadzen (DE) was determined to be the accounting acquiror in the Business Combination. Accordingly, the historical financial statements of Roadzen (DE) became the historical financial statements of the combined company upon the consummation of the Business Combination. As a result, the financial statements included in this report reflect (i) the historical operating results of Roadzen (DE) prior to the Business Combination; (ii) the combined results of the Parent Company and Roadzen (DE) following the Closing of the Business Combination; (iii) the assets and liabilities of Roadzen (DE) at their historical cost; and (iv) the Company’s equity structure for all periods presented. Our Business Model Roadzen has two principal models for generating revenue: 1) Income from Insurance as a Service (IaaS Platform), and 2) Commission and Distribution Income (Brokerage Solutions). We follow a capital-light business model, meaning that we do not underwrite any risk ourselves or carry it on our balance sheet for either source of revenue. 1. IaaS Platform : Roadzen provides an IaaS technology platform addressed towards insurance for mobility. The IaaS platform has a suite of products that work cohesively to address the auto insurance value chain. Roadzen sells its IaaS platform to insurers, car manufacturers, and fleet companies to deliver services for their respective insured customers. Our deep understanding of the insurance industry has enabled us to develop a unified suite of modules and products that is tailored to address the key challenges faced in auto insurance. Our solution suite includes several products that support the insurance lifecycle, such as: ● Via : enables fleets, carmakers and insurers to inspect a vehicle using computer vision; ● Global Distribution Network (“GDN”): enables the configuration, customer quote, payment (in any currency), and administration of any insurance policy with any insurance carrier as the underwriter: ● xClaim : enables digital, touchless and real-time resolution of claims from FNOL through payment, using telematics and computer vision; ● StrandD : enables digital, real-time dispatch and tracking for RSA and FNOL during accident claims; ● Good Driving : enables insurers and fleets to recognize their best drivers, train poor drivers and build usage-based insurance (“UBI”) programs; and ● DrivebuddyAI: enables any vehicle to get advanced driver-assistance capabilities utilizing cameras and neural networks to deliver better safety on the road. ● MixtapeAI: a platform designed to power AI agents and transform customer interactions in the insurance and mobility sectors. Our technology revolutionizes the customer experience by helping customers obtain a policy within seconds and process a claim estimate within minutes in comparison with existing processes that can take weeks. Roadzen’s revenue derived from platform sales is usage-based, meaning we get paid on a per-vehicle or per-use basis. Roadzen’s IaaS Platform accounted for approximately 47% of revenues for the year ended March 31, 2025. 2. Brokerage Solutions: Roadzen acts as an insurance broker utilizing its technology to sell insurance through our embedded and B2B2C distribution model. The policies are sold by insurance intermediaries such as agents and through captive distributors such as dealerships, fleets and used car platforms. Our B2B2C channel partners choose us for a variety of reasons - for the ease of integrating our technology through APIs into their ecosystem, for a seamless, fully digital customer experience from obtaining a policy to submitting a claim, and for integrations with a large number of insurance companies who sell their policies through our platform to give the users a handful of policy options, and our ability to deliver multiple relevant products such as auto insurance, commercial and fleet insurance, extended warranty, guaranteed asset protection, and other automotive related insurance products. Lastly, we are able to provide a superior customer experience for the end user by bundling telematics for road safety, RSA and claims management to the customer - an experience that we believe is unrivaled by other traditional brokers. Roadzen’s revenues are based on commissions and other fees that are paid by our insurance carriers as a percentage of the GWP underwritten for each policy. 52 Roadzen’s Brokerage Solutions accounted for approximately 53% of revenue for the year ended March 31, 2025. Factors Affecting Our Performance Our financial condition and results of operations have been, and will likely continue to be, affected by a number of factors, including the following: Investment in Core Technology and AI We continue to develop and invest in our technology platform to drive scalability and build innovative products. We believe our significant proprietary investments into our data pipelines, training, model development and our core technology platform are key advantages that allow us to stay ahead of competition, support our growth into global markets and improve operating margins. Investment in Sales and Marketing Our sales and marketing efforts are a key component of our growth strategy. Our investments in this area have enabled us to build and sustain our customer base while creating long-term customer relationships. Our sales efforts are materially dependent on our three different channels: (1) strategic sales to insurers and car companies; (2) sales to small-and-medium fleet owners; and (3) brokerage sales driven by agents, captive distribution channels and reinsurance partnerships. We plan to continue investing in each of these channels of growth including hiring sales personnel, event marketing and global travel. Investments in Innovation for Future Growth The world of mobility is changing rapidly due to advances in connected, electric, and autonomous vehicles. We believe this presents an exciting and large opportunity to build insurance for this evolving environment. For this reason, our performance will be impacted by our ability to continuously innovate our underwriting algorithms, internalize new data sources and technologies such as Advanced Driving Assistance Systems (“ADAS”) and video telematics for accident prevention, and invest in partnerships with carmakers for their insurance offerings and for selling insurance into fleets. Acquiring New Customers Our long-term growth will depend on our continued ability to attract new customers to our platform. We intend to continue to drive customers to our platform by expanding our B2B2C model through different avenues. ● In addition to our existing geographic and product footprint, we aim to grow by expanding into new markets across our target geographies, leveraging our technology platform to increase our speed to market. ● We intend to consistently offer cutting edge technology at the intersection of mobility and insurance - a capability that traditional insurance carriers and other insurance intermediaries have struggled to provide. As our clients look to digitize and capture a greater part of the insurance value chain, our technology is the differentiator for them to choose Roadzen as a partner. Expanding Sales Within Our Existing Customer Base A central part of our strategy is expanding solutions adoption across our existing customer base. We have developed long-term relationships with our customers and have a proven track record of successfully cross-selling product offerings. We have the opportunity to realize incremental value by selling additional functionality to customers that do not currently utilize our full solution portfolio from our platform. As we innovate and bring new technology and solutions to market, we also have the opportunity to realize incremental growth by selling new products to our existing customer base. Our ability to expand sales within our customer base will depend on a number of factors, including our customers’ satisfaction, pricing, competition, and changes in our customers’ spending levels. Roadzen’s customers include leading insurers and car companies that have a global presence and are spending millions of dollars on digitizing their insurance offerings. We believe that successful integration in one geography may open up opportunities within other geographies. Roadzen has shown the ability to expand contracts from low ticket size in India to higher ticket size in global markets. We have a significant focus on maximizing the lifetime value of our customer relationships, and we continue to make significant investments in order to grow our customer base. 53 Since January 1, 2023 we began tracking customer segmentation for Roadzen, described as such: enterprise clients that include insurers, automakers and large fleets (above 100 vehicles), and SMB clients, which include agents, brokers, small dealerships, and small fleets (under 100 vehicles). As of March 31, 2025, we had 34 insurance customer agreements (including carriers, self-insureds and other entities processing insurance claims), 78 automotive customer agreements, and approximately 3,800 agents and fleet customers agreements. Strength of the Auto Insurance Market We generate a majority of our revenues through commissions and fees which are a reflection of the total insurance policy premium. Roadzen derived 53% of revenue from its Brokerage Solutions and 47% from its IaaS Platform for the year ended March 31, 2025. A softening of the insurance market characterized by a period of declining premium rates due to competition or regulation could negatively impact our financial results. Our Regulatory Environment Our insurance broking business is subject to various laws and regulations and our inability to comply with them may adversely affect our business, results of operations, and reputation. Our subsidiary in India is licensed to act as a direct insurance broker (life and general) under the Insurance Brokers Regulations of India. Accordingly, we are subject to certain laws, regulations and licensing requirements. Insurance brokers operating in India are required to comply with various regulatory requirements, including stipulations that: (i) the principal officer and broker qualified persons of an insurance broker must undergo training and pass the relevant examinations specified by the IRDAI; (ii) the principal officer, directors, shareholders and key management personnel must fulfill the “fit and proper” criteria specified under the Insurance Brokers Regulations; (iii) insurance brokers may not undertake multi-level marketing for solicitation and procuring of insurance products; (iv) insurance brokers may not offer any rebate or any other inducement to a client; (v) insurance brokers must conduct their business in compliance with the code of conduct specified under the Insurance Brokers Regulations; and (vi) insurance brokers must ensure that not more than 50% of their remuneration emanates from one client in a financial year. The IRDAI may undertake inspection of the premises of an insurance broker to ascertain how activities are carried on, and inspect their books of accounts, records and documents. The Insurance Brokers Regulations specify certain approval and reporting requirements to be adhered to by the insurance brokers from time to time, as applicable. We would be subject to fines and penalties if we fail to comply with the Insurance Brokers Regulations. We derive revenues primarily from commissions and other fees paid by insurance carriers for insurance products purchased by our customers. The commissions that we can charge to our insurer partners are based on charges set forth under the IRDAI (Payment of Commission or Remuneration or Reward to Insurance Agents and Insurance Intermediaries) Regulations, 2016 (“IRDAI Commissions Regulations”). The IRDAI (Minimum Information Required for Investigation and Inspection) Regulations, 2020 (“Minimum Information Regulations”), effective from May 23, 2021, are applicable to all insurers and insurance intermediaries in relation to purposes of investigation and inspection by the IRDAI. Inter-related companies within the group are subject to a stringent regulatory framework that affects the flexibility of our operations and increases compliance costs, and any regulatory action against us and our employees may result in penalties and/or sanctions that could have an adverse effect on our business, prospects, financial condition and results of operations. The regulatory and policy environment in which we operate is evolving and is subject to change. The government of India (“GoI”) may implement new laws or other regulations and policies that could affect the fintech industry, which could lead to new compliance requirements, including requiring us to obtain approvals and licenses from the GoI and other regulatory bodies, or impose onerous requirements. New compliance requirements could increase our costs or otherwise adversely affect our business, financial condition and results of operations. Our subsidiary in the U.K. is licensed as a MGA, under which we are subject to stringent oversight by the FCA. Our operations must align with FCA regulations that are specifically tailored to govern the conduct and obligations of MGAs, which act as an intermediary between insurers and clients, with delegated authority to underwrite and process claims on behalf of insurers. Our adherence to these regulations encompasses a variety of compliance obligations, including but not limited to, ensuring that underwriting decisions are made with the requisite skill and care, maintaining accurate and secure records of insurance contracts, managing potential conflicts of interest, and safeguarding client funds. The FCA also imposes comprehensive conduct rules and solvency requirements that require us to act with due care in the interests of policyholders. 54 The FCA’s regime for MGAs mandates a high level of financial prudence and transparency, necessitating robust internal controls and reporting systems. Failure to meet these stringent regulatory requirements could result in significant sanctions, including financial penalties, suspension of authorization, or other disciplinary actions. Given the evolving nature of the regulatory environment, changes in the FCA’s rules or the introduction of new legislation could necessitate adjustments to our operational and compliance processes. These changes could carry implications for our business model and may incur additional compliance costs, ultimately impacting our financial results and operational flexibility. Roadzen is committed to maintaining a rigorous compliance posture to meet the FCA’s expectations for MGAs. Any lapse in our compliance framework could lead to regulatory scrutiny, damage our reputation, and negatively affect our business operations and financial position. It is imperative for us to continuously monitor regulatory developments and adapt our compliance measures accordingly to mitigate the risk of enforcement actions and to uphold the trust of our clients and partners. The FCA has the authority to suspend the sale of any insurance product sold within the U.K. and for which it has oversight, if it does not believe a firm or a product is protecting the interests of U.K. consumers. Effective February 2024, the FCA paused all sales of the Guaranteed Asset Protection (“GAP”) product, a key contributor to our operations in the U.K., directing all insurers, including our insurance partner, to temporarily cease selling the GAP product. The regulator mandated insurers to make a resubmission, or new GAP proposal, outlining product features, coverages and pricing for approval by the FCA before sales of the GAP product could be resumed. Although our insurance partner, which is obligated to adhere to FCA guidelines, received approval to sell GAP products, the resubmission and approval process had a significant impact on our revenue, financial performance, and overall profitability. Our subsidiary in the U.S. is licensed as an auto club in California, which exposes Roadzen to a distinct set of risks due to the stringent regulatory landscape enforced by the California Department of Insurance (“CDI”). Compliance with these regulations is paramount, as they govern a wide spectrum of our activities, including membership services, claims management, and financial integrity. Our Ability to Manage Risk with Data and Technology Our operations are highly dependent on the reliability, availability, and security of our technology platform and data. Our operations rely on the secure processing and storage of confidential information, including our information systems and networks and those of our third-party service providers. Disruptions in the technology platform, systems and control failures, security breaches, or inadvertent disclosure of user data could result in legal exposure, harm our reputation and brand, and ultimately affect our ability to attract and retain customers. Although we have implemented administrative and technical controls and have taken protective actions to reduce risk, such measures may be insufficient to prevent unauthorized and malicious attacks. As our technology-enabled platform is reliant on data from external parties, such attacks or disruption in our data sources can impact our ability to operate effectively and result in damage to our reputation and results. Components of Results of Operations Revenue We provide access to our IaaS solutions through contractual agreements with our customers, whereby the customer receives one or a bundle of our solutions, which can include inspection, claims management, RSA, and/or telematics offerings. The average contract length for our IaaS customers is approximately three years. Our clients pay us on a fixed fee per-incident or per-vehicle. Our brokerage revenues are based on commissions and fees that we receive from our insurance partners for selling their policies to customers as well as providing other client services such as claims management. Our commissions and fees are calculated as a percentage of the GWP underwritten for each policy. 55 Cost of Services The cost of services for distribution business includes commissions paid to the point-of-sale person, cost of employees and other direct expenses related to facilities. For our IaaS platform, cost of services primarily consists of direct costs involved in delivering the services to the customers, including external provider cost for inspections and RSA, as well as additional costs such as employee benefit expenses. Costs forming part of cost of revenue are recognized as incurred. Research and Development Research and development costs consist primarily of employee-related costs, including salaries, stock-based compensation, employee benefits and other expenses. It also includes the cost of annotating data pipelines for AI, the cost of building and maintaining our own AI servers for training and the cloud costs for production deployments. We continue to focus our research and development efforts on adding new features and products. Sales and Marketing Sales and marketing expenses primarily include expenditures related to advertising, channel partner incentives, media, promotional and bundling costs, brand awareness activities, business development, corporate partnerships and allocated overhead costs. These expenses are a reflection of our efforts to expand our market reach for distributing insurance policies. Sales and marketing expenses also consist of employee-related costs directly associated with our sales and marketing activities, including salaries, stock-based compensation and employee benefits. We plan to continue to invest in sales and marketing to grow our customer base and increase the awareness of end customers about our products. As a result, we expect our sales and marketing expenses to increase in absolute dollars for the foreseeable future. While we expect our sales and marketing expenses to decrease as a percentage of our revenue over the long-term, our sales and marketing expenses may fluctuate as a percentage of our revenue from period to period due to the timing and extent of these expenses. General and Administrative General and administrative expenses consist of employee-related costs for executive, finance, legal, human resources, IT, and facilities personnel, including salaries, stock-based compensation, employee benefits, professional fees for external legal, accounting, and other consulting services, and allocated overhead costs. We expect our general and administrative expenses to continue to increase in absolute dollars for the foreseeable future to support our growth as well as due to additional costs associated with legal, accounting, compliance, insurance, investor relations, and other costs as we operate as a public company. While we expect our general and administrative expenses to decrease as a percentage of our revenue over the long-term, our general and administrative expenses may fluctuate as a percentage of our revenue from period to period due to the timing and extent of these expenses. Depreciation and Amortization Depreciation and amortization reflects the recognition of the cost of our tangible and intangible assets over their useful life. Depreciation expenses relate to equipment, hardware and purchased software. Amortization relates to investments related to recent acquisitions, internal software development and investments made in intellectual property development. Depreciation and amortization are expected to increase slightly in dollar amount over time but will likely decrease as a percentage of revenue as investments in platform technology reach scale. Fair Value Changes in Financial Instruments Carried at Fair Value Our outstanding notes and warrants are financial liabilities measured at fair value with fair value changes recognized in profit or loss. We carry out a periodic fair valuation exercise and recognize the increase or decrease in the carrying values of these financial instruments in our Consolidated Statements of Operations. Such fair value changes are primarily driven by changes in our equity value, risk free interest rates and credit risk premia. 56 Impairment of goodwill and intangibles with definite life Impairment of goodwill and intangibles can arise from various factors, including economic fluctuations, industry changes, technological advancements, and evolving customer preferences. When the carrying value of these assets exceeds their recoverable amount, impairment occurs, leading to a decrease in reported value on our financial statements. Recognizing and addressing impairment in a timely and effective manner is essential. Regular assessments and impairment tests are necessary to identify potential impairments and determine the recoverable amount of these assets. Income Tax Expense/(Benefit) Income tax expense/(benefit) consists primarily of income taxes in certain foreign and state jurisdictions in which we conduct business. We maintain a full valuation allowance against our U.S. and certain foreign jurisdictions’ deferred tax assets because we have concluded that it is more likely than not that the deferred tax assets will not be realized. Results of Operations (all figures are denominated in U.S. $) Comparison of the Years Ended March 31, 2025 and March 31, 2024 For the year ended March 31, Change amount % Particulars 2025 2024 Revenue 44,296,098 46,724,287 (2,428,189 ) -5 % Costs and expenses: Cost of services 18,833,218 18,132,757 700,461 4 % Research and development 3,779,955 4,973,816 (1,193,861 ) -24 % Sales and marketing 28,873,150 33,195,608 (4,322,458 ) -13 % General and administrative 51,602,107 65,895,085 (14,292,978 ) -22 % Depreciation and amortization 2,020,610 2,185,858 (165,248 ) -8 % Total costs and expenses 105,109,040 124,383,124 (19,274,084 ) -15 % Loss from operations (60,812,942 ) (77,658,837 ) 16,845,895 -22 % Interest expense (net) (3,247,831 ) (2,291,123 ) (956,708 ) 42 % Fair value gains/(losses) in financial instruments carried at fair value (14,844,420 ) (19,475,005 ) 4,630,585 -24 % Other income (net) 7,073,235 838,728 6,234,507 743 % Impairment of investment (1,245,326 ) (3,395,234 ) 2,149,908 -63 % Gain on deconsolidation of subsidiaries - 2,098,745 (2,098,745 ) -100 % Total other income/(expense) (12,264,342 ) (22,223,889 ) 9,959,547 -45 % (Loss)/Income before income tax expense (73,077,284 ) (99,882,726 ) 26,805,442 -27 % Less: income tax (benefit)/expense (13,973 ) (23,648 ) 9,675 -41 % Net Loss before non-controlling interest (73,063,311 ) (99,859,078 ) 26,795,767 -27 % Net loss attributable to non-controlling interest, net of tax (192,879 ) (189,743 ) (3,136 ) 2 % Net Loss attributable to Ordinary Shareholders (72,870,432 ) (99,669,335 ) 26,798,903 -27 % 57 Revenue For the year ended March 31, Change amount % Particulars 2025 2024 Revenue Commission and Distribution Income 23,447,282 30,500,019 (7,052,737 ) -23 % Income from Insurance as a Service 20,848,816 16,224,268 4,624,548 29 % Total 44,296,098 46,724,287 (2,428,189 ) -5 % Revenue declined by $2.4 million, representing a 5% decrease for the year ending March 31, 2025, compared to the previous year. This reduction was primarily due to the suspension of the GAP product in the U.K. Commission and Distribution Income saw a decrease of $7.0 million, or 23%, over the same period last year. This drop can be attributed to the suspension of the GAP product in the U.K., which took effect in February 2024, offset by growth in other geographies. Conversely, revenue from the Insurance as a Service (IaaS) platform experienced significant growth, increasing by $4.6 million, or 29%, for the year ending March 31, 2025. This growth was driven by higher penetration among existing clients and the addition of new clients. As of March 31, 2025, the Company maintained 34 insurance customer agreements and 78 automotive customer agreements, as well as approximately 3,800 agents and fleet customer agreements. Cost of Services For the year ended March 31, Change amount % Particulars 2025 2024 Cost of services 18,833,218 18,132,757 700,461 4 % Cost of services increased $0.7 million, or 4%, for the year ending March 31, 2025 compared to the prior year. This increase was primarily attributed to the inclusion of costs from NAC, which was acquired in June 2023 and not included April and May 2023. Research and Development For the year ended March 31, Change amount % Particulars 2025 2024 Research and development 3,779,955 4,973,816 (1,193,861 ) -24 % Research and development expense decreased $1.2 million, or 24%, for the year ending March 31, 2025 compared to the prior year. This reduction was primarily due to a $0.8 million reduction in technology personnel and consultant expense and a $0.4 million decrease in non-cash compensation expense related to RSU grants. Sales and Marketing For the year ended March 31, Change amount % Particulars 2025 2024 Sales and marketing 28,873,150 33,195,608 (4,322,458 ) -13 % Sales and marketing expense decreased $4.3 million, or 13%, for the year ended March 31, 2025 compared to the prior year. This reduction was primarily attributed to lower expenses in the U.K. following the suspension of the GAP product, along with a $0.5 million decrease in non-cash compensation expense related to RSU grants. General and administrative For the year ended March 31, Change amount % Particulars 2025 2024 General and administrative 51,602,107 65,895,085 (14,292,978 ) -22 % 58 General and administrative expense decreased $14.3 million, or 22%, for the year ended March 31, 2025 compared to the prior year. This reduction was mainly due to a decrease of $8.1 million in non-cash RSU expense, a $4.9 million decrease in provisions for doubtful accounts (which includes $2.8 million from preferred stock issuance before the Business Combination and $2.1 million in advances to deconsolidated subsidiaries for working capital), coupled with efforts in cost discipline and lower headcount. Depreciation and Amortization For the year ended March 31, Change amount % Particulars 2025 2024 Depreciation and amortization 2,020,610 2,185,858 (165,248 ) -8 % Depreciation and amortization decreased by $0.2 million or 8% for the year ended March 31, 2025, compared to the same period in the prior year. Interest Income (Expense) For the year ended March 31, Change amount % Particulars 2025 2024 Interest income/(expense) -3,247,831 -2,291,123 (956,708 ) 42 % Interest expense increased $0.9 million or 42% increase for the year ended March 31, 2025 compared to the same period in the prior year primarily due to an increase in borrowings from banks and other parties. Fair Value Changes in Financial Instruments Carried at Fair Value For the year ended March 31, Change amount % Particulars 2025 2024 Fair value changes in financial instruments carried at fair value -14,844,420 -19,475,005 4,630,585 -24 % Loss on fair valuation changes decreased by $4.6 million or 24%, for the year ended March 31, 2025 compared to the prior year due to the fair market valuation of our Forward Purchase Agreement, convertible promissory notes, and share warrants. Impairment of Investment For the year ended March 31, Change amount % Particulars 2025 2024 Impairment of investment (1,245,326 ) (3,395,234 ) 2,149,908 -63 % The Company evaluates its non-marketable equity investments for impairment each reporting period through a qualitative assessment that considers various indicators, including significant adverse changes in the investee’s business, legal or regulatory environment, or the ability to obtain relevant financial information. During the year ended March 31, 2025, the Company recorded a full impairment charge of $1.2 million related to its joint venture investment in China. This decision was driven by escalating macroeconomic and geopolitical tensions, particularly tariff-related uncertainties between the U.S. and China, which have adversely affected the Company’s ability to exercise operational influence and access timely and reliable information about the joint venture’s financial position. In light of these factors and applying the principle of prudence, management determined that the investment no longer meets the criteria for recoverability and accordingly recognized a full impairment. Other Income/(Expense) For the year ended March 31, Change amount % Particulars 2025 2024 Other (income)/expense net 7,073,235 838,728 6,234,507 743 % Other Income increased $6.2 million, or 743%, for the year ended March 31, 2025 compared to the prior year. This was primarily driven by the $7.6 million provision and short-term liability releases during the year as part of our Balance Sheet clean-up project, partially offset by a $0.7 million write-off of customer contracts in our U.K. subsidiary due to the pause in GAP sales. Non-GAAP Financial Measures Adjusted Earnings Before Interest, Tax, Depreciation and Amortization (“Adjusted EBITDA”) is a non-GAAP financial measure which excludes the impact of finance costs, taxes, depreciation & amortization and certain other items from reported net profit or loss. We believe that Adjusted EBITDA aids investors by providing an operating profit/loss without the impact of non-cash depreciation and amortization and certain other items to help clarify sustainability and trends affecting the business. For comparability of reporting, management considers non-GAAP measures in conjunction with U.S. GAAP financial results in evaluating business performance. Adjusted EBITDA should not be considered a substitute for, or superior to, the measures of financial performance prepared in accordance with U.S. GAAP. 59 The following table reconciles our net loss reported in accordance with GAAP to Adjusted EBITDA for the year ended March 31, 2025 and March 31, 2024: For the year ended March 31, Particulars 2025 2024 Net loss (72,870,432 ) (99,669,335 ) Adjusted for: Other (income)/expense net (7,073,235 ) (838,728 ) Interest (income)/expense 3,247,831 2,291,123 Fair value changes in financial instruments carried at fair value (1) 14,844,420 19,475,005 Gain on deconsolidation of subsidiaries - (2,098,745 ) Impairment of investment 1,245,326 3,395,234 Tax (benefit)/expense (13,973 ) (23,648 ) Depreciation and amortization 2,020,610 2,185,858 Stock based compensation expense 47,211,816 56,303,135 Non-cash expenses 1,649,448 1,048,464 Non-recurring expenses 1,340,062 7,685,859 Adjusted EBITDA (8,398,127 ) (10,245,778 ) (1) Fair value changes in financial instruments are considered to be financing costs as they relate to convertible notes and liability-classified preferred stock warrants previously issued in financing transactions. These changes are non-cash as the Company does not have an unconditional obligation to settle the convertible notes and preferred stock warrants in cash. These changes in fair value are affected by the Company’s own share price as these are settleable/convertible into the Company’s Ordinary Shares. The following table reconciles our net loss reported in accordance with GAAP to Adjusted EBITDA for the three months period ended March 31, 2025 and March 31, 2024: For the three months ended March 31, Particulars 2025 2024 Net loss (106,967 ) (33,978,672 ) Adjusted for: Other (income)/expense net (3,861,541 ) (55,459 ) Interest (income)/expense 714,899 732,138 Fair value changes in financial instruments carried at fair value (1) (1,681,725 ) (2,894,633 ) Gain on deconsolidation of subsidiaries - (2,098,745 ) Impairment of investment 1,245,326 3,395,234 Tax (benefit)/expense 69,709 69,734 Depreciation and amortization 1,046,539 953,232 Stock based compensation expense 76,397 25,523,471 Non-cash expenses 493,210 820,440 Non-recurring expenses 386,746 5,408,410 Adjusted EBITDA (1,617,407 ) (2,124,850 ) (1) Fair value changes in financial instruments are considered to be financing costs as they relate to convertible notes and liability-classified preferred stock warrants previously issued in financing transactions. These changes are non-cash as the Company does not have an unconditional obligation to settle the convertible notes and preferred stock warrants in cash. These changes in fair value are affected by the Company’s own share price as these are settleable/convertible into the Company’s Ordinary Shares. Limitations and Reconciliations of Non-GAAP Financial Measures Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as substitutes for financial information presented under U.S. GAAP. There are a number of limitations related to the use of non-GAAP financial measures versus comparable financial measures determined under U.S. GAAP. For example, other companies in our industry may calculate these non-GAAP financial measures differently or may use other measures to evaluate their performance. These limitations could reduce the usefulness of these non-GAAP financial measures as analytical tools. Investors are encouraged to review the related U.S. GAAP financial measures and the reconciliations of these non-GAAP financial measures to their most directly comparable U.S. GAAP financial measures and to not rely on any single financial measure to evaluate our business. Liquidity and Capital Resources Since our incorporation, we have financed our growth through a blend of equity, convertible instruments, debt (including working capital lines), and customer payments. As of March 31, 2025, we have raised an aggregate of $52.0 million, net of issuance costs, through the issuance of Ordinary Shares, convertible instruments and preferred stock of Roadzen DE. Our accumulated deficit stood at $224.3 million as of March 31, 2025 up from $151.6 million from the previous year. These accumulated deficit stem from substantial operating losses, which stems from fair valuation, vesting of RSU, impairment of investment and intangible assets, transaction costs arose from business combination. These losses have been detailed on the table below. We anticipate that we will continue to experience operating losses and generate negative cash flows from operations over an extended period due to the planned investments in our business. Consequently, we will need to secure additional capital resources to support the execution of our strategic initiatives for growing our business in the coming years. Details of Accumulated deficit: Particulars FY 2025 (USD millions) FY 2024 (USD millions) Accumulated Deficit (end of year) 224.3 151.6 Non Cash Losses: -Fair Value Losses 52.0 37.1 -Stock based compensation Losses 103.5 56.3 -Impairment of Investments & Intangibles 5.6 4.3 -Other non cash losses 5.5 3.8 Transaction Costs – Business Combination 10.1 17.7 Net Operating Losses 47.6 32.4 Our future capital requirements will depend on many factors, including, but not limited to, our growth, our ability to attract and retain customers, the continued market acceptance of our solutions, the timing and extent of spending to support our efforts to develop our platform, and the expansion of sales and marketing activities. Further, we may in the future enter into arrangements to acquire or invest in businesses, products, services and technologies. We will be required to seek additional equity or debt financing. In the event that additional financing is required, we may not be able to raise it on terms acceptable to us or at all. If we are unable to raise additional capital when desired, our business, financial condition and results of operations could be adversely affected. 60 Cash Flows The following table shows a summary of our cash flows for the periods presented: Operating Activities For the year ended March 31, Change amount Particulars 2025 2024 Cash flow from operating activities: Net loss including non-controlling interest (73,063,311 ) (99,859,078 ) 26,795,767 Adjustments for cash flow from operation 57,364,095 83,833,027 (26,468,932 ) Changes in working capital (2,442,983 ) (3,192,114 ) 749,131 Net cash used in operating activities (18,142,199 ) (19,218,165 ) 1,075,966 Our largest sources of cash provided by operations are increases in accounts payables and payments received from our customers. Our primary uses of cash from operating activities include employee-related expenses, sales and marketing expenses, third-party cloud infrastructure expenses and other overhead costs. For the year ended March 31, 2025, net cash used in operating activities was $18.1 million, $1.1 million decrease compared to $19.2 million for the year ended March 31, 2024. This increase primarily reflects a combination of higher net losses and changes in working capital during the current period. The cash outflow in the year ended March 31, 2025 was primarily driven by a net loss of $73.1 million, and net cash outflows of $2.4 million resulting from changes in operating assets and liabilities, including increased receivables and lower payables. These outflows were partially offset by non-cash adjustments totaling $57.4 million. Non-cash charges for the period included: - $14.8 million in fair value losses, - $47.2 million in stock-based compensation expense, - $2.0 million in depreciation and amortization, - $1.2 million in impairment of investment These were partially offset by non-cash gains, notably: - $8.1 million related to the gain on deconsolidation of subsidiaries and write-back of liabilities, and - $0.1 million in unrealized foreign exchange gains. The year-over-year increase in net cash used in operating activities reflects the impact of continued investment in strategic initiatives, increased working capital outflows due to timing differences in collections and payments. Management continues to monitor liquidity closely and is actively pursuing measures to optimize working capital and align operational costs with revenue growth expectations. Investing Activities For the year ended March 31, Change amount Particulars 2025 2024 Cash flow from investing activities: Purchase of property, plant and equipment (424,910 ) (455,924 ) 31,014 Acquisition of businesses - (5,749,200 ) 5,749,200 (Investment)/ Proceeds in mutual funds 309,289 (500,000 ) 809,289 Net Cash used in investing activities (115,621 ) (6,705,124 ) 6,589,503 Cash generated from investing activities was $0.1 million for the year ended March 31, 2025, consisted of $ 0.4 million of capital expenditure for new office facilities, partially offset by receipts from investments in mutual funds (held for sale) of $0.3 million. Cash used in investing activities was $6.7 million for the year ended March 31, 2024, which primarily consisted of $5.7 million for the acquisitions of GIM and NAC, $0.5 million consisting of an investment made in a mutual fund (held for sale), and $0.5 million of capital expenditures for additional office facilities. Financing Activities For the year ended March 31, Change amount Particulars 2025 2024 Cash flow from financing activities: Proceeds from business combination - 26,824 (26,824 ) Proceeds from issue of preferred stock - 6,079,409 (6,079,409 ) Proceeds from issue of ordinary shares 7,073,913 - 7,073,913 Net proceeds/(payments) from short-term borrowings 3,669,290 15,465,516 (11,796,226 ) Net proceeds/(payments) from borrowings 1,000,000 3,790,633 (2,790,633 ) Net cash generated from financing activities 11,743,203 25,362,382 (13,619,179 ) We have generated negative cash flows from operations since our inception and have supplemented working capital through net proceeds from the issuance of Ordinary Shares as well as the issuance of debt. Cash provided by financing activities was $11.7 million for the year ended March 31, 2025, which consisted primarily of $7.1 million from the issuance of Ordinary Shares, $1.0 million from the forward purchase agreement and $3.7 million from loans from banks and other parties. 61 Cash provided by financing activities was $25.4 million for the year ended March 31, 2024, which primarily consisted of $6.1 million of proceeds from the issuance of common and preferred stock of Roadzen (DE), $3.8 million from the forward purchase agreement and $15.5 million from loans from banks and other parties. Forward Purchase Agreement On August 25, 2023, the Company (then named Vahanna Tech Edge Acquisition I Corp.) entered into an agreement with (i) Meteora Capital Partners, LP (“MCP”), (ii) Meteora Select Trading Opportunities Master, LP (“MSTO”), and (iii) Meteora Strategic Capital, LLC (“MSC” and, collectively with MCP and MSTO, “Seller”) (the “Forward Purchase Agreement” or “FPA”) for OTC Equity Prepaid Forward Transactions, as summarized in the Current Report on Form 8-K filed by the Company on September 26, 2023 (the “Prior 8-K”). Capitalized terms used but not defined herein have the meanings given to them in the Prior 8-K and/or the Forward Purchase Agreement. On January 30, 2024, the Company and the Seller entered into an amendment to the Forward Purchase Agreement (the “Amendment”). The Amendment amends the section of the Forward Purchase Agreement regarding a Prepayment Shortfall by providing that the Company has the option, at its sole discretion, at any time up to 45 days prior to the Valuation Date, to request up to $5 million in Prepayment Shortfall via ten separate written requests to Seller in the amount of $500,000 each (each, an “Additional Shortfall Request”), provided that at the time of any Additional Shortfall Request (i) Seller has recovered 117% of the prior Additional Shortfall Request, if any, via Shortfall Sales and (ii) the VWAP Price over the ten trading days prior to such Additional Shortfall Request multiplied by the then current Number of Shares less Shortfall Sale Shares held by Seller is at least seven times greater than such Additional Shortfall Request. In addition, the Amendment amends the section of the Forward Purchase Agreement regarding Prepayment Shortfall Consideration by eliminating the 180-day period following a Trade Date before Seller may commence selling Recycled Shares and by permitting such sales without payment by Seller of any Early Termination Obligation until such time as the proceeds from such sales equal 117% (instead of 100% as originally provided in the Forward Purchase Agreement) of the Prepayment Shortfall. During the year ended March 31, 2025, an additional $1 million was received from the Seller, bringing the total cash receipts to $4.8 million. Contractual Obligations and Commitments The following table summarizes our contractual obligations as of March 31, 2025: Particulars For the year ended March 31, 2025 Total Less than 1 Year 1-3 year 3-5 year After Debt (1) 22,909,864 22,770,089 70,975 68,800 Operating Leases (2) 1,208,806 437,534 453,245 180,085 137,942 Deferred Revenue 1,149,019 893,822 255,197 Accounts Payable & accrued expenses 30,254,010 30,254,010 Total 55,521,699 54,355,455 779,417 248,885 137,942 (1) The amount of debt represents carrying amount of borrowings (excluding interest) which the Company is obligated to repay in cash. (2) The Company leases office space under non-cancelable operating lease agreements, which expire on various dates through January 2033. The operating lease includes $261,485 of imputed interest due to the implementation of ASC-842. Description of Indebtedness: As of March 31, 2025 As of March 31, 2024 Particulars Long Term Borrowings Short Term Borrowings Long Term Borrowings Short Term Borrowings Loans from banks 167,177 263,846 112,169 781,455 Secured debentures 1,718,596 - 2,214,754 - Convertible debenture 1,158,446 1,374,481 Current portion of long-term borrowings (2,904,444 ) 2,904,444 (2,228,471 ) 2,228,471 Loan from Related Parties - 115,086 1,096,109 Loan from Others - 19,486,713 13,877,265 139,775 22,770,089 1,472,933 17,983,300 Description of Operating Leases: Particulars For the Year ended March 31, 2025 Operating Leases: Short term liabilities 318,921 Long term liabilities 628,400 Total operating lease liabilities 947,321 62 Senior Secured Mizuho Notes On June 30, 2023, Roadzen entered into a Note Purchase Agreement (the “Note Purchase Agreement”) with Mizuho Securities USA LLC (“Mizuho”), as administrative agent and collateral agent, and as a purchaser, pursuant to which Mizuho purchased an aggregate principal amount of $7,500,000 of senior secured notes (the “Mizuho Notes”). The Mizuho Notes bear interest at a rate of 15.0% per annum, which will automatically increase by 5% if we fail to prepay the Mizuho Notes upon the occurrence of certain mandatory prepayment events as set forth in the Note Purchase Agreement; however, we may prepay all or any portion of the Mizuho Notes prior to maturity at our option without penalty. As a condition precedent to closing under the Note Purchase Agreement, Roadzen entered into a Security Agreement, pursuant to which each of the Loan Parties granted a first priority lien on substantially all of its assets to Mizuho, as administrative agent and collateral agent for the Purchasers. The Note Purchase Agreement contains certain covenants that restrict the Note Parties’ ability to, among other things, transfer or sell assets, create liens, incur indebtedness, make payments and investments and transact with affiliates. Additionally, the Loan Parties are collectively required to maintain a cash reserve of at least $1 million in the aggregate to satisfy the minimum liquidity condition as set forth in the Note Purchase Agreement. The Note Purchase Agreement provides for customary events of default, if not cured or waived, would result in the acceleration of substantially all of the outstanding debt and interest owed under the Mizuho Notes (and any other debt containing a cross-default or cross-acceleration provision) and default interest of an additional two percent (2.0%) for so long as an event of default is continuing. The Mizuho Notes were originally scheduled to mature on June 30, 2024. On June 30, 2024, Mizuho granted to the Company a waiver of payment until July 31, 2024. On July 26, 2024, the Company entered into Amendment No. 1 to the senior secured notes, providing for an additional $4 million in principal amount to a total of $11.5 million, and an extension of the maturity date to December 31, 2024. Terms of the notes were otherwise the same as the original notes issued in June 2023, including an interest rate of 15% per annum, and did not require any additional warrants. On December 31, 2024, and again on January 31, 2025 while Amendment No. 2 to the senior secured notes were being drafted, Mizuho granted to the Company a waiver of payment until January 31, 2025 and then February 28, 2025. On February 28, 2025, the Company entered into Amendment No. 2 to the Note Purchase Agreement (the “Second Amendment”), by and among the Company, Roadzen, Inc., a wholly-owned subsidiary of the Company (the “Issuer”), the subsidiary guarantors party thereto (the “Guarantors”) and Mizuho, as administrative agent and collateral agent (in such capacity, the “Agent”) and as a purchaser thereunder (in such capacity, the “Purchaser”), which amended the Note Purchase Agreement, dated as of June 30, 2023 (as previously amended), by and among the Issuer, the Guarantors, the Agent and the Purchaser. Among other things, the Amendment provides for (i) an extension of the maturity date of the $11.5 million in principal amount of senior secured notes issued under the Note Purchase Agreement (the “Notes”) from December 31, 2024 to December 31, 2025 and (ii) the joinder of the Company as an additional Guarantor under the Note Purchase Agreement. In addition, the Company agreed to file, by March 30, 2025, a registration statement registering the resale of the Company’s ordinary shares, par value $0.0001 per share (“Ordinary Shares”), issuable upon exercise of the Warrant (as defined below) and to use its reasonable best efforts to have such registration statement effective as soon as practicable after filing. Also on February 28, 2025, in connection with the Second Amendment, the Company issued to the Purchaser an amended and restated warrant (the “Warrant”) to purchase an additional 104,566 Ordinary Shares at an exercise price of $0.001 per share, for a total of up to 1,537,083 Ordinary Shares at an exercise price of $0.001 per share. The Warrant amends, restates and supersedes in its entirety the warrant to purchase up to 1,432,517 Ordinary Shares at an exercise price of $0.001 per shares issued to the Purchaser on May 14, 2024 pursuant to the terms of the Note Purchase Agreement. Roadzen used the proceeds of the Mizuho Notes to support general corporate and working capital requirements and for other general corporate purposes. 63 December 2023 Junior Unsecured Convertible Debenture On December 15, 2023, the Company issued a Securities Purchase Agreement (the “December 2023 Convertible SPA”), among the Company and the investors party thereto from time to time. Pursuant to the terms of the December 2023 Convertible SPA, the Company may issue and sell an aggregate of up to $50 million in principal amount of convertible debentures (the “December 2023 Convertible Debentures”), on a private placement basis (collectively, the “December 2023 Private Placement”). The Company held an initial closing of the December 2023 Private Placement, at which it received $400,000 in proceeds on December 15, 2023. On January 19, 2024, the Company issued an additional convertible debenture under the December 2023 Convertible SPA in the principal amount of $500,000 to Supurna VedBrat (the “VedBrat Debenture”), a director of the Company, for a purchase price equal to the principal amount of the VedBrat Debenture. Also on January 19, 2024, Ms. VedBrat became a party to the December 2023 Convertible SPA and entered into a letter agreement with the Company (the “Letter Agreement”) with respect to her investment in the Company pursuant to the VedBrat Debenture. On February 7, 2024 the Company issued an additional convertible debenture under the December 2023 Convertible SPA in the principal amount of $200,000 and may sell additional Debentures at additional closings from time to time. The December 2023 Convertible Debentures bear interest, in arrears, at a rate of 13% per annum, payable semi-annually commencing on June 15, 2024, and matures on December 15, 2025. Interest is payable in kind, subject to the right of the Company to make any interest payments in cash. The Debentures are convertible into the Company’s Ordinary Shares, at the election of the holder at any time at an initial conversion price of $10.00 per Ordinary Share (the “Conversion Price”). The Conversion Price is subject to customary adjustments for stock dividends, stock splits, reclassifications and the like. In addition, if the average volume weighted average price of the Ordinary Shares for the 30 trading days immediately preceding December 15, 2024 (the “Average VWAP”) is less than the Conversion Price then in effect, the Conversion Price will be adjusted to an amount equal to such Average VWAP, subject to a floor of 85% of the Conversion Price then in effect. In addition, as the Average VWAP was less than the Conversion Price then in effect, the Conversion Price was adjusted to $8.50, an amount equal to 159,995 Ordinary Shares, as of December 15, 2024. The Company has the right to require the Debentures to be converted into Ordinary Shares if the closing price of the Ordinary Shares exceeds 130% of the then-applicable Conversion Price for any 20 trading days within a consecutive 30 trading day-period. The indebtedness evidenced by the December 2023 Convertible Debentures is subordinate to all other indebtedness of the Company. The Company has agreed in the December 2023 Convertible Debentures that it will not, while the December 2023 Convertible Debentures remain outstanding, incur additional indebtedness other than indebtedness (i) evidenced by other December 2023 Convertible Debentures, (ii) senior to the December 2023 Convertible Debentures in an aggregate principal amount of no more than $50 million and (iii) pari passu or junior to the December 2023 Convertible Debentures in an aggregate principal amount of no more than $50 million. The December 2023 Convertible Debentures contain customary events of default, including defaults in payment or performance that remain uncured after specified cure periods and certain events of bankruptcy. Pursuant to the terms of the Letter Agreement, the Company has (i) granted Ms. VedBrat certain most favored nations rights with respect to future issuances of securities while the VedBrat Debenture is outstanding and (ii) agreed to issue to Ms. VedBrat, warrants to purchase a number of Ordinary Shares equal in value as of December 15, 2023 to ten percent (10%) of the original principal balance of the VedBrat Debenture, at an exercise price of $8.50 per share. The Company entered into a substantially similar letter agreement with the first investor that purchased December 2023 Convertible Debentures at the initial closing under the December 2023 Convertible SPA. 64 Senior Secured 2024 Notes On March 28, 2024, the Company entered into a Securities Purchase Agreement (the “March 2024 SPA”) with Supurna VedBrat and Krishnan-Shah Family Partners, LP (together, the “2024 Purchasers”). Ms. VedBrat is a director of the Company. Ajay Shah, another director of the Company, and his wife, are trustees of the general partner of the Krishnan-Shah Family Partners, LP. Each of the 2024 Purchasers purchased $500,000 in principal amount of the 2024 SPA Notes on the date of the March 2024 SPA (the “March 2024 Notes”). On May 23, 2024, Ms. VedBrat purchased an additional $500,000 in principal amount of the 2024 SPA Notes (the “May 2024 Note”). Pursuant to the terms of the March 2024 SPA, the Company may issue and sell up to an additional $2.0 million in aggregate principal amount of the 2024 SPA Notes to one or more other purchasers. The March 2024 SPA contains covenants by the Company, including requirements to cause each of its subsidiaries (other than certain excluded subsidiaries) to guaranty the Company’s obligations under the 2024 SPA Notes and to take certain actions required to grant the 2024 Purchasers perfected security interests in the assets of the Company and its subsidiaries (subject to the existing liens of Mizuho). Pursuant to the terms of the March 2024 SPA, the Company and the 2024 Purchasers will enter into the Buyer Security Documents as defined in the March 2024 SPA. The 2024 SPA Notes bear interest at a rate of 17.5% per annum and mature on the six-month anniversary of funding of the respective note (the “Initial Rate Adjustment Date”). Interest is payable in cash or in kind, at the option of the Company, on each three month anniversary of funding through the Initial Rate Adjustment Date (after which date all interest is payable in cash unless the parties agree to payment in kind). The Company’s failure to repay all principal and accrued interest by the Initial Rate Adjustment Date would not constitute an event of default under the applicable 2024 SPA Note, however, the interest rate payable under such 2024 SPA Note would increase on such date to 19.5% per annum going forward, and thereafter would increase by an additional 200 basis points on each monthly anniversary of the Initial Rate Adjustment Date until each of the respective 2024 SPA Notes is paid in full, subject to a maximum interest rate of 29.5% per annum. Following the Initial Rate Adjustment Date, all unpaid principal and accrued interest would be payable within five business days of the holder’s written demand. If any interest under the 2024 SPA Notes is paid in kind, such payment would be made through the issuance of that number of the Company’s ordinary shares, $0.0001 par value per share (“Ordinary Shares”), calculated by dividing the amount payable by the lowest of (i) $8.00, (ii) the volume-weighted average price (“VWAP”) of the Ordinary Shares over the 60 trading days ending three trading days prior to the interest payment date, (iii) the opening price per share of the Ordinary Shares in any public offering of Ordinary Shares after the issuance of the respective 2024 SPA Notes, and (iv) the price per Ordinary Share after market close on the first day of trading following any such public offering of Ordinary Shares. The indebtedness evidenced by the 2024 SPA Notes is intended to rank senior to all outstanding and future indebtedness of the Company, other than the Company’s outstanding indebtedness to Mizuho, and is to be secured pursuant to the Buyer Security Documents. The 2024 SPA Notes contain covenants of the Company that, among other things, prohibit the Company from incurring additional indebtedness or liens, subject to certain exceptions, for so long as the 2024 SPA Notes are outstanding. The 2024 SPA Notes contain customary events of default, including certain defaults in payment or performance and certain events of bankruptcy. Also pursuant to the terms of the March 2024 SPA, the Company agreed to issue to each Purchaser warrants (the “March 2024 SPA Warrants”) to purchase, for each $10,000 in original principal amount of 2024 SPA Notes purchased, 1,000 Ordinary Shares. Each of the March 2024 SPA Warrant will be exercisable at any time during the period commencing on March 28, 2025 (the “Vesting Date”) through March 28, 2031 (or until the dissolution, liquidation or winding up of the Company, if earlier). The exercise price of the March 2024 SPA Warrants is equal to 80% of the lower of (i) the VWAP of the Company’s Ordinary Shares (RZDN), as reported on the relevant market or exchange, over the 60 trading days subsequent to the first loan funding, (ii) the opening price of any public offering of straight equity securities of the Company occurring within six months after the issue date of the March 2024 SPA Warrants and (iii) the VWAP of the Ordinary Shares over the 60 trading days immediately prior to the Vesting Date. The March 2024 SPA Warrants have customary anti-dilution protections in the event the Company declares dividends or distributions on the Ordinary Shares or subdivides, combines or reclassifies its outstanding Ordinary Shares. On April 22, 2024, the Company issued March 2024 SPA Warrants to purchase 50,000 Ordinary Shares to Krishnan-Shah Family Partners, LP. On June 20, 2024, the Company issued March 2024 SPA Warrants to purchase 50,000 Ordinary Shares to Ms. VedBrat and on October 27, 2024 issued additional March 2024 SPA Warrants to purchase an additional 50,000 Ordinary Shares to Ms. VedBrat in connection with her purchase of the May 2024 Note. Secured, Non-Convertible 2022 Debentures One of our material subsidiaries issued Secured, Non-Convertible Debentures with NP1 Capital Trust with an aggregate principal amount of $3.7 million during the fiscal year ended March 31, 2023 with varying maturity dates between January 2024 and July 2024 and interest rates ranging from 19.25% to 20.00% per annum. The principal outstanding as of March 31, 2025 is $1.7 million. On September 30, 2024 the Company entered into an amendment agreement restructuring the principal repayments and extending the maturity date to March 31, 2025. The Company has not honored the repayment of the above debentures as on the amended date but has obtained an extension from the lender up to July 31, 2025. However, there is no new agreement in place. 65 Underwritten Public Offerings On December 15, 2024, the Company entered into an underwriting agreement with ThinkEquity LLC, relating to a firm commitment underwritten public offering (the “December Offering”) of an aggregate of up to (i) 1,900,000 shares of the Company’s Ordinary Shares at a price to the public of $1.25 per share (the “December Shares”), and (ii) pre-funded warrants (the “Pre-Funded Warrants” and, together with the December Shares, the “December Securities”) to purchase 400,000 Ordinary Shares at a price to the public of $1.249 per Pre-Funded Warrant. The closing of the December Offering occurred on December 17, 2024. The gross proceeds to the Company from the sale of the December Securities, before deducting the underwriting discounts and commissions and other estimated offering expenses payable by the Company, was $2,875,000. Upon closing of the December Offering, the Company issued ThinkEquity warrants (the “December TE Warrants”) as compensation to purchase up to 115,000 Ordinary Shares (5% of the aggregate number of the December Securities sold). The December TE Warrants will be exercisable at a per share exercise price of $1.5625 and are exercisable, in whole or in part, during the five year period commencing with the commencement of sales in the December Offering. On January 2, 2025, the Company entered into a placement agency agreement (the “Agency Agreement”) with ThinkEquity LLC (the “Placement Agent”), pursuant to which the Company agreed to issue and sell directly to one or more investors, in a best efforts offering (the “January Offering”), an aggregate of 2,222,300 of the Company’s Ordinary Shares, at an offering price of $2.25 per Share. The Offering closed on January 6, 2025. The Company received gross proceeds of $5,000,175 in connection with the January Offering, before deducting Placement Agent fees and other January Offering expenses payable by the Company. As part of its compensation for acting as Placement Agent for the January Offering, the Company paid the Placement Agent a cash fee of 7.0% of the aggregate gross proceeds and also issued to the Placement Agent warrants to purchase 111,115 Ordinary Shares (the “January TE Warrants”). The January TE Warrants have a term of five years commencing January 2, 2025, are exercisable commencing July 2, 2025, and have an exercise price of $2.8125 per Ordinary Share. Debt Exchange On December 27, 2024, the Company entered into two separate subscription agreements (the “Exchange Agreements”) with related parties, Marco Polo Securities, Inc. (“Marco Polo”) and Avacara PTE Ltd. (“Avacara”). Pursuant to the terms of the Subscription Agreements, on that date, approximately $3.5 million in aggregate of liabilities of the Company to such entities was canceled in exchange for the issuance of an aggregate of 1,227,867 ordinary shares (the “Exchange Shares”) of the Company (with 892,857 Shares issued to Marco Polo and 335,000 Shares issued to Avacara), as contemplated by the binding term sheets entered into by the Company on July 18, 2024 and reported in the Form 8-K filed by the Company on July 23, 2024. The Chairman of the Board of the Company, Steven Carlson, is the principal owner of Marco Polo and the Company’s Chief Executive Officer, Rohan Malhotra, is the principal owner and Managing Partner of Avacara, a significant shareholder of the Company. The Subscription Agreements include customary “piggyback” registration rights, as well as demand registration rights which require the Company to register the Exchange Shares if requested by Marco Polo or Avacara in the event that the Shares have not been registered on a “piggyback” basis within 90 days following the closing of the transactions contemplated by the Exchange Agreement (the “Exchange Closing”). Also on December 27, 2024, the Company entered into separate lock-up letter agreements (the “Exchange Lock-Up Agreements”) with each of Marco Polo and Avacara, pursuant to which each such entity agreed not to sell any of the Exchange Shares issued to it for a period of nine months following the Exchange Closing, except that 30% of each holder’s Exchange Shares may be sold as of the 91st day after the Exchange Closing Date, another 30% may be sold on the 181st day after the Exchange Closing Date and the remainder may be sold as of one day after the nine month anniversary of the Exchange Closing Date. March Junior Notes On March 31, 2025, the Company entered into a securities purchase agreement with an institutional investor (the “Investor”) under which the Company agreed to issue and sell, in a registered public offering, junior convertible notes for up to an aggregate principal amount of $2,300,000 (the “Junior Notes”) that may be convertible into the Company’s Ordinary Shares. On April 1, 2025, the Company completed the sale of the Junior Notes to the Investor and issued the Junior Notes. The Junior Notes were sold for a gross purchase price of $2,000,000 before fees and other expenses. The Junior Notes will mature one year from the date of issuance and will bear interest at a rate of 16% per annum (increasing to 18% per annum upon the occurrence and during the continuation of an event of default). 25% of the principal amount of the Junior Notes (less any amount previously converted by the holders), together with accrued but unpaid interest, is payable quarterly, commencing three months after the date of issuance. The Junior Notes will have an initial conversion price of $2.00 and will be convertible at any time, in whole or in part and subject to certain beneficial ownership limitations, at the election of the holders, subject to customary adjustments upon any stock split, stock dividend, stock combination, recapitalization or similar event. The Company may redeem all or any portion of outstanding Junior Notes at any time upon at least five trading days’ written notice by paying an amount equal to the principal amount of the Junior Notes being redeemed, together with interest accrued on such principal amount through the date of redemption, and additional interest that would accrue on such principal amount through the maturity date (the “Make Whole Amount”). Upon the occurrence of an Event of Default (as defined in the Junior Notes), the Investor may (i) either require the Company to redeem all or any portion of the Junior Notes, (ii) or, in the case of a failure to make a required quarterly payment under the Junior Notes, convert all or any portion of the Junior Notes at a price equal to the Event of Default Conversion Price (as defined in the Junior Notes). The Company also agrees not to enter into or be party to a Fundamental Transaction (as defined in the Junior Notes) unless (i) the Successor Entity (as defined in the Junior Notes) (if other than the Company) assumes in writing all of the obligations of the Company under the Junior Notes and the other Transaction Documents in accordance with the provisions of the Junior Notes prior to such Fundamental Transaction, or (ii) at or prior to the consummation of the Fundamental Transaction, the Company redeems the Junior Notes in full by paying to the holder an amount in cash representing all outstanding Principal, accrued and unpaid Interest (including Default Interest, as applicable) and Make-Whole Amount. Subject to the provisions of the Junior Notes, if, at any time while the Junior Notes are outstanding, the Company carries out one or more Subsequent Placements (as defined in the Junior Notes), the Investor will have the right to require the Company to first use up to 25% of the net proceeds of such Subsequent Placement to redeem all or a portion of the Junior Notes in cash at the Redemption Price (as defined in the Junior Notes) applicable to the principal amount subject to the Holder Optional Redemption (as defined in the Junior Notes) plus any other amounts, if any, then owing to the holder of the Junior Notes. Subject to the provisions of the Junior Notes, the Company may redeem all or any portion of outstanding Junior Notes at any time upon at least five trading days’ written notice by paying an amount equal to the principal amount of the Junior Notes being redeemed, together with interest accrued on such principal amount through the date of redemption, and the Make Whole Amount. Off-Balance Sheet Financing Arrangements We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of March 31, 2025. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets. 66 Quantitative and Qualitative Disclosures about Market Risk We are exposed to market risks in connection with our business, which primarily relate to fluctuations in interest rates and foreign exchange risks. Interest Rate Risk Cash and loans As of March 31, 2025, we had $5.1 million of cash and cash equivalents, including $0.2 million of non-current restricted cash, and $22.9 million of repayable debt in the form of loans from banks and other parties. Our cash and cash equivalents and loans are held for working capital purposes. As of March 31, 2025, we do not believe a hypothetical 10% increase or decrease in interest rates during any of the periods presented would have had a material impact on our consolidated financial statements. Convertible Notes As of March 31, 2025, we have no variable rate convertible notes outstanding. Foreign Currency Exchange Risk Transaction Exposure Our results of operations and cash flows are subject to fluctuations due to changes in foreign currency exchange rates. All our revenue is generated in local currencies. Our expenses are generally denominated in the currencies of the jurisdictions in which we conduct our operations, which are primarily in India, the U.K. and the U.S. Our results of operations and cash flows are, therefore, subject to fluctuations due to changes in foreign currency exchange rates and may be adversely affected in the future due to changes in foreign exchange rates. The effect of a hypothetical 10% change in foreign currency exchange rates applicable to our business would not have a material impact on our historical consolidated financial statements. To date, we have not engaged in any hedging strategies. As our international operations grow, we will continue to reassess our approach to manage our risk relating to fluctuations in currency rates. Translation Exposure We are also exposed to foreign exchange rate fluctuations as we translate the financial statements of our foreign subsidiaries into U.S. dollars. If there is a change in foreign currency exchange rates, the translating adjustments resulting from the conversion of our foreign subsidiaries’ financial statements into U.S. dollars would result in a gain or loss recorded as a component of accumulated other comprehensive loss which is part of stockholders’ equity. Price Risk We have invested in common stock of two private companies, Moonshot — Internet SAS and Daokang (Beijing) Data Science Company Ltd, which were accounted for under the measurement alternative. These investments are considered as long-term, strategic investments. Valuations of our equity investments in private companies are inherently more complex due to the lack of readily available market data. Volatility in the global economic climate and financial markets could result in a significant impairment charge relating to our non-marketable equity securities. Further, observable transactions at lower valuations could result in significant losses on our non-marketable equity securities. Critical Accounting Policies and Estimates We believe that certain accounting policies involve a high degree of judgment and complexity. The application of accounting policies and preparation of our consolidated financial statements in conformity with GAAP require us to make estimates and judgments that affect the amounts reported in those financial statements and accompanying notes. Although we believe that the estimates we use are reasonable, due to the inherent uncertainty involved in making those estimates, actual results reported in future periods could differ from those estimates. The critical accounting estimates, assumptions and judgments that we believe have the most significant impact on our consolidated financial statements are described in our consolidated financial statements. These estimates involve estimating allowance for accounts receivable, fair values of financial instruments, measurement of defined benefit obligations, impairment of non-financial assets, useful lives of property plant and equipment and intangible assets, income taxes, certain deferred tax assets and tax liabilities, and other contingent liabilities. See Note 2 to our consolidated financial statements appearing elsewhere in this Annual Report for a description of our significant accounting policies involving these estimates and judgments. 67 Emerging Growth Company Status The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended, (the “Securities Act”), as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). The JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. Thus, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. The Company has elected to take advantage of the extended transition period to comply with new or revised accounting standards and to adopt certain of the reduced disclosure requirements available to emerging growth companies. As a result of the accounting standards election, the Company will not be subject to the same implementation timeline for new or revised accounting standards as other public companies that are not emerging growth companies which may make comparison of the Company’s financial statements to those of other public companies more difficult. Recent Accounting Standards Management is currently evaluating the impact of any recently issued, but not yet adopted, accounting standards, on its consolidated financial statements. Item 7A. Quantitative and Qualitative Disclosures About Market Risk. Not required for smaller reporting companies. Item 8. Financial Statements and Supplementary Data. The financial statements required to be filed pursuant to this Item 8 are appended to this Annual Report. An index of those financial statements is found in Item 15 of Part IV of this Annual Report. Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure. None.