Pursuant to Clause 49 of the Listing Agreement, a report on Management Discussion and Analysis Report is given below:

MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

Overview:

Virinchi is the global leader in providing IT solutions to the Retail Micro Lending Industry in North America with its flagship product 'QFund'. Virinchi has strategic alliances with the experts in the Industry and is consistently developing its market intelligence and approach which has led it to become a leader in the products offered from a pioneer in the focused business areas.

Virinchi is focused on providing Customer Delight with providing high quality services and continuous product & process innovation. The trust reposed in us by our clients is reflected in our growing revenues from operations such as post-implementation maintenance and support activities. Our distinct value proposition and service culture, coupled with our track record of successful service delivery, are reflected in our market leadership of our products and the long-standing customer relationships with dominant players in their respective verticals

The Company is public limited company Incorporated and domiciled In India and has its registered office at Hyderabad, Telangana, India. The Company has its primary listing in Bombay Stock Exchange Limited in India.

These Financial Statements are brpared in accordance with Indian Generally Accepted Accounting Principles(GAAP) under historical Cost Convention on accrual basis , except for certain financial instruments valued at fair market values. GAAP comprises mandatory Accounting Standards as brscribed under section 133 of the Companies Act, 2013( "the Act") read with Rule 7 of the Companies ( Accounts)

I. Industry structure and developments

The tech industry is always in flux. Frequent new products and category innovation define and redefine the sector's constantly shifting landscape. But lately we've seen even greater volatility than usual, and it has begun to affect the makeup of hardware and software companies themselves.

The tech industry is being reshaped in numerous ways. Disruption is evident in software and services delivery, business models, the vast amount of money being poured into startups of all stripes, the cloud, big data, entrebrneurialism, and constant innovation. Against that backdrop, companies can no longer rely on one-note value strategies.

Over the past two decades, India has risen to become the leading destination for global IT services sourcing, business process services and research and development services. Global IT services providers, based in India, have a proven track record for providing business and technology solutions, offering a large, high quality and English-speaking talent pool and a friendly regulatory environment. These factors have facilitated the emergence of India as a global sourcing hub.

Global IT sourcing from India offers significant cost advantages as well as productivity gains on account of access to highly skilled and competent talent at lower wage costs. According to the National Association of Software and Service Companies (NASSCOM) Strategic Review Report 2015 ("NASSCOM Report"), India-based IT services providers have been able to maintain their cost competitiveness by deploying various cost control strategies including the delivery networks in Tier II/III cities, recruiting on college and university campuses as well as experienced professionals, and offsetting wage inflation with operational gains and productivity measures.

Business favorable policy decisions of the Government of India have played a key role in the development of robust IT and business process management ("BPM") sectors in the country. The Software Technology Park ("STP") Scheme and the Special Economic Zone Act also played a critical role in the emergence and development of the IT and BPM industries by providing incentives in the form of tax holidays.

Opportunities:

Our Strategy for Run business is centered on -

1. Driving revenue growth in our core businesses through services and solutions in prioritized verticals, service lines & geographies.

2. Drive Cross-service line collaboration & Integrated Process & Technology Service offerings

The company, on a continuous basis, scans the market for scalable opportunities and has over the past twelve months identified some key areas of growth opportunities. These opportunities are in the areas of Health care, Skill Development. The company is making concerted efforts and investments to move up the value chain in its chosen markets and acquiring new competencies and services. It includes strengthening of domain knowledge, hiring highly talented sales and marketing managers, restructuring of businesses, project management and investments in new geographies. The company is experiencing significant traction from its existing customers and is receiving several enquiries from potential customers in its chosen markets. The company continues to strengthen and build relationships with its current and prospective customers as well as its global delivery model to ensure a low total cost of ownership for the customer.

Threats

Our revenues from this business are derived in major currencies of the world. The exchange rate between the rupee and major currencies of the world has fluctuated significantly in recent years and may continue to fluctuate in the future. Currency fluctuations can adversely affect our revenues and gross margins. In an economic slowdown, our clients may reduce or postpone their technology spending significantly. Reduction in spending on IT services may lower the demand for our services and negatively affect our revenues and profitability.

At an organizational level, we have a well-defined business contingency plan and disaster recovery plan to address these unforeseen events and minimize the impact on services delivered from our development centers based in India or abroad. Your company has perfect understanding of the amount of risks and extent of risks involved while delivering the project to client and knows well how to tackle them effectively. Your company is also trying to explore and find other opportunities that might prove to be beneficial in increasing our revenues and gain market share. Threat continues to be competition among companies within India and from emerging low cost destinations.

Segment wise or product wise performance:

This does not applicable to the company as the company is operating in only one segment.

Risks and concerns:

Following are some of the major risks, which the management believes form a part of the company's business and the company seriously engaged itself to mitigate them.

Financial Risks - foreign currency rate fluctuations

Business Portfolio Risks - include vertical domain concentration, service concentration, client concentrations and geographical concentration.

Legal and Statutory Risks - include contractual liabilities & statutory compliances Competition Risks - New competitors may enter the markets in which the company operates

Internal Control Systems & their adequacy:

The Management Information Systems is the back bone of our internal control mechanism. The Company has adequate internal control systems and procedures in all operational areas and at all levels equipment procurement, finance and administration marketing and personnel departments. The Company also has internal Audit system commensurate with its size and nature of business. The Audit Committee reviews the internal audit reports and the adequacy of internal controls from time to time.

Discussion on Financial Performance with respect to Operational Performance

The financial statements have been brpared in compliance with the requirements of the Companies Act, 2013 and Generally Accepted Accounting Principles in India. The Management of the Company accepts responsibility for the integrity and objectivity of the financial statements as well as for the various estimates used therein. The financial statements have been brpared on a prudent basis to reflect an accurate picture of the Company's state of affairs.

Financial Highlights:

Consolidated Revenues: The total Consolidated income of the Company for the FY 2014-15 Rs. 14120.26Lacs as against Rs. 11445.62 Lacs in FY 2013-14

Standalone Revenues: The total income of the Company for the FY 2014-15 of Rs. 8070.59 Lacs as against Rs. 6533.14 Lacs in FY 2013-14

Consolidated Profits: Profit before Tax (PBT) stood at Rs. 1106.60 Lacs as against Rs. 629.26 Lacs for the brvious year. Profit after Tax (PAT) stood at Rs.828.81 lacs as against Rs. 387.63 Lacs for the brvious year.

Standalone Profits: Profit before Tax (PBT) stood at Rs. 401.41 Lacs as against Rs. 220.94 Lacs for the brvious year. Profit after Tax (PAT) stood at Rs. 361.35 Lacs as against Rs. 140.14 Lacs for the brvious year.

Material Developments in Human Resources

As of March 31, 2015, your company had over 400 employees. In any services enterprise, employees form the core of an organization. We recognize the vitality of this stakeholder. A significant portion of our management focus is invested in engaging with our employees. We endeavor to develop best in class global leadership. We strengthen our talent pool by providing employees with growth and career enhancement opportunities. While serving global customers, employing people across the globe is an equally important aspect of our vision of becoming a truly global company.

We continue to innovate newer ways for accessing and attracting talent. We deploy pioneering and meaningful practices to enhance the engagement, capability and competitiveness of our global workforce. These practices are aligned to different phases of hiring, assimilation, learning, growth and retention.

Our leadership position, focus on training and compensation and fascination with leading-edge technologies enhances our ability to retain highly skilled personnel. Virinchi offers a world of learning opportunities, including those aimed at up-skilling, cross-skilling or re-skilling to its employees through a slew of training programs in spheres of technical, domain, soft skills and leadership aspects. Through our tie-ups with brmier institutions across the globe , we offer higher education/certification programs. 'The Integrated Talent Management System' provides anytime, anywhere learning.