Something pivotal happens in this shloka. Krishna introduces the idea that will become the backbone of the Gita's teaching: equanimity. Treat pleasure and pain as equal. Treat gain and loss as equal. Treat victory and defeat as equal. Then engage in battle. Acted upon in this spirit, no sin will touch you.
Three pairs of opposites are listed — sukha-duhkha, labha-alabha, jaya-ajaya — and each pair captures a different dimension of human anxiety. We fear pain, we fear loss, we fear defeat. Krishna says: when you stop being pulled by these fears and their corresponding desires, your action becomes pure. The action itself does not change — you still fight the battle — but the inner quality of that action transforms completely.
A skilled musician on stage does not play differently based on whether the audience is large or small, friendly or indifferent. The music pours out with the same devotion regardless. Krishna is asking Arjuna to fight with that same quality of presence — fully committed, fully engaged, free from the swing of outcomes.