aarv infratel ltd share price Management discussions

Pursuant to the Takeover of the company, the name of the company has been changed from Aarv Infratel Limited to Bhudevi Infra Projects Limited with effect from the date 09th Day of September 2022 and the CIN from L45100KA1992PLC100274 to L45100TS1992PLC175723 and The Company having by special resolution altered the provisions of its Memorandum of Association with respect to the place of the Registered Office by changing it from the state of Karnataka to the Telangana outside the jurisdiction of existing ROC Bangalore to the ROC Hyderabad i.e., from Plot No.78, Sai Durga Enclave, Agrahara Village Kogilu, Yelahanaka. Bangalore Karnataka 560064 India to 1-8-303/48/13/202, 302, 3rd Floor, Arya One, Sindhi Colony, S.P. Road, Secunderabad Hyderabad Telangana 500003 India and such alteration having been confirmed by an order of Regional Director with effect from 3rd August 2023, The objects of the Company have been changed from telecom sector to builders, property developers, Engineering Contractors, Civil,mechanical and labor contractors, building and erection engineers, consultants, Real Estate owners, layout promoters and also act asreal estate brokers, realtors and agents and other service providershave been Amended vide special resolution passed by the shareholders of the Company vide postal ballot dated 14th August, 2022 by shareholders of the company.

Indian Real Estate Industry Overview

Real estate sector in general and housing sector in particular has always played a critical role in shaping the global economies. The multiplier effect of housing sector through direct and indirect as well as through induced impact is significantly large on both the GDP as well as employment generation. There are a number of ancillary industries which support the growth of real estate construction sector, like cement, steel, other non-ferrous metals, tiles, glass, brick, and certain consumer durables etc. Further, the industries that provide the inputs to these ancillary industries also gain momentum. Hence, due to the inter-linkages among all the sectors of economy, the overall economic impact of a real estate far exceeds the direct impact especially in employment generation. India by virtue of its demography and development cycle is at a place where demand for quality urban housing is immense.

This is only going to strengthen with each passing year as India graduates from being a low-income economy to a middle-income economy. As per industry estimates, India would see creation of 100 million new households who will become ‘home ownership capable by virtue of rise in income levels by the end of the decade. This creates a ‘once in a lifetime opportunity for the Indian real estate industry. Due to the structural nature of demand, Indian real estate industry has continued to gain momentum during FY23 despite the uncertainties posed by global economic slowdown as well as steep interest rate hikes. While the market for office spaces staged a comeback in the post-pandemic period with ‘back to office normalization, the residential market further gained on the momentum seen in FY22. Despite the 250-bps repo rate hike, the robust performance of the sector especially in the housing segment signifies the strength of the underlying demand for property.

Indian Housing Market overview

Indian housing market went from strength to strength surpassing previous peaks seen during the last year. As per property research firm, Anarock Research, housing sales in 2022 grew by more than 50% YoY to 3,65,000 units, surpassing the previous peak seen in 2014 at 3,40,000 units. What is heartening to note is that this happened in a year when there was still some residual impact of the pandemic in the beginning of the year and mortgage rates went up sharply by more than 200 bps. This reinforces the view that housing demand in India is structural in nature. Sales once again exceeded launches in the top 7 cities making the available inventory at the lowest level since 2014. Launches for the year in the top 7 cities stood at around 3,60,000 units. Rising sales coupled with falling inventory has brought the inventory levels down to 21 months in Q42023 from 32 months in Q4 2014.

The supply side consolidation in the industry continues to strengthen which augers well for all the participants – consumers, reputed developers as well as financial institutions. The disciplined supply has meant moderately rising capital values of homes. As per various industry reports, residential prices have increased by around 5-7% across various geographies. This positive nominal price growth has kick started the virtuous price demand cycle where, while the nominal increases have incentivized end user demand to go up but price growth being below the wage growth has continued to keep the affordability intact.

The importance of the ‘brand in real estate has continued its upward journey. Housing is increasingly becoming a branded ‘consumer product. A strong housing brand in consumers minds stands for superior product quality, avenue for life style upgrade, an aspirational address and above all certainty of timely delivery. The above can only be delivered by branded tier 1 developers, leading to the demand side consolidation. Branded tier-1 developers with strong execution capability are expected to leverage this opportunity to gain even more market share by bringing newer products suitable for the demand dynamics whilst offering quality, and a sustainable environment as well as social ecosystem.


India has strong structural drivers in place for housing demand and it is at an early stage of a multi-year upcycle. Impact of cyclical factors such as interest rates etc. will be felt from time to time, however the structural nature of demand will overpower them to a large degree similar to the way industry has performed this year in spite of the steep mortgage rate hikes.


We are mainly focused on the housing segment with expanding presence in logistics and warehousing as well as facilities management. We also develop commercial real estate, as part of mixed-use developments in and around our larger residential projects to bring vibrancy to our residential developments and provide ‘walk-to-work options for our residential customers. Over time we have built unique strengths which have helped us grow and will enable us to continue our growth trajectory. Some of these are as follows:

Strong focus on sustainability and transparency.

Ample raw material, Large existing land holding Partner of choice for land owners for JDA partnership

Innovation in product as well as sales and marketing strategies

Exceptional management capabilities with decentralized organization structure

Risk, concerns and Threats

Global recessionary trends and geo-political disturbances continue to persist as the most concerning riskfactors.The additional capacity being created as part of our competitors expansion plans are expected to becompleted in the upcoming year and pose a threat to future growth prospects.

Internal Control Systems and their Adequacy

Your Company has appropriate internal control systems for business processes, efficiency in its operations,and compliance with all the applicable laws and regulations. Regular internal checks and audits ensurethat the responsibilities are being effectively executed. In-depth review of internal controls, accountingprocedures and policies of Company is conducted. Your Company has adopted adequate internal controland audit system commensurate with its size and nature of business.Internal audit is carried on a quarterly basis. Internal auditors work with all levels of management and thereport is placed before the audit committee. The audit committee after reviewing the findings and suggestionsdirects the respective departments to implement the same.

Human Resources

Your Company considers its Human Resources as the key to achieve its objectives. Keeping this in view, yourCompany takes utmost care to attract and retain quality employees. The employees are sufficiently empoweredand such work environment propels them to achieve higher levels of performance. The unflinching commitmentof the employees is the driving force behind your Companys vision. Your Company appreciates the spirit ofits dedicated employee

Performance Review:

Discussion on Financial Performance with respect to Operational Performance:

1. Total Income: Nil

2. Share Capital:

The paid-up share capital as on 31st March, 2023 is Rs. 458,92,380. /-

3. Net Loss:

The Companys operating Profit/loss of Rs. 32.11 Lakhs during the year.

4. Earnings Per Share (EPS):

The Earning Per Share for the Financial Year 2022-23 is Rs. 242.64 per share (Face Value: Rs.10/- each). Your directors are putting continuous efforts to increase the performance of the Company and are hopeful that the performance in coming year will overcome from the present situation.

Cautionary Statement

Statements in this management discussion analysis describing the Companys objectives, projections,estimates, expectations may be forward looking within the meaning of applicable securities-laws andregulations. Actual results may differ materially from those expressed in the statement. Important factorsthat could make difference to Companys operations include economic conditions affecting the domesticmarket and the overseas markets in which the Company operates, changes in the Government regulations,tax laws and other statutes and other incidental factors.




Deviation Reasonfor


2022-23 2021-22 (%) Change

Debtors Turnover Ratio (times)

[Revenue from operations/ Average Trade receivables] - - -

Inventories Turnover Ratio (times)

[COGS/Average Inventories] - - -

Interest Coverage Ratio (times)

[EBIT/Finance Cost] - - -
Current Ratio [Current Asset/Current 0.122 0.006 1834 Due to increase in


Liability] advances to suppliers and borrowings

Debt Equity Ratio (times)

[Debt/Shareholders Equity] - - - Due to increase of income during the Year

Operating Profit Margin Ratio (%)

[EBIT/Revenue from Operations] 16.47 - 100 Due to increase of income during the Year

Net Profit Margin Ratio (%)

[Profit After Tax#/Revenue from Operations] 16.47 - 100

Return on Net Worth (%)

[Profit for the year (before exceptional items and after tax)/Net Worth] -1.31 -0.35 271 Due to increase in profits


For and on behalf of the Board
Bhudevi Infra Projects Limited

(Formerly known as AARV Infratel Limited)

Bhasker K Bhatt
Chairman & Managing Director
(DIN: 09463033)

Date: 06.09-2023

Place: Hyderabad.