Athena Constructions Ltd Management Discussions

Two sectors in India stand out as the primary engines of growth: real estate and infrastructure. The major reason for this is that the two components of a countrys growth are intricately interconnected, forming a symbiotic relationship that significantly influences urban development and economic advancement. By 2040, the real estate market will grow to Rs. 65,000 crore (US$ 9.30 billion) from Rs. 12,000 crore (US$ 1.72 billion) in 2019. Real estate sector in India is expected to reach US$ 1 trillion in market size by 2030, up from US$ 200 billion in 2021 and contribute 13% to the countrys GDP by 2025.

Retail, hospitality, and commercial real estate are also growing significantly, providing the much-needed infrastructure for Indias growing needs. Indias real estate sector is expected to expand to US$ 5.8 trillion by 2047, contributing 15.5% to the GDP from an existing share of 7.3%.In FY23, Indias residential property market witnessed with the value of home sales reaching an all-time high of Rs. 3.47 lakh crore (US$ 42 billion), marking a robust 48% year-on-year increase. The volume of sales also exhibited a strong growth trajectory, with a 36% rise to 379,095 units sold. Demand for residential properties has surged due to increased urbanization and rising household income. India is among the top 10 price appreciating housing markets internationally. Driven by increasing transparency and returns, theres a surge in private investment in the sector.

The Government has allowed FDI of up to 100% for townships and settlements development projects. The Union Budget 2025-26 boosts homeowners with nil tax on two self-occupied properties (earlier one) and raises TDS threshold on rent from Rs. 2.4 lakh (US$ 2,769) to Rs. 6 lakh (US$ 6,924), driving property ownership demand. In the Union Budget 2024-25, PM Awas Yojana Urban 2.0 will address housing needs for 1 crore urban poor and middle-class families with a Rs. 10 lakh crore (US$ 120.16 billion) investment.

Indias real estate market is experiencing significant growth, fueled by market dynamics and supportive government actions. The residential sector is expanding rapidly, thanks to affordability programs that increase access to housing. At the same time, flexible office spaces are revolutionizing the commercial landscape, responding to evolving consumer demands. Major urban centres such as Mumbai, Pune, Hyderabad, and the National Capital Region (NCR) serve as the primary engines of this growth, reflecting their strong economies and increasing populations.

Projections indicate that the Indian Real Estate Sector will reach a trillion dollars by 2030, driven by strategic investments and innovative approaches. Incorporating technology and sustainable practices is fundamentally transforming the industry. From smart homes to data-driven decision-making and energy- efficient construction, the real estate sector in India is adopting a future-oriented and globally aligned trajectory In 2024, real estate investments throughout the Asia Pacific region experienced a 12% annual increase, reaching US$155.9 billion, as reported by Colliers. Importantly, India exhibited remarkable growth, with investments soaring by 88% year-on year, amounting to US$3 billion in the latter half of 2024.

Office properties retained their status as the preferred investment choice, capturing 47% of the market, followed by industrial and logistics assets, which constituted 27%. Mumbai emerged as a significant investment hub, accounting for nearly half of Indias total investments, predominantly driven by acquisitions of office assets.

OUTLOOK

The rising demand for residential properties, along with the growing infrastructural development that provides enhanced connectivity via roads, air, and railways, is primarily driving the India real estate market. The Indian real estate market is expected to exhibit a CAGR of 9.2% during 2023-2028. Moreover, the increasing need for contemporary office spaces and the emerging trend of urban and semi-urban lodging are acting as other significant growth inducing factors. Furthermore, the expanding ecommerce sector in the country is catalyzing the demand for warehousing facilities, which is providing a positive thrust to the market. Besides this, with the growing use of telecommunication services and the implementation of 5G and data localization norms, there is a rise in the need for data storage facilities. This, in turn, is positively influencing the demand for resilient data center infrastructure and consequently bolstering the market growth.

The Company is engaged in construction activity, hence the segment wise reporting is not applicable. Financial Performance of the Company for the year under review has already covered under the Directors Report.

Management Discussion and Analysis detailing the Companys objectives, outlook and expectations have "forward looking statement" within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied depending upon global and Indian demand supply conditions, changes in Government regulations, tax regimes and economic developments within India and overseas.