Bhudevi Infra Projects Ltd Management Discussions

Industry review:

The Indian real estate sector continued to witness sustained growth, supported by urbanisation, rising household incomes and continued demand across residential and commercial segments. The residential market has also witnessed a shift towards premium housing with 36% of homebuyers preferring properties priced between Rs. 90 lakhs and Rs.1.5 crore in H1 2025, compared with 18% before the COVID-19 pandemic. Housing demand increased by 77% between FY2019 and FY2025, while housing sales across the top cities are expected to exceed Rs. 6.65 lakh crore in FY2026, compared with approximately Rs. 5.59 lakh crore in FY2025.

The office real estate segment also remained strong. Gross office leasing across the top seven cities reached 62.98 million sq. ft. in FY2025, registering a 26.40% year-on-year increase. Further, gross leasing across the leading office markets reached 83.30 million sq. ft. during calendar year 2025, reflecting continued demand for commercial office space.

The sector continued to attract significant institutional investment. Institutional investments in Indian real estate reached Rs. 98,942 crores in 2025, while investments during January-June 2026 increased by 23% year-on-year to Rs. 40,801 crores. The office segment accounted for 54% of institutional investment during H1 2026, with domestic institutional investors contributing 64% of total investment volumes.

(Source: IBEF - Indian Real Estate Industry Analysis and IBEF - Institutional Real Estate Investment H1 2026)

Opportunities and Threats:

Opportunities

The Indian real estate sector presents significant opportunities driven by sustained housing demand, urbanisation and increasing formalisation of the sector. The Economic Survey 2025-26 notes that the sector has entered a sustained upcycle since September 2021, with housing sales remaining higher than the FY2022-FY2024 levels. Individual housing loans have also increased substantially, with outstanding housing loans exceeding Rs. 37 lakhs crores as at March 2025.

The sector also has scope for further growth through increasing demand for premium housing and continued institutional participation. IBEF reports that housing demand increased by 77% between FY2019 and FY2025, while demand for luxury homes priced at Rs. 4 crores and above increased by approximately 28% year-on-year in 2025 across seven major cities. Institutional investment in Indian real estate also remained strong, reaching Rs. 98,942 crores in 2025.

Threats

The real estate sector remains exposed to risks associated with project execution, financing, cost escalation and regulatory requirements. The Economic Survey has specifically highlighted the challenge of stalled real estate projects, with stressed dwelling units affected by financial viability issues, cost overruns and delays.

Further, while demand remains strong, the industry continues to operate in an environment of global economic uncertainty, inflationary pressures and currency volatility, which may influence investment flows and financing conditions. IBEF, citing JLL India, notes that foreign capital inflows declined in H1 2026 amid global economic uncertainty, although increased domestic institutional participation helped offset the decline.

Outlook:

The Indian construction and real estate sector continue to be a favoured destination for global investors. Several large global investors, including a number of sovereign funds, have taken the first move by partnering with successful local investors and developers for investing in the Indian real estate industry.

Under such circumstances, business gives right signals of growth & improvement and to avail of all such growth opportunities. The Board, therefore, considers that the Company should be managed in controlled manner.

Risks and concerns

The factor like increased cement & steel cost, power cost; increase in labour cost and transportation cost could contribute to inflation. The Company considers good corporate governance as a prerequisite for meeting the needs and aspiration of its shareholders. The main risk to the Company which may arise is mainly due to Government policies and decisions, Fluctuations in prices of Raw materials, Exchange rate fluctuations, Industry demand etc.,

Segment or Product wise Performance

The Company is operating in one segment i.e. construction activity. The revenue from operations (i.e. from construction activities) is Rs. 287.76 lakhs for the financial year ended March 31, 2026.

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 ensure that the responsibilities are being effectively executed. In-depth review of internal controls, accounting procedures and policies of Company is conducted. Your Company has adopted adequate internal control and 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 the report is placed before the audit committee. The audit committee after reviewing the findings and suggestions directs the respective departments to implement the same.

Discussion on Financial Performance with respect to Operational Performance:

1. Income from operations is Rs. 287.76 lakhs

2. Total Income: Rs. 288.49 lakhs

3. Share Capital: The paid-up share capital as on March 31, 2026 is Rs. 458,92,380/-

4. Net Loss: The Companys operating Profit/loss of Rs. 11.63 Lakhs during the year

5. Earnings Per Share (EPS):

The Earnings Per Share for the Financial Year 2025-26 is Rs. 0.25 per share. 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.

Human Resource:

Your company recognizes that the human resources are the most crucial factor for achieving sustained growth over the years. The management considers its highly motivated and passion driven workforce as its partner in the growth of the company.

Details of significant changes (i.e. change of 25% or more as compared to the immediately previous financial year) in key financial ratios, along with detailed explanations therefor, including:

S.No.	Particulars	FY 2025-26	FY 2024-25	Change	Reason for Change
1	Current Ratio	0.85	0.90	-6%	Not Applicable
2	Debt Equity Ratio	8.13	6.71	21%	Not Applicable
3	Return on Equity Ratio	0.10	0.33	-69%	Due to Higher Operating Cost from the Construction project.
4	Trade Payable Turnover Ratio	9.35	11.08	-16%	Due to recognition of revenue from the construction project in the FY 26-27 and incurring of subcontracting expenses in the current financial Year
5	Net Capital turnover Ratio	-1.54	-3.30	-53%	Due to recognition of revenue from the construction projects in the current year and decrease in closing inventory.
6	Net Profit Ratio %	0.04	0.09	-57%	Due to higher operating cost from the construction projects, which in turn decreased the net profits of the company.
7	Return on Capital employed	0.06	0.52	-88%	Due to higher operating cost from the construction projects, which in turn decreased the net profits of the company. Repayment of loans taken and increase in inventory also effected the change.

8	Trade Receivables turnover ratio	7	11	-100%	Due to services rendered to a new party, which is increased sales and receivables.
9	Inventory Turnover	-	-	-	-
10	Interest Coverage Ratio	0.07	-	-100%	New Car loan Taken
11	Operating Profit Margin (%)	0.03	0.12	-75%	Due to increase in construction cost, indirect cost, Salaries and Rents.
12	Return on Net Worth (%)	0.11	0.33	-66%	Due to reduction in profits.

Disclosure of Accounting Treatment:

The Company follows the guidelines of Accounting Standards referred to in Indian Accounting Standards issued by the Institute of Chartered Accountants of India.

Cautionary Statement:

The statements in this management discussion and analysis describing the outlook may be forward looking statement within the meaning of applicable laws and regulations. Actual result might differ substantially or materially from those expected due to the developments that could affect the companys operations. The factors like significant change in political and economic environment, tax laws, litigation, technology, fluctuations in material cost etc. may deviate the outlook and result.

For and on behalf of Board of Directors of Bhudevi Infra Projects Limited

Sd/- Bhasker K Bhatt Chairman & Managing Director DIN:09463033