Gallops Enterprise Ltd Management Discussions

The countrys real estate market was affected by the COVID-19 pandemic. In addition, the residential sector was the worst hit as strict lockdown measures across major cities in India impacted housing sales as home registrations were suspended and home loan disbursement was slow. However, the sector recovered due to an increase in house sales, new project launches, and increasing demand for new office and commercial spaces, etc. The growth of this sector is well complemented by the growth in the corporate environment and the demand for office space as well as urban and semi-urban accommodation. The construction industry ranks third among the 14 major sectors in terms of direct, indirect, and induced effects in all sectors of the economy.

Economy Overview

The India Residential Construction Market size is estimated at USD 189.80 billion in 2024, and is expected to reach USD 272.67 billion by 2029, growing at a CAGR of 7.51% during the forecast period (2024-2029). In 2024, the Real Estate Industry In India Market size is expected to reach USD 0.33 trillion.

Market Trend

Indias real estate market was affected by the COVID-19 pandemic. The residential sector was the worst hit as strict lockdown measures across major cities impacted housing sales as home registrations were suspended and home loan disbursement was slow. However, the sector recovered due to an increase in house sales, new project launches, and increasing demand for new office and commercial spaces, etc. The growth of this sector is well complemented by the growth in the corporate environment and the demand for office space as well as urban and semi-urban accommodation. The construction industry ranks third among the 14 major sectors in terms of direct, indirect, and induced effects in all sectors of the economy. According to industry reports, real estate demand for data centers is expected to increase by 15-18 million sq. ft. by 2025. 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.

Government Initiatives

Moreover, the industry has benefited from the push for policy that has resulted in legislation like the Real Estate Regulatory Authority (RERA), the introduction of Real Estate Investment Trusts (REITs), and SWAMIH (Special Window for Completion of Construction of Affordable and Mid-Income Housing Projects). It is anticipated that increased spending on residential projects by the state and central governments will continue to boost industry growth over the forecast period in the nation.

Products and Services

Company is in business of real estate which covered the below activities: Building Construction Property Developers Civil, Mechanical and labor contractors Building and erection engineers

Research and Development (R&D) :

At Gallops we have taken following initiatives for stakeholders to sustain good corporate governance; Effective Board Evaluation Transparency Ethics and Compliance Management Competent and diverse board Define Roles and Responsibilities

Real Estate Business:

Over 12 months prices have increased 1-9 per cent, with Bengaluru seeing the most increase and Ahmedabad the least. This is the fifth consecutive half-yearly period of price increase in all the cities, according to the property consultant. The increase in prices has had an impact on the residential sector, with a higher growth in premium homes compared to those priced lower, as affordability has become an issue for those buying in the lower-priced bracket. In the office sector rentals are trending higher due to a supply squeeze. Chennai and Bengaluru experienced the maximum annual rental growth at 9 per cent and 7 per cent respectively in H1 2024.Pan-India leasing rose by a third to 34.7 million square feet during the first half and 25 percent to 18.5 million square feet in the June quarter. New supply in the half year was 39 per cent higher at 25 msf, but in the June quarter there was a 10 per cent decline in new completions. Volatile market of Real Estate business increase strength to grow business more as well as build thin line between opportunities and threats

Opportunities:

Wide range of scope for investments

Demand of commercial and residential market are booming Inventory Management and reuse of assets Rental Income Advantage

Threats:

Costly Production creates adverse effect to profit ratio Liquidity Risk Huge Infrastructure Investment Economic Uncertainty

SEGMENT WISE OR PRODUCT-WISE PERFORMANCE & DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

FINANCIAL HIGHLIGHTS

Particulars	Financial Year 2023-24	Financial Year 2022-23
	(Amount in Lakhs.)	(Amount in Lakhs.)
Revenue from Operations	0.09	0.07
Other Income	7.54	10.40
Total Income	7.63	10.47
Less:
Total Expenditure	7.03	14.65
Profit/(Loss) Before Tax	0.60	-4.17
Less:
Total Tax	-	-
Profit After Tax	0.60	-4.17

FINANCIAL PERFORMANCE

During the year under review, the company has earned a Total Income of Rs. 7.63 Lakhs as compared to that of Rs. 10.47 Lakhs in the previous financial year. The Total Expenditure of Rs. 7.03 Lakhs were incurred during the year under review as compared to that of Rs. 14.65 Lakhs in the previous financial year. The net profit for the year under review was Rs. 0.60 lakhs as compared to the loss of Rs. 4.17 Lakhs in the previous financial year. Your directors are continuously looking for avenues for future growth of the company.

DETAILS OF SIGNIFICANT CHANGES IN KEY FINANCIAL RATIOS (STANDALONE BASIS)

Ratio	For Year ended 31/03/2024	For Year ended 31/03/2023	Variance
Current Ratio	25.08	19.68	27%
Debt Equity Ratio	NA	NA	NA
Debt Service Coverage Ratio	NA	NA	NA
Return on Equity	0.4	-2.8	-114%
Inventory Ratio	NA	NA	NA
Trade Receivables Turnover Ratio	NA	NA	NA
Trade Payable Turnover Ratio	NA	NA	NA
Net Profit Ratio	7.81	-39.85	-120%
Return on Capital Employed	0.4	-2.8	-114%
Operating Profit Margin	(75.28)	(209.85)	-64%
Return on investment	NA	NA	0

 

Ratio	Reason for Variance
Current Ratio	The ratio has improved due to increase in current asset as the company has received repayment of Non Current Loan.
Return on Equity	The ratio has improved due to due to increase in profit due to changes in the value of closing stock as per Ind AS 109.
Net Profit Ratio	The ratio has improved due to due to increase in profit due to changes in the value of closing stock as per Ind AS 109.
Return of Capital Employed	The ratio has improved due to due to increase in profit due to changes in the value of closing stock as per Ind AS 109.

RISK AND CONCERNS:

Regulatory and Legal Risks

Property Deterioration and Maintenance Issues Operational Risk Market Volatility

INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY

Internal Control system and adequacy Internal Control measures and systems are established to ensure the correctness of the transactions and safeguarding of the assets. Thus, internal control is an integral component of risk management. The Internal control checks and internal audit programs adopted by the Company plays an important role in the risk management feedback loop, in which the information generated in the internal control process is reported back to the Board and Management. The internal control systems are modified continuously to meet the dynamic change. Further the Audit Committee of the Board of Directors reviews the internal audit reports and the adequacy and effectiveness of internal controls.

MATERIAL DEVELOPMENTS IN HUMAN RESOURCES / INDUSTRIAL RELATIONS FRONT, INCLUDING NUMBER

The Company believes in creating a place where every human being connected feels valuable and able to work efficiently. Company taking initiatives for employees at all levels to update their knowledge and upgrade their skills and abilities. As on March 31, 2024, the Company had total 2 full time employees. The industrial relations have remained harmonious throughout the year.

CAUTIONARY NOTE

Statements in this Report, describing the Companys objectives, projections, estimates and expectations may constitute forward looking statements within the meaning of applicable laws and regulations. Forward-looking statements are based on certain assumptions and expectations of future events. These statements are subject to certain risks and uncertainties. The Company cannot guarantee that these assumptions and expectations are accurate or will be realized. The actual results may be different from those expressed or implied since the Companys operations are affected by many external and internal factors, which are beyond the control of the management. Hence the Company assumes no responsibility in respect of forward-looking statements that may be amended or modified in future based on subsequent developments, information or events.