Gallops Enterprise Ltd Management Discussions

Industry structure & developments Introduction

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

As of 2025, the Indian residential construction market is experiencing significant growth. The market size is estimated at USD 268.40 billion in 2025, with projections to reach USD 372.5 billion by 2030, reflecting a compound annual growth rate (CAGR) of 6.80% during the forecast period (2025 2030) Simultaneously, the broader Indian real estate industry is also expanding. The market size is estimated at USD 332.85 billion in 2025, with expectations to reach USD 985.80 billion by 2030, marking a robust CAGR of 24.25% over the same period. These trends indicate a dynamic and expanding residential construction market in India, supported by favorable economic and policy factors.

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. The demand for residential properties in India is surging due to increased urbanization and rising household incomes. According to the Economic Survey for 2023-24, half of Indias population is projected to live in urban areas by 2050, up from 31% in 2011, indicating a significant shift towards urban living . This urban migration is driving the need for more housing, particularly in metro cities and emerging urban centers.

Government Initiatives

Indias real estate sector is experiencing significant growth, driven by policy reforms and increased government spending. Key initiatives such as the Real Estate Regulatory Authority (RERA), the Special Window for Completion of Construction of Affordable and Mid-Income Housing Projects (SWAMIH), and Real Estate Investment Trusts (REITs) have played pivotal roles in shaping the industrys trajectory. Real Estate Regulatory Authority (RERA): Implemented to enhance transparency and accountability, RERA mandates developers to register projects and adhere to specified timelines. This has led to a reduction in project delays and increased buyer confidence. For instance, the Telangana Real Estate Regulatory Authority (TGRERA) recently halted a project in Hyderabad due to buyer complaints, showcasing its active role in protecting consumer interests. SWAMIH Fund: The SWAMIH initiative, launched to address stalled affordable housing projects, has been instrumental in completing over 50,000 dwelling units. An additional Rs 15,000 crore has been allocated to complete another 100,000 units, alleviating the housing shortage and supporting middle-class families. Real Estate Investment Trusts (REITs): REITs have introduced a new avenue for investment in the real estate sector, enhancing liquidity and transparency. Since their inception, the gross asset value of REITs has increased threefold, with cumulative distributions exceeding Rs. 14,300 crore. Government Spending: Increased expenditure on residential projects by both state and central governments is expected to further boost industry growth. The establishment of a Rs 1 trillion Urban

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Challenge Fund aims to support initiatives under the Cities as Growth Hubs program, promoting urban development and infrastructure enhancement.

- These developments indicate a robust growth trajectory for Indias real estate sector, underpinned by strategic policy interventions and government support.

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:

- Indias real estate market in FY 2024 25 sustained its growth momentum amid robust demand, policy reforms, and macro factors. Residential property prices saw notable hikes Delhi NCR experienced a 30 32% YoY increase, Bengaluru 23 24%, and Ahmedabad around 15 16%, marking the 16th consecutive quarter of rising prices across major cities. However, this upswing has been driven largely by premium and luxury segments, putting affordability under strain for first-time and lower-income buyers.

- On the commercial front, rental growth remained strong. Chennai recorded annual office rental growth of 9%, Bengaluru 7%, supported by leasing volumes rising 34% to 34.7 msf in H1, and 25% to 18.5 msf in Q1 FY25, even as new completions declined by 10% in the June quarter. This resilience has been bolstered by increased leasing from Global Capability Centers (GCCs) and diversified tenant profiles .

- Policy interventions such as RERA, REITs, and the SWAMIH fund have enhanced transparency, unlocked stalled housing, and supported sectoral confidence. Continued government investment in residential projects is poised to further strengthen industry fundamentals. Looking ahead, while affordability remains a concern, especially in entry-level segments, sustained demand, evolving consumer preferences, and infrastructure-driven growth in both residential and commercial spaces suggest a positive outlook for Indias real estate market.

- 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 2024-25	Financial Year 2023-24
	(Amount in Lakhs.)	(Amount in Lakhs.)
Revenue from Operations	0.05	0.09
Other Income	5.37	7.54
Total Income	5.42	7.63
Less:	-
Total Expenditure	1.92	7.03
Profit/(Loss) Before Tax	3.49	0.60
Less:
Total Tax	-	-
Profit After Tax	3.49	0.60

FINANCIAL PERFORMANCE

During the year under review, the company has earned a Total Income of Rs. 5.42 Lakhs as compared to that of Rs. 7.63 Lakhs in the previous financial year. The Total Expenditure of Rs. 1.92 Lakhs were incurred during the year under review as compared to that of Rs. 7.03 Lakhs in the previous financial year. The net profit for the year under review has been Rs. 3.49 lakhs as compared to the loss of Rs. 0.60 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	Numerator	Denominat or	For Year ended 31-03-2025	For Year ended 31-03- 2024	Variance
Current Ratio	Current Assets	Current liabilities	18.66	25.08	-26%
Debt Equity Ratio	Debt	Shareholder s equity	NA	NA	0%
Debt Service Coverage Ratio	Earning Available for Debt Servicing	Total Debt Service	NA	NA	0%
Return on Equity	Net Profit After Taxes	Average Sharholders Equity	(0.13)	0.40	-134%
Inventory Ratio	Cost of Goods Sold	Average Inventory	NA	NA	0%
Trade Receivales Turnover Ratio	Revenue From Operations	Average Trade Receivable	NA	NA	0%
Trade Payable Turnover Ratio	Purchases	Average Trade Payables	NA	NA	0%
Net Capital Turnover Ratio	Revenue	Average Working Capital	0.07	0.10	-30%
Net Profit Ratio	Net Profit After Taxes	Total Income	(3.22)	0.08	-4217%
Return on Capital Employed	Earning Before Interest and Taxes	Capital Employed	(0.13)	0.00	-3454%
Return on investment	Return on Investment	Cost of Investment	NA	NA	0%

 

Ratio	Reason for Variance
Current Ratio	The ratio has deteriorated due to decrease in current asset due to decrease in value of inventory.
Return on Equity	The ratio has deteriorated due to decrease in profit on account of changes in the value of closing stock as per Ind AS 109.
Net Capital Turnover Ratio	The ratio has deteriorated due to increase in net working capital.
Net Profit Ratio	The ratio has deteriorated due to decrease in profit on account of changes in the value of closing stock as per Ind AS 109.
Return of Capital Employed	The ratio has deteriorated due to decrease in profit on account of 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, 2025, 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.