Ganesh Housing Ltd Management Discussions

Indian Economy Overview: Momentum in Motion

Indias economy continues to demonstrate resilience and momentum, supported by strong domestic consumption, sustained government capital expenditure, and structural reforms. Despite global macroeconomic uncertainties, India remains among the fastest- growing major economies, underpinned by favourable demographics, rising urbanisation, and increasing formalisation of the economy.

Retail inflation, which had seen intermittent pressures driven by food prices, has moderated over the course of the year, aided by calibrated monetary policy actions by the Reserve Bank of India (RBI).

Core inflation remains relatively stable, providing room for steady economic activity while maintaining price stability. Interest rates, while elevated compared to the ultra-low levels of earlier years, have largely stabilised, offering greater visibility for long-term investment decisions.

In the Union Budget 2026-27, our Finance Minister continued the governments focus on long-term growth for the real estate sector by significantly boosting public capital expenditure, which supports urban infrastructure and enhances connectivity-key drivers of housing demand beyond the top metros. Major initiatives include leveraging REITs and monetization of public sector real estate assets to deepen institutional investment, and enhanced spending on urban development that could unlock new residential and commercial opportunities across Tier-2 and Tier-3 cities. While the budget did not introduce sweeping new tax cuts for homebuyers, the policy emphasis on affordable housing, infrastructure expansion, and streamlined realty regulation aims to strengthen market fundamentals and attract investment, helping the sector recover momentum after recent sales softness. Additionally, provisions affecting NRI property transactions aim to simplify compliance and reduce friction in cross-border real estate deals.

Key economic drivers include:

• Continued public infrastructure spending across transport, housing, and urban development

• Strong services sector performance, particularly IT, financial services, and trade

• Improved balance sheets across banks and corporates, supporting credit growth

These factors collectively create a conducive backdrop for real estate development and investment.

Indian Real Estate Sector: Poised to Prosper

The Indian real estate sector is undergoing a structural transformation marked by improved transparency, stronger balance sheets, and increasing institutional participation. Regulatory reforms such as RERA, GST, and digitisation of land records have enhanced buyer confidence and improved governance standards across the sector.

Demand across residential, commercial, and retail segments remains healthy, supported by urbanisation, rising disposable incomes, and expanding employment opportunities. While construction costs and financing conditions remain areas of focus, developers with prudent capital allocation and strong execution capabilities are well positioned to benefit from the sectors long-term growth trajectory.

Key structural positives include:

• Consolidation in favour of organised and credible developers

• Growing preference for completed or near-completion projects

• Increasing participation from private equity and institutional investors

Trends in the Indian Real Estate Market: A Promising Tomorrow

Indias household consumption expenditure, a key proxy for spending capacity has been rising steadily, reflecting both higher incomes and evolving lifestyles. According to the latest Household Consumption Expenditure Survey by the Ministry of Statistics & Programme Implementation (MoSPI), Monthly Per Capita Consumption Expenditure (MPCE) for urban India increased to around 6,996, while rural Indias MPCE rose to 4,122 in 2023-24, up from the previous year. This points to sustained growth in consumption, with urban residents spending more across food, non-food and discretionary categories .

Source: https://www.credaincr.org/iismgmt/all-images/ policypdf/pdf_1753099631.pdf

Urban consumption has historically been higher due to larger incomes and access to services and discretionary spending options. Growth in non-food components such as conveyance, clothing, entertainment and durable goods has been robust, indicating that a growing share of spending in cities is now beyond mere essentials. These trends signal expanding purchasing power in urban areas and an increasingly diverse consumer base beyond necessities.

Residential Sector

The residential market has witnessed sustained demand, particularly in the mid-income and premium housing segments. End- user demand continues to outpace speculative activity, reflecting a shift towards real, utility-driven purchases. Stable interest rates, improving affordability, and lifestyle- driven housing preferences have supported steady sales momentum.

The key drivers in this segment include:

i. Shift towards larger homes:

Industry surveys indicate that homebuyers now prefer 3BHK and larger configurations, driven by rising disposable incomes, work- from-home requirements, and multigenerational living trends, marking a clear move away from compact housing.

ii. Growing appetite for amenity- rich developments:

Premium and lifestyle-led projects offering gyms, landscaped open spaces, co-working zones and smart features have seen faster absorption and stronger price appreciation, with premium housing accounting for a significantly higher share of total residential sales in major cities.

iii. End-user-led demand remains dominant:

Residential sales continue to be driven largely by genuine end users rather than speculative investors, lending greater stability to demand and supporting sustained pricing without excessive volatility.

iv. Outperformance of established urban micro-markets:

Well-connected micro-markets with proximity to employment hubs, metro rail, expressways and social infrastructure continue to witness higher sales velocity and pricing resilience compared to peripheral or unproven locations.

v. Infrastructure-led location preference:

Areas benefiting from ongoing or completed infrastructure projects including metro corridors, ring roads and business districts have emerged as preferred residential destinations, reinforcing long-term value visibility.

vi. Clear preference for trusted developers:

Buyers are increasingly gravitating toward established developers with proven delivery track records, transparent governance and strong balance sheets, as evidenced by rising market share and strong sales growth among leading, organised players.

Office Sector

Indias office market remains structurally strong, supported by the countrys position as a global hub for IT/ITeS, GCCs, and knowledge-led industries. Leasing activity has shown resilience, driven by expansion from domestic enterprises and multinational corporations.

Key drivers in the office sector:

• Continued growth of Global Capability Centres (GCCs)

• Demand for Grade A, ESG-compliant office spaces

• Hybrid work models stabilising rather than disrupting office demand

Retail Sector

The retail real estate segment has seen a revival, supported by rising consumer spending and experiential retail formats. Organised retail, high-street locations, and mixed-use developments continue to attract strong tenant interest.

Emerging Theme	What is Happening?	Why it Matters?	Implications for Real Estate Developers
Growth of destination malls and lifestyle centres	Retail development is shifting towards large, experience-led malls and mixed-use lifestyle destinations that combine shopping, dining and entertainment	Consumers are increasingly seeking experiential, social and leisure-oriented retail formats beyond pure shopping	Higher footfalls, longer dwell times and stronger tenant stickiness support stable rental income and asset value
Increased demand from food & beverage, entertainment, and premium brands	F&B outlets, cinemas, family entertainment zones and premium brands are emerging as key demand drivers for retail space	Rising disposable incomes and changing consumption patterns are boosting discretionary and experience-led spending	Diversified tenant mix improves occupancy levels and enhances the resilience of retail assets
Omnichannel strategies driving demand for well- located physical stores	Brands are integrating physical stores with digital channels, using stores for experience, fulfilment and brand visibility	Physical retail remains critical for customer engagement, last-mile fulfilment and trustbuilding	Strong demand for high- street and mall locations with good connectivity and catchment strength

About Ahmedabad: Structurally Strong, Strategically Positioned

City Tiers and Consumer Behaviour

The distribution of income and spending power varies significantly across city tiers. Tier-I and Tier- II cities together account for a disproportionate share of urban income, making them particularly important for consumption-led growth. Data from McKinseys Rise of the Indian Consumer shows that Tier-I and Tier-II cities together held over half of urban disposable income, highlighting the concentration of spending capacity in larger urban centers. Interestingly, studies on online shopping behaviour reveal that Tier-II city consumers are increasingly assertive spenders dedicating around 16% of their income to e-commerce purchases, a share comparable to or even above Tier-I city averages. This suggests that emerging urban centres are closing the gap in discretionary consumption, driven by young, aspirational consumers who prioritise digital channels and lifestyle categories, subsequently affecting the real estate segment.

Ahmedabad Real Estate Market: Shaping a new India

Ahmedabads real estate market increasingly reflects the contours of a new India, one driven by formalisation, infrastructure-led growth, and disciplined urban expansion. The city combines cost competitiveness with scale, offering residential and commercial affordability relative to Tier I metros while delivering comparable urban infrastructure and governance stability. Sustained public investment in connectivity, the emergence of GIFT City as a global financial district, and policy-led initiatives such as redevelopment of ageing residential stock have structurally strengthened the market.

Residential demand remains largely end-user driven, anchored by rising household incomes, improving affordability, and a clear preference for organised, lifestyle-led developments, while the commercial segment is benefitting from a diversifying occupier base spanning BFSI, professional services, manufacturing-linked offices and GCCs.

Importantly, growth in Ahmedabad has been measured rather than speculative, resulting in balanced supply additions, resilient absorption and steady price appreciation. Together, these factors position Ahmedabad not merely as a beneficiary of Indias urbanisation story, but as a model city shaping the next phase of sustainable, investment-led urban development in India .

In 2025, Ahmedabads real estate evolution is being decisively shaped by infrastructure-led urban planning and policy-driven development. The operationalisation and expansion of the Metro Rail network, including the ~24 km corridor connecting Ahmedabad and Gandhinagar, alongside the mature BRTS network, has significantly improved city-wide mobility and reduced commute times across key residential and commercial corridors. These transit enhancements are actively influencing real estate absorption, with western and northern micro-markets witnessing higher development intensity due to improved accessibility.

Urban liveability indicators have also strengthened meaningfully. Increased allocation toward public open spaces, riverfront development, pedestrian zones and recreational infrastructure has enhanced the citys quality-of- life metrics, supporting sustained residential demand. On the governance front, Ahmedabads adoption of smart surveillance systems and data-led urban safety initiatives has improved civic security, reinforcing its attractiveness to residents and businesses alike. Supported by a diversified economic base encompassing manufacturing, services, BFSI and emerging global capability functions, Ahmedabad in 2025 presents a balanced, scalable and sustainable real estate market, aligned with Indias long-term urban growth blueprint.

Ahmedabads Residential Segment

Ahmedabads residential real estate market has witnessed a strong and sustained recovery post the pandemic, driven by renewed homebuyer confidence, improved affordability, and steady economic activity. The resurgence in demand translated into annual home sales reaching a decade-high of 18,462 units in 2024 , underscoring the citys position as a resilient end-user-driven housing market.

Source: Demand for Premium Housing in India Rises,

https://internationalinvestment.biz/en/real-estate/5374-demand-for-premium-housing-in-india-rises.html

In 2025, Ahmedabads residential market continues to demonstrate steady momentum, supported by sustained end-user demand, stable affordability levels and ongoing traction in western micro-markets, particularly for mid-income and lifestyle-oriented housing.

Early 2025 indicators suggest balanced absorption and disciplined new launches, with developers maintaining a measured supply approach while buyer preference remains skewed towards spacious apartments in well-connected locations.

In response to rising demand, developers have launched projects characterised by larger apartment sizes, modern high-rise formats, and enhanced lifestyle amenities, while maintaining pricing discipline to align with buyer affordability. Although new residential launches moderated marginally, overall supply continued to remain healthy and ahead of absorption, supporting sustained market momentum.

Spatially, western Ahmedabad emerged as the dominant residential growth corridor, accounting for nearly 50% of total annual launches. Micro-markets such as Shela, Bodakdev and Naranpura witnessed heightened development activity, supported by superior connectivity, social infrastructure, and proximity to commercial hubs. Further strengthening redevelopment-led supply, the State Governments policy allowing redevelopment of residential societies older than 25 years (subject to 75% member consent) has catalysed multiple projects, particularly in Naranpura and Sola.

Ahmedabads Commercial Segment

A key distinguishing feature in 2025 has been the growing landlord leverage in prime submarkets particularly around GIFT City and the Secondary Business District (SBD) where demand from BFSI (Banking, Financial Services & Insurance) and IT/ITES occupiers has translated into higher rental values. In H1 2025, Ahmedabad recorded a rare 1:1 balance between new supply and leasing demand of around 0.5 million sq. ft., reflecting disciplined development and strong absorption. Market rents for high-quality Grade A office space are now about 25.5 % above passing rents, signalling improved pricing power and occupier confidence.

Source: Office space in Ahmedabad sees 25.5% rent upside, July 2025 Report http://constructionweekonline.in/business/office-ahmedabad

Opportunities and Threats

Opportunities

i. Infrastructure-Led Demand Expansion

Large-scale public infrastructure investments such as metro rail expansion, expressways, logistics corridors and urban redevelopment initiatives continue to unlock new residential and commercial micromarkets. Improved connectivity enhances land values, accelerates absorption and supports long-term demand visibility for well-located real estate assets.

ii. Sustained End-User Housing Demand

Rising household incomes, favourable demographics and increasing preference for home ownership are driving stable end- user demand across mid-income and premium housing segments. The growing inclination toward larger homes and amenity-rich developments offers developers the opportunity to improve product mix and pricing power.

iii. Shift Towards Organised and Credible Developers

Regulatory reforms and heightened buyer awareness have accelerated consolidation in the sector. Homebuyers and institutional investors are increasingly favouring developers with strong governance, transparent execution and proven delivery track records, enabling organised players to gain market share.

iv. Commercial Demand from Diversifying Occupiers

Growth in professional services, BFSI, manufacturing-linked offices and Global Capability Centres is supporting steady demand for Grade A office spaces. Tier-II and emerging commercial hubs are increasingly being viewed as cost- efficient alternatives to traditional metros, strengthening leasing prospects.

v. Institutional Capital and Alternative Asset Classes

Increasing interest from private equity, REITs and long-term institutional investors is improving access to capital, particularly for income-generating commercial and mixed-use assets. This trend supports balance sheet optimisation, asset monetisation and disciplined growth.

Threats

i. Volatility in Input Costs and Interest Rates

Fluctuations in construction material costs and a prolonged higher interest rate environment could impact project viability, affordability and buyer sentiment, particularly in price-sensitive segments.

ii. Supply-Demand Imbalances in Certain Micro-Markets

While overall market fundamentals remain stable, selective pockets may experience elevated vacancy or slower absorption due to legacy inventory or speculative supply, potentially exerting pressure on rentals and capital values.

About the Company: Laying the Foundations of Tomorrow

Ganesh Housing Limited (GHL) is a well-established real estate developer headquartered in Ahmedabad, Gujarat, with a legacy spanning over three decades.

The Company has built a strong reputation for quality execution, timely delivery and disciplined capital management, and has emerged as one of the leading organised real estate players in the Ahmedabad region.

The Company has developed and delivered over 23 million sq. ft. of real estate space across residential, commercial, retail and integrated developments. Its portfolio spans mid-income to premium housing, commercial business centres and technology-led projects. The Company has also built a robust land bank and development pipeline exceeding 30 million sq. ft., providing long-term visibility for growth through phased monetisation.

The Companys flagship developments include commercial assets, including SEZ and IT park developments, positioning the Company to benefit from Ahmedabads expanding residential demand and the citys growing appeal as a commercial and institutional hub. Strategic partnerships with global and domestic stakeholders further strengthen execution capabilities and market reach.

With a clear focus on sustainable development, governance and longterm value creation, GHL continues to align its growth strategy with evolving customer preferences, regulatory frameworks and urban development trends. The Company remains well positioned to capitalise on Ahmedabads structural growth story while delivering consistent value to its stakeholders.

Operational Performance

With deep roots in Ahmedabad, the Company continued to strengthen its position as a differentiated real estate developer by leveraging a deep understanding of the local market, customer preferences and evolving urban landscape.

Our emphasis on quality, timely execution and customer-centric development has enabled us to build a trusted brand that continues to command a leadership position in the region.

Operational performance during the year reflected disciplined execution against our strategic priorities. Guided by a clear focus on timely delivery, prudent capital allocation and operational excellence, we continued to convert our plans into tangible outcomes while strengthening our market position and creating sustainable value for all stakeholders.

A key pillar of our long-term growth strategy is the timely identification and acquisition of high-potential development opportunities. Through disciplined planning and a forwardlooking approach, we have built a land bank, securing a robust pipeline that positions us to capitalise on future demand and sustain growth over the coming years.

Looking ahead, we remain focused on expanding our development footprint through a pipeline of large- scale infrastructure and special projects, including initiatives such as Million Minds (IT-SEZ).

Financial Performance

In FY26, the Company continued to demonstrate financial resilience while maintaining a strong profitability profile amid the normalisation of revenue recognition. Revenue stood at INR 5,385 Mn, reflecting the timing of project execution and handovers during the year.

The Company sustained an industry-leading EBITDA margin of 83.5%, with EBITDA at INR 4,497 Mn, highlighting its efficient cost structure and disciplined project execution. Profit Before Tax (PBT) amounted to INR 4,392 Mn, while Profit After Tax (PAT) stood at INR 3,163 Mn, translating into a robust PAT margin of 58.7%. The Company also maintained a prudent capital structure with minimal finance costs, reflecting its continued focus on balance sheet strength and financial flexibility.

Supported by a healthy development pipeline, a low capital geared balance sheet and a disciplined execution strategy, the Company remains well positioned to capitalise on future growth opportunities. As projects progress through execution and monetisation, it is confident of sustaining long-term value creation through operational excellence, prudent capital allocation and an unwavering commitment to delivering superior returns to all stakeholders.

Key Ratios

(Based on Consolidated Financial Statements)

RATIOS	2025-26	2024-25	Change(%)	Reason for Change
Debtors Turnover Ratio	1.8	2.8	-37%	Debtor Turnover Ratio has declined due to lower proportionate realisation compared to the turnover level.
Inventory Turnover Ratio	1.0	2.1	-52%	Inventory Turnover Ratio has declined due to a decrease in sales and an increase in inventory on account of accumulation of under construction WIP stock.
Interest Coverage Ratio	112.7	212.1	-47%	Interest Coverage Ratio has declined on account of substantial decrease in operational income.
Current Assets Ratio	5.5	6.0	-9%	Current Ratio has declined due to a increase in current liabilities relating to Advance from customers as well as borrowing taken to support the growth phase.
Debt Equity Ratio	0.2	0.1	55%	Debt Equity Ratio has increased due to addition of new long-term borrowings during the year.
Operating Profit Margin	86.7%	83.9%	3%	Operating Profit Margin Ratio has improved on account of proportionate reduction in operating cost compared to revenue movement during the year.
Net Profit Margin	61.8%	62.3%	-1%	Net Profit Margin remained relatively stable as effective cost-containment measures offset the substantial decline in sales turnover.
Return On Net Worth	13.6%	29.1%	-53%	Return on Net Worth decreased significantly during the year, driven by lower profitability compared to last year.

Internal Control System and Its Adequacy

The Company has proper and adequate systems of internal controls commensurate with its size and nature of operations to provide reasonable assurance that all assets are safeguarded, transactions are authorised, recorded & reported properly and to ascertain operating business risks, which are mitigated by regular monitoring and corrective actions. The internal control systems have been designed so as to ensure that the financial and other records are reliable and reflect a true and fair view of the state of the Companys business.

Human Resource

Human resources continue to be a critical pillar supporting the Companys operational efficiency, innovation capability, and long-term growth. During the year, the Company focused on strengthening its workforce through skill development, cross-functional collaboration, and continuous learning, particularly in areas related to digital technologies, process optimization, and customer-centric solutions.

GHL fosters a collaborative and inclusive work environment that encourages knowledge sharing, accountability, and continuous improvement across functions. Internal processes were further streamlined to enhance coordination between technical, commercial, and support teams, enabling faster decision-making and improved responsiveness to customer requirements.

The Company also prioritizes employee engagement, workplace safety, and adherence to ethical and compliance standards. Management believes that sustained investment in people, systems, and internal governance will remain essential to maintaining operational excellence and supporting strategic objectives in a competitive and rapidly evolving industry.

Training and development of the employees is ensured through on the job and outside training programs and workshop. The Company continues to attract excellent talent to further its business interests. Industrial relations continue to be cordial.

As of March 31, 2026, GHLs workforce stands at over 123 employees, reflecting its success in building a resilient and future-ready team.

Risk Management

Risk management remains integral to GHLs strategy for delivering sustainable growth and operational resilience. Operating in a dynamic real estate environment, the Company proactively identifies, assesses and mitigates risks that may impact project execution, financial performance and long-term value creation. Supported by a robust governance framework, disciplined internal controls and continuous monitoring mechanisms, the Company is well equipped to navigate evolving market conditions, regulatory developments and operational challenges while safeguarding the interests of its customers, investors and other stakeholders.

Risk	Risk Level	Risk Description	Mitigation Strategy
Regulatory & Approval Risk	High	Delays in obtaining statutory approvals, changes in land use regulations, environmental clearances and evolving compliance requirements can impact project timelines, costs and launches.	Maintain proactive engagement with regulatory authorities, strengthen compliance frameworks, conduct rigorous due diligence before land acquisition and continuously monitor regulatory developments.
Construction & Project Execution Risk	High	Escalation in input costs, contractor performance issues, labour shortages and supply chain disruptions may delay project completion and affect profitability.	Adopt robust project planning and monitoring mechanisms, diversify vendor and contractor base, implement stringent quality controls and leverage technology-driven project management systems.
Market Demand & Economic Risk	Moderate	Changes in interest rates, economic conditions, customer sentiment and real estate demand may influence sales velocity, pricing and cash flows.	Focus on strategic project locations, maintain a diversified project portfolio, adopt customer-centric offerings, preserve a strong balance sheet and continuously monitor market trends to enable agile business decisions.

Cautionary Statement

Statements in this ‘Management Discussion and Analysis and this Annual Report describing the Companys objectives, projections, estimates, expectations, plans or predictions, or industry conditions or events are ‘forwardlooking statements within the meaning of applicable securities laws and regulations. Actual results, performance, or achievements could differ materially from those expressed or implied. Several factors could make a significant difference to the Companys operations. These include economic conditions affecting demand and supply, Government regulations and taxation, natural calamities, and so on, over which the Company has no direct control. The Company undertakes no obligation to publicly update or revise any forward-looking statements based on subsequent developments or events.