Kedia Construction Company Ltd Management Discussions

INDUSTRY STRUCTURE AND DEVELOPMENT

The real estate sector plays a pivotal role in the Indian economy, acting as a significant contributor to the nations Gross Domestic Product (GDP) and providing substantial employment opportunities. Currently, the market is undergoing a dynamic and transformative phase, influenced by a confluence of socioeconomic shifts and technological advancements.

The Indian real estate market demonstrated robust performance in 2024, establishing a strong foundation for continued growth into 2025 and beyond. The luxury housing segment experienced particularly significant expansion, accompanied by a steady increase in overall property prices. Looking ahead to 2025, housing affordability is anticipated to improve for most markets due to projected interest rate cuts, although regional variations are expected. Key factors propelling the market forward include rapid urbanization, sustained economic growth, supportive government initiatives, and increasing technological advancements.

Indias real estate market is entering a vital phase, with 2025 set to redefine its growth path. Contributing around 7% to the nations gross domestic product (GDP) in 2024, the sector is poised to grow to 13% in 2025, aligning with Indias projected $26 trillion GDP by its centenary of independence. The market size is expected to expand from $300 billion in 2024 to $1 trillion by 2030.

The government will set up an Urban Challenge Fund of Rs 1 lakh crore to implement proposals for ‘Cities as Growth Hubs, Creative Redevelopment of Cities announced in the budget.

OPPORTUNITIES AND THREATS

As India awaits policy reforms to pick up speed, your Company firmly believes that the demand for Real Estate in a country like India should remain strong in the medium to long term. Your Companys well- accepted brand, contemporary architecture, well-designed projects in strategic locations, strong balance sheet, and stable financial performance even in testing times make it a preferred choice for customers and shareholders. Your company is ideally placed to further strengthen its development potential by acquiring new land parcels.

While the management of your Company is confident of creating and exploiting the opportunities, it also finds the many challenges such as unanticipated delays in project approvals, availability of accomplished and trained labour force Increased cost of manpower, rising cost of construction, growth in auxiliary infrastructure facilities, over-regulated environment

OUTLOOK

The year was remarkable for the Indian real estate market, witnessing an upward growth trajectory in the luxury segment. Affluent buyers, including HNIs and NRIs, dominated the market, propelling the demand and sales.

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.

RISK AND CONCERNS

Construction activity in the real estate sector involves multiple variables that can pose significant risks and concerns, ultimately affecting project delivery, cost efficiency, and overall business performance. Key challenges include labour shortage, demand uncertainty etc, each of these factors must be carefully assessed and managed during planning and execution to minimize their impact on business outcomes.

SEGMENT OR PRODUCT WISE PERFORMANCE

The Company is operating in one segment known as construction activity. The product wise comparison is not possible as it is not producing the product but it is undertaking the project. Hence performance can be compared on project completion as such performance of the Company has to be seen in overall manner.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY

The Company has developed adequate internal control system commensurate to its size and business. The Company has Internal Auditors, to conduct the internal audit to ensure adequacy of internal control system, compliance of rules and regulations of the country and adherence to the management policies.

FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

The Company has registered a turnover of Rs. 30.36 Lakhs and Profit/ Loss before depreciation and a tax were Rs.0.50 Lakhs. The depreciation provided during the year was NIL and, the net profit after tax for the year is Rs. 0.53 Lakhs.

HUMAN RESOURCES

During the year, Company maintained harmonious and cordial relations. No man days lost due to any reason.

DISCLOSURE BY THE SENIOR MANAGEMENT PERSONNEL I.E. ONE LEVEL BELOW THE BOARD INCLUDING ALL HODS

None of the Senior Management Personnel has financial and commercial transaction with the Company, where they have personal interest that would have a potential conflict with the interest of the Company at large.

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.