Mahendra Realtors & Infrastructure Ltd Management Discussions

The following discussion is intended to convey managements perspective on our financial condition and results of operations for the financial year ended March 31, 2025, March 31, 2024 and March 31, 2023. One should read the following discussion and analysis of our financial condition and results of operations in conjunction with our section titled "Financial Statements" and the chapter titled "Financial Information" on page 227 of the Red Herring Prospectus. This discussion contains forward-looking statements and reflects our current views with respect to future events and our financial performance and involves numerous risks and uncertainties, including, but not limited to, those described in the section entitled "Risk Factors" on page 31 of this Red Herring Prospectus. Actual results could differ materially from those contained in any forward-looking statements and for further details regarding forward-looking statements, kindly refer the chapter titled "Forward-Looking Statements" on page 18 of this Red Herring Prospectus. Unless otherwise stated, the financial information of our Company used in this section has been derived from the Restated Financial Information. Accordingly, unless otherwise stated, all references to a particular financial year are to the 12- month period ending March 31 of that year.

In this section, unless the context otherwise requires, any reference to "we ", "us " or "our" refers to Mahendra Realtors & Infrastructure Limited, our Company. Unless otherwise indicated, financial information included herein is based on our Restated Financial Statements for the Financial Years 2025, 2024 & 2023 included in this Red Herring Prospectus beginning on page 227 of this Red Herring Prospectus.

BUSINESS OVERVIEW

Our Company was originally incorporated as a private limited Company under the Companies Act, 1956, in the name and style of "Mahendra Realtors & Infrastructure Private Limited" bearing corporate identification number U70102MH2007PTC171445, dated June 08, 2007, issued by the Registrar of Companies, Mumbai. Subsequently, the name of our Company was changed to "Mahendra Realtors & Infrastructure Limited" pursuant to a shareholders resolution passed at the Extra-Ordinary General Meeting held on June 13, 2014, and a fresh certificate of incorporation dated August 25, 2014, was issued by Registrar of Companies, Mumbai bearing corporate identification number U70102MH2007PLC171445. However, the name of our company was again changed to "Mahendra Realtors & Infrastructure Private Limited" pursuant to a shareholders resolution passed at an Extra-Ordinary General Meeting held on August 26, 2014, and a fresh certificate of incorporation dated November 03, 2014, was issued by Registrar of Companies, Mumbai bearing corporate identification number U70102MH2007PTC171445. Thereafter, the name of our company was further changed to "Mahendra Realtors & Infrastructure Limited" pursuant to a shareholders resolution passed at an Extra-Ordinary General Meeting held on April 3, 2024, and a fresh certificate of incorporation dated July 15, 2024, was issued by Registrar of Companies, Mumbai bearing corporate identification number U70102MH2007PLC171445.

For further details of the change in name and change in the registered office of our Company, please refer to the section titled ‘Our History and Certain Other Corporate Matters beginning on page 188 of this Red Herring Prospectus.

Our Company is engaged in a company that primarily operates in the business government contracting of civil structure repairs and restoration, as well as plumbing contracting, offering specialised services in civil engineering, structural repairs, waterproofing, painting, interior work, and plumbing. Due to the nature of this business, it is highly working capital intensive. A significant portion of the working capital requirements is financed through internal accruals. Works Contract Service for Specialized Structural Repairs/ Restoration/Rehabilitation/Retrofitting, Corporate Interiors, BOT, Construction, C & D waste Processing etc.

KEY PERFORMANCE INDICATORS OF OUR COMPANY

Key Financial Performance	March 31, 2025	March 31, 2024	March 31, 2023
Revenue from operations (1)	12,477.18	10,148.98	6,302.02
EBITDA (2)	2,189.89	1699.67	903.59
EBITDA Margin (3)	17.55%	16.75%	14.34%
PAT (4)	1,486.63	1,157.83	404.12
PAT Margin (5)	11.91%	11.41%	6.41%
Net Worth (6)	7,088.90	5,602.27	4,444.44
Return on Net Worth (7)	23.43%	23.05%	9.53%
RoCE (8)	30.56%	29.87%	19.72%

Notes:

(1) Revenue from operations means the revenue generated from operations by our Company as appearing in the Restated Financial Statement.

(2) EBITDA is calculated as Profit before tax + Depreciation + Interest Expenses

(3) EBITDA Margin is calculated as EBITDA divided by Revenue from Operations

(4) PAT is mentioned as profit after tax for the period.

(5) PAT Margin is calculated as PAT for the period/year divided by revenue from operations.

(6) Net Worth means the aggregate value of the paid-up share capital and reserves and surplus (including, Securities Premium, General Reserve and surplus in statement ofprofit and loss) of the company.

(7) ROE/RONW: Return on Equity is calculated as PAT divided by average shareholders equity

(8) ROCE: Return on Capital Employed is calculated as EBIT divided by capital employed, which is defined as shareholders equity plus long-term debt.

SIGNIFICANT DEVELOPMENTS SUBSEQUENT TO THE LAST FINANCIAL YEAR

As per mutual discussion between the Board of the Company and Book Running Lead Manager, in the opinion of the Board of the Company there have not arisen any circumstances since the date of the last financial statements as disclosed in the Red Herring Prospectus and which materially and adversely affect or is likely to affect within the next twelve months except as follows:

• The Board of Directors of our Company has approved and passed a resolution on July 30, 2024, to authorize the Board of Directors to raise the funds by way of an Initial Public Offering.

• The members of our Company have approved and passed a resolution on September 20, 2024, to authorize the Board of Directors to raise the funds by way of an Initial Public Offering

• The members of our Company have appointed Mr. Shiv Karan (DIN: 02694165) and Mr. Shah Amit RajeshKumar (DIN: 10581336), as Independent Directors of the Company in the 17thAnnual General Meeting held on September 20, 2024.

• The Board of directors in its meeting held on April 01st 2024 appointed Mrs. Niharika Kothari as Company Secretary & Compliance Officer of the Company.

• The Board of directors in its meeting held on May 02nd 2024 appointed Mr. Sandeep Kumar S. Singh as Chief Financial Officer of the Company.

• The Board of directors in its meeting held on December 09th 2024 appointed Mr. Bhavesh Mahendrakumar Shah as Whole Time Director of the Company w.e.f. January 01st, 2025

• The Board of directors in its meeting held on December 09th 2024, appointed Mr. Hemanshu Shah as Managing Director of the company for a period of 3 years w.e.f. January 01st, 2025.

Our business is subject to various risks and uncertainties, including those discussed in the section titled "Risk Factor" beginning on page 31 of this Red Herring Prospectus. Our results of operations and financial conditions are affected by numerous factors including but not limited to the following:

• Changes, if any, in the regulations / regulatory framework / economic policies in India and/or in foreign countries, which affect national & international finance;

• Companys results of operations and financial performance;

• Condition and performance of the real estate market in India;

• Failure to obtain any approvals, licenses, registrations and permits in a timely manner;

• Delay in timely completion of the Companys projects;

• Substantial delay in allotting the funds by the government for already executed work may hamper our operations.

• Budget allocation by Government, Semi-government, and PSU for the various works contract jobs, which the Company has expertise in and also on the Tender Published and allotted to the Company;

• Performance of the Companys competitors as well as competition with existing and new entrants;

• Significant developments in Indias economic and fiscal policies;

• Volatility in the Indian and global capital market;

• Changes in political and social conditions in India;

• Inflation, deflation, unanticipated turbulence in interest rates;

• Fluctuations in operating costs may result volatility in the Companys results of operations and financial performance;

• Our ability to meet our capital expenditure requirements and/or our failure to keep pace with rapid changes in technology;

• Our dependence on our key personnel, including our directors and senior management;

• Our ability to successfully implement our business strategy and plans;

• The occurrence of natural disasters or calamities;

DISCUSSION ON RESULT OF OPERATION

The following table sets forth financial data from the restated profit and loss account for the financial year ended on March 31, 2025, 2024 and 2023 the components of which are also expressed as a percentage of total income for such periods.

(Amount in Lakhs)

Particulars	For the year ended 31 March, 2025	%age of Total Income	For the year ended 31 March, 2024	%age of Total Income	For the year ended 31 March, 2023	%age of Total Income
Income
Revenue from Operations	12,477.18	96.95	10,148.98	96.56	6,302.02	95.39
Other Income	392.06	3.05	361.98	3.44	304.61	4.61
Total Income (I + II)	12,869.25	100	10510.96	100	6606.63	100
Expenditure
Cost of material consumed	8,719.71	67.76	7,218.42	68.68	4,493.58	68.02
Employee benefits expenses	1,273.78	9.90	1,081.88	10.29	590.02	8.93
Finance Cost	118.47	0.92	125.25	1.19	259.56	3.93
Depreciation and Amortization expenses	23.49	0.18	26.42	0.25	27.08	0.41
Other expenses	685.87	5.33	510.99	4.86	619.45	9.38
Total expenses	10,821.32	84.09	8,962.96	83.83	5,989.68	86.32
Profit before Taxation	2,047.93	15.95	1548.00	14.73	616.95	9.34
Current Tax	561.00	4.36	413.00	3.93	186.75	2.83
Deferred Tax	0.30	0.002	(22.83)	-0.22	26.08	0.39
Earlier Years Tax Expense	0.00	0.00	0	0.00	0.00	-
Profit After Tax but Before Extraordinary Items	1,486.63	11.55	1157.83	11.02	404.12	6.12
Extraordinary Items			-		-
Earnings per share
Basic and Diluted	8.55	-	6.66	-	2.33	-

The Service wise revenue breakup of the Company are as follows:

(Amount in Lakhs and % from total Revenue from operations)

Product	For the period ended 31st March, 2025		For the period ended 31 March, 2024		For the period ended 31 March, 2023
Corporate Interior	1,873.89	15.02%	2,102.16	20.71%	778.28	12.35%
Maintenance	57.30	0.46%	143.77	1.42%	83.96	1.33%
Works Contract (Repairs/ Renovation/Restoration)	10545.10	84.52%	7,820.59	77.06%	4,821.08	76.50%
Built-Operate-Transfer (BOT)	-	-	82.46	0.81%	618.70	9.82%
Total	12,477.18	100%	10,148.98	100%	6,302.02	100%

Rationale for the decrease in revenue generated from Corporate Interiors segment and BOT segment in FY2025

CORPORATE INTERIORS - FY 2024-25

The revenue from the corporate Interiors segment declined in FY 2024-24, primarily due to reduction in tenders awarded to the company. This led to reduction of 10.86% revenue from corporate interiors.

BOT SEGMENT - FY 2024-25

The company did not bid for any new BOT projects during the year, as they were assessed to be financially unviable. For existing projects, a customer sale agreement was executed; however, revenue was not recognized due to pending fulfillment of criteria under the companys revenue recognition policy. The details of the same are mentioned Annexure 34 of "Financial Information" on page 256 of Red Herring Prospectus.

Rationale for the decrease in revenue generated from Corporate Interiors segment in FY2023 and the BOT segment in FY2024:

CORPORATE INTERIORS - FY 2022-23

The revenue from the Corporate Interiors segment declined significantly in FY 2022-23, primarily due to a reduction in the overall order inflow and the Companys total turnover during the year. The Companys revenue

• Low Opening Order Book: As on March 31, 2022, the order book for the interiors segment stood at only Rs. 10.22 crore, which limited the revenue potential for the ensuing financial year.

• Limited Tender Awards: Although the Company participated in 62 interior tenders worth approximately Rs. 176.85 crore during FY 2022-23, it secured only 9 tenders, collectively valued at Rs. 20.05 crore. This low conversion rate significantly impacted segmental revenue.

• Political Instability: The State of Maharashtra experienced a period of political uncertainty, including the split of a major political party and a shift in the ruling coalition. This instability led to a noticeable decline in the issuance of high-value government tenders.

• Intensified Market Competition: With fewer tenders available, the market became highly competitive. Many infrastructure players resorted to undercutting prices to win contracts, making it difficult for the Company to secure projects at sustainable margins.

BOT SEGMENT - FY 2023-24:

The Company had undertaken a single BOT project, for which the Occupancy Certificate (OC) was obtained in February 2023. As per the project completion method of accounting, the revenue from units sold prior to obtaining the OC was recognized in FY 2022-23. Units sold after the OC, during FY 2023-24, were accordingly recognized in that fiscal year. However, since a significant portion of the revenue was already recognized in the earlier year, therefore the contribution from the BOT segment was lower in FY 2023-24.

Additionally, no new BOT projects have been awarded or undertaken by the Company in the past three years. As a result, maximum revenue from the existing project has already been recorded in FY 2022-23, leading to a natural decline in revenue from this segment in FY 2023-24.

Geographical Revenue breakup of the Company are as follows:

(Amount in Lakhs and % from total Revenue from operations

State	For the period ended 31st March, 2025		For the period ended st 31 March, 2024		For the period ended st 31 March, 2023
	Amount	%	Amount	%	Amount	%
Andhra Pradesh	7.61	0.06%	28.25	0.28%	-	0.00%
Delhi	32.23	0.26%	76.43	0.75%	382.26	6.07%
GOA	-	0.00%	-	0.00%	8.62	0.14%
Gujarat	343.29	2.75%	1,007.26	9.92%	964.73	15.31%
Maharashtra	12,047.27	96.55%	8,946.38	88.15%	4,769.49	75.68%
Tamil Nadu	46.79	0.38%	90.66	0.89%	176.92	2.81%
Telangana	-	0.00%	-	0.00%	-	0.00%
Total	12,477.18	100%	10,148.98	100%	6,302.02	100%

Key performance Indicators

For significant key performance indicators, please refer to KPI under chapter titled "Basis of Issue Price" beginning on page no. 114 of this Red Herring Prospectus.

Our Significant Accounting Policies

For Significant accounting policies please refer to Significant Accounting Policies, under Chapter titled "Financial Statements" beginning on page no. 227 of the Red Herring Prospectus.

Changes in Accounting Policies in Previous 3 years

Except as mentioned in the Notes to the Accounts in the chapter "Restated Financial Information" on page no. 227 of this Red Herring Prospectus has been no change in accounting policies in last 3 years.

Reservations, Qualifications and Adverse Remarks

The Examination Report issued by our Statutory Auditors has no reservations, qualifications and adverse remarks.

Overview of Revenue & Expenditure

The following discussion on the results of operations should be read in conjunction with the Restated Financial statements for the Financial Year ended on March 2025, 2024 and 2023. Our revenue and expenses are reported in the following manner:

Revenue Recognition Method adopted by the company

Revenue from the execution of works contracts is recognized on the basis of percentage of completion method subject to transfer of significant risk and rewards to the buyer, reliable estimation of the outcome of the construction contract and stage of completion of the contract reaching at reasonable level of development is certified by the engineer.

Revenue from sale of properties under construction is recognized on the basis of percentage of completion method subject to transfer of significant risk and rewards to the buyer, reliable estimation of the outcome of the real estate project and stage of completion of the project reaching at reasonable level of development i.e. at least 25% of total project cost should be incurred at reporting date.

When the outcome of a real estate project can be estimated reliably and the conditions stipulated below are satisfied, project revenue and project costs associated with the real estate project should be recognized as revenue and expenses respectively by reference to the stage of completion of the project activity at each reporting date. Stage of completion is arrived with reference to the entire project cost incurred versus total estimated project cost. Further, with regard to total estimated cost of each project is based upon the judgment of management and certified by the Companys technical personnel.

The following specific recognition criteria must also be met before revenue is recognized:

• All critical approvals necessary for commencement of the project have been obtained.

• At least 25% of construction & development cost (excluding cost incurred in acquisition of land and its development rights and borrowing cost) is incurred.

• At least 25% of the saleable project area is secured by contracts or agreements with buyers.

• And at least 10 % of the total revenue as per the agreements of sale or any other legally enforceable documents are realized at the reporting date in respect of each of the contracts and it is reasonable to expect that the parties to such contracts will comply with the payment terms as defined in the contracts.

* Revenue of operations

I. Our Companys revenue mainly consists of the sale of services by way of a) Structural Repair, renovation and Restoration; b) Maintenance; c) Corporate Interior; d) Build operate & transfer.

* Other Income

Other Income includes Interest Income from Fixed Deposits and others, dividend income, profit on sale of mutual funds, rent income and profit in sale of Asset.

Particulars	For the period ended March 31,
	2025	2024	2023
Income
Revenue from Operations	12,477.18	10,148.98	6,302.02
As a % of Total Income	96.95	96.56	95.39
Other Income	392.06	361.98	304.61
As a % of Total Income	3.05	3.44	4.61
Total Income	12,869.25	10,510.96	6,606.63

Expenditure

Our total expenditure primarily includes the cost of material consumed, Employee benefit expenses, and Other Expenses. We also have incurred financial charges and depreciation as expenditures, which we have shown separately from total expenditure.

* Cost of material consumed

Our cost of material includes purchasing raw materials and adjustment with an inventory of raw materials used in the year, along with direct labour costs incurred by the Company.

* Employment Benefit Expenses

Our employee benefits expense primarily comprises of Salaries, Wages & Bonus expenses, Contribution to Provident, Directors Remuneration and Other Fund and Staff welfare expenses.

* Finance Cost

Our finance costs mainly include Bank interest and other borrowing costs.

* Depreciation and Amortization Expenses

Depreciation includes depreciation on Buildings, Plant & Equipment, Furniture & Fixtures, Computers, etc.

* Other Expenses

Other Expenses include majorly site expenses, tax expenses, professional charges, tender costs, insurance, electricity charges and other miscellaneous expenses.

DETAILS FOR THE FINANCIAL YEAR ENDED MARCH, 2025 COMPARED TO FINANCIAL YEAR ENDED ON MARCH 2024 (BASED ON RESTATED FINANCIAL STATEMENTS)

Revenues

* Total Income

Total Income for the Financial Year 2024-25 stood at Rs. 12,869.25 Lakhs whereas in Financial Year 202324 it stood at Rs.10,510.96 Lakhs representing an increase of 22.44% due to increase in revenue from operations.

* Revenue of operations

Net revenue from operations for the Financial Year 2024-25 Stood at Rs. 12,477.18 Lakhs. Whereas for the Financial Year 2023-24, it stood at Rs.10,148.98 Lakhs representing an increase of22.94%. Owing to strong standing orders, timely execution of work, and prompt approvals from the clients, the revenue booked during FY 2024-25 was significantly high.

* Other Income

Other Income for the Financial Year 2024-25 stood at Rs. 392.06 Lakhs. Whereas for the Financial Year 2023-24, it stood at Rs. 361.98 Lakhs representing an increase of 8.31%. This is mainly due to an increase in interest income earned from investments made in Fixed Deposits.

* Total Expenses

Total Expenses for the Financial Year 2024-25 stood at Rs. 10,821.32 Lakhs. Whereas for the Financial Year 2023-24, it stood at Rs.8,962.96 Lakhs representing an increase of 20.73%.

* Cost of Material Consumed

The cost of material consumed for the Financial Year ended 2024-25 stood at Rs.8,719.71 Lakhs. Whereas for the Financial year 2023-24, it stood at Rs.7218.42 Lakhs representing an increase of 20.80%. This increase is in line with the 22.94% rise in revenue during the same period. However, as a percentage of revenue from operations, the cost of materials consumed decreased from 71.12% in FY 2023-24 to 69.89% in FY 2024-25. This reduction is attributed to the companys ability to secure better procurement deals through effective negotiations, thereby improving cost efficiency.

* Employment Benefit Expenses

Employee benefit expenses for the Financial Year ended 2024-25 stood at Rs.1,273.78 Lakhs. Whereas for the Financial Year 2023-24, it stood at Rs. 1081.88 Lakhs representing an increase of 17.74%. In September company provided an increment to all the employees of average 10%, resulting in high employee expenses.

* Other Expenses

The Other Expenses for the Financial Year 2024-25 stood at Rs. 685.87 Lakhs. Whereas for the Financial Year 2023-24, it stood at Rs. 510.99 Lakhs representing an increase of 34.22%. This rise is primarily attributable to a significant increase in deductions from sales, which rose from Rs. 75.62 lakhs to Rs. 184.67 lakhs, Professional Charges which increased from Rs. 98.64 lakhs to Rs. 131.77 lakhs and software expenses, which increased from Rs. 5.86 lakhs to Rs. 37.09 lakhs, this representing major components of the overall increase.

* Depreciation and Amortization Expenses

The Depreciation and Amortization Expenses for the Financial Year 2024-25 stood at Rs.23.49 Lakhs whereas in the Financial Year 2023-24 it stood at Rs. 26.42 Lakhs, which is calculated for the period and values, as per the utilization of assets for the Companys business.

* Finance Cost

Finance Cost for the Financial Year 2024-25 stood at Rs. 118.47 Lakhs whereas in Financial Year 2023-24 it stood at Rs. 125.25 Lakhs representing a decrease of 5.41% due to reduction is primarily due to the repayment of unsecured loans from related parties towards the end of the previous financial year, which led to a lower effective interest burden in the current year.

* Restated Profit before Tax

The restated profit before tax for the Financial Year 2024-25 stood at Rs. 2,047.93 Lakhs. Whereas for the Financial Year 2023-24, it stood at Rs. 1548.0 Lakhs representing an increase of 32.30% due to higher revenue incurred in FY 2024-25 and slight reduction in the material and labour cost.

* Restated Profit after Tax

The restated profit before tax for the Financial Year 2024-25 stood at Rs. 1,486.63 Lakhs. Whereas for the Financial Year 2023-24, it stood at Rs. 1,157.83 Lakhs, which is almost equivalent to 11.91% and 11.41% of the Revenue from operations in the corresponding financial year respectively. Due to better negotiation skills, the company grabbed better deals for their pending order book hence, resulting in a marginal increase in PAT margin.

DETAILS OF FINANCIAL YEAR ENDED ON MARCH 2024 COMPARED TO FINANCIAL YEAR ENDED ON MARCH 2023 (BASED ON RESTATED FINANCIAL STATEMENTS)

* Total Income

Total Income for the Financial Year 2023-24, stood at Rs. 10,510.96 Lakhs whereas in Financial Year 202223 it was stood at Rs.6,606.63 Lakhs representing an increase of 59.10%. This is mainly because of increase in revenue from operations and other income of the business as stated below.

* Revenue of operations

Net revenue from operations For the Financial Year 2023-24 stood at Rs.10,148.98 Lakhs. Whereas for the Financial Year 2022-23, it stood at Rs. 6,302.02 Lakhs representing an increase of 61.04%. This can be attributed to higher project completions in the year as the Company recognized revenue on a percentage of completion basis and acquiring of more projects than the previous year due to the expansion of business in new markets as well more tender floating in the year due to stable Maharashtrian government.

Reasons for 61% increase in Revenue from operations in FY 2023-24 as compared to FY 2022-23.

1. Improved Order Book Position and Project Execution:

Unlike the previous financial year, FY24 witnessed a robust inflow of new projects, leading to a healthier order book. The company successfully secured and executed multiple large-scale contracts, contributing significantly to the topline.

2. Key Projects Executed in FY24:

Due to major projects which were acquired and substantially executed during the year, played a critical role in boosting the companys revenue, such high-value contracts not only enhanced project turnover but also reflect the companys strengthened market presence and execution capabilities across multiple geographies and sectors.

Overall, the substantial increase in revenue during FY24 underscores the companys ability to capitalize on market opportunities, improve operational efficiency, and deliver large-scale infrastructure and repair solutions successfully. Also, considering the 2022-23 as exceptional year, CAGR from the FY 2022 to FY 2024 is only 4.65% as mentioned on page 114 of RHP under Key performance indicators under chapter titled ‘Basis of Issue Price

* Other Income

Other Income for the Financial Year 2023-24 stood at Rs.361.98 Lakhs. Whereas for the Financial Year 2022-23, it stood at Rs. 304.61 Lakhs representing an increase of 18.83%. This is mainly due to an increase in interest earned from investments made in Fixed Deposits.

Expenditure

* Total Expenses

Total Expenses for the Financial Year 2023-24 stood at Rs.8,962.96 Lakhs. Whereas for the Financial Year 2022-23, it stood at Rs.5,989.68 Lakhs representing an increase of49.64% generally in line with the increase in total turnover and other incomes along with a decrease in finance cost.

* Cost of Material Consumed

The cost of material consumed for the Financial Year 2023-24 stood at Rs. 7,218.42 Lakhs. Whereas for the Financial year 2022-23, it stood at Rs. 4,493.58 Lakhs representing an increase of 60.64 which is in line with the increase in revenue from operations. As our market expanded, our tenders increased. Higher project volume leads to an increase in the cost of material consumed. In figures, it is 68.68% and 68.02% of total income in the respective years which states that the increase in cost of material consumed is proportionately in line with an increase in total income.

* Employment Benefit Expenses

Employee benefit expenses for the Financial Year 2023-24 stood at Rs.1081.88 Lakhs. Whereas for the Financial Year 2022-23, it stood at Rs. 590.02 Lakhs representing an increase of 83.36%. This was due to an increase in a number of employees and laborers to accommodate more projects and a change in wage rate for the specialized roles.

* Other Expenses

The Other Expenses for the Financial Year 2023-24 stood at Rs. 510.99 Lakhs. Whereas for the Financial Year 2022-23, it stood at Rs. 619.45 Lakhs representing a decrease of 17.51%, which is primarily due to a decrease in indirect tax expenses and other expenses. As the Company faced a GST Demand in the previous year 2022-23, its indirect tax expense was significantly increased in that year, also in the previous year some of the debtors were written off which increased the other expenses of the Company in the previous financial year. These two expenses are one-time expenses and hence not incurred in the Financial Year 2023-34.

* Depreciation and Amortization Expenses

The Depreciation and Amortization Expenses for the Financial Year 2023-24, stood at Rs.26.42 Lakhs whereas in the Financial Year 2022-23 it stood at Rs. 27.08 Lakhs, which is calculated for the period and values, as per the utilization of assets for the Companys business representing decrease of Rs0.66 Lakhs.

* Finance Cost

Finance Cost for the Financial Year 2023-24, stood at Rs. 125.25 Lakhs whereas in Financial Year 202223 it stood at Rs. 259.56 Lakhs representing a decrease of 51.74%, this is due to lesser loan in the Financial Year 2023-2024, which can be seen from restated financials that short term borrowings had decreased from Rs3,246.92 Lakhs to Rs508.44 lakhs. This made a major impact in the decrease of finance costs along with more favorable payment terms and interest rates.

* Restated Profit before Tax

The restated profit before tax For the Financial Year 2023-24 stood at Rs. 1548 Lakhs. Whereas for the Financial Year 2022-23, it stood at Rs. 616.93 Lakhs, representing an increase of 150.92%, It is primarily because of the increase in scale of operations, increase in revenue along with effective cost management and reduction in finance cost.

* Restated Profit after Tax

The restated profit before tax For the Financial Year 2023-24 stood at Rs. 1157.83 Lakhs. Whereas for the Financial Year 2022-23, it stood at Rs. 404.10 Lakhs, representing an increase of 186.52%, in line with the increase in scale of operations, increase in revenue along with effective cost management and reduction in finance cost.

PAT margins of the company were increased from 6.41% in FY 2022-23 to 11.41% in FY 2023-24. This was due to the following reasons as mentioned below:

1. Reduction in Finance Cost:

During FY24, the Company repaid major portions of its short-term borrowings, resulting in a considerable decline in interest expenses. Finance costs reduced both in absolute terms and as a percentage of revenue—from 3.93% in FY23 to 1.19% in FY24. This reduction significantly boosted net profitability and contributed approximately 88.4% to the overall increase in PAT.

Adjusted PAT Margin after interest:

FY24: 12.64%

FY23: 10.53%

2. Non-recurrence of Exceptional Expenses:

In FY23, the Company incurred several one-time expenses, including:

GST demand of Rs.233.68 lakhs

Write-off of debtors/advances worth Rs.55.96 lakhs

The absence of such exceptional items in FY24 helped control other expenses and improve the overall profit margin.

3. Improved Project Mix and Margin:

The Company executed a more profitable set of projects during FY24 compared to the prior year. In FY23, a portion of revenue was derived from a BOT (Build-Operate-Transfer) project with only 2% margin, which accounted for approximately 9.82% of total revenue, thereby diluting overall margins. In contrast, FY24 projects had significantly better profitability profiles, boosting bottom-line performance.

4. Impact of Deferred Tax Adjustment:

Deferred tax accounting also played a role in PAT movement. In FY23, there was a deferred tax expense of Rs.26.08 lakhs, whereas in FY24, there was a deferred tax income of Rs.22.83 lakhs, further contributing positively to the net profit.

Cash Flows

The table below summarizes our cash flows from our Restated Financial Information for the financial year ended in March 2025, 2024 and 2023.

(Rs in Lakhs)

Particulars	F.Y 2025	F.Y 2024	F.Y 2023
Net cash (used in)/ generated from operating activities	(562.69)	2182.13	995.86
Net cash (used in)/ generated from investing activities	(278.75)	(1287.08)	972.42
Net cash (used in)/ generated from financing activities	1,059.63	(2,868.13)	(387.58)
Net increase/(decrease) in cash and cash equivalents	218.19	(1973.08)	1,580.70
Cash and Cash Equivalents at the beginning of the period	13.60	1986.68	405.98
Cash and Cash Equivalents at the end of the period	231.78	13.60	1,986.68

Net cash from/ (used in) Operating Activities

For fiscal 2025, to net cash flow generated from operating activities was at Rs (562.69) lakhs as compared to Profit Before Tax of Rs 2,047.93 lakhs. We had operating profit before working capital changes of Rs1,824.70 lakhs primarily due to non-operating and non-cash expenses such as depreciation & amortization and finance cost of Rs23.49 and Rs118.47 lakhs respectively as well as non-operating and non-cash incomes such as Profit on sale of investments and interest income Rs6.57 and Rs370.02 lakhs.

For fiscal 2024, to net cash flow generated from operating activities was Rs2,182.13 lakhs as compared to Profit Before Tax of Rs 1548.00 lakhs. We had operating profit before working capital changes of Rs1,357.82 lakhs primarily due to non-operating and non-cash expenses such as depreciation and amortization and finance cost of Rs26.42 and 125.25 lakhs respectively as well as non-operating and non-cash incomes such as Profit on sale of investments and interest income Rs10.92 and Rs330.94 lakhs.

For fiscal 2023, to net cash flow generated from operating activities was at Rs 995.86 lakhs as compared to Profit Before Tax of Rs 616.95 lakhs. We had operating profit before working capital changes of Rs633.81 lakhs primarily due to non-operating and non-cash expenses such as depreciation and amortization and finance cost of Rs27.08 and 259.56 lakhs respectively as well as non-operating and non-cash incomes such as Profit on sale of investments and interest income Rs2.68 and Rs267.11 lakhs.

Net cash from/ (used in) Investing Activities

For fiscal 2025, net cash used in investing activities was at Rs (278.75) lakhs due to investing in fixed deposit and other deposits in Rs566.78, interest income of Rs370.02 lakhs and other sale of units and investments along with investment in fixed asset is Rs6.57 and Rs88.56 lakhs respectively.

For fiscal 2024, to net cash used in investing activities was Rs (1287.08) lakhs due to investments made in fixed and other deposits of Rs1,594.1 lakhs, investment in fixed assets of Rs34.61 lakhs, interest income and other sales of investment fixed assets of Rs337.92 lakhs.

For fiscal 2023, net cash from investing activities was Rs 972.42 lakhs due to investment in fixed deposit of Rs39.79 lakhs, withdrawal of deposit of Rs1006.03 lakhs, investment in fixed assets of Rs10.45 lakhs, sale of investment of Rs253.15 lakhs and interest income along with sale of units and shares of Rs269.78 lakhs.

Net cash Flow from/ (used in) Financing Activities

For fiscal 2025, net cash from financing activities was Rs 1,059.63 lakhs due to the introduction of funds from short-term borrowings and an increase in long-term liabilities of Rs1,031.57 lakhs and Rs 146.53 lakhs respectively along with finance cost Rs118.47 lakhs.

For fiscal 2024, net cash used in financing activities was Rs 2,868.13 lakhs due to a decrease in short-term borrowing and long-term liabilities of Rs 2738.48 lakhs and Rs 4.40 lakhs respectively and finance cost of Rs125.25 lakhs.

For fiscal 2023, net cash used in financing activities was Rs 387.58 lakhs due to a decrease in short-term borrowings and an increase in long-term liabilities of Rs206.10 and Rs78.08 lakhs respectively along with finance cost of Rs259.56 lakhs.

Financial Indebtedness

Please see "Financial Indebtedness for a description of broad terms of our indebtedness on page no. 261 of this Red Herring Prospectus. The company has an impeccable record of servicing its debts and has consistently reduced its dependence on institutional finance, there are negligible chances of any default. In the event our lenders declare an event of default, such current and any future defaults could lead to an acceleration of our obligations, termination of one or more of our financing agreements or force us to sell our assets, winch may adversely affect our business, results of operations and financial condition.

Off-balance Sheet Commitments and Arrangements

We do not have any off-balance sheet arrangements, derivative instruments, swap transactions or relationships with affiliates or other unconsolidated entities or financial partnerships that would have been established for the purpose of facilitating off-balance sheet arrangements other than contingent liabilities as of March 31, 2025, as set out below:

(Rs in lakhs)

Sr. No. Particulars	As at March 31, 2025
Contingent Liabilities
a) Bank Guarantees given to govt, authorities	1,901.43
b) Service Tax	514.53
Total	2,415.95

Outstanding Dues to Trade Payables

For purposes of the disclosure in Issue Document pursuant to the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018 as amended, the Board of Directors of the Company has identified a materiality threshold of in excess 5% of total trade payables of the Company pursuant to a resolution dated November 07, 2024; and the amounts owed as of March 31, 2025 by the Company to any small scale undertaking and any other creditor equal to or exceeding such materiality threshold is identified in summary form as brought out in the tables below.

Name of Material Creditor	Amount (Rs Lakhs)
Creditor 1	635.10
Creditor 2	471.53
Creditor 3	590.54
Total	1,697.16

INFORMATION REQUIRED AS PER ITEM (II) (C) (iv) OF PART A OF SCHEDULE VI TO THE SEBI REGULATIONS:

1. Unusual or infrequent events or transactions

Except as described in this Red Herring Prospectus, during the periods under review, there have been no transactions or events, which in our best judgment, would be considered unusual or infrequent.

2. Significant economic changes that materially affected or are likely to affect income from continuing operations

Other than as described in the section titled Risk Factors beginning on page no. 31 of this Red Herring Prospectus, to our knowledge there are no known significant economic changes that have or had or are expected to have a material adverse impact on revenues or income of our Company from continuing operations.

3. Known trends or uncertainties that have had or are expected to have a material adverse impact on sales, revenue or income from continuing operations

Other than as described in this Red Herring Prospectus, particularly in the sections Risk Factors and Managements Discussion and Analysis of Financial Condition and Results of Operations on pages 31 and 264, respectively, to our knowledge, there are no known trends or uncertainties that are expected to have a material adverse impact on our revenues or income from continuing operations

4. Income and Sales on account of major product/main activities

Income and sales of our Company on account of major activities derive from the business of selling of service of Structural Repair and Restoration, redevelopment, Maintenance projects, Corporate Interiors Build-operate-transfer projects, and other designing projects.

5. Future changes in the relationship between costs and revenues, in case of events such as future increases in labour or material costs or prices that will cause a material change are known.

Our Companys future costs and revenues can be impacted by an increase in labour costs as the Company started expanding, it may incur more labour costs to expand the business.

6. Future relationship between Costs and Income

Our Companys future costs and revenues will be determined by competition, demand/supply situation, Indian Government Policies, real estate market of India.

7. Extent to which material increases in net sales or revenue is due to increased sales volume, the introduction of new products or services or increased sales prices.

Increases in net sales are material because of new projects acquired and an increase in the volume of tenders grabbed by the Company.

8. Total turnover of each major industry segment in which the issuer Company operates.

The Company operates in Construction Sector. Relevant industry data, as available, has been included in the chapter titled "Industry overview" beginning on page 125 of this Red Herring Prospectus.

9. Status of any publicly announced new products or business segments

Our Company has not announced any new services and products and segment/scheme, other than disclosure in this Red Herring Prospectus.

10. The extent to which the business is seasonal.

Our business is not seasonal in nature. However, due to the rainy season in the month of (July - September), the revenue of the company is less as compared to the revenue of other months

11. Competitive Conditions

We face competition from existing and potential competitors which is common for any business. We have, over a period of time, developed certain competitive strengths which have been discussed in the section titled "Our Business" on page 144 of this Red Herring Prospectus.