Newtime Infrastructure Ltd Management Discussions.

GLOBAL ECONOMIC OVERVIEW

The global economy will continue to grow at a steady pace of around 3.2 percent in calendar years 2019 and picking up to 3.5 percent in 2020, after an expansion of 3.6 per cent in 2018 amid signs that global growth has peaked. However, a worrisome combination of development challenges could further undermine growth, according to the United Nations World Economic Situation and Prospects (WESP) 2019.

Further global financial conditions tighten an unexpectedly rapid rise in interest rates or a significant strengthening of the US dollar could exacerbate emerging market fragilities, leading to heightened risk of debt distress. This risk can be further aggravated by global trade tensions, monetary policy adjustment in developed economies, commodity price shocks, or domestic political or economic disruptions. Many low-income countries have already experienced a substantial rise in interest burdens. Countries with a substantial amount of dollar-denominated debt, high current account or fiscal deficits, large external financing needs and limited policy buffers are particularly vulnerable to financial stress.

As global trade weakened towards the end of 2018 partly due to the impact of tariff increases in the United States and China and higher energy prices. The global trade slowdown was led by a sharp deceleration in import demand in emerging markets. Given relatively weaker growth outlook, China is implementing a stimulus package and the United States Fed has indicated a pause in the monetary policy tightening cycle. These policy support measures could potentially help offset growth weakness in the European Union, and be supportive for global demand and commodity prices .

INDIAN ECONOMY OVERVIEW

India is moving towards realizing a New India by 2022, when we celebrate 75 years of Indias independence. Promoting inclusive employment-intensive industry and building resilient infrastructure are vital factors for economic growth and development.

India to Remain Fastest-growing Economy in 2019 & 2020, Says UN Report; Pegs GDP Growth at 7.1 percent in 2019-20 The country is expected to witness strong economic growth in FY 20, after it has emerged as the fastest growing major world economy last year despite growing global vulnerabilities "Better demand conditions, settled GST implementation, capacity expansion from growing investments in infrastructure, continuing positive effects of reform policies and improved credit off take especially in the services sector at 24 per cent will sustain the robust GDP growth in the range of 7.5 per cent in calendar year 2019." The Indian industry body observed that despite 2018 being filled with external vulnerabilities arising out of rising oil prices, trade wars between major global trading partners and US monetary tightening, India outshined as the worlds fastest growing major economy .

Indias foreign exchange reserves were US$ 405.64 billion in the week up to March 15, 2019, according to data from the RBI.

The recent Non-Banking Financial Companies (NBFC) and Housing Finance Companies (HFC) crisis caused by the IL&FS default led to drying up of funds which had a substantial impact on the real estate and infrastructure sector. Sensing the trouble, RBI came forward to aid NBFCs by relaxing liquidity and asset securitisation norms and allowing banks to lend more. The financial sector troubles do not bode well for the economy as the ongoing liquidity crunch led by nonbank financial institutions could result in further slowdown in Indias discretionary consumption, thus derailing overall growth momentum over the next few quarters.

Overall, the Indian economy is well poised for the next leg of growth riding on the back of structural reforms, increasing consumption and investment and government spending on infrastructure and rural economy.

INFRASTRUCTURE INDUSTRY – AN OVERVIEW

Infrastructure sector is a key driver for the Indian economy. The sector is highly responsible for propelling Indias overall development and enjoys intense focus from Government for initiating policies that would ensure time-bound creation of world class infrastructure in the country. Infrastructure sector includes power, bridges, dams, roads and urban infrastructure development. In 2018, India ranked 44th out of 167 countries in World Banks Logistics Performance Index (LPI) 2018.

Indias rank jumped to 24 in 2018 from 137 in 2014 on World Banks Ease of doing business.

The fiscal year 2018-19 was a year of consolidation for Real Estate sector. The Indian Real Estate segment moved on a recovery path as the residential realty sales grew by 6% in 2018 compared to the previous year, according to a report by Knight Frank. Developers have now started realising the importance of execution and completing existing projects rather than launching new ones owing to increasing level of unsold inventory and lack of growth in demand. As such, completion of existing projects is being prioritized over launching new ones and the focus has shifted to streamlining processes and delivery. Steady income growth, stable home prices, declining interest rates and improvement in the liquidity conditions bodes well for the industry.

NEED FOR INFRASTRUCTURE DEVELOPMENT

(1) Housing shortage in rural and urban India;

(2) Inadequacy of existing urban infrastructure to meet the current demand of urban population.

India has a requirement of investment worth ‘ 50 trillion (US$ 777.73 billion) in infrastructure by 2022 to have sustainable development in the country. India is witnessing significant interest from international investors in the infrastructure space. Some key investments in the sector are listed below.

In 2018, infrastructure sector in India witnessed private equity and venture capital investments worth US$ 1.97 billion. During the fiscal year 2018-19, majority of the launches as well as demand have been witnessed in the affordable housing segment. This was driven by incentives announced by the government under Pradhan Mantri Awas Yojana (PMAY) which pushed developers towards the affordable segment. Policy initiatives undertaken by the government in the past two years have contributed to increased home buyer interest in this segment. The sector faced temporary hiccups due to NBFC and Housing Finance Companies (HFC) crisis which led to increased rates thereby impacting margins of some developers. However, the industry will not grow much but the organised player will get mores share because of the market consolidation. The immediate liquidity crisis has also forced some of the NBFCs to slow down lending to ongoing projects as well.

Developers with a scalable business model are well placed to augment market share in a well regulated environment that calls for greater transparency and accountability from real estate developers.

GOVERNMENT INITIATIVES

The Government of India is expected to invest highly in the infrastructure sector, mainly highways, renewable energy and urban transport. The Government of India is taking every possible initiative to boost the infrastructure sector. We are poised to become a Five Trillion Dollar Economy in the next five years and aspire to become a Ten Trillion Dollar Economy in the next 8 years thereafter.

KEY DEVELOPMENTS IN THE INDIAN REAL ESTATE REGULATORY FRAMEWORK

Real Estate(regulatory and Development Act,2016

The Central Government had notified the RERA in May, 2016. However, Certain States are yet to notify the rules or certain states notified the rules but were yet to launch an operational website by the close of the financial year under review. Even as the regulation induced short term pain, it is likely to be beneficial for the sector by enhancing consumer confidence and sectoral transparency.

Goods & Services Tax

New norms stipulated a one-time option to continue with existing slabs(effective rate of 12% for regular and 8 % for affordable housing) with input tax credit or switch to new slabs(5% for regular and 1% for affordable housing) without input tax credit for under-construction or ongoing realty projects.

New projects mandatorily have to be in 5% slab for regular segment and 1% slab for affordable segment without any input tax credit. New norms are applicable for residential properties only, while there has been no change for commercial Properties.

Announcements in Union Budget 2019-20:

The Government of India has given a massive push to the infrastructure sector by allocating ‘ 4.56 lakh Cr (US$ 63.20 billion) for the sector.

Communication sector allocated ‘ 38,637.46 Cr (US$ 5.36 billion) to development of post and telecommunications departments.

The Indian Railways received allocation under Union Budget 2019- 20 at ‘ 66.77 billion (US$ 9.25 billion). Out of this allocation, ‘ 64.587 billion (US$ 8.95 billion) is capital expenditure.

Rs. 83,015.97 Cr (US$11.51 billion) allocated towards road transport and highway.

Rs. 3,899.9 Cr (US$ 540.53 billion) to increase capacity of Green Energy Corridor Project along with wind and solar power projects.

Allocation of Rs. 8,350.00 Cr (US$ 1.16 billion) to boost telecom infrastructure. Water supply to be provided to all households in 500 cities.

Allocation of Rs. 888.00 Cr (US$ 110.88 million) for the upgradation of state government medical colleges (PG seats) at the district hospitals and Rs. 1,361.00 Cr (US$ 188.63 million) for government medical colleges (UG seats) and government health institutions.

Government plans to invest Rs. 100 lakh crore in Infrastructure in next five years. Achievements in the past four years:

• The total national highways length increased to 122,434 kms in FY18 from 92,851 kms in FY14.

• Energy deficit reduced to 0.7 per cent in FY18 from 4.2 per cent in FY14.

• Number of airports has increased to 102 in 2018.

• Indias national highway network is expected to cover 50,000 kilometers by 2019. National highway construction in India has increased by 20 per cent year-on-year in 2017-18.

• India and Japan have joined hands for infrastructure development in Indias north-eastern states and are also setting up an India-Japan Coordination Forum for Development of North East to undertake strategic infrastructure projects in the northeast.

• First 100 smart cities in India will require an annual investment of ‘ 35,000 Cr over the next 20 years, both private investments and public private partnerships (PPP) are essential.

OUTLOOK

Your Company believes that demand conditions in the real estate sector are exhibiting early signs of improvement, and signs of declining interest rates as well as renewed activity in the lending and public capital markets are expected to ease funding pressures. As your Company continues to build on its core business of real estate development and leasing, your Company believes that it is well placed to achieve its targets of reducing its overall indebtedness, executing its real estate development and leasing operations and taking advantage of a potential revival in economic growth and its resultant positive effects on the real estate sector. Expansions are required to be made in developing Shopping Complexes.

Foreign institutional Investors have also shown confidence in the countrys construction and are showing up investments in India. This is a positive sign and will open new areas of growth and development.

STRENGTHS

Our Company has the following principle competitive strengths:

• Positioned strategically to realize opportunities in the sector

• Experience and end to end expertise in the Infrastructure Projects

• Sustained investment in equipment and fixed assets

• Professional Board and Management Team

This steady growth owes itself to the Companys unerring strategy of leveraging its core competencies and drawing heavily upon past experience. An effective combination of energy, excellence and endurance is evident everywhere, from the construction site to the administrative division. The result, a holistic growth pattern that has seen the company grows into a preferred choice for national projects.

Strengths

• Strong brand awareness and reputation

• Recognized industry leader in large civil construction and infrastructure projects

• Four decades of experience.

• Track record of successfully completing complex projects

• Ensuring quality and timely completion of the projects without cost overruns

• Diversified business portfolio and strong order book

• Enduring relationships built on mutual trust and respect with our clients, sub-contractors, financial institutions and shareholders

• Pan India presence

• Large pool of talented and skilled employees with low attrition rate

OPPORTUNITIES

Better Business Opportunities means better growth. In todays era, a lots of Growth opportunities are available to infrastructure industry and the only need is to grab and act on them with perfect vision and mission. After analysis, broadly speaking, the following opportunities are available to the Company to achieve the desired position and goal:

Increasing Income Levels: The economic growth in India contributed to increasing income levels. This, combined with trends of higher urbanization, increase in working age population and nuclear families, created greater demand for housing. Much of the demand was backed by easier availability of housing finance that often converted people from living on rent to having their own housing asset.

Rising Foreign Direct Investment Levels: FDI up to 100 percent allowed with the Government permission for development of township and settlements will provide opportunities in the sector. In view of shortage of housing for low income groups in major cities and town, in the union budget there are proposals to set up Credit Guarantee Trust Fund to ensure better flow of institutional credit for housing loans, allowing External Commercial Borrowing (ECB) for low cost affordable housing projects which are positive for the growth of housing sector. The infrastructure of India is also growing day by day so it adds to the better facility to different sectors which boost the real estate projects.

Growth in IT/ITES Sector: The primary growth driver of commercial real estate is the IT/ITES sector, which, is growing at a rapid pace.

Expansion in organized retail sector: Concept of specialized malls is also gaining popularity with auto malls, jewellery malls, furniture malls, and electronic malls anticipated to be the part of the sector in the future. Several other factors, such as rising incomes, evolving preferences, emergence of nuclear families, tax incentives and home loans at competitive rates have been responsible for the growth in demand for homes and residential construction.

Demand for newer avenues for entertainment: As the demand for more and more amusement parks is growing, development of same needs to take place.

Hotel Industry: Despite the temporary slowdown that the Indian hospitality industry faced due to the global economic crisis, India is still one of the worlds fastest growing hotel markets.

Supply Push Factors: Certain Factors like, Policy and Regulatory factors providing with simplification of urban development guidelines, infrastructural support and development by government, some fiscal benefits to developers, positive outlook of global investors etc have also increased the opportunities at real estate sector.

THREATS/RISKS

What needs to be determined is:

a. The proportion of real versus perceived risks.

b. The monetary quantification of risks.

c. The real import and the impact of a type of risk.

Risks, when indeterminate, are worse than assessed risks. The obvious outcome of the situation is that the Banks and Financial Institutions hesitate in lending to the operators of Construction Industry or alternatively lend in absence of authentic and reliable inputs. Either of the situations is detrimental to the overall growth of the industry and thus, the economy. It is therefore of paramount importance that the present operating systems be substantially strengthened to provide comfort to the financial systems. Mitigation of risks is the all en-compassing requirement. Broadly speaking, Construction Projects face the following type of risks:

Completion risk: This is the risk that the project may not be completed on time, or at all, due to various reasons such as cost overruns, technology failure, force majeure etc.

Price risk: This is the risk that the price of the projects output might be volatile due to supply-demand factors. If new capacities are coming up or if there is likelihood of fall in demand of the project output, the price risk is high.

Resource risk: This risk includes the non-availability of raw materials for the project operation. It also includes the risk that the raw material prices might move adversely.

Technology risk: This is the risk that the technology used in the project is not sufficiently proven.

Operating risk: This is a risk that the project operational and maintenance costs would escalate. It also includes the risk that the project will have operational problems.

Political risk: This risk relates to matters such as increased taxes and royalties, revocations or changes to the concession, exchange controls on proceeds, forced government participation in shares and refusal of import licenses for essential equipment.

Casualty risk: This is the risk of physical damage to the project equipment. It also includes liabilities to third parties on account of accidents at the project site.

Environmental risk: This risk refers to increased project costs for complying with new environmental standards. There could also be environmental protests from the local populace against the project.

Permission risk: This is the risk that official clearances for the project may not be forthcoming or subject to expensive conditions.

Exchange rate risk: This is the risk that the currency of sale of the project produce would depreciate with reference to the currency of the project loans. Even though the debt being rated might be Rupee denominated, the presence of foreign currency liabilities can decrease the debt service coverage ratio of the bonds in case there is adverse exchange rate movement.

Interest rate risk: This is the risk that the floating interest rate of the project loans would increase beyond the levels assumed for preparing projected cash flows.

Insolvency risk: This is the risk of insolvency of contractors, project sponsors, suppliers, and purchasers of project output, insurers or a syndicate bank.

Project development risk: This is the risk that the project development might not take place in an orderly manner. Site risk: This is the risk that the project site might have legal encumbrances. It also includes the risk that the site has technical problems.

SEGMENT WISE PERFORMANCE

The Company deals in only one segment i.e. Real Estate. Therefore, it is not required to give segment wise performance.

DISCUSSION ON FINANCIAL PERFORMANCE - STANDALONE REVENUES

The Revenue from Operations is 12.50 Lakhs for the financial year 2018-19

Profit/Loss before Tax: The Loss before Tax for 2018-19 is (257.97) Lakhs as compared to Loss before Tax of Rs. (318.34) Lakhs in 2017-18.

Profits/Loss after Tax: The Loss before Tax for 2018-19 is (257.97) Lakhs as compared to Loss before Tax of Rs. (318.34) Lakhs in 2017-18.

DISCUSSION ON FINANCIAL PERFORMANCE - CONSOLIDATED REVENUES

The Revenue from Operations is 12.50 Lakhs for the financial year 2018-19

Profit/Loss before Tax: The Loss before Tax for 2018-19 is (554.94) Lakhs as compared to Loss before Tax of Rs. (473.31) Lakhs in 2017-18.

Profits/Loss after Tax: The Loss before Tax for 2018-19 is (554.94) Lakhs as compared to Loss before Tax of Rs. (473.31) Lakhs in 2017-18.

INTERNAL CONTROL SYSTEMS

The company has proper and adequate system of internal controls commensurate with its size and nature of operations to provide assurance that all assets are safeguarded, transactions are authorized, recorded and reported properly; applicable status, the code of conduct and corporate policies are duly complied with.

The Company has an internal audit department which conducts audit in various functional areas as per audit programme approved by the Audit Committee of Directors. The internal audit department reports its findings and observations to the audit committee, which meets at regular intervals to review the audit issues and to follow up implementation of corrective actions.

The committee also seeks the views of statutory auditors on the adequacy of the internal control system in the company. The audit committee has majority of independent directors to maintain the objectivity.

HUMAN RESOURCES DEVELOPMENT

Employees are the key to achieve the Companys objectives and strategies. The Company provides to the employees a fair equitable work environment and support from their peers with a view to develop their capabilities leaving them with the freedom to act and to take responsibilities for the tasks assigned. The Company strongly believes that its team of capable and committed manpower, which is its core strength, is the key factor behind its achievements, success and future growth.

We are continuously working to create and nurture an organization that is highly motivated, result oriented and adaptable to the changing business environment. The industrial relations remained cordial during the year.

STATUTORY COMPLIANCE

The Whole Time Director makes a declaration to the Board of Directors every quarter regarding compliance with provisions of various statutes as applicable. The Company Secretary ensures compliance with the Companies Act, 2013, SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and compliance with the guidelines on insider trading for prevention of the same.

CAUTION STATEMENT

This communication contains statements that constitute ‘forward looking statements including, without limitation, statements relating to the implementation of strategic initiatives and other statements relating to our future business developments and economic performance. While these forward looking statements represent the managements judgments and future expectations concerning the development of our business a number of risks, uncertainties and other important factors could cause actual developments and results to differ materially from our expectations.

These factors include, but not limited to general Market, Macro Economics, Governmental, regulatory trends, movement in currency exchange, interest rate, competitive pressures, technological developments, changes in Financial Conditions of third party dealing with us, legislative developments and other key factors that could adversely affect our business and Financial Performance

Newtime Infrastructure undertakes no obligation to publicly revise any forward looking statements to reflect forward looking statements to reflect future events or circumstances.