Real Eco-Energy Ltd Management Discussions.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

> INDUSTRIAL STRUCTURE AND DEVELOPMENT:

The Company is in business of "Real estate". "Real Estate" is one of the best growing sectors of the Country, but it is as well a phase vital for Indias economy due to its large potential for employment generation, capital magnetism and revenue generation for the Government. During the year, the real estate sector witnessed a slowdown due to moderate end user demand, rising inventory and high finance costs. However, despite adverse sector dynamics, prices were resilient in most cities and have dropped only in select micro markets. Although the current market situation in the sphere is affected adversely but overall Performance of the Company is satisfactory.

The Company is also engaged in the business of news broadcasting and digital marketing. Indian Broadcasters are now under increasing pressure to present superior quality content, as is reflected in some recent trends. The television industry in India continues to undergo solid competition from the digital cable and satellite TV industries. The cable TV industry, in special, represents a bigger threat to future industry growth. A number of elements points to low development in advertising revenue, including forecast low economical growth, the declining total share of the TV audience, and competition from new media. With the current Governments approach being industry enabling, we can hope for the policy majors for ease of doing business.

The Board of Directors of the Company has determined to attain new altitude in business field and to achieve further escalation. To accomplish the set goals, the company is engaged in the activity of Energy Management & their products, by-products and other related services. The Management has vision that there is enormous scope and opportunities in this activity which will ultimately escort the Company to the new elevation of victory and growth.

> OVERVIEW:

The Financial Statements have been prepared in compliance with the Indian Accounting Standards (IND-AS) issued by the Institute of Chartered Accountants of India (ICAI) which have been notified under the Companies (Indian Accounting Standards) Rules, 2015 (IND AS Rules), of the Companies Act, 2013. The management of the Company accepts responsibility for the integrity and objectivity of these financial statements have been made on a prudent and reasonable basis, in order that the financial statements reflect in a true and fair manner the form and substance of transactions, and reasonably present the Companys state of affairs and profit for the year.

> THREATS:

COMPETITION:

Competition in the market has inflated and strained the players to take up hostile advertising strategy and promotional campaigns to capture and defend their market shares, The Company has the plans to penetrate better in to market, especially through the client retention and business enlargement in the regions which have not been tapped.

Sharp fluctuations in value of the Indian Rupee and the going up inventory prices have put pressure on the profitability of the Company.

> SEGMENTS-WISE OR PRODUCT-WISE PERFORMANCE:

The Company operates in diverse segments - Real Estate, News Broadcasting & Digital Marketing as well as in energy management. Every industries are competent. There are mainly three segments in the construction industry like real estate construction which includes residential and commercial construction; infrastructure building.

The construction industry in India is highly fragmented. There are number of unorganised players in the industry which work on the subcontracting basis. To execute more critical projects, now-a-days bids are increasing placed in consortium. But the profitability of the construction projects varies across different segments. The media and broadcasting segment in which Company has ongoing its operations are wide and varied. The Company has extended its area of action and looking forward in this epoch of digitalisation. Moreover the industrial energy management systems contributed considerable revenue share in 2022 owing to rising inclinations toward achieving energy efficiency. Further, the increasing adoption of energy management solutions across different market verticals has also fueled the market penetration in the recent years. As a result, the trend is expected to continue in the coming years driving the market growth of industrial EMS and thereby holding the significant market share in the forecast period.

> RISK AND CONCERN:

The risk management function is elementary to the company and its objectives include ensuring that critical risk are recognized persistently, monitored and managed effectively in order to protect the companys business.

However, the changes in the tax laws, Government policies and regulatory requirement might affect the companys business. The company is functioning in highly competitive market. The common risks inter-alia is: regulations, competition, business risk, technology obsolescence, long-term investments and expansion of facilities. Business Risk, inter-alia, further includes fiscal risk, political risk, fidelity risk, legal risk.

The organization has already taken initiatives in advance for mitigating the above mentioned risk and concerns/challenges. The company has taken major initiatives like strong marketing efforts, focus on cost reduction through techniques, and retain talented employees etc.

> INITIATIVES BY THE COMPANY:

The Company has taken the following initiatives:

• Concentration on creating demand in the market for urbanisation by efficient promoting strategy and undertaking other detailed work out in diverse fields.

• Focus in magnifying of revenue.

The Company is quite positive that prosperity would improve in a sustainable manner, as an outcome of this strategy.

> OUTLOOK:

The profit margins in the industry are under pressure. However, the Company has taken counteractive measures. The Company is convinced to meet the challenges with its vigour in marketing association and its tactical arrangement.

India is expected to become the third largest construction market globally by 2022. India plans to spend US$ 1.4 trillion on infrastructure during 2019-23 to have a sustainable development of the country. Further, the recent policy measures to relax Foreign Direct Investment (FDI) norms, provide housing for all by 2022, create 100 smart cities and approve Real Estate Investment Trusts (REITs) have boosted the confidence of stakeholders. The key factors responsible for such a strapping augmentation in the industry are good demographics, a large population base, rapid urbanization, and mounting trend towards nuclear families, rural-urban migration, ever-developing infrastructure, higher income levels and housing demand.

Two main sources of revenue for the broadcasters are - Advertisement proceeds and Subscription returns. The ad spend on a channel depends on its market share, reach and the credibility and popularity it enjoys with the consumer. With the improved diffusion of digitisation including new platforms, the Company is expected to gain from revenue through more transparency and addressable reporting.

Furthermore, rising consciousness towards energy efficiency among residential users is expected to witness attractive growth rate and subsequently provide profitable expansion opportunities for the market players in future. In addition, the increasing demand of energy efficient solutions in end-user such as enterprise, office spaces, and commercial sites to minimize their daily operational costs through effective energy consumption is also projected to propel the market growth in the forecast period.

> INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has implemented appropriate and ample systems of internal control to make sure that all assets are safeguarded and sheltered against loss from any unofficial use or disposition and all transactions are authorised, recorded and reported correctly. The structure ensures proper information flow to facilitate effectual monitoring. The internal audit system also ensures configuration and execution of corporate policies for economic reporting, accounting, and information safety.

> HUMAN RESOURCE:

Your Company firmly believes that employees are the most incalculable assets and key players of business triumph and continued intensification. Various employee benefits, recreational and team building efforts are made to add to employee skills, motivation as also to foster team spirit. Industrial relations were cordial throughout the year.

> HEALTH, SAFETY AND ENVIRONMENTAL PROTECTION:

Your Company has complied with all the pertinent laws. The Company has been complying with the relevant laws and has taking all necessary measures to protect the environment.

> CAUTIONARY STATEMENT

All statements made in "Management and Discussion Analysis Report" have been made in good faith. Many unforeseen factors may come into play and influence the actual results, which could be divergent from what the Management predicts in terms of performance and outlook. Market data, industry information etc. contained in this Report have been based on information gathered from various published and unpublished reports and their accuracy, reliability, and completeness cannot be assured. Factors such as economic conditions affecting demand/supply and priced conditions in domestic and international markets in which the Company operates, and changes in Government regulations, tax laws, other statues and other supplementary factors, may affect the concluding outcome and performance of the Company.

> DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE:

In terms of performance, FY 2020-21 has been a difficult year as nil revenue was generated during the period. However, the Company is focused on the task on hand in terms of better reliability of operations and more focused market efforts. Cash and cash equivalents at the end of the year stood at Rs. 11.59 lakhs.

> DETAILS OF SIGNIFICANT CHANGES IN KEY FINANCIAL RATIOS:

2020-21 2019-20
Debtors Turnover Ratio NA NA
Inventory Turnover Ratio NA NA
Interest coverage ratio NA NA
Current Ratio 7.98 6.95
Debt Equity Ratio 1 1.03
Operating Profit Margin NA NA
Net Profit Margin NA NA
Return on Networth 4.88 -33.21
P/E Ratio 27.58 -13.57

> DETAILS OF ANY CHANGE IN RETURN ON NET WORTH AS COMPARED TO THE IMMEDIATELY PREVIOUS FINANCIAL YEAR ALONG WITH A DETAILED EXPLANATION THEREOF:

Even though the Company has rational retribution but due to adjustment of past years losses, your Company fall short to earn significant sum as return on Net Worth.

Place: Ahmedabad For and on behalf of the Board
Date: 8th September, 2021
SD/- SD/-
Dharm S. Patel Hina S. Patel
Managing Director Director
DIN: 07464810 DIN:01987053