Rodium Realty Ltd Management Discussions

The Mumbais real estate market has been one of Indias most vibrant and dynamic, with numerous factors driving its growth over the years. With, the ongoing recovery and rising demand for residential and commercial properties, trends in real estate are expected to continue their growth trajectory in 2023.

The COVID-19 pandemic significantly impacted demand for residential and commercial projects especially Mumbai. But now, as the situation has improved, it is expected to bounce back, with developers adapting to the changing market conditions. Mumbais growing population, the citys status as a significant commercial and financial hub, and government initiatives like affordable housing and infrastructure development will drive the real estate market in 2023.

However, as per the latest Mumbai real estate market forecast, challenges, such as increasing construction costs, liquidity issues, and regulatory changes, could impact the market. Understanding these factors and theii potential impact will be critical for developers, investors, and homebuyers to make informed decisions in the Mumbai real estate market in 2023.

"Buoyed By Major Infrastructure Developments ami Resurging Demand Jbr Homes, The Countrys Residential Real Estate Market Is Set for Another Tear of Healthy Growth

The Government of Indias capital outlay towards infrastructure has increased from 1.7% of GDP in FY 2012-13 to 2.5% estimated for FY 2023-24. Additionally, this sector is the second largest employment generator with multiple linkages to the economy. In the last ten years, the output from Indias construction sector - inclusive of both infrastructure and real estate development and services - has grown at a CAGR of 11%. The construction sector, along with the output generated from real estate services and ownership of dwellings, contributes 18% to the economys total output.

The output generated from Indias real estate sector is estimated to grow to USD 1 trillion by 2030 from the existing USD 650 billion. The growth push to the real estate sector is mostly emerging from foe residential demand, in addition to commercial, retail, hospitality, and warehousing developments, to cater to demand arising from the growing population.

Kandivali, Mumbai: Residential Trend

Kandivali, located in western suburbs of Mumbai, is one of the most preferred residential areas in the city. It is a well-established neighbourhood that is well-connected to other parts of Mumbai, making it favourable location for homebuyers and investors alike. It is an upcoming residential location that is experiencing significant growth in terms of housing development There is a high demand for both affordable and premium residential properties in Kandivali, making it a prime location for real estate investment. According to 2023 projections, Kandivali is expected to continue experiencing growth in the housing market due to its strategic location and infrastructure development

Self-redevelopment initiatives could lead to a more sustainable and equitable housing market, benefitting both residents and the broader community. Keeping in mind the factors of redevelopment, Your Company has successfully proposed to launch a new redevelopment project ‘Xone - Luxury Like None" in Kandivali. It has continued to strive to create comfortable yet affordable spaces for the families of the city. This project is nestled in the prime location of Kandivali (West), standing as a masterpiece of architectural ingenuity, a blend of luxury and practicality, where every detail has been

meticulously crafted to exceed customers

expectations. It is set against the backdrop of the serene Shankar Mandir and Jain Derashar. This project enjoys a unique blend of spiritual tranquillity and urban convenience. This is not just home; its a statement of your refined taste and aspirations.

Another landmark

project "Xenus - Where Life Resides" is nearing completing and is expected to be completed by end of this year.

Major achievement will

be taking place by your Company by mid - 2024 in the commenced operations of "Xline - Redefining Kandivali** Skyline".

However, the procedure is not without its hassles. Residents across foe nation, where redevelopment is rampant are facing issues because of delayed deliveries. But your Company understands that redevelopment has a massive role to play in improving the quality of peoples lives and eventually foe citys standard of living.

We believe new and existing projects results into strong balance sheets and the projects are poised to grow faster, given the limited period of opportunity to contract projects at low costs and their pace of growth depends on the success of the existing projects (cash flows), ability to grow (balance sheets), intent (growth track records), execution skills and pricing flexibilities.

OPPORTUNITIES:

* Kw3i.EE Demand

The pandemic has nudged a lot of fence-sitters to convert into first-time home buyers and existing ones to upgrade to larger homes by re-establishing the security that homeownership offers, resulting in rising housing demand across segments. An expected economic recovery along with the belief of housing prices bottoming out amongst consumers and rising income levels are some of the factors which will drive the housing demand going ahead. Hybrid working models will also continue to drive demand for larger homes. Employers are expected to continue to offer flexibility to their employees in order to attract and retain talent.

* Affordable Housing

Affordable housing continues to remain a significant opportunity for developers and key focus area of the government. White the tax benefit for first-time homebuyers and tax holiday for developers in affordable housing segment was rolled back in Budget 2022, we believe it wilt not deter homebuyers decision of purchasing homes and demand will continue to be strong in affordable housing segment.

THREATS AND CHALLENGES:

* Shortage qf Labour anj Technology

Being the second largest employer in the country, the construction sector is heavily dependent on manual labour. During the pandemic, the sector was badly hit due to labour availability issues which affected the project completion timelines. Hence, there is a need for development of technologically less labour-intensive alternative methods of construction.

* Regulatory Hundley

Real estate sector is a highly regulated sector and any unfavourable changes in government policies and the regulatory environment can adversely impact the performance of the sector. There are substantial procedural delays with regards to land acquisition, land use, project launches and construction approvals. Retrospective policy changes and regulatory bottlenecks may impact profitability and affect the attractiveness of the sector and companies operating within the sector.

* Monetary Tightening and Funding Issues

There has been a contrasting trend in real estate lending over the past few years wherein reputed, low leveraged developers continued to enjoy easy access to liquidity as the lenders remained selective and weaker developers struggled with limited sources of capital. Real estate sector performance is closely linked to economic recovery and its monetary policies. The Reserve Bank of India has so far maintained accommodative stance. Going ahead, we expect to see monetary policy remain tight and gradually ease as the central bank tries to support the economic recovery and also balance inflation.

OUTLOOK:

FY2022-23 was a landmark year for the real estate sector. Post-pandemic, developers have moved away from the traditional way of doing business and rightly focused on end-user customer demand with a strong focus on innovation and digital transformation. We believe FY2023- 24 will continue the healthy sales momentum backed by solid structural foundation, sustained demand.

COMPLETED PROJECTS

"XCZAR" - Residences that will make you proud

Structurally grandiose and majestic, Xczar will undoubtedly be the envy of the quaint neighbourhood of J.V.P.D. A residential space which will be a symbol of magnificence at its best Serving you with the most stupendous and dazzling of services and offerings that you would only have dreamt of. Setting high standards of living, enjoying life to the peak and lavish living at its best, are some of the things that Xczar stands for.

"Xtrium" - A Symphony of Elegance and Class

CRISIL 5-Star Rated Commercial Development located on the commercial artery. With a passion for achieving supremacy, Xtrium promises ergonomically designed spaces with word-class infrastructure to house Commercial offices, Banquet halls and Residential hotels. Every floor at these eco-techno environs is meticulously planned making them not just commercial spaces but refreshing surrounds.

"Xcube" - Integrating Eminence and Efficiency

CRISIL 5-Star Rated Commercial Development located in Andheri (West), Xcube offers exotic spaces catering to the needs of restaurants, showrooms, office exhibition areas & customizing to the needs of MNCs, Corporate houses, Professionals & Exhibitors. An advance and unmarked rendition. The structure has been made environmentally sensitive by emphasizing on the conservation of natural resources. Xcube successfully makes a bold visual statement.

"Xpoint" - Reside I Relax I Rejuvenate

In the perspective of creating & designing spaces, for every owner to love, to be proud of and be happy to live in. With such expectations we create, one after another, exclusive and unique living spaces here by introducing X-POINT. The Project is a mix of retail spaces and residences that comes along with a rare vision to transcend the expectations of occupant. Arriving at the site one is first greeted with a truly elegant double height lobby forming a welcoming gesture, this is a place to come home to.

ONGOING PROJECTS

"Xenus" - Where Life Resides

Xenus by Rodium is not just an ordinary block - on - block building. It is a beautiful space that is designed keeping your needs and goals in mind Xenus personifies the best experience of affluent lifestyle replete with unparalleled conveniences. With all the luxuries and amenities of 5 stars to the basic housing needs, weve prepared a breath - taking space that you will be proud to call your home.

"XLine" - Redefining Kandivali >s Skyline

After the success of Rodium Xpoint, we are developing another iconic landmark to redefine the skyline of Kandivali. Located in the bustling suburbs of Kandivali West, Rodium Xline offers you a lifestyle most people can only dream of. We are creating a project that has thoughtfully designed homes and delightful amenities. At Rodium Xline, we intend to deliver another successful project and develop another iconic landmark in Kandivali.

UPCOMING PROJECTS

"XOne" - Luxury Like None

The Rodium Xone Project, nestled in the prime local of Kandivali West, stands as a masterpiece of architectural ingenuity, a blend of luxury and practicality, where every detail has been meticulously crafted to exceed your expectations. Set against the backdrop of the serene Shankar Mandir and Jain Derashar, the project enjoys a unique blend of spiritual tranquillity and urban convenience. This is not just a home; its a statement of your refined taste and aspirations.

"Xmeadows" - Smart Homes for Smart Living

Your Company is also seeking the opportunities in MMR Region- the largest market for sales of residential units in the country. Your Company is exploring opportunity to develop smart homes for smart living concept in MMR region.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:

Radium Realty Limited has a well-established internal control system to manage business operations, financial reporting and other compliance needs. The business performance vis-a-vis plan is monitored periodically, and regular internal audits are performed to ensure sustenance of the interna) control systems.

The Company has a robust and well embedded Internal Control systems in place, adequate Tor the sise of the Company and the nature of its business. The Primary function of our internal control systems is to ensure efficiency in business operations, safeguarding of Companys assets, adherence to policies and procedures, protecting and detecting errors and frauds, compliance with applicable laws and ensuring the reliability of financial statements and reporting. This provided assurances to the Audit Committee regarding the adequacy and efficacy of internal controls, advises management on Lhe changing risks that matter and is aligned with the business objectives.

Progress to plan and key findings ame reviewed by the Audit Committee each quarter. Further, the Audit Committee also monitors the status of management actions following the internal audit reviews.

RISKS AKP CQNCEKN:

* Statutory Approvals:

The real estate sector in India is heavily regulated by the central, state and local governments. Real estate developers are required to comply with a number of laws ami regulations, including policies and procedures established and Implemented by local authorities in relation to land acquisition, transfer of property, registration and use of land. These laws often vary from state to state. Several of your Companys projects are in preliminary stages of planning and any delay in obtaining approvals could warrant revised scheduling of project timelines.

* Industry Cyclicality

The real estate market is inherently a cyclical market and is affected by macroeconomic conditions, changes in applicable governmental schemes, changes in supply and demand for projects, availability of consumer financing and illiquidity. However, any future significant downturn in the industry and the overall investment dimate may adversely impact business,

* Climate Change-

The sector is already experiencing shifts due to climate change, the intensity of which is expected to increase over the coming years. The challenges or risks can be broadly classified into two categories, physical and transitional. The former is on account of acute and chronic physical effects of climate change such as damage to infrastructure at construction sites or building projects, damages to logistics routes, reduced effidency of workforce due to heatwaves, etc.

Several management and leadership team members including Board of Directors periodically review the risk management policies and systems to incorporate any changes in the risk profile due to changes in the external environment and strategic priorities. The Board of Directors and the Audit Committee of the Manager is assisted by internal audit team in monitoring Lhe risk profile and effectiveness of mitigation plans to manage the identified business risks. The major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis.

DISCUSSION ON FINANCIAL PERFORMANCE:

I "be financial overview comprises of revenue primarily from sale of completed property and proportionate revenue of property under development.

Standalone Financial Results of Rodinm Realty Limited

(Rs. In Lakhs)

Particulars	FY 2032-2023	FY 2021-2022
INCOME AND GAINS
Revenue from operations	2,373.00	1,388.89
Other Income	434.16	182,70
Total Income	2,807.16	1,471.59
EXPENSE AND LOSSES
Cost of Construction &. Development	1,093-35	939.03
Cost of Finished Units	170.00	-
Changes in inventories of Finished Goods, Stock -intrade and Work -in- progress	996.41	82.07
Employee Benefit Expenses	52.35	59.83
Finance Costs	173.36	220.86
Depreciation and Amortisation expense	8.77	4.90
Other Expenses	223.34	260.41
Total Expense	2,717.58	1,567.10
Profit/ (Loss) Before Tax	89.58	(95.51)
TAX EXPENSE
-Deferred Tax	27.34	(61.49)
?Earlier year adjustments	(0 52)	3.47
Total Tax Expense	26.82	(58.02)
Profit/ (Loss) For the Year	62.76	(37.50)
OTHER COMPREHENSIVE INCOME
Items that will not be reclassified to profit and loss
-Remeasurement of defined benefit plans	3.22	5,63
-Income tax relating to items that will not be reclassified to Profit or Loss	(0.81)	(1-42)
Total Other Comprehensive Income fnr the year, Net of Tax	2.41	4.21
Total Other Comprehensive Income/ (Loss) for the year	65.17	(33.28)

These Separate financial statements (also known as Standalone Financial Statements) have been prepared in accordance with (ND AS as prescribed under Section 133 of the Companies Ad. 3013 read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and subsequent amendments thereto.

Consolidated Financial Results of Rodium Realty 1 .limited

(Rs. In Lakhs)

Particulars	FY 2022-2023	FY 2021-2022
INCOME AND GAINS
Revenue from operations	4,205.63	1,288.89
Other Income	233.28	153.67
Total Income	4,438.91	1,442.56
EXPENSE AND LOSSES
Cost of Construction & Development	2,606 04	1,555.61
Cost of Finished Units	170.00	-
Changes in inventories of Finished Goods, Stock -intrade and Work -in- progress	953.37	(534.51)
Employee Benefit Expenses	52,35	59.83
Finance Costs	173.36	220.86
Depreciation and Amortisation expense	8.77	4.90
Other Expenses	235.71	260.60
Total Expense	4,199.60	1,567.29
Profit/ (Loss) Before Tax	239.31	(124.73)
TAX EXPENSE
-Current Tax	123.46	-
-Deferred Tax	27.37	<61.49)
-Earlier year adjustments	<0.47)	3,47
Total Tax Expense	150.36	(58.02)
Profit/ (Loss) For the Year	88.95	(66.71)
OTHER COMPREHENSIVE INCOME
Items that will not be reclassified to profit and loss
-Rcmeasureitient of defined benefit plans	3.22	5.63
-Income tax relating to items that will not be reclassified to Profit or Loss	(0.S1)	(i-42)
Total Other Comprehensive Income for the year, Net of Tax	: 2.41	4.21
Total Other Comprehensive Income/ (Loss) for the year	91.36	(62.50)

The consolidated financial statements comprise the financial statements of the Holding Company and its subsidiaries as at 31 March 2023, Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to afreet those returns through its power over the invested Specifically; the Group controls an investee if and only if the Group has:

? Power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of the investee)

* Exposure, or rights, to variable returns from its involvement with the investee, and

? The ability to use its pow^rer over the investee to affect its returns

Generally, there is a presumption that a majority of voting nghts result in control. To support this presumption and when the Group has less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and circumstances in assessing whether it has power over an investee, including:

* The contractual arrangement with the other vote holders of the investee

* Rights arising from other contractual arrangements

* The Groups voting rights and potential voting rights

* The size of the groups holding of voting rights relative to the size and dispersion of the holdings of the other voting rights holders

The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated financial statements from the date the Group gains control until the date the Group ceases to control the Subsidiary-

Consolidated financial statements are prepared using uniform accounting policies for like transactions and other events in similar circumstances. If a member of the group uses accounting policies other than those adopted in the consolidated financial statements for like transactions and events in similar

circumstances, appropriate adjustments, if material, are made to that group members financial statements in preparing the consolidated financial statements to ensure conformity with the groups accounting poiicies.

The financial statements of all entities used for the purpose of consolidation are drawn up to same reporting date as that of the Holding Company, i.e., year ended on 31 March.

DETAILS OF SIGNIFICANT CHANGES IN KEY FINANCIAL RATIOS &. RETURN ON NET WORTH:

Particulars	FY 2022-2023	FY 2021-2022	% Change	Remarks for variance more than 25%
Debtors Turnover	1.99	1.11	(79.28) %	Increase in revenue For the year
Inventory Turnover	0.44	0 22	(100) %	Increase in revenue for the year
Debt Service Coverage Ratio	0.20	0.14	(42.86) %	Increase in profit during the year
Current Ratio	1 33	1.27	(4.72) %	NA
Debt Equity Ratio	6.13	6.70	8.51 %	NA
Net capital turnover Ratio	1.03	0.60	(71.67)%	Increase in revenue for the year
Net Profit Margin (%)	2.2%	-2.5%	188 %	Increase in profit during the year
Return on Net worth (%)	4.59%	-2.9%	258.28 %	Increase in profit during the year

DISCLOSURE OF ACCOUNTING TREATMENT:

Your Company has followed all the relevant Accounting Standards while preparing the financial statements. The Financial Statements have been prepared on historical cost basis considering the applicable provisions of Companies Act 2013 except the following material items that have been measured at fair value as required by relevant Ind AS. Nevertheless, historical cost is generally based at the fair value of the consideration given in exchange for goods and services.

DISCLAIMER;

The Company shall be registering its forthcoming projects at an appropriate time in the applicable jurisdictions t States under the Real Estate (Regulation and Development) Act, 2016 (RERA) and Rules thereunder. Till such rime, the forthcoming projects, none of the images, material, projections, details, descriptions and other information that are mentioned in the Annual Report fbr the FY 2022 2023, should be deemed to be or constitute advertisements, solicitations, marketing, offer for sale, invitation to offer, or invitation to acquire within the purview of the RERAThe Company uses carpet areas as per RERA in its customer communication. However, the data in saleable area terms has been presented in the Annual Report for the FY 2022-2023 to enable continuity of information to investors and shall not be construed to be of any relevance to home buyers /customers.