Runwal Enterprises Ltd Management Discussions

MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion of our financial condition and results of operations in conjunction with our Restated Consolidated Financial Information included in this Red Herring Prospectus as of and for the years ended March 31, 2026, March 31, 2025 and March 31, 2024, including the related notes, schedules and annexures on page 283. Our Restated Consolidated Financial Information have been derived from our audited financial statements and restated in accordance with the relevant provisions of the Ind AS, Section 26 of the Companies Act, 2013, the SEBIICDR Regulations and the Guidance Note. Ind AS differs in certain material respects from IFRS and U.S. GAAP. For further details see "Risk Factors - External Risk Factors - Significant differences exist between Ind AS and other accounting principles, such as U.S. GAAP and IFRS, which investors may be more familiar with and may consider material to their assessment of our financial condition. on page 66.

This discussion contains certain forward-looking statements that involve risks and uncertainties and reflect our current view with respect to future events and financial performance, many of which are beyond our control, which may cause the actual results to be different from those expressed or implied by the forward-looking statements. See "Forward-Looking Statements" and "Risk Factors" on pages 17 and 18, respectively.

We have included certain non-GAAP financial measures and other performance indicators relating to our financial performance and business in this Red Herring Prospectus, each of which are supplemental measures of our performance and liquidity and are not required by, or presented in accordance with Ind AS, Indian GAAP, IFRS or U.S. GAAP. Further, such measures and indicators are not defined under Ind AS, IFRS or U.S. GAAP, and therefore, should not be viewed as substitutes for performance, liquidity or profitability measures under Ind AS, IFRS or U.S. GAAP. The manner in which such operational and financial performance indicators are calculated and presented, and the assumptions and estimates used in such calculations, may vary from that used by other companies in India and other jurisdictions. Investors are accordingly cautioned against placing undue reliance on such information in making an investment decision and should consult their own advisors and evaluate such information in the context of the Restated Consolidated Financial Information and other information relating to our business and operations included in this Red Herring Prospectus.

Unless otherwise indicated, industry and market data used in this section has been derivedfrom the JLL Report dated September 11, 2026, prepared and issued by Jones Lang LaSalle Property Consultants (India) Private Limited ("JLL "), appointed by us on August 18, 2026, and exclusively commissioned and paid for by us in connection with the Issue. Further, a copy of the JLL Report shall be available on the website of our Company at www.runwalenterprises.com in compliance with applicable laws. There are no parts, data or information, that have been left out or changed in any material manner. The JLL Report is not a recommendation to invest or disinvest in any company covered in the report. The views expressed in the JLL Report are that of JLL. Prospective investors are advised not to unduly rely on the JLL Report. Unless otherwise indicated, all financial, operational, industry and other related information derived from the JLL Report and included herein with respect to any particular year refers to such information for the relevant calendar year. See "Certain Conventions, Presentation of Financial, Industry and Market Data and Currency of Presentation - Industry and Market Data" and "Risk Factors-Internal Risk Factors - Industry information included in this Red Herring Prospectus has been derived from an industry report commissioned by us, and paidfor by us for such purpose. There can be no assurance that such third-party statistical, financial and other industry information is either complete or accurate. " on pages 15 and 52, respectively. The information included in this section includes excerpts from the JLL Report and may have been re-ordered by us for the purposes ofpresentation.

Our Companys financial year commences on April 1 and ends on March 31 of the immediately subsequent year. Unless otherwise indicated or the context otherwise requires, the financial information as of and for the years ended March 31, 2026, March 31, 2025 and March 31, 2024 included herein is derivedfrom the Restated Consolidated Financial Information included in this Red Herring Prospectus.

Unless otherwise indicated or the context otherwise requires, in this section, references to "we", "us" and "our" are to our Company, our Subsidiaries, our Associate and our Joint Venture on a consolidated basis and references to "the Company" or "our Company" are to Runwal Enterprises Limited on a standalone basis.

Overview

Introduction

We are a real estate developer present across the full spectrum of real estate development, specializing in residential projects that cater to affordable, mid-income, and luxury segments, as well as commercial spaces, retail malls and educational buildings. (Source: JLL Report) We are a recognized brand in the industry and have a strong presence in Mumbai. (Source: JLL Report)

We are ranked third in terms of new launches and sales in Mumbai with approximate market shares of 2.33% and 2.46%, respectively, between January 2023 and March 31, 2026. (Source: JLL Report) Between January 2023 and March 2026, Mumbai was ranked first among the top seven Indian residential real estate markets (i.e., Mumbai, Pune, Bengaluru, Hyderabad,

Delhi National Capital Region, Chennai and Kolkata) in terms of its contribution to market activity, accounting for approximately 24% of the overall sales, approximately 24% of the overall new launches and overall sales value in India.

(Source: JLL Report)

In the eastern suburbs submarket of Mumbai (which encompasses Mulund, Vikhroli, Ghatkopar, Kanjurmarg, Powai and Bhandup), we ranked first in sales accounting for approximately 7.88% of the sales, and fourth in new launches, accounting for approximately 2.89%, between January 2023 and March 31, 2026. (Source: JLL Report) We are ranked first in terms of new launches and second in terms of sales in Kalyan, Dombivli, with approximate market shares of 11.41% and 6.33%, respectively, between January 2023 and March 31, 2026. (Source: JLL Report)

As of March 31, 2026, we have 19 Completed Projects, 28 Ongoing Projects and 33 Upcoming Projects. Our experience includes greenfield projects requiring land acquisition, as well as flexible models and asset light models such as via joint development agreements ("JDA"). Greenfield projects refer to developments undertaken on land parcels that have never been previously used, developed or constructed upon for residential dwelling purposes. For such projects, we acquire the greenfield land, obtain all necessary regulatory, statutory and environmental approvals required under applicable laws and we subsequently plan, design and develop the project, including undertaking construction and related activities.

Below are details of our projects bifurcated into greenfield projects and non-greenfield projects as of March 31, 2026:

No. Type of Project	Developable Area (sq. ft.)
1. Greenfield projects (A)	83,566,500.85
2. Non-greenfield projects (B)	4,807,622.42
Total (C = A + B)	88,374,123.27
Greenfield projects as a percentage of total projects (A/C)	94.56%

Notes:

(6) "msf" stands for million square feet

(7) On the basis of new launches and sales of residential units between January 2023 and March 2026 (Source: JLL Report)

(8) As of March 31, 2026

(9) Number of Ongoing Projects and Upcoming Projects

(10) Area under Ongoing Projects and Upcoming Projects

Corporate history

Our Group traces its origins to the legacy "Runwal group", established in 1978 by Subhash Runwal. His son, Subodh Subhash Runwal, joined Wheelabrator Alloy Castings Limited in 1995, commencing his experience in the real estate business. Under Subodh Subhash Runwals leadership, our Group emerged as a separate entity in 2016. For more details, see "Our Business - Business Operations - History of our Business" on page 197.

Real estate development business

Our real estate development business spans all activities related to real estate development, from the identification and acquisition of land through to the planning, execution, marketing and sales of our development projects. It is through this process that we develop a variety of residential and commercial projects comprising apartments, retail spaces, offices, schools, hospitals, and townhalls. As of March 31, 2026, we have developed and are in the process of developing an aggregate Developable Area of 31.96 million square feet of residential, retail and commercial properties, which include residential buildings, townships, corporate offices, retail malls, retail spaces, schools and various other real estate projects spread across the eastern, central, peripheral central, south central and western suburbs of Mumbai.

Our vision is to be a full-service real estate developer in Mumbai, developing both residential and non-residential projects (across the price spectrum) and in communities (including integrated townships) that feature a wide range of amenities and iconic landmarks.

Our residential portfolio consists of an aggregate Developable Area and Estimated Developable Area (in the case of Upcoming Projects) of 74.58 million square feet of Completed Projects, Ongoing Projects and Upcoming Projects ("Projects") as of March 31, 2026 and is segmented into the affordable, mid-income and luxury markets. We had historically focused on the affordable and mid-income residential segments (notable examples being Runwal Gardens in Dombivli and Runwal Greens in Mulund West) but have recently expanded our focus to include the luxury residential segment (namely, 7 Mahalaxmi and Girgaum). We are also expanding geographically within Mumbai, moving from the eastern suburbs to western areas such as Mahalaxmi, Girgaum and Bandra, and outside the MMR, near Alibaug. Our business also consists of the development and lease/sale of units in certain commercial and shopping complexes. As of March 31, 2026, our non-residential portfolio consists of an aggregate Developable Area and Estimated Developable Area (in the case of Upcoming Projects) of 13.80 million square feet of Projects.

Below is a map indicating the locations of our Projects in Maharashtra as of March 31, 2026:

Significant Factors Affecting our Results of Operations

Our financial performance and results of operations are influenced by a number of important factors, some of which are beyond our control, including without limitation, competition, general economic conditions, changes in the conditions in the markets in which we operate and evolving government regulations and policies. Some of the key factors are discussed below. Also see

"Risk Factors on page 18.

General economic conditions and the performance of the real estate market in India, particularly Mumbai

As of March 31, 2026, our operations are primarily focused in Mumbai. Accordingly, the economic condition of this area significantly influences our revenue from operations. All our Ongoing Projects and Upcoming Projects in India are concentrated within Mumbai, which makes us dependent on the state of both the Indian and Mumbai real estate markets, as well as the broader Indian economy.

This dependence also extends to our expenses, such as the pricing and supply of construction materials and other raw materials, which are affected by a variety of external factors. These factors include but are not limited to the cost of raw materials, high demand, prevailing economic conditions, geopolitical situations, regulatory changes and controls, competition, indirect taxes, and import duties.

The demand for new residential and commercial properties is largely driven by rising employment levels and increasing disposable income. Therefore, any slowdown or perceived slowdown in the Indian economy, or its specific sectors, could adversely impact our business and financial performance.

Fluctuations in market prices for our Projects

Our total income is affected by the sales and rental prices of our projects, which are affected by prevailing market conditions and prices in the real estate sector in Mumbai and in India generally (including market forces of supply and demand), the nature and location of our projects, and other factors such as our brand, reputation and the design of our projects.

Supply and demand market conditions are affected by various factors outside our control, including:

• prevailing local and economic, income and demographic conditions;

• changes in the supply and demand for properties comparable to those we develop;

• availability of financing for real estate projects;

• availability of consumer financing (interest rates and eligibility criteria for loans);

• changes in the applicable governmental regulations and related policies;

• decrease in or restrictions on foreign currency remittances;

• regional natural disasters or pandemics;

• performance of key industrial sectors; or

• competition from other real estate developers.

Since all our Ongoing Projects and Upcoming Projects are concentrated in Mumbai, we are particularly affected by changes in prices in the real estate market in Mumbai.

Sales volumes, revenue recognition, cost of sales and rate ofprogress of construction and development

The table below sets out our revenue from operations for Fiscals 2026, 2025 and 2024 also presented as a percentage of our total income:

Particulars	Fiscal 2026		Fiscal 2025		Fiscal 2024
	Amount (Rs. in million)	Percentage of total income (%)	Amount (Rs. in million)	Percentage of total income (%)	Amount (Rs. in million)	Percentage of total income (%)
Revenue from operations	17,989.49	97.20	10,077.66	95.91	24,088.65	98.86

We recognize revenue based on the fulfilment of performance obligations as set out in the contracts with our customers, which is further described in Note 2(x) of our Restated Consolidated Financial Information. The estimate of costs are reviewed periodically by our management and any effect of changes therein is recognized in the period in which changes are determined. Our cost estimates are affected by, among other things, volatility in expenses comprising the costs to acquire land, development rights and construction costs. Such changes may in turn affect the profit recognized during the same Fiscal. Accordingly, our income across time periods may fluctuate significantly due to a variety of factors, including the size and number of our developments, execution of agreements and/or contracts with buyers and general market conditions.

Variation of project timelines due to project delays and estimates may also have an adverse effect on our ability to recognize revenue in a particular period. Construction activities were notably delayed in 2020 and 2021 due to lockdowns imposed in India to control the COVID-19 pandemic and future pandemics or health emergencies could similarly affect our project timelines. As a result of COVID-19, the completion dates of some of our projects were or have been delayed, in some cases by up to two years:

• Runwal Gardens Phase 1, Phase 2 (Buildings 13 to 17), Phase 2 (Buildings 18 to 23), Phase 3 (Buildings 24 to 26), Phase 3 (Buildings 27 to 28) and Phase 3 (Buildings 29 to 30);

• Runwal Avenue (Wings K to J);

• Runwal Forests Phase 1 (Towers 1 to 8);

• Runwal Bliss Phase 1 (Towers A to E);

• Runwal Forests Phase 2 (Towers 9 to 11); and

• Runwal Pinnacle.

Additionally, certain of our projects also experienced non-COVID-19-related timeline extensions:

• Runwal Shopping Arcade;

• Runwal Pinnacle;

• Runwal Bliss Phase 2 (Tower F);

• Runwal Forests Phase 2 (Towers 9 to 11);

• Runwal Avenue: Residential (Wings L and M);

• Runwal Gardens Phase 1, Phase 3 ,Phase 4, Phase 5, Phase 8, Shopping Arcade and Edge; and

• Runwal My City - Cluster 6.

We estimate the total costs of a project prior to its commencement based on, among other things, the size, specifications and location of the project. We re-evaluate our project costs periodically. If, during the re-evaluation, the total project cost is estimated to exceed the total revenue from the project, we will recognize the loss in the relevant Fiscal. Re-evaluations also affect our ability to allocate resources to the project in a timely manner, which in turn affects construction progress. Our construction process is also affected by other factors including the competence of, and priority given to our projects by, our contractors, the receipt of approvals and regulatory clearances, access to utilities such as electricity and water, and the absence of contingencies such as litigation and adverse weather conditions.

Further, we may incur certain cost of sales. Cost of sales and other operational expenses include the cost of construction, which in turn primarily comprises cost of raw materials (including steel, cement, flooring, facade and other building materials) and labour. Raw material prices, particularly those of steel and cement, may be affected by price volatility caused by various factors that affect the Indian and international commodity markets.

Availability of future growth opportunities

Our growth is linked to the availability of land in areas where we intend to develop projects either by ourselves or under joint development or joint venture arrangements. Suitable land parcels are limited in Mumbai, being our primary target market.

We believe that redevelopment projects will be an important means for obtaining land in Mumbai, and we intend to increase our focus on participating in redevelopment projects. We intend to leverage our brand recall and strong execution, marketing and sales capabilities to further develop our existing real estate business. In this regard, we intend to utilize a range of development models such as JV, JDAs and redevelopment in addition to acquiring freehold and leasehold interests in land for development. In doing so, we aim to be in a strong position to capture greater market share and benefit from the industry trend towards consolidation.

Our ability to identify and acquire interests in suitable land parcels is a vital element of growing our business and is dependent on a number of factors, some of which may be beyond our control, such as identifying land with clean title at locations that are preferred by our target customers at suitable prices, the willingness of land owners to sell land or assign development rights or interest in the land on terms acceptable to us, our ability to acquire contiguous parcels of land, the availability and cost of financing, encumbrances on targeted land, Government directives on use of land, and consents and approvals for land acquisition and development. Our acquisition of interests in land is also subject to the risk that sellers may, during such time, identify and transact with alternative purchasers or decide not to sell the land.

The cost of acquiring land, which includes the amounts paid for freehold rights, leasehold rights, the cost of registration and stamp duty, represents a substantial part of our project cost, and may sometimes determine whether we are able to acquire certain parcels of land at all. We acquire land from private parties and also from the Government. We enter into a deed of conveyance or a lease deed transferring title or leasehold rights in our favor.

The registration charges and stamp duty are generally payable by us. Additional costs include those incurred in complying with regulatory formalities, such as fees paid for change of land use, infrastructure and development charges and premium.

Cost of financing and changes in interest rates or tax incentives

Our business is capital intensive and requires significant expenditure for land acquisition and project development. Though we believe we are able to obtain funding at competitive interest rates, cost of financing is material for us. Details of our total borrowings and finance costs as of and for Fiscals 2026, 2025 and 2024 are set out below:

Particulars	As of and for the year ended March 31,
	2026	2025	2024
		(Rs. in million)
Total borrowings	29,091.28	23,125.78	17,836.50
Finance costs (attributable to cost of construction and development)	2,284.74	1,966.09	1,771.60

Among the major factors that drive the growth of demand for residential units is rising disposable income and availability of housing loans at affordable interest rates. Changes in interest rates also affect the ability and willingness of our prospective customers, particularly customers for our residential properties, to obtain financing for their purchase of our developments.

Further, any changes in the tax incentives available to purchasers or properties or tax treatment with respect to the repayment of principal on housing loans and interest payable on housing loans could affect demand for residential real estate. Certain of our real estate developments projects qualify for tax benefits that affect our results of operations. For example, we are subject to a minimum alternate tax ("MAT") of 15% on our book profits in addition to the applicable surcharge and cess.

Amounts paid as MAT may be credited against future income taxes for up to 15 years from the year in which the MAT credited was paid. Indian tax policies also make our properties more affordable to customers by allowing for a deduction of principal payments and interest payments on mortgage loans up to specific amounts. The continuation of these tax benefits or the lack thereof will have an effect on the affordability of our projects and consequently, our business.

Competition

We operate our business in an intensely competitive and highly fragmented industry. Our competitors include other real estate developers that operate within the same geographical regions and target similar market segments. The extent of the competition we face in a potential property market depends on a number of factors, such as the size and type of property development, contract value and potential margins, the complexity and location of the property development, and the risks relating to revenue generation.

The level of competition in any given micro-market depends on several factors, including the size and type of property development, contract value and potential margins, the complexity and location of the development, and the reputation of both the customer and ourselves, as well as other risks related to revenue generation. While we have an established presence in Mumbai, we face the risk that some of our competitors, who are also engaged in real estate development, may be better known, enjoy better relationships with landowners and international or domestic joint venture partners, may gain early access to information regarding attractive parcels of land within Mumbai and may be better placed to acquire such land.

Some of our competitors are larger than us and have greater land reserves or financial resources or a more experienced management team. They may also benefit from greater economies of scale and operating efficiencies. Moreover, our competitors pan-India presence may give them an edge in any new geographical areas where we seek to diversify. Our ability to compete effectively in these new markets is crucial for our future success. There can be no assurance that we can continue to compete effectively with our competitors in the future, and failure to compete effectively may have an adverse effect on our business, financial condition and results of operations. Competitive overbuilding in certain markets may have a material adverse effect on our operations in that market.

According to the JLL Report, our key competitors in the areas where we currently operate and focus include real estate developers such as Ajmera Realty, Chandak Group, Dosti Realty, Godrej Properties Limited, Hiranandani Group, Kalpataru Group, K. Raheja Corp, Lodha Group, Marathon Realty, Oberoi Realty, Piramal Realty, Prestige Group, Raunak Group, Rustomjee Group and Sugee Group.

Regulatory framework

The real estate sector in India is subject to extensive regulation. Our operations must comply with multiple standards, including those related to land acquisition, the built-up area-to-land ratio, land usage, building site suitability, road access, essential community facilities, open spaces, water supply, sewage disposal systems, electricity supply, environmental suitability, and the overall size of the project.

The approval of development plans depends on, among other factors, the successful acquisition of the project site and adherence to relevant conditions. Approvals are required at both national and local levels, and consequently, our operational results are likely to continue being influenced by the nature and extent of business regulations. This includes the varying time and costs associated with obtaining approvals for each new project.

For instance, the RERA imposes several obligations on real estate developers, including us. These obligations entail mandatory registration of real estate projects, prohibiting advertisements and acceptance of advances until projects are registered under the RERA, restrictions on the utilization of funds received from customers before project completion, and the requirement to obtain customer approval for major modifications in the sanctioned plan.

Additionally, under RERA, if we do not complete the developments within the specified timeframe, we are required to compensate our customers at predetermined rates for any delay, except in cases of force majeure or other situations deemed necessary for extending the timeframe. We are also obliged to provide warranties for up to five years for any construction defects and may be held liable for such defects. Also see " Key Regulations and Policies in India" and Risk Factors - Internal Risk Factors - We are subject to extensive statutory or governmental regulations, including the Real Estate (Regulation and Development) Act, 2016 and change in laws, rules, regulations and legal uncertainties, including the withdrawal of certain benefits or adverse application of tax laws or any noncompliance of any applicable law, may adversely affect our business, prospects and results of operationson pages 219 and 60, respectively.

Material Accounting Policies

The notes to our Restated Consolidated Financial Information included in this Red Herring Prospectus contain a summary of our material accounting policies. Set forth below is a summary of our material accounting policies under Ind AS.

Basis ofpreparation and presentation

Compliance with Ind AS

The restated consolidated financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015 read with Section 133 of the Companies Act 2013 (as amended from time to time) and presentation requirements of Division II of Schedule III to the Companies Act, 2013, (Ind AS compliant Schedule III), as applicable to this consolidated financial statements.

The restated consolidated financial statements have been prepared using the material accounting policies and measurement bases summarized as below. These accounting policies have been applied consistently over all the periods presented in these Restated Consolidated Financial Statements, except where we have applied certain accounting policies and exemptions upon transition to Ind AS.

Historical Cost Convention

The restated consolidated financial statements have been prepared on a historical cost basis, except for certain financial instruments are measured at fair value.

Preparation of Restated Consolidated Financial Statement

As per the format prescribed under Division II of Schedule III to the Companies Act, 2013, we present the Consolidated Restated Statement of Assets and Liabilities, the Consolidated Restated Statement of Profit and Loss, the Restated Consolidated statement of Cash Flows and the Restated Consolidated Statement of Changes in Equity. The accounting policies have been applied consistently over all the year presented in these Restated Consolidated Financial Statements.

Principles of Consolidation and Equity Accounting

(i) Subsidiaries

Subsidiaries are all entities over which our Group has control. Our Group controls an entity, when we are exposed to, or have rights to, variable returns from our involvement with such entity and have the ability to affect the returns through our power to direct the relevant activities of the entity.

Subsidiaries are fully consolidated from the date on which control is transferred to our Group. Control is reassessed whenever facts and circumstances indicate that there may be a change in any of these elements of control. They are deconsolidated from the date that control ceases.

Our Group combines the financial statements of the holding company and its subsidiaries line by line adding together like items of assets, liabilities, equity, income and expenses. Intercompany transactions, balances and unrealized gains or losses on transactions between Group companies are eliminated.

Non-controlling interests in the results and equity of subsidiaries are shown separately in the Restated Consolidated Statement of Profit and Loss, Restated Consolidated Statement of Changes in Equity and Restated Consolidated Balance Sheet, respectively.

(ii) Associates/ Joint Venture

Associates or joint ventures are all entities over which we have significant influence or joint control but not control. This is generally the case where we hold between 20% and 50% of the voting rights or where decisions over the relevant activities are unanimous in case of joint venture. Investments in associates and joint ventures are accounted for using the equity method of accounting after initially being recognized at cost.

Under the equity method of accounting, the excess of cost of investment over the proportionate share in equity of the associate/ joint venture as at the date of acquisition of stake is identified as goodwill or capital reserve as the case may be and included in the carrying value of the investment in the associate/ joint venture.

The carrying amount of the investment is adjusted thereafter to recognize our share of the post-acquisition profits or losses of the investee in the consolidated statement of profit and loss, and our share of other comprehensive income of the investee in consolidated other comprehensive income.

However, the share of losses is accounted for only to the extent of the cost of investment. Subsequent profits of such associates/ joint ventures are not accounted for unless the accumulated losses (not accounted for by us) are recouped. Additional losses are provided for to the extent that we have incurred obligations or made payments on behalf of the associate and joint venture to satisfy obligations of the associate and joint venture that we have guaranteed or to which we are otherwise committed. Unrealised gains or losses on transactions between us and our associates and joint ventures are eliminated to the extent of our interest in these entities.

Business Combinations

We apply the acquisition method in accounting for business combinations for the businesses which are not under common control. The cost of an acquisition is measured as the aggregate of the consideration transferred measured at acquisition date fair value and the amount of any non-controlling interests in the acquiree. For each business combination, we elect whether to measure the non-controlling interests in the acquiree at fair value or at the proportionate share of the acquirees identifiable net assets. Acquisition related costs are expensed as incurred.

At the acquisition date, the identifiable assets acquired and the liabilities assumed are recognised at their acquisition date fair values. For this purpose, the liabilities assumed include contingent liabilities representing present obligation and they are measured at their acquisition fair values irrespective of the fact that outflow of resources embodying economic benefits is not probable. However, the following assets and liabilities acquired in a business combination are measured at the basis indicated below:

(a) Deferred tax assets or liabilities and the assets or liabilities related to employee benefit arrangements are recognised and measured in accordance with Ind AS 12 ‘Income Tax and Ind AS 19 ‘Employee Benefits respectively.

(b) Potential tax effects of temporary differences and carry forwards of an acquiree that exist at the acquisition date or arise as a result of the acquisition are accounted in accordance with Ind AS 12.

(c) Reacquired rights are measured at a value determined on the basis of the remaining contractual term of the related contract. Such valuation does not consider potential renewal of the reacquired right.

Any contingent consideration to be transferred by the acquirer is recognised at fair value at the acquisition date. Contingent consideration classified as an asset or liability that is a financial instrument and within the scope of Ind AS 109 ‘Financial Instruments, is measured at fair value with changes in fair value recognised in profit or loss. If the contingent consideratio n is not within the scope of Ind AS 109, it is measured in accordance with the appropriate Ind AS.

Contingent consideration that is classified as equity is not re-measured at subsequent reporting dates and its subsequent settlement is accounted for within equity.

When we acquire a business, we assess the financial assets and liabilities assumed for appropriate classification and designation in accordance with the contractual terms, economic circumstances and pertinent conditions as at the acquisition date.

If the business combination is achieved in stages, any previously held equity interest is re-measured at its acquisition date fair value and any resulting gain or loss is recognised in profit or loss or other comprehensive income, as appropriate.

Business combinations under common control

Business combinations involving entities that are controlled by us are accounted for using the pooling of interests method as follows:

• The assets and liabilities of the combining entities are reflected at their carrying amounts.

• No adjustments are made to reflect fair values, or recognise any new assets or liabilities. Adjustments are only made to harmonise accounting policies.

• The restated financial information in the financial statements in respect of prior periods is restated as if the business combination had occurred from the beginning of the preceding period in the financial statements, irrespective of the actual date of the combination. However, where the business combination had occurred after that date, the prior period information is restated only from that date.

• The balance of the retained earnings appearing in the restated consolidated financial information of the transferor is aggregated with the corresponding balance appearing in the financial statements of the transferee or is adjusted against general reserve.

• The identity of the reserves are preserved and the reserves of the transferor become the reserves of the transferee.

• The difference, if any, between the amounts recorded as share capital issued plus any additional consideration in the form of cash or other assets and the amount of share capital of the transferor is transferred to capital reserve and is presented separately from other capital reserves.

Current vs Non-Current classification

We present assets and liabilities in the Restated Consolidated Balance Sheet based on current/ non-current classification.

An asset is treated as current when it is:

(i) expected to be realised or intended to be sold or consumed in normal operating cycle.

(ii) held primarily for the purpose of trading

(iii) expected to be realised within 12 months after the reporting period, or

(iv) cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least 12 months after the reporting period.

All other assets are classified as non-current.

A liability is current when:

(i) it is expected to be settled in normal operating cycle

(ii) it is held primarily for the purpose of trading

(iii) it is due to be settled within 12 months after the reporting period, or

(iv) there is no unconditional right to defer the settlement of the liability for at least 12 months after the reporting period. We classify all other liabilities as non-current.

Deferred tax assets and liabilities are classified as non-current assets and liabilities respectively.

The operating cycle is the time between the acquisition of assets for processing and their realisation in cash and cash equivalents. The operating cycle of our real estate operations varies from project to project depending on the size of the project, type of development, project complexities and related approvals. Accordingly, project related assets and liabilities are classified into current and non-current based on the operating cycle of the project. All other assets and liabilities have been classified into current and non-current based on a period of 12 months.

Functional and Presentation Currency

Our Restated Consolidated Financial Information are presented in Indian Rupee (" Rs.") which is also the functional currency of our Group. All values are rounded off to the nearest million(s).

Use of Accounting Judgements, Assumptions and Estimates

In the application of our accounting policies, our management is required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods. Detailed information about each of these estimates and judgements is included in relevant notes together with information about the basis of calculation for each affected line item in the financial statements.

The following are the key areas of judgements, assumptions and estimates which have significant effect on the amounts recognized in the consolidated financial statements:

Estimation of Net Realisable Value (NRV) for Inventory

Inventory is stated at the lower of cost and net realizable value ("NRV").

NRV of completed or developed inventory is assessed by reference to market conditions, prices and trends existing at the reporting date and is determined by us based on comparable transactions observed /identified for similar properties in the same geographical market serving the same real estate segment.

NRV in respect of inventory under development is assessed with reference to market prices and trends existing at the reporting date for similar completed property, less the estimated cost to complete construction and an estimate of the time value of money to the date of completion.

Estimated cost to complete is reviewed at each year end by considering cost escalation and overruns basis the progress of the project.

Impairment of Other Non-Financial Assets

We assess at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, we estimate the assets recoverable amount. An assets recoverable amount is the higher of an assets fair value less costs of disposal and its value in use. When the carrying amount of an asset excee ds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessment of the time value of money and the risk specific to the asset. In determining fair value less cost of disposal, recent market transactions are taken into account. If no such transactions can be identified, an appropriate valuation model is used. These calculations are corroborated by valuation multiples or other available fair value indicators.

Impairment of Financial Assets

The impairment provisions for financial assets are based on assumptions about the risk of default and expected loss rates. We use judgement in making these assumptions and selecting the inputs for impairment calculation, based on our past history, existing market conditions as well as forward looking estimates at the end of each reporting period.

Useful Life and Residual Value of Property, Plant and Equipment

Useful lives of property, plant and equipment are based on the life prescribed in Schedule II of the Companies Act, 2013. In cases, where the useful lives are different from that prescribed in Schedule II, they are based on technical advice. Assumptions also need to be made when we assess whether an asset may be capitalised and which components of the cost of the asset may be capitalised.

Recognition and Measurement of Defined Benefit Obligations

The obligation arising from defined benefit plan is determined on the basis of actuarial assumptions. Key actuarial assumptions include discount rate, expected return on plan assets, trends in salary escalation and attrition rate. The discount rate is determined by reference to market yields at the end of the reporting period on government bonds. The period to maturity of the underlying bonds correspond to the probable maturity of the post employment benefit obligations.

Fair Value Measurement of Financial Instruments

When the fair values of the financial assets and liabilities recorded in the balance sheet cannot be measured based on the quoted market prices in active markets, their fair value is measured using valuation technique. The inputs to these models are taken from the observable market wherever possible, but where this is not feasible, a review of judgement is required in establishing fair values. Any changes in assumptions could affect the fair value relating to financial instruments.

Provision and Contingent Liability

On an ongoing basis, we review pending cases, claims by third parties and other contingencies. For contingent losses that are considered probable, an estimated loss is recorded as an accrual our Restated Consolidated Financial Information. Loss contingencies that are considered possible are not provided for but disclosed as contingent liabilities in the restated consolidated financial statements. Contingencies the likelihood of which is remote are not disclosed in our Restated Consolidated Financial Information. Gain contingencies are not recognized until the contingency has been resolved and amounts are received or receivable.

Recognition of Deferred Tax Assets

Deferred tax assets are recognised for unused tax-loss carry forwards and unused tax credits to the extent that realisation of the related tax benefit is probable. The assessment of the probability with regard to the realisation of the tax benefit involves assumptions based on the history of the entity and budgeted data for the future.

Measurement of Fair Values

We measure financial instruments, such as certain investments at fair value at each balance sheet date. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either in the principal market for the asset or liability, or in the absence of a principal market, in the most advantageous market for the asset or liability. The principal or the most advantageous market must be accessible by us.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.

A fair value measurement of a non-financial asset takes into account a market participants ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

We use valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.

We have an established control framework with respect to the measurement of fair values. Our management regularly reviews significant unobservable inputs and valuation adjustments. If third party information is used to measure fair values, then our management assesses the evidence obtained from third parties to support the conclusion that such valuations meet the requirements of Ind AS, including the level in the fair value hierarchy in which such valuations should be classified.

When measuring the fair value of a financial asset or a financial liability, we use observable market data as far as possible. Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows.

Level 1: Quoted prices in active markets for identical assets or liabilities.

Level 2: Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3: Inputs for the asset or liability that are not based on observable market data.

If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

We recognise transfers between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred.

Property, Plant and Equipment

Recognition and Measurement

Items of property, plant and equipment are stated at cost less accumulated depreciation and impairment losses, if any. The Cost of an item of property, plant and equipment comprises of:

(i) its purchase price, including import duties and non-refundable purchase taxes after deducting trade discounts and rebates;

(ii) any costs directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by our management;

(iii) the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located, the obligation for which we incur either when the item is acquired or as a consequence of having used the item during a particular period for purposes other than to produce inventories during that period;

(iv) borrowing costs relating to acquisition/construction/development of property, plant and equipment, which takes substantial period of time to get ready for its intended use are also included to the extent they relate to the period till such assets are ready to be put to use; and

(v) income and expenses related to the incidental operations, not necessary to bring the item to the location and condition necessary for it to be capable of operating in the manner intended by our management are recognised in the Restated Statement of Profit and Loss. If significant parts of an item of property, plant and equipment have different useful lives, then they are accounted for as separate items (major components) of property, plant and equipment.

Subsequent Expenditure

Subsequent expenditure related to an item of property, plant and equipment is added to its book value only if it increases the future benefits from the existing asset beyond its previously assessed standard of performance. All other expenses on existing property, plant and equipment, including repair and maintenance expenditure and cost of replacing parts are charged to the Restated Statement of Profit and Loss for the period during which such expenses are incurred.

Expenses incurred for acquisition of capital assets excluding advances paid towards the acquisition of property, plant and equipment outstanding at each Balance Sheet date are disclosed under capital work-in-progress.

Capital work-in-progress in respect of assets which are not ready for their intended use are carried at cost, comprising of direct costs, related incidental expenses and attributable interest.

Any gain or loss on disposal of an item of property, plant and equipment is recognized in the Restated Statement of Profit and Loss in the year of disposal.

Depreciation

Depreciation is provided on a pro-rata basis on the straight-line method over the estimated useful lives of the assets. The useful life of the assets are based on the useful lives as per Schedule II of the Companies Act, 2013.

Nature of the asset	Useful life
Computers	3 years
Plant & Machinery	15 years
Office Equipment	5 years
Vehicle	8 years
Furniture and Fittings	10 years
Server & Networks	6 years
Buildings	60 years

The estimated useful lives of assets based on management estimates and technical evaluation that are different from the life specified in Schedule II to the Companies Act, 2013, are as follows:

Nature of the asset	Useful life as per estimates	Useful life as per Companies Act
Aluminium Formwork (Plant & Machinery)	5 years	15 years

The residual values, useful life and methods of depreciation of property, plant and equipment are reviewed at each financial year end and adjusted prospectively, if appropriate.

Derecognition

An item of property, plant and equipment and any significant part initially recognised is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is recognised in the Restated Statement of Profit and Loss, when the asset is derecognised.

Investment Properties

Building, that is held for long-term rental yields or for capital appreciation or both, and that is not in use by us, is classified as investment property. Investment property is measured initially at its acquisition cost, including related transaction costs and where applicable borrowing costs. Subsequent expenditure is capitalised to the assets carrying amount only when it is probab le that future economic benefits associated with the expenditure will flow to us and the cost of the item can be measured reliably. All other repairs and maintenance costs are expensed when incurred. When part of an investment property is replaced, the carrying amount of the replaced part is derecognised.

The carrying amount of investment property is reviewed periodically for impairment based on internal and external factors. An impairment loss is recognised wherever the carrying amount of assets exceeds its recoverable amount. The recoverable amount is the greater of the assets net selling price and value in use.

Investment properties (building) are depreciated on a pro-rata basis on the straight line method over the estimated useful lives of the assets, which are in line with Schedule II to the Companies Act, 2013, in order to reflect the actual usage of the assets.

Initial direct costs incurred by us in negotiating and arranging an operating lease shall be added to the carrying amount of the leased asset and recognised as an expense over the lease term on the same basis as the lease income.

Depreciation is provided on the straight line method to allocate the cost of assets, net of their residual values, over their estimated useful lives.

The estimated useful life of investment property is 60 years.

An investment property is derecognised upon disposal or when the investment property is permanently withdrawn from use and no future economic benefits are expected from the disposal. Any gain or loss arising on derecognition of property is recognised in the Restated Statement of Profit and Loss in the same period.

Intangible Assets and Amortization

Intangible assets are stated at acquisition cost, net of accumulated amortization and accumulated impairment losses, if any. Intangible assets are amortized on a straight line basis over their estimated useful lives. The amortisation period and the amortisation method for an intangible asset with a finite useful life are reviewed at least at the end of each reporting period. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered to modify the amortisation period or method, as appropriate, and are treated as changes in accounting estimates.

Gains or losses arising from the retirement or disposal of an intangible asset are determined as the difference between the net disposal proceeds and the carrying amount of the asset and recognised as income or expense in the Restated Statement of Profit and Loss.

The estimated useful life of intangible assets are as follows:

Nature of the asset	Amortization period
Computer software	6 years

Foreign Currency Transactions/Translations

Foreign exchange transactions are recorded at the closing rate prevailing on the dates of the respective transactions or at the contracted rates as applicable.

Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated into the functional currency at the exchange rate at that date.

Exchange differences arising on the settlement of monetary items or on translating monetary items at rates different from those at which they were translated on initial recognition during the period or in previous financial statements are recognised in the Restated Statement of Profit and Loss in the period in which they arise.

Financial Instruments

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. Financial assets and financial liabilities are recognised when we become a party to the contractual provisions of the instruments.

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities measured at fair value through profit or loss are recognized immediately in the Statement of Profit and Loss.

Financial Assets

All regular way purchases or sales of financial assets are recognised and derecognised on a trade date basis. Regular way purchases or sales are purchases or sales of financial assets that require delivery of assets within the time frame established by regulation or convention in the market place. All recognised financial assets are subsequently measured in their entirety at either amortised cost or fair value, depending on the classification of the financial assets.

(i) Financial assets at amortised cost

Financial assets are subsequently measured at amortised cost using the effective interest rate method if these financial assets are held within a business whose objective is to hold these assets in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

(ii) Financial assets at fair value through other comprehensive income

A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

On initial recognition, we make an irrevocable election on an instrument-by-instrument basis to present the subsequent changes in fair value in other comprehensive income pertaining to investments in equity instruments, other than equity investment which are held for trading. Subsequently, they are measured at fair value with gains and losses arising from changes in fair value recognised in other comprehensive income and accumulated in the reserve for equity instruments through other comprehensive income. The cumulative gain or loss is not reclassified to profit or loss on disposal of the investments.

(iii) Financial assets at fair value through profit or loss (FVTPL)

Investments in equity instruments are classified as at FVTPL, unless we irrevocably elect on initial recognition to present subsequent changes in fair value in other comprehensive income for investments in equity instruments which are not held for trading. Other financial assets are measured at fair value through profit or loss unless it is measured at amortised cost or at fair value through other comprehensive income on initial recognition.

(iv) Impairment of investments

We review our carrying value of investments carried at cost annually, or more frequently when there is indication for impairment. If the recoverable amount is less than the carrying amount, the impairment loss is accounted in the Restated Statement of Profit and Loss.

(v) Derecognition

A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognised (i.e. removed from our balance sheet) when:

• the right to receive cash flows from the asset have expired, or

• we have transferred our right to receive cash flows from the asset or have assumed an obligation to pay the received cash flows in full without material delay to a third party under a ‘pass-through arrangement and either

(a) we have transferred substantially all the risks and rewards of the asset, or (b) we have neither transferred nor retained substantially all the risks and rewards of the asset, but have transferred control of the asset.

When we have transferred our right to receive cash flows from an asset or have entered into a pass-through arrangement, we evaluate if and to what extent we have retained the risks and rewards of ownership. When we have neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, we continue to recognise the transferred asset to the extent of our continuing involvement. In that case, we also recognise an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that we have retained.

(vi) Impairment of financial assets

We assess at each date of balance sheet whether a financial asset or a group of financial assets is impaired. Ind AS 109 requires expected credit losses to be measured through a loss allowance. We recognize lifetime expected losses for all contract assets and/or all trade receivables that do not constitute a financing transaction. For all other financial assets, expected credit losses are measured at an amount equal to the 12 month expected credit losses or at an amount equal to the life time expected credit losses if the credit risk on the financial asset has increased significantly since initial recognition.

Financial Liabilities and Equity Instruments

(i) Classification as Debt or Equity

Debt and equity instruments issued by us are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument.

(ii) Equity Instruments

An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by us are recognised at the proceeds received, net of direct issue costs.

(iii) Financial Liabilities

All financial liabilities are recognised initially at fair value and in case of financial liabilities at amortised cost, net of directly attributable transaction costs. All financial liabilities are subsequently measured at amortised cost using the effective interest method. Gains and losses are recognised in Restated Statement of Profit and Loss when the liabilities are derecognised as well as through the Effective Interest Rate (EIR) amortisation process. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance costs in the restated statement of profit and loss.

(iv) Derecognition

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the Restated Statement of Profit and Loss.

Reclassification of Financial Assets and Liabilities

We determine classification of financial assets and liabilities on initial recognition. After initial recognition, no reclassification is made for financial assets which are equity instruments and financial liabilities. For financial assets which are debt instruments, a reclassification is made only if there is a change in the business model for managing those assets. Changes to the business model are expected to be infrequent. Our senior management determines change in the business model as a result of external or internal changes which are significant to our operations.

Such changes are evident to external parties. A change in the business model occurs when we either begin or cease to perform an activity that is significant to our operations. If we reclassify financial assets, we apply the reclassification prospectively from the reclassification date which is the first day of the immediately next reporting period following the change in business model. We do not restate any previously recognised gains, losses (including impairment gains or losses) or interest.

Offsetting of Financial Instruments

Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously.

Redeemable preference shares

The redeemable preference shares issued by us is a compound financial instrument and is classified separately as financial liability and equity in accordance with the substance of the contractual arrangement and the definitions of a financial liability and an equity instrument. At the date of issue, fair value of the liability component is estimated using the prevailing market interest rate of a similar non-compound instrument. This amount is recognised as liability on an amortised cost basis using the effective interest rate method until extinguished at the instruments maturity date. The difference between the fair value of the liability component at the date of issue and the issue price is recognised as the other equity.

Inventories

Direct expenditure relating to real estate development activity is inventorised. Other expenditure (including borrowing costs) during construction period is inventorized to the extent the expenditure is directly attributable cost of bringing the asset to its working condition for its intended use. Other expenditure (including borrowing costs) incurred during the construction period which is not directly attributable for bringing the asset to its working condition for its intended use is charged to the restated statement of profit and loss. Direct and other expenditure is determined based on specific identification to the construction and real estate activity. Cost incurred/ items purchased specifically for projects are taken as consumed as and when incurred/ received.

(a) Inventories comprise of: (i) finished realty stock representing unsold premises in completed projects (ii) construction work-in-progress representing properties under construction /development; and (iii) cost of unused land represents land held for development on which construction activities are yet to commence.

(b) Inventories are valued at lower of cost and net realisable value.

(c) Cost of realty construction/development is charged to the Restated Statement of Profit and Loss in proportion to the revenue recognised during the period and the balance cost is carried over under inventory as part of either realty work- in-progress or finished realty stock. Cost of realty construction/development includes all costs directly related to the project (including finance cost attributable to the project) and other expenditure as identified by our management which are incurred for the purpose of executing and securing the completion of the project (net off incidental recoveries/receipts) upto the date of receipt of occupation certificate of the project from the relevant authorities.

Realty work-in-progress includes cost of land, premium for development rights, transferable development rights (TDR), construction costs, allocated interest and expenses incidental to the projects undertaken by us.

Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and estimated costs necessary to make the sale.

Revenue Recognition

Five-step model (Ind AS 115)

We have applied the five step model as set out in Ind AS 115 to recognise revenue in our Restated Consolidated Financial Information:

Step 1. Identify the contract(s) with a customer: A contract is defined as an agreement between two or more parties that creates enforceable rights and obligations and sets out the criteria for every contract that must be met.

Step 2. Identify the performance obligations in the contract: A performance obligation is a promise in a contract with a customer to transfer a good or service to the customer.

Step 3. Determine the transaction price: The transaction price is the amount of consideration to which we expect to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties.

Step 4. Allocate the transaction price to the performance obligations in the contract: For a contract that has more than one performance obligation, we will allocate the transaction price to each performance obligation in an amount that depicts the amount of consideration to which we expect to be entitled in exchange for satisfying each performance obligation.

Step 5. Recognise revenue when (or as) the entity satisfies a performance obligation.

We satisfy a performance obligation and recognise revenue over time, if one of the following criteria is met:

• the customer simultaneously receives and consumes the benefits provided by our performance as we perform; or

• our performance creates or enhances an asset that the customer controls as the asset is created or enhanced; or

• our performance does not create an asset with an alternative use to us and the entity has an enforceable right to payment for performance completed to date.

For performance obligations where one of the above conditions are not met, revenue is recognised at the point in time at which the performance obligation is satisfied.

Revenue is recognised either at point of time and over a period of time based on the conditions in the contracts with customers. The specific revenue recognition criteria are described below:

(i) Income from Property Development

We have determined that the existing terms of the contract with customers does not meet the criteria to recognise revenue over a period of time. Revenue is recognized at point in time with respect to contracts for sale of residential and commercial units as and when the control is passed on to the customers which is linked to the receipt of occupancy certificate and on issuing the possession letter of the property.

(ii) Sale of Materials, Land and Development Rights

Revenue is recognized at point in time with respect to contracts for sale of materials, land and development rights as and when the control is passed on to the customers.

(iii) Income from Investment in Partnership Firms & LLP, AOPs

Share of profit/loss in partnership firms is recognized when the right to receive is established as per agreement/agreed terms between all the partners/members.

(iv) Interest Income

Interest income is accounted on an accrual basis at effective interest rate (EIR method).

(v) Dividend Income

Dividend income is recognized when the right to receive the payment is established.

(vi) Commission Income

Revenue is recognized when our right to receive the payment is established.

Contract Balances

Contract asset is the right to consideration in exchange for goods or services transferred to the customer. If we perform by transferring goods or services to a customer before the customer pays consideration or before payment is due, a contract asset is recognised for the earned consideration that is conditional.

Trade receivable represents our right to an amount of consideration that is unconditional (i.e., only the passage of time is required before payment of the consideration is due).

Contract liability is the obligation to transfer goods or services to a customer for which we have received consideration (or an amount of consideration is due) from the customer. If a customer pays consideration before we transfer goods or services to the customer, a contract liability is recognised when the payment is made or the payment is due (whichever is earlier). Contract liabilities are recognised as revenue when we perform under the contract.

Cost to obtain a contract

We recognise as an asset the incremental costs of obtaining a contract with a customer if we expect to recover those costs. W e incur costs such as sales commission when we enter into a new contract, which are directly related to winning the contract.

Income Tax

Current Income Tax:

Current income tax for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities based on the taxable profit for the period. The tax rates and tax laws used to compute the amount are those that are enacted by the reporting date and applicable for the period.

Deferred Tax:

Deferred tax is recognized using the balance sheet approach. Deferred tax assets and liabilities are recognized for all deductible and taxable temporary differences arising between the tax bases of assets and liabilities and their carrying amount in financial statements, except when the deferred tax arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and affects neither accounting nor taxable profits or loss at the time of transaction.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period when the asset is realized or the liability is settled, based on tax rates that have been enacted or substantively enacted at the reporting date.

Deferred tax asset in respect of carry forward of unused tax credits and unused tax losses are recognized to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilized.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilized.

Presentation of Current and Deferred Tax:

Current and deferred tax are recognized as income or an expense in the Restated Statement of Profit and Loss, except when they relate to items that are recognized in other comprehensive income, in which case, the current and deferred tax income/ expense are recognized in other comprehensive income. We offset current tax assets and current tax liabilities, where we have a legally enforceable right to set off the recognized amounts and where we intend either to settle on a net basis, or to realize the asset and settle the liability simultaneously. In case of deferred tax assets and deferred tax liabilities, the same are offset if we have a legally enforceable right to set off corresponding current tax assets against current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same tax authority on us.

Employee Benefits

Short Term Employee Benefits

Short term employee benefits are expensed as the related service is provided. A liability is recognised for the amount expected to be paid if we have a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

Post Employment Benefits

(i) Defined Contribution Plans

Obligations for contributions to defined contribution plans are expensed as the related service is provided.

Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in future payments is available.

(ii) Defined Benefit Plans

Payment of gratuity to employees is in the nature of a defined benefit plan. Provision for gratuity is recorded on the basis of actuarial valuation certificate provided by the actuary using projected unit credit method.

Our net obligation in respect of defined benefit plans is calculated separately for each plan by estimating the amount of future benefit that employees have earned in the current and prior periods, discounting that amount and deducting the fair value of any plan assets.

The calculation of defined benefit obligations is performed annually by a qualified actuary using the projected unit credit method. When the calculation results in a potential asset for us, the recognised asset is limited to the present value of economic benefits available in the form of any future refunds from the plan or reductions in future contributions to the plan. To calculate the present value of economic benefits, consideration is given to any applicable minimum funding requirements.

Remeasurement of the net defined benefit liability, which comprise of actuarial gains and losses and the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest) are recognised immediately in restated other comprehensive income. Net interest expense/ (income) on the net defined liability/(asset) is computed by applying the discount rate, used to measure the net defined liability/(asset). Net interest expense and other expenses related to defined benefit plans are recognised in the Restated Statement of Profit and Loss.

When the benefits of a plan are changed or when a plan is curtailed, the resulting change in benefit that relates to past service or the gain or loss on curtailment is recognised immediately in the Restated Statement of Profit and Loss. We recognise gains and losses on the settlement of a defined benefit plan when the settlement occurs.

Other Long Term Employee Benefits

Our liability towards compensated absences is determined by an independent actuary using the projected unit credit method. Past services are recognised on a straight line basis over the average period until the benefits become vested. Actuarial gains and losses are recognised immediately in the Restated Statement of Profit and Loss as income or expense or recognized under Restated other comprehensive income to the extent such actuarial gains or losses arise due to experience adjustments. Obligation is measured at the present value of the estimated future cash flows using a discounted rate that is determined by reference to the market yields at the balance sheet date on government bonds where the currency and terms of the government bonds are consistent with the currency and estimated terms of the defined benefit obligation.

Leases

Where we are the Lessee

We apply a single recognition and measurement approach for all leases, except for short-term leases and leases of low-value assets. We recognise lease liabilities to make lease payments and right-of-use assets representing the right to use the underlying assets.

(i) Right-of-use assets

We recognise right-of-use assets at the commencement date of the lease (i.e., the date the underlying asset is available for use). Right-of-use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities recognised, initial direct costs incurred, and lease payments made at or before the commencement date less any lease incentives received. Right-of-use assets are depreciated on a straight-line basis over the shorter of the lease term and the estimated useful lives of the assets.

(ii) Lease liabilities

At the commencement date of the lease, we recognise lease liabilities measured at the present value of lease payments to be made over the lease term. The lease payments include fixed payments (including in substance fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected to be paid under residual value guarantees.

In calculating the present value of lease payments, we use our incremental borrowing rate at the lease commencement date because the interest rate implicit in the lease is not readily determinable. After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the lease payments (e.g., changes to future payments resulting from a change in an index or rate used to determine such lease payments) or a change in the assessment of an option to purchase the underlying asset.

(iii) Short term leases and leases of low value of assets

We apply the short-term lease recognition exemption to those leases that have a lease term of 12 months or less from the commencement date and do not contain a purchase option. Lease payments on short-term leases and leases of low- value assets are recognised as expense on a straight-line basis over the lease term.

Where we are the Lessor

Leases in which we do not transfer substantially all the risks and rewards incidental to ownership of an asset is classified as operating leases. Rental income arising is accounted for on a straight-line basis over the lease terms. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised over the lease term on the same basis as rental income. Contingent rents are recognised as revenue in the period in which they are earned.

Borrowing Cost

Borrowing costs are interest and other costs that we incur in connection with the borrowing of funds and is measured with reference to the effective interest rate applicable to the respective borrowing.

Borrowing costs allocated to qualifying assets pertaining to the period from commencement of activities relating to construction/development of the qualifying asset up to the time all the activities necessary to prepare the qualifying asset for its intended use or sale are complete.

All other borrowing costs are recognised as an expense in the period in which they are incurred.

Cash and Cash Equivalent

Cash and cash equivalent as reported in the balance sheet comprise cash at banks and on hand and short term deposits with an original maturity of three months or less which are subject to an insignificant risk of changes in value. However, for the purposes of the cash flow statement, cash and cash equivalents comprise of cash and short term deposits as defined in Ind AS 7.

Earnings Per Share

Basic earnings per share is computed by dividing the restated profit/(loss) after tax by the weighted average number of equity shares outstanding during the year. The weighted average number of equity shares outstanding during the year is adjusted for the events for bonus issue, bonus element in a rights issue to existing shareholders, share split and reverse share split (consolidation of shares).

Diluted earnings per share is computed by dividing the restated profit/(loss) after tax as adjusted for dividend, interest and other charges to expense or income (net off any attributable taxes) relating to the dilutive potential equity shares, by the weighted average number of equity shares considered for deriving basic earnings per share and the weighted average number of equity shares which could have been issued on conversion of all dilutive potential equity shares.

Provisions, Contingent Liabilities & Contingent Assets

Provisions are recognized when we have a present obligation (legal or constructive) as a result of a past event, it is probab le that we will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation.

The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows (when the effect of the time value of money is material).

Contingent liabilities are disclosed for:

(i) possible obligations which will be confirmed only by future events not wholly within the control of our Group; or

(ii) present obligations arising from past events where it is not probable that an outflow of resources will be required to settle the obligation or a reliable estimate of the amount of the obligation cannot be made.

Contingent assets are not recognised in Restated Financial Statements. If an inflow of economic benefits has become probable, contingent assets are disclosed.

Contingent assets are assessed continually to ensure that developments are appropriately reflected in the Restated Financial Statements. If it has become virtually certain that an inflow of economic benefits will arise, the asset and the related income are recognised in the Restated Financial Statements of the period in which the changes occurs.

Provisions, contingent liabilities, contingent assets and commitments are reviewed at each reporting date.

Segment Reporting

Our board of directors monitor the operating results of our business segments separately for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on profit or loss and is measured consistently with profit or loss in the financial statements. The operating segments have been identified on the basis of nature of product/services.

We are not engaged in any other segment other than real estate.

Changes in accounting policies and recent accounting pronouncements

There have been no changes in our accounting policies for Fiscals 2026, 2025 and 2024.

As of the date of this Red Herring Prospectus, there are no recent accounting pronouncements which would have a material effect on our financial condition or results of operations.

Key Components of our Statement of Profit and Loss

The key components of our statement of profit and loss are described below:

Income

Income consists of revenue from operations and other income.

Revenue from operations. Revenue from operations comprises (i) revenue from sales, which includes revenue from sale of residential units and retail shops; and (ii) other operating revenue, which includes license fees, sale of material, service charges and others. License fees relate to fees received through leasing of commercial premises owned by us.

Other income. Other income comprises interest income (which includes interest on income tax refund, among others), gains on sale of property, plant and equipment (net), gain on sale of investment properties, gain on financial instruments at fair value through profit or loss (net), financial guarantee commission income and miscellaneous income. Miscellaneous income relates to income from non-operating activities, such as the sale of scrap.

Expenses

Expenses consist of cost of construction and development, changes inventories of finished goods (including stock-in-trade) and work-in-progress, employee benefits expenses, finance costs, depreciation and amortization expenses, and other expenses.

Cost of construction and development. Cost of construction and development incurred during the year comprise purchases of land and development rights, project execution expenses, consultancy charges, other project expenses, overheads, depreciation, finance costs (which are distinguished from finance costs charged directly to our profit and loss account) and other operating expenses.

Changes inventories of finished goods (including stock-in-trade) and work-in-progress. Changes inventories of finished goods (including stock-in-trade) and work-in-progress is represented by difference in our opening stock and the closing stock.

Employee benefits expense. Employee benefits expense comprises salaries, allowances and bonus, contribution to provident and other funds, directors remuneration and staff welfare.

Finance costs. Finance costs comprise interest expenses on financial liabilities at amortized cost, including borrowings and bank and other financial charges. Our finance costs are adjusted for transfers to work-in-progress (which we account for as part of our cost of sales and other operational expenses, based on the stage of completion of the relevant project for which they are incurred) and capital work-in-progress.

Depreciation and amortization expense. Depreciation and amortization expense includes depreciation and amortization on property, plant and equipment, investment property and intangible assets. Intangible assets include software and license keys.

Other expenses. The largest components of other expenses are advertisement and publicity expenses, rent and accommodation expenses and repairs and maintenance expenses. Other components of other expenses include rates and taxes, electricity charges, security charges, insurance expense, legal and professional fees, directors sitting fees, conveyance and travelling expenses, printing and stationery, membership and subscriptions, communication charges, auditors remuneration, brokerage and commission, loss on sale of property, plant and equipment (net), share of loss from partnership firms and miscellaneous expenses.

Tax expense

Tax expense consists of current tax and deferred tax (credit)/charge.

Results of Operations

Set out below are select financial information from our restated consolidated statement of profit and loss for Fiscals 2026, 2025 and 2024, the components of which are also expressed as a percentage of our total income for such years:

Particulars	Fiscal 2026		Fiscal 2025		Fiscal 2024
	Amount	Percentage of total income	Amount	Percentage of total income	Amount	Percentage of total income
	f in million)	(%)	(Rs. in million)	(%)	f in million)	(%)
Income:
Revenue from operations	17,989.49	97.20	10,077.66	95.91	24,088.65	98.86
Other income	518.44	2.80	429.48	4.09	278.09	1.14
Total Income	18,507.93	100.00	10,507.14	100.00	24,366.74	100.00
Expenses:
Cost of construction and development	15,144.41	81.83	15,422.00	146.78	13,969.61	57.33
Changes in inventories of finished goods (including stock-in-trade) and work-in-progress	(3,177.86)	(17.17)	(8,962.06)	(85.29)	5,377.08	22.07
Employee benefits expenses	979.53	5.29	660.40	6.29	456.48	1.87
Financial Costs	1,151.55	6.22	788.61	7.51	417.82	1.71
Depreciation and amortization expense	107.20	0.58	36.89	0.35	31.79	0.13
Other expenses	2,063.80	11.15	1,585.70	15.09	2,546.24	10.45
Total expenses	16,268.63	87.90	9,531.54	90.71	22,799.02	93.57
Restated Profit/(Loss) before exceptional items, tax, share of profit in associates and joint ventures	2,239.30	12.10	975.60	9.29	1,567.73	6.43
Share of profit/(loss) in associates and joint ventures (net)	(0.15)	(0.00)	(0.04)	(0.00)	(0.02)	(0.00)

 

Particulars	Fiscal 2026		Fiscal 2025		Fiscal 2024
	Amount	Percentage of total income	Amount	Percentage of total income	Amount	Percentage of total income
	(Rs. in million)	(%)	(Rs. in million)	(%)	(Rs. in million)	(%)
Restated Profit/(Loss) before exceptional items, tax	2,239.15	12.10	975.56	9.28	1,567.71	6.43
Exceptional items (net)	-	-	-	-	-	-
Restated Profit/(Loss) before tax, share of profits in associates and joint ventures	2,239.15	12.10	975.56	9.28	1,567.71	6.43
Tax expenses:
Current tax	604.57	3.27	688.13	6.55	(668.42)	(2.74)
Deferred tax credit/(charge)	(223.05)	(1.21)	(269.05)	(2.56)	(37.71)	(0.15)
Total tax expenses	381.52	2.06	419.08	3.99	(630.71)	(2.59)
Profit/(Loss) for the year	1,857.63	10.04	556.48	5.30	937.00	3.85

Fiscal 2026 compared to Fiscal 2025

Total income. Total income increased by 76.15% from Rs.10,507.14 million for Fiscal 2025 to Rs.18,507.93 million for Fiscal 2026, primarily as a result of an increase in revenue from operations.

Revenue from operations. Revenue from operations increased by 78.51% from Rs.10,077.66 million for Fiscal 2025 to Rs.17,989.49 million for Fiscal 2026, primarily as a result of an increase in revenue from contracts with customers from Rs.10,034.94 millio n for Fiscal 2025 to Rs.17,707.20 million for Fiscal 2026, due to higher sales recognition from our residential real estate projects, namely, Runwal Forests undertaken by Wheelabrator Alloy Castings Limited, Runwal Bliss undertaken by Evie Real Estate Private Limited, Runwal Avenue Retail undertaken by Susneh Infrapark Private Limited, Runwal My City undertaken by Horizon Projects Private Limited and Runwal Gardens undertaken by Runwal Residency Private Limited during the year.

Other income. Other income increased by 20.71% from Rs.429.48 million for Fiscal 2025 to Rs.518.44 million for Fiscal 2026, primarily as a result of an increase in interest income from Rs.187.49 million for Fiscal 2025 to Rs.205.45 million for Fiscal 20 26 and profit on sale of assets of Rs.112.45 million recognized in Fiscal 2026, on account of the sale of a school building previously classified as a non-current asset held for sale.

Total expenses. Total expenses increased by 70.68% from Rs.9,531.54 million for Fiscal 2025 to Rs.16,268.63 million for Fiscal 2026, primarily as a result of a decrease in the changes in inventories of finished goods (including stock-in-trade) and work-inprogress and an increase in employee benefits expenses, finance costs and other expenses.

Cost of construction and development. Cost of construction and development decreased by 1.80% from Rs.15,422.00 million for Fiscal 2025 to Rs.15,144.41 million for Fiscal 2026, primarily as a result of a decrease in other expenses allocated to project cost from Rs.5,226.31 million for Fiscal 2025 to Rs.2,682.74 million for Fiscal 2026, partially offset by an increase in construction materials and other expenses from Rs.6,450.49 million for Fiscal 2025 to Rs.9,404.41 million for Fiscal 2026 and an increase in finance costs allocated to project cost from Rs.1,966.09 million for Fiscal 2025 to Rs.2,284.75 million for Fiscal 2026.

Changes in inventories of finished goods (including stock-in-trade) and work-in-progress. Changes in inventories of finished goods (including stock-in-trade) and work-in-progress decreased by 64.54% from Rs.(8,962.06) million for Fiscal 2025 to Rs.(3,177.86) million for Fiscal 2026, primarily as a result of an increase in closing work-in-progress stock (i.e. accumulated cost of development of the project until revenue is recognized from the project) from Rs.61,357.85 million to Rs.77,318.95 million, partially offset by a decrease in closing finished goods stock from Rs.4,397.06 million to Rs.3,743.16 mill ion during the year.

Employee benefit expenses. Employee benefit expenses increased by 48.32% from Rs.660.40 million for Fiscal 2025 to Rs.979.53 million for Fiscal 2026, primarily as a result of an increase in salaries, wages and bonus from Rs.1,340.60 million for Fiscal 2025 to Rs.1,997.75 million for Fiscal 2026, which was primarily due to an increase in headcount and routine yearly increments and promotions.

Finance costs. Finance costs increased by 46.02% from Rs.788.61 million for Fiscal 2025 to Rs.1,151.55 million for Fiscal 2026, primarily as a result of an increase in interest on borrowings and others from Rs.2,660.59 million for Fiscal 2025 to Rs.3,140.20 million for Fiscal 2026 and unwinding of discount on liabilities from Rs.29.99 million for Fiscal 2025 to Rs.266.29 million for Fiscal 2026, partially offset by an increase in allocation to project cost from Rs.1,966.09 million for Fiscal 2025 to Rs.2,284.74 million for Fiscal 2026.

Depreciation and amortization expense. Depreciation and amortization expense increased by 190.58% from Rs.36.89 million for Fiscal 2025 to Rs.107.20 million for Fiscal 2026, primarily on account of an increase in the depreciation of tangible and intangible assets from Rs.209.60 million for Fiscal 2025 to Rs.247.01 million for Fiscal 2026, coupled with a decrease in the amounts allocated to project costs from Rs.172.71 million for Fiscal 2025 to Rs.139.81 million for Fiscal 2026.

Other expenses. Other expenses increased by 30.15% from Rs.1,585.70 million for Fiscal 2025 to Rs.2,063.80 million for Fiscal 2026, primarily as a result of a decrease in the amounts allocated to project costs from Rs.5,226.31 million for Fiscal 2025 to Rs.2,682.75 million for Fiscal 2026, and increase in advertising expenses from Rs.793.38 million for Fiscal 2025 to Rs.1,025.36 million in Fiscal 2026, increase in legal & professional expenses from Rs.578.51 million for Fiscal 2025 to Rs.877.84 million for Fiscal 2026 and development rights and related expense of Rs.282.31 million for Fiscal 2026. This was partially offset by a decrease in rates and taxes from Rs.4,027.69 million for Fiscal 2025 to Rs.2,227.43 million for Fiscal 2026 and increase in the amounts allocated to investment property from Rs.8.75 million for Fiscal 2025 to Rs.780.50 million for Fiscal 2026.

Total tax expenses. Total tax expenses decreased by 8.96% from Rs.419.08 million for Fiscal 2025 to Rs.381.52 million for Fiscal 2026, primarily as a result of a decrease in current tax from Rs.688.13 million for Fiscal 2025 to Rs.604.57 million for Fiscal 2026, along with a deferred tax credit of Rs.223.05 million for Fiscal 2026 as compared to a deferred tax credit of Rs.269.05 million for Fiscal 2025.

Restated net profit/(loss) for the year. As a result of the foregoing, we achieved a restated net profit of Rs.1,857.63 milli on for Fiscal 2026 as compared to a net profit of Rs.556.48 million for Fiscal 2025.

Fiscal 2025 compared to Fiscal 2024

Total income. Total income decreased by 56.88% from Rs.24,366.74 million for Fiscal 2024 to Rs.10,507.14 million for Fiscal 2025, primarily as a result of decrease in revenue from operations.

Revenue from operations. Revenue from operations decreased by 58.16% from Rs.24,088.65 million for Fiscal 2024 to Rs.10,077.66 million for Fiscal 2025, primarily as a result of decrease in revenue from sale of residential units in select towers of our Runwal Gardens project undertaken by our wholly-owned subsidiary, Runwal Residency Private Limited.

Other income. Other income increased by 54.43% from Rs.278.10 million for Fiscal 2024 to Rs.429.48 million for Fiscal 2025, primarily as a result of an increase in interest income from Rs.139.08 million for Fiscal 2024 to Rs.187.49 million for Fiscal 20 25 and increase in other non-operating income from Rs.139.02 million for Fiscal 2024 to Rs.241.99 million for Fiscal 2025.

Total expenses. Total expenses decreased by 58.19% from Rs.22,799.02 million for Fiscal 2024 to Rs.9,531.54 million for Fiscal 2025, primarily as a result of a decrease in the changes in inventories of finished goods (including stock-in-trade) and work-inprogress.

Cost of construction and development. Cost of construction and development increased by 10.40% from Rs.13,969.61 million for Fiscal 2024 to Rs.15,422 million for Fiscal 2025, primarily as a result of an increase in other expenses allocated to project cost from Rs.1,034.32 million for Fiscal 2024 to Rs.5,226.31 million for Fiscal 2025. This was partially offset by a decrease in construction material and other expenses from Rs.8,988.15 million for Fiscal 2024 to Rs.6,450.49 million for Fiscal 2025.

Changes in inventories of finished goods (including stock-in-trade) and work-in-progress. Changes in inventories of finished goods (including stock-in-trade) and work-in-progress decreased by 266.67% from Rs.5,377.08 million for Fiscal 2024 to Rs.(8,962.06) million for Fiscal 2025, primarily as a result of an increase in closing finished goods from Rs.3,684.27 million for Fiscal 2024 to Rs.4,397.06 million for Fiscal 2025, coupled with an increase in capitalised amount of work-in-progress from Rs.53,156.87 million for Fiscal 2024 to Rs.61,357.64 million for Fiscal 2025.

Employee benefit expenses. Employee benefit expenses increased by 44.67% from Rs.456.48 million for Fiscal 2024 to Rs.660.40 million for Fiscal 2025, primarily as a result of increase in salaries, wages and bonus from Rs.1,103.82 million for Fiscal 2024 to Rs.1,340.60 million for Fiscal 2025 which was primarily due to an increase in headcount and routine yearly increments and promotions.

Finance costs. Finance costs increased by 88.74% from Rs.417.82 million for Fiscal 2024 to Rs.788.61 million for Fiscal 2025, primarily as a result of increase in interest on inter-corporate deposits from Rs.13.80 million for Fiscal 2024 to Rs.233.05 million for Fiscal 2025, increase in interest on overdraft facility from Rs.64.05 million in Fiscal 2024 to Rs.229.54 million for Fiscal 2025 and increase on non-convertible debentures from Rs.34.34 million in Fiscal 2024 to Rs.204.90 million for Fiscal 2025.

Depreciation and amortization expense. Depreciation and amortization expense increased by 16.05% from Rs.31.79 million for Fiscal 2024 to Rs.36.89 million for Fiscal 2025, primarily on account of an increase in the depreciation of tangible and intangible assets from Rs.187.82 million for Fiscal 2024 to Rs.209.60 million for Fiscal 2025. This was partially offset by an increase in t he amounts allocated to project costs from Rs.156.03 million for Fiscal 2024 to Rs.172.71 million for Fiscal 2025.

Other expenses. Other expenses decreased by 37.72% from Rs.2,546.24 million for Fiscal 2024 to Rs.1,585.70 million for Fiscal 2025, primarily as a result of a decrease in advertising expense from Rs.1,099.11 million for Fiscal 2024 to Rs.793.38 million fo r Fiscal 2025 and brokerage and incremental cost from Rs.697.18 million for Fiscal 2024 to Rs.414.94 million for Fis cal 2025. This was partially offset by an increase in rates and taxes from Rs.1,197.79 million for Fiscal 2024 to Rs.4,027.69 million for Fiscal 2025, and in amounts allocated to project costs from Rs.1,034.32 million for Fiscal 2024 to Rs.5,226.31 million for Fis cal 2025.

Total tax expenses. Total tax expenses increased by 166.45% from Rs.(630.71) million for Fiscal 2024 to Rs.419.08 million for Fiscal 2025, primarily as a result of an increase in current tax expense from Rs.(668.42) million for Fiscal 2024 to Rs.688.13 million for Fiscal 2025, partially offset by a decrease in deferred tax credit from Rs.37.71 million for Fiscal 2024 to deferred tax ch arge of Rs.269.05 million for Fiscal 2025.

Restated net profit/(loss) for the year. As a result of the foregoing, we achieved net profit of Rs.556.48 million for Fiscal 2025 as compared to a net profit of Rs.937.00 million for Fiscal 2024.

Liquidity and Capital Resources

Our primary sources of liquidity include cash generated from operating activities, and from borrowings, both current and noncurrent, including term loans and proceeds from the issue of non-convertible debentures. As of March 31, 2026, we had cash and cash equivalents of Rs.2,012.64 million.

Our financing requirements are primarily for the construction and completion of our Ongoing Projects. We expect that cash flow from operating activities and borrowings will continue to be our principal sources of funds in the long-term. We evaluate our funding requirements periodically in light of our net cash flow from operating activities, the requirements of our business and operations, acquisition opportunities and market conditions. We expect that our cash flows from operating activities, borrowings and the Net Proceeds of the Issue will address our capital requirements for the next 12 months.

Cash Flows

Particulars	Fiscal 2026	Fiscal 2025	Fiscal 2024
		(Rs. in million)
Net cash generated from/(used in) operating activities	(1,807.13)	(1,981.36)	(5,494.82)
Net cash generated from/(used in) investing activities	(2,132.31)	(1,676.74)	2,514.86
Net cash generated from/(used in) financing activities	4,960.10	3,097.63	3,518.10
Net increase/(decrease) in cash and cash equivalents	1,020.72	(560.43)	538.10
Cash and cash equivalents at the beginning of the year/period	991.92	1,552.35	1,014.25
Cash and cash equivalents at the end of the year/period	2,012.64	991.92	1,552.35

Operating activities

Net cash used in operating activities was Rs.1,807.13 million for Fiscal 2026. We had a profit before tax of Rs.2,239.30 million for the year, which was primarily adjusted for finance costs of Rs.776.68 million, depreciation and amortisation of Rs.107.20 million, gratuity and compensated absences of Rs.82.81 million, and provision for impairment of Rs.5.00 million, which was partially offse t by interest income of Rs.205.45 million and sundry balances written back of Rs.70.57 million. This was further adjusted for working capital changes, which consisted primarily of an increase in inventories of Rs.13,971.70 million and an increase in other current liabilities of Rs.8,363.89 million, partially offset by a decrease in other current assets of Rs.1,134.51 million and an increase in trade payables of Rs.337.92 million. As a result, cash used in operating activities was Rs.1,010.96 million before adjusting for income tax paid of Rs.796.17 million.

Net cash used in operating activities was Rs.1,981.36 million for Fiscal 2025. We had a profit before tax of Rs.975.60 million fo r the year, which was primarily adjusted for finance costs of Rs.641.33 million, depreciation and amortisation of Rs.36.89 million, gratuity and compensated absences of Rs.27.43 million, provision for impairment of Rs.183.19 million, which was partially offset by interest income of Rs.187.49 million and sundry balances written back of Rs.175.12 million. This was further adjusted for working capital changes, which consisted primarily of an increase in inventories of Rs.6,567.80 million, an increase in other current liabilities of Rs.5,599.58 million, and an increase in trade payables of Rs.286.65 million. As a result, cash used in operating activities was Rs.1,643.67 million before adjusting for income tax paid of Rs.337.69 million.

Net cash used in operating activities was Rs.5,494.82 million for Fiscal 2024. We had a profit before tax of Rs.1,567.73 million for the year, which was primarily adjusted for finance costs of Rs.301.20 million, depreciation and amortisation of Rs.31.79 million, gratuity and compensated absences of Rs.19.31 million, partially offset by interest income of Rs.139.08 million, profit on sale of shares of Rs.1.70 million and sundry balances written back of Rs.48.39 million.

This was further adjusted for working capital changes, which consisted primarily of an increase in inventories of Rs.18,636.83 million, an increase in other current liabilities of Rs.11,065.24 million, an increase in trade payables of Rs.1,952.07 million and an increase in other current assets of Rs.818.68 million. As a result, cash used in operating activities was Rs.5,034.20 million before adjusting for income tax paid of Rs.460.62 million.

Investing activities

Net cash used in investing activities was Rs.2,132.31 million for Fiscal 2026. This was primarily due to the purchase of property, plant and equipment and intangible assets of Rs.2,316.21 million and investment in inter-corporate deposits of Rs.315.67 million, which was partially offset by proceeds from investments of Rs.234.58 million and interest received of Rs.195.26 million.

Net cash used in investing activities was Rs.1,676.74 million for Fiscal 2025. This was primarily due to the purchase of property, plant and equipment and intangible assets of Rs.751.09 million, investment in fixed deposits and security deposits of Rs.711.12 million, investment in inter-corporate deposits of Rs.155.09 million and purchase of investments of Rs.212.86 million, which was partially offset by interest received of Rs.144.20 million.

Net cash generated from investing activities was Rs.2,514.86 million for Fiscal 2024. This was primarily due to proceeds from inter-corporate deposits of Rs.3,451.25 million, proceeds from sale of investment of Rs.387.69 million and interest received of Rs.118.97 million, which was partially offset by the purchase of property, plant and equipment and intangible assets of Rs.1,283.32 million and investment in fixed deposits of Rs.165.56 million.

Financing activities

Net cash generated from financing activities was Rs.4,960.10 million for Fiscal 2026. This was primarily due to proceeds from non-current borrowings of Rs.16,839.33 million and proceeds from current borrowings of Rs.8,462.48 million, which was partially offset by repayment of non-current borrowings of Rs.18,156.10 million, repayment of current borrowings of Rs.1,180.21 million, and interest payments of Rs.2,729.00 million.

Net cash generated from financing activities was Rs.3,097.63 million for Fiscal 2025. This was primarily due to proceeds from non-current borrowings of Rs.15,107.49 million and proceeds from current borrowings of Rs.7,060.67 million, which was partially offset by repayment of non-current borrowings of Rs.11,074.71 million, repayment of current borrowings of Rs.5,804.17 million, and interest payments of Rs.2,191.65 million.

Net cash generated from financing activities was Rs.3,518.10 million for Fiscal 2024. This was primarily due to proceeds from non-current borrowings of Rs.5,961.56 million and proceeds from current borrowings of Rs.2,824.43 million, which was partially offset by repayment of non-current borrowings of Rs.2,638.49 million, repayment of current borrowings of Rs.593.63 million, and interest payments of Rs.2,035.77 million.

Financial indebtedness

As of March 31, 2026, we had outstanding borrowings (current and non-current) aggregating to Rs.29,091.28 million, which primarily consisted of secured term and car loans from banks and proceeds from the issue of unsecured non-convertible redeemable preference shares. For further details, see "Financial Indebtedness" on page 398. After adjusting for cash and cash equivalents, our net debt as of March 31, 2026, was Rs.27,781.10 million. Net debt refers to the sum of non-current borrowings, current borrowings, interest payable reduced by cash and cash equivalents.

Contingent liabilities

As at March 31, 2026, we recorded the following contingent liabilities in our Restated Consolidated Financial Information:

Particulars	Amount F in million)
Direct and indirect tax matters in dispute	6,292.78
Bank guarantees	21.66
Corporate guarantees?	18,400.00
Personal Guarantee Received	54,900.00
Claims by parties against the Group not acknowledged as debt	70.47
MahaRERA	1.27
Vendor disputes	-
Contractual Agreements	114.63
Total	79,800.81

Note:

(1) (i) Runwal Enterprises Limited has provided corporate guarantee to Induslnd Bank Limited towards financial assistance of Rs.4,000.00 million availed by M/s Runwal Real Estates Private Limited;

(ii) Runwal Commercial Plaza Pvt Ltd has provided corporate guarantee to HDFC capital Limited towards financial assistance of Rs.4,500.00 million availed by M/s Wheelabrator Realty Private Limited; and

(iii) Horizon Projects Private Limited has provided corporate guarantee to ICICI Bank Limited towards financial assistance of Rs.9,900.00 million availed by Runwal Residency Private Limited.

For details, see "Restated Consolidated Financial Information" on page 283.

Capital and other commitments

We have contracts remaining to be executed on capital account of Rs.1,998.70 million as at March 31, 2026, Rs.1,961.95 million as at March 31, 2025 and Rs.2,066.79 million as at March 31, 2024.

Capital expenditure.