Samor Reality Ltd Management Discussions

Annexure - D

GLOBAL ECONOMIC OVERVIEW

Real estate sector in India is expected to reach US$ 1 trillion in market size by 2030, up from US$ 200 billion in 2021 and contribute 13% to the countrys GDP by 2025. Retail, hospitality, and commercial real estate are also growing significantly, providing the much-needed infrastructure for Indias growing needs. The Indian real estate market is projected to experience a substantial increase, potentially reaching a value of US$ 5-7 trillion by the year 2047, with the possibility of surpassing US$ 10 trillion.

Housing sales across the top seven Indian cities saw a slight dip of 4% in 2024, with around 4.59 lakh units sold compared to 4.76 lakh in 2023, as per ANAROCK data. In the first quarter of CY25 (January-March), Indias residential real estate market experienced a notable slowdown, with total housing sales across the top seven cities declining by 28% year-on-year to approximately 93,280 units, down from over 1.30 lakh units in CY2024.

In FY23, Indias residential property market witnessed with the value of home sales reaching an all-time high of Rs. 3.47 lakh crore (US$ 42 billion), marking a robust 48%fYoY increase. The volume of sales also exhibited a strong growth trajectory, with a 36% rise to 379,095 units sold. Indian real estate developers operating in the countrys major urban centers are poised to achieve a significant feat in 2023, with the completion of approximately 558,000 homes.

In 2023, demand for residential properties surged in the top 8 Indian cities, driven by mid-income, premium, and luxury segments despite challenges like high mortgage rates and property prices. Indias physical retail landscape is poised for a substantial boost, with nearly 41 million sq. ft of retail developments set to be operational between 2024 and 2028 across the top 7 cities, encompassing projects in various stages from construction to planning.

For the first time, gross leasing in Indias top 7 markets surpassed the 60 million sq ft mark, reaching an impressive total of 62.98 million sq ft, marking a substantial 26.4% increase compared to the previous year. Notably, the December quarter emerged as the busiest quarter on record, with gross leasing hitting 20.94 million sq ft.

CBRE anticipated 14% increase in gross leasing transactions for office spaces across nine major cities in calendar year 2024, with a projected total of 70 million square feet. This growth is attributed to increased demand from both global and domestic corporate entities. Technology companies held the highest share in leasing activity at 22% during first quarter of 2024.Engineering and manufacturing (E&M) companies accounted for 13%, and banking, financial services and insurance account for 12%. Flexible space operators increase by 48%, showcasing their notable contributions.

According to Savills India, real estate demand for data centers is expected to increase by 15-18 million sq. ft. by 2025. Indias office sector had a record-breaking 2024, clocking 89 million sq. ft. of gross leasing across the top 8 cities the highest ever. This marks a 19% jump over 2023, surpassing the previous peak by 14 million sq. ft.

In 2023, office absorption in the top seven cities stood at 41.97 million Sq. ft. and Gross Leasing Volume is at 62.98 million sq. ft.

Fresh real estate launches across Indias top seven cities grabbed a 41% share in the first quarter of 2023 (January- March), marking an increase from the 26% recorded in the same period four years ago. Out of approximately 1.14 lakh units sold across the top seven cities in the first quarter of 2023, over 41% were fresh launches.

In 2021-22, the commercial space was expacted to record increasing investments. For instance, in October 2021, Chintels Group announced to invest Rs. 400 crore (US$ 53.47 million) to build a new commercial project in Gurugram, covering a 9.28 lakh square feet area. The transactions of commercial real estate doubled and reached 1.5 million sq. ft. in Q1 of 2023.

According to the Economic Times Housing Finance Summit, about three houses are built per 1,000 people per year compared with the required construction rate of five houses per 1,000 population. The current shortage of housing in urban areas is estimated to be ~10 million units. An additional 25 million units of affordable housing are required by 2030 to meet the growth in the countrys urban population.

OPPORTUNITIES AND THREATS

Opportunities

As India awaits policy reforms to pick up speed, your Company firmly believes that the demand for Real Estate in a country like India should remain strong in the medium to long term. Your Companys well accepted brand, contemporary architecture, well designed projects in strategic locations, strong balance sheet and stable financial performance even in testing times make it a preferred choice for customers and shareholders. Your Company is ideally placed to further strengthen its development potential by acquiring new land parcels.

Challenges

While the management of your Company is confident of creating and exploiting the opportunities, it also finds the following challenges:

• Unanticipated delays in project approvals;

• Availability of accomplished and trained labour force;

• Increased cost of manpower;

• Rising cost of construction lead by increase in commodity prices;

• Growth in auxiliary infrastructure facilities; and

• Over regulated environment.

Segment wise Performance

The Company is operating only in one segment. The turnover/performance of the Company has been disclosed in the Directors report under the Head "Review of Operations, sales and working results."

Recent Trend and Future Outlook

Your Company remains committed to upholding the highest standards of governance, transparency, and ethical practices. With India racing towards growth and becoming a strong economy, we look forward to emerge as a strong, reliable, and sustainable company. Together, we shall embrace the future with optimism, determination, and the desire to build a brighter tomorrow.

Risks and Concerns

Market price fluctuation

The performance of your Company may be affected by the sales of its projects. These prices are driven by prevailing market conditions, the nature and location of the projects and other factors such as brand, reputation and the design of the projects. Your Company follows a prudent business model and tries to ensure steady cash flow even during adverse pricing scenario

Sales volume

The volume of bookings depends on the ability to design projects that will meet customer preferences, getting various approvals in time, general market factors, project launch and customer trust in entering into sale agreements well in advance of receiving possession of the projects. Your Company sells its projects in phases from the time it launches the project, based on the type and scale of the project and depending on market conditions

Execution

Execution depends on several factors which include labour availability, raw material prices, receipt of approvals and regulatory clearances, access to utilities such as electricity and water, weather conditions and the absence of contingencies such as litigation. Your Company manages the adversities with cautious approach, meticulous planning and by engaging established and reputed contractors. As your Company imports various materials, at times execution is also dependent upon timely shipment and clearance of the material.

Financing costs

The acquisition of land and development rights needs substantial capital outflow. Inadequate funding resources and high interest costs may impact regular business and operations. Your Company has always tried to build sufficient reserves resulting out of operating cash flows to take advantage of any land acquisition or development opportunity.

Internal Control Systems and their Adequacy

The Company has adequate internal audit and control systems. Internal auditors comprising of Chartered Accountants have been entrusted the job to conduct regular internal audits at all units and report the lapses, if any, to the management. Both Internal auditors and Statutory auditors independently evaluate the adequacy of internal control system. Based on the audit observations and suggestions, follow up and remedial measures are being taken including review and increase in the scope of coverage, wherever necessary. The Audit Committee of Directors in its periodical meetings, review the adequacy of internal control systems and procedures and suggest areas of improvements.

Details of Significant Changes in Key Financial Ratios

Particulars	As at 31st March 202 S	As at 31st March 2024
(i) Current Ratio Current Assets/Current Liabilities
Current Ratio (In Times)	4.45	6.08
Current Assets	8.489 36	5.865 73
Current liabilities	1.906 16	964 04
H Change from Previous Period/ Year	-26 80%
Comment: There is Significant increase in Short term borrowings compared to previous year, last year the short term borrowmg was Rs SI 1.68 Lacs and the same in the current year is Rs 1597.68 Lacs. So because of that the Current ratio has decreased
(ii) Debt- Equity Ratio Total Debt/ Shareholders Equity
Debt - Equity Ratio (in Times)	0.67	0.49
Total Debts	4.094 99	2.399 41
Share holders Equity	6,117 84	4.870 95
% Change from Previous Period/ Year	35.88%	.

Comment: There ts significant meres* in the debt, as the company is into the business of construction & development of residential flats so that continuous working capital requirment is fufilied by the borrowing money from different entrtles/Pvt Ltd Companies.

(iii) Debt Service Coverage Ratio ( DSCR) - Earnings Available for debt Service/ Debt Service

Debt Service Coverage Ratio (in Times)	0.84	0.60
Earnings before exceptional items, interest and tax (EBlT)	375 11	77 88
[Franc# cost principal repayments made durxig the period for non-current borrowvigs (including current maturities)]	448 83	129.38
% Change from Previous Period/ Year	38.84%	-

Comment: Movement m ratio due to improvement m EBIT.

(hr) Return on Equity Ratio Net Profit After Tax/ (Share holders Equity - Mtsc Expenses)

Return on Equity Ratio %	-1.14%	-0.78%
Net profit after taxes less preference dividend	<62 71)	<29 74)
Average shareholders equity	5.494 40	3.796.28
% Change from Previous Period/ Year	45 68%	-

Comment: There is a decrease in ratio on account of improvement in net profit as compared to previous year but due to issue of right shares there is decrease ?n ROE.

(v) Inventory Turnover Ratio = Cost of Goods Sold/ Average inventory
Inventory Turnover Ratio (in Times)	0-38	0.73
Cost of Goods Sold	2,654 73	2.980 78
Average inventory	6.917 79	4.10003
% Change from Previous Period/ year	-47.21%	-
Comment: There is no sales in the current financial year
(vi) Trade Receivables Turnover Ratio < Net Credit Sales/ Average Trade Reoevabies
Trade Receivables Turnover Ratio (in Times)	0	0^7
Net credit sales	-	6.23
Average Trade receivable!	-	13 34
% Change from Previous Period/ year	-100 00%	-
Comment: No sale m the Current Period
(vii) Trade Payable Turnover Ratio • Net Credit Purchase/ Average Trade Payables
Trade Payable Turnover Ratio (in Times)	6.83	7.80
Net credit purchases	2,163 85	2,813 44
Average Trade payables	316 86	36053
% Change from Previous Period/ year	-12 49%	-
Comment: Decrease in ratio due to increase trade payables as compared to previous year
(viB) Net Capital Turnover Ratio Revenue Prom Operations/ Average Working Capital
N?t Capital Turnover Ratio (in Times)	-	0.0017
Revenue from Operations	*	6
Average Working Capital	5,742	3,602
% Change from Previous Period/ year	-100 00%	-
Comment: Decrease due to no in revenue from operation
(ia) Net Profit Ratio = Net Profit After Tax/ Revenue from Operations
Net Profit Ratio (in %)	0.00%	-477.37%
Profit Attar Tax	(62 71)	(29.74)
Revenue From Opearations	*	6.23
H Change from Previous Period/ year	-100 00H	-
Comment Decrease due to no Revenue from Operation
(a) Return on Capital Employed ? Earnings before Interest A Tax/ Total Assets less current liability excluding short term borrowing
Return on Capital Employed (in %	6.13%	1.60%
Earnings before interest & Tax	375 11	77.88
Capital Employed	6,117 84	4.870 95
% Change from Previous Period/ year	263.48%	-
Comment: There *s a increase m ratio on account of increase m capital employed

Financial Performance with respect to Operational Performance

The financial performance of the company for the year 2024-2025 is described in the Director s report under the head "Review of Operations, sales and working results."

Material Developments in Human Resources and Industrial Relations Front

The Company has continued to give special attention to Human Resources/ Industrial relations development. Industrial relations remained cordial throughout the year and there was no incidence of strike, lock out etc.

Cautionary Statement

Statement in this Management Discussion and Analysis Report, Describing the Companys objectives, estimated and expectations may constitute "Forwarding Looking Statements" within the meaning of applicable laws or regulations. Actual results might differ materially from those either expressed or implied.

	For and on behalf of Board of Directors
	Samor Reality Limited
Date: 5th September 2025	Birjukumar Ajitbhai Shah	Jagrutiben Birjubhai Shah
Place: Ahmedabad	Managing Director & CFO	Whole Time Director
	DIN: 02323418	DIN: 02334894