1. Industry structure and developments
BUSINESS OVERVIEW
Our Company is a reputed company having its presence in the construction industry.
Company has delivered a number of Projects which includes Residential Housing Projects and
Commercial Building Projects. Our residential portfolio currently covers projects catering
to customers across all income groups. We believe that we have established a successful
track record in the real estate industry in Rajasthan (Neemrana) by developing versatile
projects through our focus on innovative architecture, strong project execution and
quality construction.
GLOBAL ECONOMY
In response to disruptions from the global pandemic, many central banks in emerging
market and developing economies employed asset purchase programs for the first time in
their history. These programs were successful in lowering bond yields without triggering
currency depreciations.
Global growth is expected to slump from 5.9 percent in 2022 to 3.9 percent in 2023-
significantly lower than 4.1 percent that was anticipated in January. It is expected to
hover around that pace over 2023-24, as the war in Ukraine disrupts activity, investment,
and trade in the near term, pent-up demand fades, and fiscal and monetary policy
accommodation is withdrawn. As a result of the damage from the pandemic and the war, the
level of per capita income in developing economies this year will be nearly 5 percent
below its pre pandemic trend.
INDIAN ECONOMY
Capital outflows and rising import bills will weigh on the current account balance and
currency valuation. Despite the external shocks, Indias underlying economic fundamentals
are strong and despite the short-term turbulence, the impact on the long-term outlook will
be marginal Growth-enhancing policies and schemes, increased infrastructure spending,
rising exports, rapid digitization, and spill-over effects of geopolitical developments
will likely aid in growth. With economic momentum resuming, and the long-term advantages
of supply-side reforms in the works, the Indian economy is poised to grow at a
considerable pace.
INDUSTRY REVIEW
The real estate sector is one of the most globally recognized sectors. The real estate
sector comprises four sub sectors - housing, retail, hospitality and commercial. The
growth of this sector is well complemented by the growth of the corporate environment and
the demand for office space as well as urban and semi-urban accommodations. The
construction industry ranks third among the 14 major sectors in terms of direct, indirect
and induced effects in all sectors of the economy.
After the unlocking process was initiated in the third quarter of 2020, both the
residential and office Government of India along with the governments of respective States
has taken several initiatives to encourage development in the sector. The Smart City
Project, with a plan to build 100 smart cities, is a prime opportunity for real estate
companies. Below are some of the other major Government initiatives:
? The Atmanirbhar Bharat 3.0 package announced by Finance Minister Ms. Nirmala
Sitharaman in November 2020 included income tax relief measures for real estate developers
and homebuyers for primary purchase/sale of residential units of value (up to Rs. 2 crore
from November 12, 2020 to June 30, 2021).
? In October 2020, the Ministry of Housing and Urban Affairs (MoHUA) launched an
affordable rental housing complex portal.
? In order to revive around 1,600 stalled housing projects across top cities in the
country, the Union Cabinet has approved the setting up of Rs. 25,000 crore alternative
investment fund (AIF). Under Pradhan Mantri Awas Yojana (Urban) (PMAY (U)),1.12 crore
houses have been sanctioned in urban areas, creating 1.20 crore jobs. ? Government has
created an Affordable Housing Fund (AHF) in the National Housing Bank (NHB) with an
initial corpus of Rs 10,000 crore (US$ 1.43 billion) using priority sector lending short
fall of banks/financial institutions for micro financing of the HFCs.
In 2014, the Securities and Exchange Board of India (SEBI) has given its approval for
the Real Estate Investment Trust (REIT) platform, which has allowed all kind of investors
to invest in the Indian real estate market. It would create an opportunity worth Rs.1.25
trillion (US$ 19.65 billion) in the Indian market in the coming years. Responding to an
increasingly well-informed consumer base and bearing in mind the aspect of globalisation,
Indian real estate developers have shifted gears and accepted fresh challenges. The most
marked change has been the shift from family-owned businesses to that of professionally
managed ones. Real estate developers, in meeting the growing need for managing multiple
projects across cities, are also investing in centralised processes to source material and
organise manpower and hiring qualified professionals in areas like project management,
architecture and engineering.
The improved sales momentum has lifted confidence among realty developers, pushing them
to launch more projects as indicated by the rise in new offerings across markets.
2. OPPORTUNITIES AND CHALLENGES
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; ? Concern due to
ongoing pandemic situation; ? Increased cost of manpower; ? Rising cost of construction;
? Growth in auxiliary infrastructure facilities; and ? Over regulated environment.
COMPANY STRENGTHS
Your Company continues to capitalize on the market opportunities by leveraging its key
strengths. These include:
1. Brand Reputation: Enjoys higher recall and influences the buying decision of the
customer. Strong customer connects further results in higher premium realizations.
2. Execution: Possesses a successful track record of quality execution of projects
with contemporary architecture.
3. Strong cash flows: Has built a business model that ensures continuous cash flows
from their investment and development properties ensuring a steady cash flow even during
the adverse business cycles.
4. Significant leveraging opportunity: Follows conservative debt practice coupled
with enough cash balance which provides a significant leveraging opportunity for further
expansions.
5. Outsourcing: Operates an outsourcing model of appointing globally renowned
architects/contractors that allows scalability and emphasizes contemporary design and
quality construction a key factor of success.
6. Transparency: Follows a strong culture of corporate governance and ensures
transparency and high levels of business ethics.
7. Highly qualified execution team: Employs experienced, capable and highly
qualified design and project management teams who oversee and execute all aspects of
project development.
3. Segment-wise or product-wise performance
During the year under review, since company is being working in a single segment
therefore the specific performance does not stand eligible.
4. Outlook
The presence of a stable government at the center will be a major catalyst in taking
major decisions which would push forward the pace of reforms and thereby directly
improving the macro-economic environment. It is now being forecasted that in the near
future, the Indian economy will become the fastest growing emerging market.
The Government is looking at easing investment conditions in India and focusing on
project clearances. Also, 2023 is expected to see a rush of foreign direct investments
(FDI) coming into India supported by FII inflows, thanks to liberalizing the defense,
insurance and construction sectors etc. Looking at the Indian economy the company has
plans to diversify its business in future.
5. Risks and areas of concern
Our strength is our determination and team work, weakness is the low equity base,
opportunities are multiples and threats are the vibrations in the economy and government
policies.
In any business, risks and prospects are inseparable. As a responsible management, the
Companys principal endeavor is to maximize returns. The Company continues to take all
steps necessary to minimize its expenses through detailed studies and interaction with
experts.
6. Internal control systems and their adequacy
The Company has carried out the internal audit in-house and has ensure that recording
and reporting are adequate and proper, the internal controls exist in the system and that
sufficient measures are taken to update the internal control system. The system also
ensures that all transaction are appropriately authorized, recorded and reported.
Exercises for safeguarding assets and protection against unauthorized use are undertaken
from time to time. The Companys audit Committee reviewed the internal control system. All
efforts are being made to make the internal control systems more effective. All these
measures are continuously reviewed by the management and as and when necessary
improvements are affected.
7. Discussion on financial performance with respect to operational performance
The financial statements have been prepared in compliance with the requirements of the
Companies Act, 2013 and Generally Accepted Accounting Principles in India. Further, the
financial performance during the year under reference has been impressive in terms of
sales. Even though there has been a decent increase in the turnover, the volume of profits
has also increased as compared to last year.
8. Material developments in human resources/industrial relations front, including
number of people employed.
The Company had sufficient numbers of employees at its administrative office. The
company recognizes the importance of human value and ensures that proper encouragement
both moral and financial is extended to employees to motivate them. The company enjoyed
excellent relationship with workers and staff during the last year.
9. Cautionary Statement
The statements in the "Management Discussion and Analysis Report" section
describes the Companys objectives, projections, estimates, expectations and predictions,
which may be "forward looking statements" within the meaning of the applicable
laws and regulations. The annual results can differ materially from those expressed or
implied, depending upon the economic and climatic conditions, Government policies and
other incidental factors.
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