Shreeshay Engineers Ltd Management Discussions

The management of Shreeshay Engineers Limited is pleased to present the Management Discussion and Analysis (MD&A) report, which provides an in-depth overview of the Companys performance, operations, and strategic direction for the financial year 2025-26.

As an Expert in the field of real estate construction and engineering solutions, Shreeshay Engineers continues to deliver comprehensive and innovative services that meet the evolving needs of the industry. This report aims to offer stakeholders valuable insights into the Companys business activities, financial performance, market trends, and the broader economic and industry landscape in which we operate.

Our focus remains on operational excellence, growth, and sustainability, and this report highlights the key achievements, challenges, and opportunities faced during the year under review.

BUSINESS OVERVIEW

Your Company operates in the construction and engineering space. Your Company undertakes civil and engineering, procurement and construction (EPC) works, engineering and technical services, and real estate development, drawing on a common base of project management capability, technical resources and contracting relationships. These activities are managed and reviewed together as a single line of business. Our focus remains on selective participation in opportunities where we can apply our execution experience, on prudent cost management, and on maintaining a sound financial position, while continuing to deliver services that meet the evolving requirements of the sectors in which we operate.

INDUSTRY STRUCTURE & DEVELOPMENT:

The Company operates within the real estate and engineering sector, which encompasses engineering, procurement and construction (EPC) contracting, civil and infrastructure works, engineering and technical consultancy services, and real estate development. These activities are closely inter-linked and share a common base of project management capability, technical resources and contracting relationships. The sector remains an important contributor to economic activity and employment, and is among the larger sectors in terms of its direct and indirect linkages with the wider economy. Demand across its various segments is driven principally by public and private capital expenditure on infrastructure, by urbanisation and the associated requirement for residential, commercial and industrial space, and by the pace of policy and regulatory reform. Activity levels have generally been supported in recent periods by sustained emphasis on infrastructure creation, though conditions vary considerably between segments and between geographies. The industry continues to be characterised by a large number of participants, ranging from small regional contractors to integrated national players, and by a gradual shift towards more organised and professionally managed operations, greater adoption of technology in design and project execution, and increasing attention to sustainability in construction practice.

MARKET SIZE

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.

Indias luxury housing market witnessed a remarkable surge in H1 2025, with sales of 7,000 homes priced between Rs. 4-6 crore (US$ 466,091-699,137), marking an 85% YoY increase, according to a joint report by CBRE South Asia and Assocham.

Indias real estate market witnessed an unprecedented land acquisition spree in H1 2025 (January-June 2025), with 2,898 acres transacted across 76 deals, surpassing the 2,515 acres across 133 deals recorded in the whole of 2024, according to Anarocks report. As of Q3 2025, Indias real estate sector recorded a historic 42 transactions worth Rs. 25,375 crore

(US$ 2.9 billion), marking the highest quarterly deal volume on record and signaling strong institutional investment and market momentum.

Indias housing market ranked 15th globally in Q1 2025 (January-March) with 7.7% annual price growth, driven by strong demand, rising incomes, investor confidence, and stable interest rates.

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 accounted 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.

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.

OUTLOOK:

India remains among the faster-growing major economies globally, and the construction and engineering sector, spanning infrastructure, industrial and civil works, engineering services and real estate development, continues to play a significant role in economic activity, employment generation and capital formation. Sustained public and private investment in infrastructure, together with continuing urbanisation and industrial capacity creation, is expected to support demand across the sector over the medium term.

The sector has evolved considerably in recent years. Participants have moved from largely family-run operations towards more professionally managed structures, with greater investment in centralised procurement, project management systems and qualified technical personnel across engineering, design and execution functions. The broadening of financing avenues, including through instruments that allow wider investor participation in infrastructure and real estate assets, has also improved access to capital for the sector as a whole. Alongside this, demand for organised project execution capability and for contractors able to offer integrated engineering and construction solutions has continued to grow.

The Company will continue to evaluate opportunities across construction contracting, engineering services and real estate development, with an emphasis on selective participation, prudent cost management and the maintenance of a sound financial position. The Companys prospects remain dependent on general economic conditions, the level of capital expenditure in the sector and the availability of suitable opportunities on acceptable commercial terms.

OPPORTUNITIES IN THE REAL ESTATE SECTOR

Increasing Investments

Indias real estate sector reached a milestone in 2025, with institutional investments soaring to US$

10.50 billion (Rs. 91,96,900 crore) across 78 transactions, led by a 52% surge in domestic capital contribution, led by a 52% surge in domestic capital contribution and sustained demand in office and residential segments, reflecting continued investor confidence despite global uncertainties.

Private equity (PE) and venture capital (VC) investments totalled Rs. 455.73 lakh crore (US$ 49.30 billion) in the first 11 months of 2025, accounting for about 88.00% of the Rs. 519.93 lakh crore (US$ 56.20 billion) deployed in 2024, highlighting sustained investor momentum and faster capital deployment cycles, according to Anarock capital

Robust Demand

Indias housing market is shifting as more buyers seek larger, premium homes. The Anarock H1 2025 survey shows 36% now prefer properties priced between Rs. 90 lakh-1.5 crore (US$ 1,02,052-

1,70,087), up from 18% before Covid-19.

In 2026 Office leasing activity is projected to remain robust, with net absorption levels expected to record near-about 55 MSF.

Luxury home demand in India remained strong in 2025, with sales of Rs. 4 crore (US$ 0.5 Million) and above rising nearly 28% YoY across seven major cities.

In Q1 2025, 1,930 luxury homes were sold across Indias top seven cities, a 28% jump from the 1,510 units sold in the same period the previous year.

Technological Advancements:

Technology is revolutionizing the real estate sector with the rise of smart homes, digital property management tools, and online marketplaces, providing opportunities for enhanced value and efficiency in the market.

There is growing demand for green and sustainable buildings, driven by consumer preferences and regulatory requirements, offering opportunities for developers focused on eco-friendly construction.

Expanding Middle Class and Rising Incomes:

Rising incomes, especially in emerging markets, are fueling demand for housing, particularly in the residential sector.

As wealth increases among certain population segments, there is a growing demand for luxury and premium real estate, presenting lucrative opportunities in high-end residential and commercial markets.

Attractive Opportunities

ICRA expects new project launches across the top seven cities to rise by 6-9% in FY2026, reaching around 620-640 million square feet

Average home prices rose by 13-15% in FY25, and theyre expected to climb another 3 5% in FY26, a sign that demand remains strong and developers continue to hold pricing power.

Private market investor, Blackstone, which has significantly invested in the Indian real estate sector worth Rs. 3.8 lakh crore (US$ 50 billion), is seeking to invest an additional Rs. 1.7 lakh crore (US$ 22 billion) by 2030

Policy Support

The Government has allowed FDI of up to 100% for townships and settlements development projects.

The Union Budget 2026-27 emphasises infrastructure-led growth, with public capital expenditure increased in FY27 (2026 27) to Rs. 12.20 lakh crore (US$ 138.03 billion) from Rs. 11.20 lakh crore (US$ 126.73 billion) in FY26 (2025 26).

The National Real Estate Policy 2025 introduced a major reform with a unified single-window clearance system for real estate projects, aimed at streamlining approvals and reducing project delays by up to 40%. The policy also incentivizes green-certified developments with tax benefits and subsidies to promote sustainable construction

These opportunities, coupled with robust demand and supportive government policies, position the real estate sector for sustained growth and development in the coming years.

THREATS IN THE REAL ESTATE SECTOR

Economic Uncertainty and Market Volatility:

Recession and Economic Slowdown: Economic downturns can lead to reduced demand for real estate, lower property values, and higher vacancy rates, negatively impacting returns.

Interest Rate Fluctuations: Rising interest rates can increase the cost of borrowing, making it more expensive for both developers and buyers to finance real estate projects, potentially slowing down market activity.

Regulatory Risks:

Stringent Government Regulations: New regulations aimed at curbing property speculation, increasing taxes, or enforcing stricter environmental standards can add costs and complexity to real estate projects.

Changes in Zoning Laws: Sudden changes in zoning laws or land use regulations can disrupt planned developments and affect property values.

Environmental and Climate Risks:

Natural Disasters: Properties in areas prone to natural disasters like floods, hurricanes, and earthquakes face significant risks, including damage, higher insurance costs, and potential devaluation.

Climate Change Impact: Rising sea levels, extreme weather events, and shifting climate patterns pose long-term risks to real estate, particularly in coastal and low-lying areas.

Market Saturation and Oversupply:

Overbuilding: In some regions, particularly in urban centers, there is a risk of oversupply in both residential and commercial real estate markets. This can lead to lower occupancy rates, reduced rental yields, and declining property values.

Declining Demand in Certain Segments: For example, the rise of remote work has decreased demand for traditional office spaces, while changes in retail behavior, such as the growth of e-commerce, have impacted the demand for physical retail spaces.

Technological Disruption:

Rapid Technological Changes: While technology offers opportunities, it also poses threats. For instance, the rapid pace of technological change can render existing buildings obsolete, especially if they lack the infrastructure to support modern amenities like high-speed internet or smart home features.

Cybersecurity Risks: As real estate transactions and property management increasingly move online, the sector faces growing risks from cyberattacks and data breaches, which can lead to financial losses and reputational damage.

Social and Demographic Shifts:

Aging Population: In some regions, an aging population can lead to declining demand for certain types of real estate, such as family homes, while increasing demand for senior living facilities.

Changing Consumer Preferences: Shifts in lifestyle preferences, such as the increasing desire for flexible living arrangements or the preference for rental over ownership, can impact traditional real estate markets.

COMPETITION:

The construction and engineering sector in which we operate is both highly competitive and fragmented, with competition arising from a diverse range of participants from small regional contractors and specialist service providers to large integrated players operating across engineering, procurement and construction, infrastructure works and real estate development. Organized companies within the sector seek to differentiate themselves by delivering high-quality, time-sensitive and value-added services across the project lifecycle.

We believe that the key factors driving competition in the sector include pricing, technical capability, quality of execution, timely project delivery and reliability. Our competitive position rests on being a knowledge-driven organisation with experience across construction contracting, engineering services and real estate development, which allows us to approach opportunities across these related activities. We remain committed to completing assignments on schedule and to a consistent standard of quality, so as to meet the requirements and expectations of our clients

SEGMENT-WISE OR PRODUCT-WISE PERFORMANCE:

The Company is engaged in the business of real estate construction and engineering focused solutions, accordingly this is the only single reportable segment.

DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE.

The Financial Results of the Company for the year ended on 31st March, 2026 are as follows:

Particulars	Year ended March 31, 2026	Year ended March 31, 2025
Total Income	200.12	150.12
Total Expense	168.08	130.08
Profit before extraordinary items and tax	32.04	20.03
Extraordinary items	-	-
Profit before tax	32.04	20.03
Tax Expense	8.65	6.49
Net Profit After Tax	23.38	13.54
Earnings Per Equity Share	0.18	0.10

REVIEW OF OPERATIONS:

The Company is engaged in the business of providing real estate construction and engineering focused solutions. The total income of the Company during the year under review was Rs. 200.12 (Amount in Lakhs) as compared to Rs. 150.12 (Amount in Lakhs) during the previous year. During the year under review the Company has earned net profit of Rs 23.38 (Amount in Lakhs) as compared to profit of

Rs. 13.54 (Amount in Lakhs) during previous year.

RISKS AND CONCERNS

The principal risks to which the Company is exposed include the cyclicality of demand in the construction and real estate sectors; competitive pressure on pricing and margins; the risk of delay or cost escalation in project execution; concentration of revenue in a limited number of transactions in any given period; credit risk on receivables; and changes in the regulatory, taxation and environmental framework applicable to the sector. The Company also has certain tax matters and a legal proceeding outstanding, the details of which are set out in the notes to the financial statements. The Board reviews the Companys risk profile periodically and, in its opinion, there is presently no risk which threatens the existence of the Company.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:

Your Company has an effective internal control and risk-mitigation system, which are constantly assessed and strengthened with new/revised standard operating procedures. The Companys internal control system is commensurate with its size, scale and complexities of its operations. The internal and operational audit is entrusted to M/s. DGMS & Co., Chartered Accountants, (FRN: 0112187W), a reputed firm of Chartered Accountants. The main thrust of internal audit is to test and review controls, appraisal of risks and business processes, besides benchmarking controls with best practices in the industry. The Audit Committee of the Board of Directors actively reviews the adequacy and effectiveness of the internal control systems and suggests improvements to strengthen the same. The Company has a robust Management Information System, which is an integral part of the control mechanism. The Audit Committee of the Board of Directors, Statutory Auditors and the Business Heads are periodically apprised of the internal audit findings and corrective actions taken. Audit plays a key role in providing assurance to the Board of Directors. Significant audit observations and corrective actions taken by the management are presented to the Audit Committee of the Board. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee.

ENVIRONMENT AND SAFETY:

The Company is conscious of the importance of environmentally clean and safe operations. The

Companys policy requires conduct of operations in such a manner, so as to ensure safety of all concerned, compliances of environmental regulations and preservation of natural resources.

HUMAN RESOURCES:

Your Company has team of qualified and dedicated personnel who have contributed to the consolidation of the operations of your Company. Your Companys industrial relations continued to be harmonious during the year under review. Your Company has succeeded in attracting and retaining key professional and intends to continue to seek fresh talents to further enhance and grow our business.

KEY FINANCIAL RATIOS:

(Disclosure of the following ratio changed 25% or more as compared to the previous year)

		Ratio			Reasons for Differences, if Difference is More than 25%.
Sr. No.	Ratio Analysis	31-Mar-26	31-Mar-25	Difference
1	Current Ratio Debt Equity	3.00	1.38	117.54%	An increase in current assets & independent drop in current liabilities
2	Ratio Debt Service	NA	NA	NA	-
3	Coverage Ratio Return on	NA	NA	NA	-
4	Equity Ratio Inventory	0.97%	0.57%	71.3%	-
5	Turnover Ratio	NA	NA	NA	-
6	Trade Receivables turnover ratio	0.55	0.15	255.81%	A massive acceleration in cash collection cycles, or a shift towards strict credit control policies.
7	Trade payables turnover ratio	0.46	0.13	260.83%	An increase in overall procurement/purchases (fuel, operational expenses, materials) during the year that outpaced the outstanding closing liability balances.
8	Net capital turnover ratio	0.23	0.37	-36.71%	It indicates that more capital is locked up in liquid assets/working capital cycles rather than being aggressively turned over into active sales revenue.
9	Net profit ratio	14.67%	10.52%	39.43%	Improved operational efficiency, better pricing power, or effective cost- cutting strategies reducing the Cost of Goods Sold (COGS) and administrative overheads.

Return on Net Worth Ratio

(Amount in Rs. Lakhs)

Ratio	Numerator	Denominator As	at March, 2026	31st As at March, 2025	31st % Change	Reason for Variance
Return on Worth	Net Net Profit	Net (Total Equity)	Worth 0.97%	0.57%	71.00%	Increase is mainly due to a sharp rise in Net Profit (Rs. 23.38 lakhs vs Rs. 13.54 lakhs, up 72.7%), while Net Worth remained largely

Workings

Particulars	FY 2025-26 (Rs. in Lakhs)	FY 2024-25 (Rs. in Lakhs)
Net Profit (as per Statement of Profit & Loss)	23.38	13.54
Net Worth (Total Equity, closing balance)	2,414.92	2,391.54
Return on Net Worth (%)	0.97%	0.57%

CAUTIONERY STATEMENT:

Statements in this report describing the Companys objective, expectations or predictions may be optimistic statements within the meaning of applicable securities laws and regulations. The actual result may differ materially from those expressed in the statements. Important factors that could influence the companys operations include economic conditions affecting demand / supply price condition in the domestic markets in which the company operates, changes in the government regulations, tax laws and other statutes and other incidental factor.