Sunteck Realty Ltd Management Discussions

GLOBAL ECONOMY

The year 2024 was marked by paradigm shift across global markets, impelled by pivotal events that reshaped the economic and financial landscape. From Japans historic decision to end its negative interest rate policy to Federal Reserves first rate cut since the pandemic recovery, each event carried profound implications. These pivotal events, including Japans groundbreaking shift away from negative interest rates and the Federal Reserves inaugural rate cut since the pandemics onset had far-reaching consequences. They not only reflected changing economic conditions but also influenced market dynamics, investor sentiment, and global economic trajectories. The rate cuts impact was multifaceted. the bond market, yields fell as investors anticipated lower borrowing costs, making existing bonds with higher yields more attractive. The forex market saw a mixed response, with the US Dollar weakening against some currencies amid expectations of reduced rate differentials. This shift in market dynamics reflected changing investor sentiment, as the rate cut signaled a new direction in monetary policy. As a result, currency fluctuations and bond market dynamics were influenced, potentially impacting trade, investment, and borrowing costs.

Since the start of CY2025, the United States has announced multiple waves of tariffs on major trading partners and critical sectors, setting the stage for a complex and challenging global economic landscape. This development is unfolding in a context that is vastly different from the previous century, with the global economy now characterized by deep economic and financial integration, intricate supply chains, and interconnected financial flows. As a result, forecasts for global growth have been revised downward, reflecting the impact of effective tariff rates at levels not seen in a century and a highly unpredictable environment. Furthermore, the outlook is dominated by intensifying downside risks, driven by escalating trade tensions, financial market adjustments, and the potential for tighter global financial conditions. The ratcheting up of trade wars and heightened trade policy uncertainty pose significant threats to both short-term and long-term growth prospects, underscoring the importance of international cooperation in navigating these challenges and fostering a more resilient global economy.

The International Monetary Fund (IMF) has indeed projected global growth at 3.0% for 2025 and 3.1% in 2026, marking an upward revision from April 2025 World Economic Outlook. Heres a breakdown of the key points supporting the same: Global Growth: The upward revision reflects several factors, including i) Front-loading ahead of tariffs: Businesses and traders have accelerated imports to avoid higher tariffs, contributing to stronger-than-expected economic activity; ii) Lower effective tariff rates: The average effective U.S. tariff rates are lower than previously expected, which has also supported growth; iii) Better financial conditions: A weaker U.S. dollar has improved financial conditions globally, contributing to the upward revision; iv) Global Inflation: Global headline inflation is expected to decline to 4.2% in 2025 and 3.6% in 2026. However, U.S. inflation is predicted to stay above target, which may impact monetary policy decisions. Despite the upward revision, downside risks persist, including: i) Potentially higher tariffs: Further escalation of trade tensions could lead to higher tariffs, impacting global growth; ii) Elevated uncertainty: Uncertainty surrounding trade policies and geopolitical tensions could weigh on business activity and investment; iii) Geopolitical tensions: Ongoing geopolitical tensions pose a risk to global economic stability.

INDIAN ECONOMY

India has emerged as the fastest-growing major economy globally and is projected to become one of the top three economic powers in the next 10-15 years, supported by its robust democratic structure and strong international partnerships. IMF raises Indias Growth Forecast to 6.4% for 2025 and 2026, Retains Status as Fastest-Growing Major Economy. Indias economy has demonstrated resilience, supported by robust domestic demand and structural reforms. However, challenges persist, including addressing income disparities to ensure inclusive growth, balancing growth with sustainable development and environmental protection, and continued investment in infrastructure to support the growing economy.

The Union Budget 2025-26 has introduced several initiatives to drive Indias economic growth, including tax incentives, increased capital expenditure, and support for MSMEs and startups. The budget aims to stimulate consumption, encourage savings, and drive investment, thereby paving the way for a more resilient and self-reliant economy. However, Foreign Institutional Investors (FIIs) have been net sellers in the Indian market, particularly in the first half of CY2025, due to global macroeconomic factors like a strong U.S. dollar and high bond yields. Nevertheless, FIIs have started buying Indian equities again, driven by Indias robust GDP growth and declining inflation and interest rates.

With the governments focus on infrastructure development, clean tech, and digital transformation, India is expected to remain an attractive destination for investments, supporting its economic growth trajectory.

INDIAN REAL ESTATE

The Indian real estate market is witnessing significant trends that are shaping its future. There is a notable rise in demand for luxury and low-density housing, with people seeking private, eco-friendly, and sustainable living spaces. Developers are responding by creating exclusive projects with green spaces and reduced infrastructure usage. The commercial real estate sector is also expanding rapidly, driven by economic growth, foreign investment, and increased demand for office spaces post-pandemic. Projections indicate a 3.32% CAGR, reaching a market size of US$7.23 trillion by 2029. Furthermore, the warehousing sector is attracting substantial investment, fuelled by the booming e-commerce industry, logistics growth, and government initiatives like the National Logistics Policy. With Indias e-commerce market expected to reach $350 billion by 2030, the demand for modern, Grade A storage spaces are set to skyrocket, creating vast opportunities for growth in the warehousing segment.

The Indian Real Estate sector has demonstrated remarkable growth driven by robust demand, government initiatives, and structural reforms. Residential sales have surged by nearly 77% since FY 2019, with luxury housing segments (above 1 crore) driving growth due to higher incomes and lifestyle changes. The sector has also seen significant IPO activity, raising nearly INR 400 billion since 2021, including INR 76 billion from seven listings in 2025 alone, showcasing strong investor confidence. Gross bank credit to real estate has doubled from INR 17.8 lakh crore in FY 2021 to INR 35.4 lakh crore by FY 2025, representing nearly 20% of total bank credit in India. Government initiatives like RERA and GST have made the sector more transparent and resilient, while urbanization, infrastructure development, and technological advancements are expected to drive sustained growth. With genuine end-user demand, infrastructure development, and transformative impact of policies, the sector is poised for continued growth, increased investment, and strong performance in premium and luxury segments.

MMR REAL ESTATE

The Mumbai Metropolitan Region (MMR) real estate market has witnessed significant growth and evolution in 2024 and 2025. With an 11% year-on-year increase in sales volume and new unit launches reaching a 13-year high in 2024, the market is driven by strong end-user demand, infrastructure development, and a shift towards premium segments. Luxury and premium segments are on the all-time high demand, with transactions in the INR 10 million to INR 50 million and above categories increasing, reflecting growing investor interest in high-end properties. Sustainability has become a key selling point, with developers incorporating eco-friendly features into their projects. Technology and data analysis are also playing a crucial role in shaping real estate decisions, with developers using data to understand market trends and optimize their offerings. Despite rising inventory levels, property values continue to appreciate, with a 4% increase in apartment values from FY23 to FY24. Overall, the MMR real estate market is experiencing robust growth, driven by strong demand, infrastructure development, and evolving buyer preferences. The influx of Global Capability Centers (GCCs) in the city is significantly boosting the citys residential real estate market. With

over 53 million square feet of office space leased between 2022 and mid-2024 alone, GCCs are absorbing prime real estate at an unprecedented pace, driving demand for high-quality residential spaces. This trend is creating new opportunities for real estate investors, including consistent rental yields, capital appreciation, and diversification options through fractional ownership. As GCCs continue to expand in Mumbai, they are expected to drive growth in both commercial and residential real estate sectors. The growth of GCCs in Mumbai is driven by the citys robust infrastructure, skilled workforce, and connectivity, making it an attractive destination for global companies. With India expected to host over 2,100 GCCs by FY2028, the demand for premium office spaces is likely to increase, further fuelling the commercial real estate boom.

Luxury real estate market is experiencing a significant surge, driven by high-net-worth individuals (HNWIs), ultra-high- net-worth individuals (UHNWIs), and non-resident Indians (NRIs) seeking premium properties. The demand for luxury homes is growing. This trend is reshaping the market dynamics, offering lucrative opportunities for discerning investors and homeowners. Several factors contribute to this trend, including economic resilience, lifestyle aspirations, and investment potential. Luxury properties are seen as stable and appreciating assets, making them attractive investment options. The luxury real estate market in India is also witnessing a shift in consumer demands, particularly among millennials who are driving the demand for smart homes equipped with state-of-the-art technology and sustainable living solutions. Eco-friendly features have transformed from niche to necessary in high-end properties, appealing to the socially conscious wealthy demographic.

Business Overview

Sunteck Realty remains steadfast in its commitment to best product delivery which continue to be at the core of its business philosophy. Over the past years, the company has strategically shifted its portfolio towards the ultrapremium Uber Luxury segment, reflecting its aspiration to establish a leadership position in the luxury real estate market. Its business development strategy is diversified and flexible, encompassing redevelopment projects, strategic land acquisitions, and combination of an asset-light model. However, every opportunity is carefully evaluated against stringent margin thresholds to ensure financial discipline. The company applies segment-specific risk-return priorities to maintain profitability across all categories. Construction for Sunteck Realtys projects is predominantly managed inhouse, enabling the company to exercise rigorous oversight and maintain stringent quality standards throughout the building process. By leveraging its internal construction teams, Sunteck ensures close coordination across all phases of quality control resulting in superior craftsmanship and timely delivery. This hands-on approach not only allows for greater control over cost efficiencies and timelines but also helps uphold the brands commitment to excellence and customer satisfaction. The in-house model fosters seamless communication among project managers, engineers, and quality inspectors, minimizing risks associated with third-party contractors and ensuring that every detail aligns with the companys exacting standards.

Geographically, Sunteck continues to focus primarily on the Mumbai Metropolitan Region (MMR), leveraging its deep market knowledge to develop predominantly residential projects in prime locations-a critical factor in its project selection and expansion strategy. Financial prudence remains a hallmark of the companys approach, with a strong emphasis on maintaining a low-leverage posture. Sunteck Realty operates with a stringent balance sheet, aiming for minimal or near-zero net debt, ensuring long-term financial stability and resilience. This disciplined and adaptive strategy positions the company well to capitalize on evolving market opportunities while preserving its core strength in margin management.

Your company has forayed into commercial portfolio which currently comprises of two high-quality assets, marking its strategic positioning into annuity income streams. Both properties - Sunteck BKC51 and Sunteck Icon are leased to single tenants on long-term contracts spanning 29 years, ensuring full occupancy and stable, predictable cash flows. The leases include built-in escalation clauses, guaranteeing rental increases each year and enhancing income growth over time. This focused approach delivers very high returns on capital employed, reinforcing Suntecks commitment to building a robust and resilient commercial asset base that complements its residential business while providing consistent, long-term financial stability.

Your company has demonstrated consistent and robust growth in its Gross Development Value (GDV) and pre-sales across the FY22 to FY25 period, reflecting strong demand for its projects and an expanding portfolio.

• Steady Increase in GDV

Over the four years, the companys GDV has grown significantly from approximately INR 13,650 crores in FY22 to INR 26,645 crores in FY24, before surging towards an remarkable INR 39,370 crores in FY25. This nearly threefold increase over three years showcases Suntecks expanding development pipeline and increasing market presence from 3 locations in FY22 to 10 locations in FY25.

• Pre-sales Growth Reflecting Market Confidence

Corresponding with GDV growth, pre-sales indicate strong market acceptance and successful sales execution. Pre-sales rose from around INR 1,303 crore in FY22 to INR 1,602 crore in FY23, further growing to INR 1,915 crore in FY24, and achieving a substantial jump to INR 2,531 crore in FY25. This represents an approximately 32% increase in pre-sales in FY25 alone, underscoring accelerating buyer interest and confidence in companys offerings.

• Portfolio Composition and Project Highlights

The GDV is supported by a mix of launched and upcoming projects primarily concentrated in various micro markets of MMR. Notably, flagship projects such as:

Signature Island & Signia Isles & Signia Pearl - Bandra Kurla Complex (BKC) has undergone a dramatic transformation, evolving from a nascent, office-focused location to Mumbais most prestigious and strategically planned commercial hub. Developed by MMRDA to decentralize activity from South Mumbai, BKC rapidly attracted top-tier financial institutions, multinational corporations, foreign consulates, luxury hotels, and world-class convention centers. It now stands as the nations foremost corporate address, home to the National Stock Exchange, SEBI, millions of professionals, cementing its status as the financial heartbeat of Mumbai. Infrastructure advancements-including the Mumbai Metro Line 3, improved road connectivity via the Santacruz-Chembur Link Road, Bandra-Worli Sea Link, and upcoming High-Speed Rail station-have drastically reduced commute times and bolstered the precincts connectivity and desirability.

Amid this backdrop, the residential real estate opportunity in BKC has shifted from serving a niche set of executives seeking proximity to work, to being the domain of ultra-luxury living for CXOs, business leaders, NRIs, and high-net- worth individuals. Residential supply remains chronically scarce, with signature projects of your company such as Signature Island, Signia Isles, and Signia Pearl offering rare and exclusive homes defined by privacy, sophistication, and unmatched amenities.

Sunteck City - Oshiwara District Centre (ODC, Goregaon) has rapidly emerged as one of Mumbais most dynamic real estate micro-markets, blending commercial and residential development. Premium projects, robust infrastructure upgrades-including metro lines, expressways, and new railway connections-and proximity to major commercial hubs have driven investor and end-user demand. Property prices in ODC are expected to appreciate 30-40% over the next three to four years, outpacing nearby micro-markets, while rental yields remain attractive for this locality. Planned mixed-use developments and the transformation of ODC into an integrated township with modern business spaces, retail, and luxury housing are further elevating desirability and capital values. Sunteck has created landmark projects Sunteck City Avenue 1, Avenue 2 and Avenue 4 and is gearing up for the launch of Avenue 5 residential and commercial project in the same location to further expand its portfolio. The convergence of infrastructural boosts, job proximity, mixed-use planning, and lifestyle upgrades that is propelling ODC-Goregaons sustained property appreciation. Sunteck Citys proximity to Oshiwara District Centre (ODC) offers residents significant benefits through seamless connectivity and integrated urban living.

Sunteck World - Naigaon is a premium residential project part of a larger 150-acre township by your company, offering well-designed 1, 2, and 3 BHK apartments. It offers over 55 world-class amenities such as a clubhouse, swimming pool, gym, jogging tracks, sports courts, childrens play areas, and landscaped gardens, creating a vibrant and healthy living environment. Sunteck World blends comfortable living with modern conveniences and eco-friendly features, making it a favoured choice for families and professionals seeking well-managed township living in the Mumbai suburbs.

Under the brand Sunteck World, your company has successfully delivered 2 residential phases named Sunteck West World and Sunteck MaxxWorld. Sunteck One World is progressing with construction at full swing while during the year, one more phase - Sunteck Ultra World has been launched to meet additional demand of that area.

Sunteck Beach Residences - Vasai positioned as beachfront township, strategically located in Vasai with prime coastal frontage along the Arabian Sea and strong connectivity to Mumbais business districts, educational hubs, and entertainment centres. The project generated significant traction at launch, achieving robust pre-sales within its first year and signalling strong acceptance in the premium residential segment. Its dual advantage of beachfront living and efficient transport links enhances appeal for both lifestyle buyers and investors seeking long-term capital growth. Featuring high-value lifestyle infrastructure, the development is poised to boost property valuation and rental yields. With its market differentiation, large-scale master plan, and early sales momentum, Sunteck Beach Residences offers promising prospects for sustained absorption rates, price appreciation, and rental income potential as surrounding infrastructure matures. Total 6 towers have been launched until end of FY25 and response received for the same is propelling.

Sunteck Sky Park (Mira Road) Mira Road in 2025 stands out as one of Mumbais fastest-growing and most attractive residential micro markets, thanks to its strategic location, robust infrastructure, and relative affordability. The suburb now offers excellent connectivity through the Western Express Highway, Metro Line 9, and suburban rail, making daily commutes and access to the rest of Mumbai seamless for residents. After the successful launch and swift uptake of two residential towers in 2023, your company has further strengthened its presence in the Mira Road market with the launch of an additional tower in 2025. The project has received an exceptionally positive response from homebuyers, reaffirming the strong demand in this rapidly developing micro-market.

Sunteck Crescent Park (Kalyan) located in the rapidly developing micro-market of Dhakate Shahad, Kalyan, our newly launched residential township is envisioned as a benchmark for luxury living in the region. The development showcases Suntecks unwavering commitment to excellence through its emphasis on premium design, functional layouts, and innovative architectural concepts. The first tower of the project was launched towards the end of Q3 FY24, marking the Companys strategic entry into the Kalyan market. As a new entrant in this locality, our initial focus has been on pre-sales activities to gain insights into customer preferences and market dynamics.

Opportunities

Mumbai real estate offers promising opportunities driven by several key factors. The market is evolving to emphasize integrated living environments, blending residential, commercial, and recreational spaces to meet modern lifestyle demands. Luxury homes focus increasingly on wellness, spacious layouts, and tech integration including smart security and energy-efficient solutions. Environmental sustainability is becoming a standard expectation, with green building practices gaining traction. Infrastructure development remains a major growth driver, with projects like Mumbai Metro expansions, Coastal Road, expressways, and upcoming high-speed rail enhancing connectivity and accessibility across the city. These improvements stimulate demand in established and emerging micro-markets which continue to attract affluent buyers and investors.

Mumbais premium real estate segment is seeing rising ticket sizes, with high-value homes fueling strong registration and revenue growth. Affordable housing is also gaining importance, supported by government initiatives and financing options, broadening the market base.

Mixed-use developments and smart city initiatives are expected to further elevate lifestyle quality and investment appeal. However, challenges such as rising construction costs and regulatory changes necessitate cautious optimism. Recent rate cuts by RBI have offered some relief, helping sustain end-user momentum. As we refine our product offerings and infrastructure gains translate into liveability benefits, the market appears poised for steady, end-user- led growth in the near term, even as headline numbers moderate from previous peaks. As we move ahead in FY26, we remain focussed on value accretive project additions and more projects coming up for revenue recognition. we are confident of surpassing the margins of previous years.

ESG INITIATIVES

Sunteck Realty Limited embarked on its sustainability journey at the outset of the previous year, marking a significant milestone with the establishment of our dedicated ESG committee. Since then, we have made remarkable progress in integrating ESG considerations into our operations, evident through our compliance with esteemed standards such as ISO. This year we have successfully completed the ISO surveillance audit without any material/significant non-conformities, maintaining our certification. Looking ahead, we are eager to continue driving positive change as an organization, striving to create a lasting and meaningful impact on our stakeholders and the wider community.

INTERNAL CONTROL SYSTEMS & THEIR ADEQUACY

The Company has established a robust internal control framework designed to safeguard its assets, ensure operational efficiency, and maintain compliance with applicable regulations. To strengthen its control environment and data protection measures, the Company has implemented SAP S/4HANA, which provides enhanced security, governance, and operational oversight across all business functions. Advanced capabilities in data encryption, access management, and real-time monitoring are integrated into our CRM systems to ensure strong protection of customer information. Sensitive customer details, such as mobile numbers and email addresses, are masked, while Data Loss Prevention (DLP) protocols are actively enforced to mitigate risks of unauthorized access or data leakage. Recognizing the growing complexity of cyber threats, the Company has deployed comprehensive antivirus solutions, firewalls, and upgraded IT hardware to strengthen network security and optimize performance. Additionally, clearly defined IT policies and a structured monthly IT check-up process are in place, promoting continuous audit readiness, operational integrity, and accountability.

Through these measures, the Company ensures that its internal control systems remain adequate, resilient, and responsive to emerging challenges, enabling the organization to operate in a secure and compliant environment.

HUMAN RESOURCE

Our People remain the cornerstone of our success. At the heart of our achievements this year lies a strong, committed, and future ready workforce. They are our most valuable assets for achieving our both vision and mission goals. Diversity, Inclusion, equal Opportunity, Non-Discrimination, and freedom of expression are the foundation of our work culture.

We continue to invest in upskilling and reskilling our teams by improving their Functional, Technical, and Behavioral competencies to meet the dynamic needs of our industry. We are committed to the safe and secure work environment across all locations by implementing robust safety protocols, conducting regular trainings, and building a strong safety culture that prioritizes the health and protection of every individual on site and in our offices. For us safety is not just a compliance measure - it is embedded in our values and daily operations.

Equally important is our focus on effective communication. We believe open, transparent, and timely communication fosters trust alignment and stronger collaboration. Through digital platforms and HR Connect programs we have ensured that our people are informed, heard, and empowered.

A Key priority has been strengthening our talent pipeline by focusing on recruiting young talent, bringing in fresh perspectives and digital skills aligned with the future of work. At the same time, we are equally committed to betting on our internal talent, identifying high potential individuals and giving them the higher responsibility.

We have made employee feedback a key input in our decision-making process through regular internal surveys. We gain valuable insights into employee sentiments, helping us continuously improve workplace practices culture and engagement.

The Key priority this year has been Strategic Talent Management particularly in Sales, Marketing and CRM functions which are vital to our customer centric growth along with core technical functions like Quality, Safety, EPC, Design and Architecture which are critical to the Execution Excellence.

We deeply value the contributions of our people and acknowledge the role each individual plays in driving our vision forward.

CONSOLIDATED FINANCIAL PERFORMANCE

Your Company recorded Income from operations of 85,313.40 Lakh in 2024-25. PAT stood at 15,031.61 Lakh in 2024-25. As part of the Companys endeavour to reward shareholders, the Board has recommended a final dividend @150% of 1.5 per equity share having face value of Re. 1 each to the Shareholders of the Company. The Companys proposed dividend payout in FY 2024-25 shall be approx. 21.97 Crore on the total equity base. As on 31st March, 2025, the Net Worth of the Company stood at 3,260 Crore. Net Debt to equity ratio stood at -0.04x in FY 2024-25. Our prudent corporate finance practices also ensured efficient finance costs during the year.

ABRIDGED CONSOLIDATED ASSETS AND LIABILITIES

in lakhs

Liabilities	: FY 2025 :	FY 2024	Assets	FY 2025 :	FY 2024
Shareholders Funds	3,26,003.00	3,12,419.67	Trade Receivables	11,744.94	29,253.03
Minority Interest	-	-	Inventories	6,20,640.54	5,96,628.46
Secured Loans	33,594.42	29,855.33	Loans & Advances	34,701.78	29,014.59
Unsecured Loans	5,099.62	7,638.73	Cash & Bank balances	20,251.90	10,577.55
Others	4,67,958.10	4,42,450.49	Others	1,45,315.97	1,26,890.59
Total	8,32,655.14	7,92,364.22	Total	8,32,655.14	7,92,364.22

ABRIDGED CONSOLIDATED PROFIT & LOSS ACCOUNT

Particulars	March 31,2025	March 31,2024
Income from Operations	85,313.40	56,484.68
Other Income	4,954.51	5,547.20
Total Revenue	90,267.91	62,031.88
Total Expenditure	72,105.92	52,544.82
Profit Before Tax	18,161.99	9,487.06
Share of profit of Joint Venture (net)	183.98	10.31
Tax	3,314.36	2,404.53
Profit After Tax	15,031.61	7,092.84
Minority Interest (Profit)/loss	-	-
Comprehensive Income/(loss)	534.43	429.91
Adjusted Profit After Tax	15,566.04	7,522.75
EPS ( / share)
Basic EPS	10.26	4.99
Diluted EPS	10.26	4.99

FINANCIAL RATIOS

Financial Ratios	Measure in Times/ Percentage	Numerator/ Denominator		FY 2024	Remarks
Debtors Turnover	x	Revenue from Operation/ Average Trade Receivable	4.16	2.56	Driven by higher and efficient collections during the year
Inventory Turnover	x	COGS/Average Inventory	0.07	0.04	Better due to increase in sales
Interest Coverage Ratio	x	EBIT / Interest Expense	5.49	2.39	Due to increase in profit and decrease in interest expense
Current Ratio	x	Current Assets / Current Liabilities	1.50	1.53	Ratio change due to proactive capital deployment strategy and improvement in inventory turnover
Debt Equity Ratio	x	Total Borrowings / Total Shareholders Equity	0.12	0.12	Ratios indicate stable financial Positions
Operating Profit Margin	o/	EBITDA / Revenue from Operation	22%	21%	Ratio indicates improved margins, better sales realization
Net Profit Margin	o/	PAT / Revenue from Operation	18%	13%	Driven by strong revenue performance resulting to higher net profit margin
RoNW	o/ %	PAT / Total Shareholders Equity	5%	2%	Ratio indicates improvement in Profitability and optimal capital allocation

CAUTIONARY STATEMENT

This management discussion and analysis contain forward looking statements that reflects your Companys current views with respect to future events and financial performance. The actual results may differ materially from those anticipated in the forward looking statements as a result of many factors.