Super Spinning Mills Ltd Management Discussions

The Indian Real Estate sector witnessed a strong growth in the past couple of years and is poised for an assuring growth in the future. The outlook is driven by a confluence of multiple factors including increasing urbanization, shifting demographics, aspirational lifestyle and supportive economic growth in the country. A number of factors are adding further impetus to the growth of the industry. The growth can be attributed to a growing residential demand, expected growth in sustainable workplaces, rising consumption and the needs of a growing population with higher income levels. The real estate growth in India is unrivaled, with the market expected to expand to $5.8 trillion by 2047, contributing 15.5% to the GDP from an existing share of 7.3%. The sector supports Indias growing urban needs and has become the backbone of the nations infrastructure. Moreover, the growth of the corporate sector has led to a higher need for commercial centers and housing projects, paving the way for rapid urbanization. Indias real estate market is set for significant expansion, projected to grow from $332.85 billion in 2025 to $985.80 billion by 2030, with a CAGR of 24.25%. This rapid growth highlights the sectors increasing demand, investment potential, and evolving opportunities.

Indias office market continues its upward trajectory in 2025, building on the momentum for the past two years. The fact that five of the seven major cities recorded over 2.0 million square feet of leasing each in a single quarter highlights the depth and vibrancy of India office market. Backed by diversifying occupier base, a steady pipeline and growing investor appetite, 2025-2026 is shaping up to be another impressive year for commercial real estate in India. Overall, office space demand looks well placed to reach 65-70 million square feet at least by the end of the year.

In continuation to the closure of textile business operations during the year 2023-2024, your company has moved into the sector of Lease and rental business activity. It has identified through various sources and has leased some of its properties to be used as commercial and factory spaces on operating lease arrangements. Your Companys liabilities have significantly reduced and has started to provide for any contingent liability that may arise and the focus of the Company is shifting majorly towards rental services. It is anticipated that the Company will experience a rapid recovery in the foreseeable future.

Your company has currently Leased out few portions of factory and warehouse space at the Super Sara Unit in Hindupur. In addition, the company is currently looking at options to develop a Grade A commercial property within the companys existing land parcel with a joint development partner in Coimbatore. This would greatly expand the companys portfolio of leasable assets. The company has also accelerated its efforts to lease out its existing super B unit by launching various marketing campaigns. Your company is hopeful of finding a suitable tenant for the Super B unit very soon. Upon accomplishing these objectives, your company will look into using its other existing land parcels for new developments and will be looking to monetize all suitable assets of the company

Tier-II cities across India are witnessing a steady surge in office space leasing, marking a significant shift in the countrys commercial real estate landscape. As companies look beyond traditional metros like Bengaluru, Mumbai, and Delhi-NCR, cities such as Coimbatore, Mysuru, and Bhubaneswar are emerging as promising growth destinations. Overall, real estate experts say rapid urbanization, infrastructure upgrades, and rising employment opportunities can spur commercial real estate growth in multiple Tier II and III cities. These cities are likely to complement the established office markets increasingly over the next few years. In the last 3-4 years, several multinational companies have leased over 10.87 lakh square feet of office space in Coimbatore, marking a significant shift in commercial real estate activity in the city. The total value of these lease transactions stands at approximately

402.26 crore, reflecting growing confidence among global firms in Tier II city markets.

Your company has moved to rental and leasing activity with assets in Hindupur and Coimbatore, it has let property for leasing and is also planning for the right opportunity to invest and construct commercial properties in the existing land to increase the income for the company and its stakeholders. A slowdown in the Indian or global economy (e.g., due to inflation, geopolitical tensions, or recession) can reduce demand for office spaces. Rapid construction activity in Tier-II cities could lead to an oversupply of commercial spaces, driving down lease rates and property values. Coimbatore is already attracting large-scale leasing—if supply outpaces demand, rental yields may stagnate.

The Company is exposed to a number of risks such as economic trends, income uncertainty, delay in project completion, High operational costs, regulatory, taxation and environmental risks as well as sectoral investment outlook. In India, A significant barrier to enter into commercial real estate is the high initial investment and vacant property, but your company is trying to mitigate the risks by entering into collaborative agreements to synergize the resources and has all plans in place to overcome such risk and concerns.

Your Company has always been adopting all possible safety measures concerning the health and safety of the staff at all levels. Your company is committed to provide all its employees with a healthy and safe work environment.

Industrial relations remained cordial during the period under review. Necessary measures are being adopted to improve the life, work culture, productivity, efficiency and effectiveness of the workers and staff at all levels. The Company has 5 employees on roll as on 31st March 2025.

The Company has a robust and well-embedded system of internal financial controls. This ensures that all assets are safeguarded and protected against loss from unauthorized use or disposition and all transactions are authorized, recorded and reported correctly. An extensive risk-based programme of internal audit and management reviews provides assurance on the effectiveness of internal financial controls, which are continuously monitored through management reviews, self-assessment, functional experts as well as by the Statutory/ Internal Auditors during their audits. The internal audit plan is also aligned to the current business objectives of the Company, which are reviewed and approved by the Audit Committee. Further, the Audit Committee monitors the adequacy and effectiveness of the Companys internal control framework. The internal financial control policies and procedures followed and adopted by the Company for ensuring orderly and efficient conduct of the business are adequate and operating effectively. The adequacy and effectiveness of the internal control systems is also being periodically reviewed by the Audit Committee of the company and a report of auditors pursuant to Section 143(3)(i) of the Companies Act, 2013 certifying the adequacy of internal financial controls is annexed with the Auditors report.

Directors Report contains details pertaining to the financial and operational performance of the company for the financial year 2024-25. Further, the audited financial statements, which has been prepared in accordance with the requirement of the Companies Act, 2013 read with the Companies (Indian Accounting Standards) Rules, 2015, discloses a true and fair view of the performance of the company during the said period.

At present, the Company is engaged only in the business of real estate activities and there is no other separate reportable segment.