Veer Global Infraconstruction Ltd Management Discussions

FOR THE FINANCIAL YEAR ENDED MARCH 31, 2025

INDUSTRY STRUCTURE AND DEVELOPMENTS

The Indian real estate and construction industry is a vital component of the nations economy, accounting for approximately 7 8% of the gross domestic product significantly lower than developed economies, where the sector accounts for around 15%. This indicates substantial headroom for growth. While short-term disruptions driven by fluctuations in interest rates and commodity prices are inevitable, the transformative reforms of the past decade such as the introduction of RERA, demonetization, GST, and tighter lending norms for banks and NBFCs have helped correct supply-side imbalances and enhance transparency. The construction industry is serving as the second-largest source of employment after agriculture. This sector encompasses residential, commercial, retail, hospitality, and infrastructure development activities. These reforms have laid the foundation for a more regulated, efficient, and resilient real estate ecosystem. As a result, the Indian housing market now stands on a strong structural footing, with increasing demand and investor confidence. Real estate is therefore well-positioned not just to benefit from broader economic expansion, but to serve as a key driver of Indias long-term GDP growth.

During the fiscal year 2024 25, the industry experienced sustained growth, primarily driven by robust demand in residential housing markets within Tier I and Tier II cities. Contributing factors include low interest rates, enhanced affordability, and increasing urbanization. Additionally, the increasing nuclearisation of families and rising aspirations for homeownership further supported residential demand. These structural drivers are expected to continue shaping the housing market in the coming years.

OPPORTUNITIES AND THREATS

Opportunities

Continued growth in urban populations, coupled with increasing disposable incomes of the middle class, is driving sustained demand for residential and commercial real estate across Tier I, II, and III cities.

Schemes such as Pradhan Mantri Awas Yojana (PMAY), the Real Estate (Regulation and Development) Act (RERA), and the framework for Real Estate Investment Trusts (REITs) have enhanced transparency, regulatory oversight, and access to capital in the sector, creating a more investor-friendly environment.

Relaxation in FDI norms and policy reforms have encouraged higher foreign investment in construction development and real estate, providing additional funding sources and boosting investor confidence.

The rapid growth of the e-commerce industry is fueling demand for warehousing, logistics parks, and last-mile delivery infrastructure, creating new avenues for real estate development.

With an increase in Indias globalization, the number of tourists in India increased by 106% this year. Due to this, the demand for hotels, resorts and other tourism-focused structures gives real estate a new industry to venture into.

Threats

A sustained slowdown in economic activity may weaken consumer sentiment, delay investment decisions, and adversely affect project launches and sales.

Escalating construction costs attributable to inflation in raw materials such as cement and steel.

A continued rise in housing prices outpacing wage growth could impact affordability, particularly for the middle-income segment.

Prolonged approval timelines, complex regulatory frameworks, and difficulties in land acquisition continue to pose significant challenges, often leading to delays in project initiation and completion.

Elevated interest rates may reduce housing affordability and borrowing capacity, particularly for middle-class homebuyers, thereby dampening overall demand.

Financial sector stress, coupled with tightening of credit norms, and limited funding options within the industry.

Increasingly stringent environmental regulations and the growing demand for sustainable construction practices require continuous investment in eco-friendly technologies and processes, adding to compliance and operational costs.

SEGMENT-WISE OR PRODUCT-WISE PERFORMANCE

The Company is engaged in the business of construction and real estate development. The operations of the Company are considered to be a single segment, namely "Construction and Real Estate Development," as the resources are allocated and performance is evaluated by the management on an overall basis. Accordingly, there is no separate reportable segment.

OUTLOOK

The demand for affordable housing continues to remain high, particularly in major metropolitan areas, driven by the rapid pace of urbanization and government-led housing initiatives. Middle-income housing is witnessing strong growth as a result of increasing urban migration and rising household incomes. Simultaneously, the premium and luxury housing segments are gaining traction, with urban consumers aspiring for an improved quality of life and enhanced living standards.

The housing market is expected to maintain steady momentum in 2025, supported by rising homeownership aspirations, improved income levels, and continued investment in infrastructure development. Key factors influencing sales performance include inventory availability, developer credibility, investor sentiment, and proximity to critical infrastructure projects such as metro connectivity, highways, and business districts.

Integrated townships offering a blend of community-focused living, modern amenities, and green spaces are becoming increasingly popular among homebuyers. Additionally, there is a growing demand for tech-enabled homes equipped with features such as AI-based security systems, smart lighting, and energy-efficient solutions. Looking ahead, with relatively favorable lending rates and sustained consumer demand, the Indian housing market is poised to maintain its growth trajectory over the near to medium term.

Despite the global shift towards remote and hybrid work models, Indias office space market continues to demonstrate resilience. Demand for commercial office space remains strong in major urban centers, primarily driven by the Information Technology, and the expansion of Business Process Management sectors. These sectors continue to anchor the commercial real estate market, ensuring steady leasing activity.

Meanwhile, the warehousing and logistics segments are experiencing rapid growth, propelled by rising domestic consumption, the expansion of organized retail, and the ongoing e-commerce boom. The pandemic highlighted the critical importance of robust and agile supply chains, leading to increased investments in modern, technology-enabled warehousing infrastructure. Post-COVID, companies have focused on enhancing supply chain, further accelerating demand for strategically located, large-scale logistics parks and fulfillment centers.

RISKS AND CONCERNS

Operational Risks: Operational risks in the construction sector encompass a range of challenges, including the management of complex project timelines, coordination among multiple contractors, sub-contractors, and vendors, and strict compliance with safety norms and regulatory standards. Any delay in procurement of key materials, unexpected site conditions, labour shortages, or lapses in project coordination can result in significant cost overruns and schedule slippages.

Regulatory and Legal Risks: Delays in obtaining statutory approvals, environmental clearances, and construction permits, as well as changes in land acquisition laws or development regulations, can adversely impact project timelines and overall feasibility.

Interest Rate Risk: An increase in interest rates can lead to higher borrowing costs for the Company and reduced affordability for buyers, potentially impacting overall demand and project financing.

Governance Risk: Inadequate corporate governance practices, or non-compliance with regulatory and disclosure requirements can adversely affect stakeholder confidence and the Companys reputation. In the construction sector, where large-scale projects involve multiple stakeholders and regulatory interfaces, weak governance may lead to contractual disputes, delays in decision-making, and legal liabilities.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Companys control measures are closely aligned with its operational activities. Internal systems and procedures are implemented based on the criticality of each function, with a focus on enhancing efficiency, ensuring compliance, and supporting overall performance objectives.

FINANCIAL PERFORMANCE WITH RESPECT TO OPERATION PERFORMANCE

During the year under review:

Total Revenue: 11.63 Crore

EBITDA: 4.36 Crore

PAT: 1.81 Crore

EPS: 1.12 per share

There is an improvement in the performance due to operational optimization.

HUMAN RESOURCES / INDUSTRIAL RELATIONS

The Company recognizes that its employees are a vital asset and the contribution of it in growth and success. During FY 2024 25, efforts were made to train the manpower for the overall improvement of the same. The employee strength as of March 31, 2025 was 7. Industrial relations remained cordial throughout the year.

KEY FINANCIAL RATIOS

Ratio	FY 2024 25	FY 2023 24	Change	Remarks
			(%)
Debtor Turnover	0.49	0.82	(40.24%)	Slower collection of receivables.
Inventory Turnover	0.57	0.90	(36.67%)	Decreased rotation of inventory.
Interest Coverage Ratio	2.18	10.43	(79.08%)	Fall due to increase in finance costs.
Current Ratio	2.63	2.26	16.37%	Improved due to better
				Current Assets Management
Debt-Equity Ratio Operating Profit Margin	0.49	0.29	68.97%	Increase in borrowings. growth due to
(%)	35.77%	11.16%	220.55%	Margin operational efficiency.
Net Profit Margin (%)	0.16%	0.10%	60.00%	Improved Profitability.

DISCLOSURE OF ACCOUNTING TREATMENT

The Company has followed the accounting principles and policies consistently and has prepared its financial statements in accordance with the applicable Indian Accounting Standards (Ind AS) as prescribed under the Companies Act, 2013, read with the relevant rules issued thereunder. There is no deviation in the accounting treatment during the year from that prescribed in the applicable Accounting Standards.

CAUTIONARY STATEMENT

The Statements in this Management Discussion and Analysis Report describing the Companys objectives, projections, estimates, plans, industry, conditions, and events are "forward-looking" statements within the meaning of the applicable laws or regulations. The statements are based on certain assumptions and expectations of future events. Actual outcomes may vary significantly due to factors beyond the Companys control. The Company cannot guarantee that these assumptions and expectations are accurate or will be realized. The Companys actual results, performance, or achievements could thus differ materially from those projected in any such forward-looking statements. The Company assumes no responsibility to publicly amend, modify or revise any forward-looking statements, on the basis of any subsequent developments, information or event. Investors are advised to conduct thorough due diligence before making any investment decisions.

By Order of the Board of Directors
For: Veer Global Infraconstruction Limited
Sd/-
Vijaybhai Vagjibhai Bhanshali
(Managing Director - DIN: 05122207)
Date: July 23, 2025	Place: Mumbai