Zodiac Ventures Ltd Management Discussions

In 2024, the world economy grew at a moderate rate of 3.3% as per IMF, signifying a phase of relative stability, but growth was still restrained. As we progress through 2025, the global environment is seeing a substantial transformation, prompted by nations realigning their policy priorities in reaction to escalating geopolitical tensions and increasing economic difficulties.

The United States has implemented a series of additional tariff measures, eliciting immediate and vigorous responses from key trading partners. This resulted in the enactment of nearly universal tariffs on April 2. Consequently, effective tariff rates have escalated to unprecedented heights, inflicting a severe and detrimental impact on global GDP. The issue has been exacerbated by the rapid and erratic nature of these policy shifts, which have markedly intensified economic uncertainty and rendered the short-term outlook highly unstable.

In light of this uncertainty, worldwide headline inflation is projected to decrease at a slower rate than previously planned. IMF projection indicates a decline to 4.3% in 2025 and thereafter to 3.6% in 2026. The revision indicates elevated inflation projections for industrialised nations, somewhat counterbalanced by slight downward modifications in emerging markets and developing economies (source: IMF, World Economic Outlook, April 2025).

Regardless of the difficulties that the global economy is currently experiencing, this period presents a one-of-a-kind chance to increase resilience and map out a more sustainable route forward. There is a possibility of recovery if the appropriate combination of coordinated policies and proactive reform is implemented, as seen by the adaptability displayed by many economies that are under strain.

As per IMF, Indias GDP expanded by 6.5% in FY 2024-25, solidifying its status as one of the fastestgrowing major countries amid global uncertainties. This performance was supported by structural reforms, swift digital transformation, and ongoing infrastructure investments, which combined fortified the countrys economic base. Strong domestic demand and ongoing private sector investment contributed further impetus across several sectors.

Monetary policy became accommodative throughout the year. The Reserve Bank of India decreased the repo rate by 25 basis points to 6.25%, aiming to reconcile inflation management with the necessity to enhance credit flow and investment. This supportive position enhanced liquidity and facilitated corporate growth. Indias trade performance exhibited resilience externally, with total exports increasing almost 6% yearon-year. Services exports developed as a significant contributor, enhancing Indias stake in global services trade and solidifying its status as a leading global services exporter.

Indias FY 2025-26 economic outlook is cautious and resilient due to domestic strengths and global uncertainties. Commodity price volatility, trade interruptions, and geopolitical concerns may hinder growth. Due to structural stability and a strong policy framework, the economy should be able to weather these threats. Maintaining momentum requires accelerating corporate wage growth, improving consumer sentiment, and boosting private sector investment in critical industries. Agriculture, lower food inflation, and macroeconomic stability should boost rural demand. These elements are crucial for inclusive growth and consumption. Indias global competitiveness is likely to improve with targeted deregulation and grassroots structural reforms.

Indian real estate sector has witnessed high growth in the recent times with rise in demand for office as well as residential spaces. 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.

Indian real estate has seen diverging trends as compared to global peers. Higher interest rates dented housing sales, layoffs and weak consumer sentiment impacted office and retail space leasing in advanced economies. India on the other hand witnessed surge in housing demand, accompanied by recovery in office leasing despite global slowdown in IT/ITes spending. Retail real estate continues to perform well driven by upbeat consumer spending.

The residential segment exhibited a strong performance and sustained momentum during the last fiscal despite several headwinds. The offices segment exhibited resiliency and has started to witness gradual recovery resulting in improvement in occupancy levels across quality assets. This recovery was primarily led by the return to normalcy and back-to-office policies for the majority; however, certain occupiers continue to operate on a flexible and hybrid approach. The retail segment delivered robust growth as a result of increase in consumption and footfalls.

We keep our customers at the forefront in policy-making decisions including designing and changing needs and preferences of customers in evolving environment. This enables us to build trust, create happy experiences and provide them with the best-in-class products. By understanding our customers needs, we aim to make the customers home-buying experience a simple and joyous one, thereby enhancing brand advocacy.

Having shifted its focus toward sustained growth, your Company has undertaken two redevelopment projects with residential societies at prime locations in Vile Parle (East), Mumbai viz. Zodiac Anjaneshwar and Zodiac Guruchhaya.

Zodiac Anjaneshwar Project: After completion of 3-level basement, the project has been completed up to the sixth slab level with two slabs remaining. The project is scheduled for completion by June 2026. Zodiac Guruchhaya Project: The project has received Intimation of Disapproval (IOD) from the MCGM. Demolition of the existing structure has been completed, and excavation and shore piling work is currently in progress. This project is expected to be completed within 24 months.

Looking ahead to the financial year 2025 26, your Company intends to continue focusing on both redevelopment and slum rehabilitation models, aiming to build upon its substantial foothold in these sectors.

In line with this strategy, the Companys management has acquired a 25% stake in Zodiac Capital Pvt. Ltd., which has proposed a large slum rehabilitation scheme spread over 5600 square meters at Indira Nagar, Vile Parle (West), Mumbai, in the vicinity of Juhu and Mithibai College. The proposal has been submitted to the Slum Rehabilitation Authority (SRA), Mumbai, and the Company expects to receive the necessary sanctions by the end of this financial year. This scheme is expected to further strengthen the Companys position in the slum rehabilitation sector.

Additionally, your Company has already ventured into new business avenues within the Food Processing Industry under the name Mumbai Mega Food Park, as part of its diversification strategy. It has received approval from the Ministry of Food Processing Industries, Government of India, for setting up Agro Processing Clusters, also known as Food Parks, in Raigad District, Maharashtra.

Real estate sector in India is expected to reach US$ 1 trillion by 2030. Emergence of nuclear families, rapid urbanization and rising household income are likely to remain the key drivers for growth in all spheres of real estate, including residential, commercial, and retail. Rapid urbanization in the country is pushing the growth of real estate. Indian real estate developers have shifted gears and accepted fresh challenges.

The management of your Company is confident of creating and exploiting the opportunities it is faced with, keeping in mind any unfavorable changes in the government policies and the regulatory environment that can adversely impact the performance of the sector. Retrospective policy changes and regulatory bottlenecks may impact profitability and affect the attractiveness of the sector and companies operating within the sector.

The Company has an adequate Internal Control System commensurate with size and nature of its business to safeguard all assets and to ensure their efficient productivity. The Company has continued to keep focus on processes and controls. The Company has a suitable internal control system for the business processes, operations, financial reporting, compliance with applicable laws and regulations. Wherever deemed necessary, internal control systems are also reassessed and corrective action is taken, if required.

10. Financial and operational performance

Despite unpredictable economic development, your Company performed reasonably well upon financial parameters.

11. Cautionary Statement

Statements in this Report, particularly those which relate to Management Discussion and Analysis, describing the Companys objectives, projections, estimates and expectations, may constitute forward looking statements within the meaning of applicable laws and regulations. Actual results might differ materially from those either expressed or implied.