Anant Raj Ltd

We have increased focus on execution, steadily progressing towards deleveraging and pursuing newer avenues to unlock newer opportunities and reach newer heights.

Dear Shareholders,

With the blessings of our founder Shri Ashok Sarin, son of Lala Anant Ram Sarin and Smt. Raj Kumari Sarin, we are delighted to present our Annual Report for FY 2022-23.

With immense pride and jubilation we write to you about the success we achieved during the year and the progress we are making towards a better tomorrow. FY 2022-23 in many ways is the culmination of the dream and values nurtured by our visionary Founder, as we crossed the milestone figure of Rs 1,000 Crore in revenue for the very first time in our glorious history. This achievement comes following two successive years of revenue doubling, and manifests that we are well past the period of challenges.

The management takes this opportunity to thank all our stakeholders whose confidence and support have been instrumental. While we have set an unprecedented benchmark of success, we are inspired more than ever to push beyond new horizons. We have increased focus on execution, steadily progressing towards deleveraging and pursuing avenues to unlock newer opportunities and reach greater heights.

THE MACRO ECONOMY

After a prolonged period of uncertainty, 2022 was expected to see the beginning of a global economic recovery with the pandemic dissipating and focus returning to economic growth. However, geopolitical tensions, energy crisis, and high inflation posed challenges for the global economy and businesses in general. Central banks across the world raised policy rates to combat this permacrisis.

Nonetheless, India outperformed and became the world's fastest-growing economies even as most developed nations faced slowing growth. The Indian economy registered an estimated Gross Domestic Product (GDP) growth of 7% in FY 2022-23 as against 9.1% growth attained in the previous fiscal. The optimistic growth stems from a slew of positive initiatives by the Government including increasing fiscal investments and implementing favourable policy regime that synergistically converged to propel the economy forward. This included a push for infrastructure development with an allocation of Rs 10 Lakh Crore, emphasis on manufacturing self-reliance and launch of production-linked incentives (PLI) schemes which helped thrust economic activities. These efforts have positioned India attractively as a major global manufacturing destination. The trinity of manufacturing, infrastructure and digitalisation has potential to propel India's economic growth and unlock new business opportunities.

The positive momentum in the Indian economy was also reflected in the robust office and residential demand, and even complemented by relatively strong price growth seen during 2022. While the resurgence in the office market has been a welcome surprise, the residential market has sustained the momentum seen in the later half of 2021. Despite the 225 basis points (bps) repo rate hike and high mortgage rates during the year, the robust performance of the sector signifies the strength of the underlying demand for real estate properties. The sector is expected to continue its journey of long-term growth with continuous rise in GDP per capita, higher disposable incomes, growing urbanisation, favourable policy reforms, and most of all, a larger focus on India to emerge as the next big economy.

A YEAR OF OUTSTANDING PERFORMANCE

At Anant Raj, we moved with agility to capture the immense momentum in the residential segment including expediting new launches and focus on execution and commencing sale of small-sized plots which were in demand. These efforts contributed to a solid resounding performance.

Our total income for FY 2022-23 increased 100.47% to Rs 1,004.86 Crore. EBITDA increased by 112.55% to Rs 244.98 Crore. PAT grew by 175.31% to Rs 151.12 Crore. It gives us great pride to state that we continued our march towards deleveraging and enhancing balance sheet strength.

TAKING OUR BUSINESSES TO NEWER PEAKS

The operational performance has been equally impressive. In the residential segment, we are doing Independent Floors, Furnished Villas, Commercial Buildings and Plots. Our Founder has been the source of inspiration for all that we do, and in his commemoration, we launched a residential project namely Ashok Estate over 20.14 acres of land in Anant Raj Estate township, Sector-63A, Golf Course Extension Road, Gurugram. Through the project, highly sought-after small and affordable plots were offered to mid-segment buyers, and nearly 50% of the plots have already been sold out.

We also got licence to develop the Group Housing Project having saleable area of 1 million sq. ft., which will be launched in FY 2023-24. The Company also has the plan to launch one Commercial Complex for which construction shall commence in FY 2023-24.

Apart from this, construction activity is in full swing at the Birla Navya project, which is being executed through a JV LLP named "Avarna Projects LLP" between Birla Estates & Anant Raj Limited at our iconic Anant Raj Estate Township. During the year, we have launched Phases II and III of the Project and overall 95% of total launched inventory is sold. We are well on track for the expected launch of Phase IV and last phase in FY 2023-24.

Affordable housing project, "Aashray II" in Tirupati, Andhra Pradesh having approx. 2,000 units has received all clearances and the Development & Construction work is set to commence in Q3 of FY 2023-24. The requisite team is already in place to commence the Project.

In the Hospitality Segment, we have finalised plans for mixed use developments across our land parcels in Delhi including Hospitality, Convention and Commercial facilities. We also intend to capitalise on new policy guidelines which allows additional development at our existing hotel projects. We intend to undertake diverse developments and transfer them into socio-economic hubs. The Company got approval for higher FAR on 5.75 acres land parcel in one Project situated in Chhatarpur, New Delhi, a premium place and hub of Motels. The Company will commence construction on this Project having built up area of approx. 7,00,000 sq. ft., out of which 20% is allowed for Commercial & Retail use and remaining 80% shall be allowed for use as Hotel and Service apartment.

In our latest Data Centre business, we have entered strategic partnership with RailTel and Telecommunications Consultants India to drive forward our vision with their technical expertise.

Both organisations are public sector undertaking under Government of India and are entitled to get the contract on nomination basis.

During this financial year, we have successfully completed 3 MW IT Load at Manesar IT Park which is part of Phase 1 of the Data Centre duly certified by TIA-942 Tier III Certificate for 21 MW IT Load. The next phase of the Data Centre is slated for completion in FY 2023-24. Over the next two years, we intend to increase the overall load at Manesar to the planned capacity of 50 MW, the largest Data Centre in North India.

Apart from this, we have two other identified Tech parks having a planned capacity of 250 MW, mix of green field and ready to use Buildings. The Development of Data Centre at these two locations shall be undertaken subsequent to completion of the Manesar facility. The Company's endeavour is to develop these two subsequent Data Centres without impacting Asset liability ratio.

GEARED FOR THRIVING OPPORTUNITIES

We believe that we are at the threshold of exciting times and are prepping to capitalise on the emerging opportunities with our prudent strategy and expansion activities. We are well past the baggage of the previous years and are strongly focussing on the positives. We are approaching the future with full confidence, clarity, and conviction.

In the near to medium-term, we see immense opportunities in Residential (both luxury and affordable housing) and Data Centre segments. We are taking these up on priority with several projects underway along with construction of additional FAR allowed in our Motels. We are channelising our efforts and resources towards CORPORATE OVERVIEW executing them with trademark Anant Raj excellence. We are also focussed on optimally utilising our vast fully-paid landbank of 240 acres and pursuing newer acquisition opportunities in prime locations, to take up new projects.

The path ahead is promising, and we intend to progress ahead with a clear focus on completely deleveraging balance sheet in the next two years. This is being ensured by prudently deploying internal accruals to pay-off debts and fund project execution. Further, we will also explore opportunities for capital-light development model to ensure that capital is highly productive and funds for execution are available.

CONCLUSION

In closing, I would like to express my heartfelt gratitude to our Shareholders, Bankers, Business Partners, Suppliers, Customers, and Employees for having journeyed with us over the years. These are exciting times and we look forward to delivering and creating immense value for our stakeholders.