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Anant Raj Ltd.

BSE: 515055 | NSE: ANANTRAJ |

Represents Equity.Intra - day transactions are permissible and normal trading is done in this category
Series: EQ | ISIN: INE242C01024 | SECTOR: Construction - Real Estate

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Dec 03, 16:00
66.00 -1.05 (-1.57%)
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Dec 03, 15:58
66.30 -0.90 (-1.34%)
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Annual Report

For Year :
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Chairman's Speech

Dear Shareholders,

It is our pleasure to welcome you to the Annual General Meeting of your Company for the year 2015-16. We always look forward to reviewing the performance for the previous fiscal year as well as share our views on the outlook and future plans of your Company.

As you are aware, the Indian real estate industry had been facing stiff and strong winds over the last few years. We can trace this rough weather to the financial crisis of 2008 which had a direct and drastic impact on the real estate space. The recent past has seen concerning overhang of inventory, projects slowing down, decline in launch of new project and an overall sense of trepidation and apprehension in the sector. Almost every player, big or small, fell the impact of these Strong Winds as sales remained subdued, costs increased and margins came under pressure.

However, the last year has been a year of revival sector. As the Indian economy continues to surge ahead, there has been a remarkable change in sentiments. Key macro-economical parameters like inflation and interest rates have been favorable. Wages are rising. The government''s thrust on the real estate sector with long-term initiatives like Housing for All by 2022, 100 Smart Cities and focus on infrastructure are all expected to boost demand in the coming years. Legislative interventions in the form of Real Estate (Regulation and Development) Act, 2016 as well as clarity on REITs will bring in more structure and transparency in the sector and make it more attractive for investors. There has been a flurry of activities in the PE space. The commercial real estate market has been witnessing strong demand during the year.

We believe, these are all positive signs that the real estate sector is poised for a phase of growth.

At Anant Raj Limited, this was a year when we continued to focus on our execution. Anant Raj Estate, our marquee mega project at Sector 63A in Gurgaon, saw work going on in full swing and received the fastest ever certificate of partial completion. We are also considering launching a commercial project worth about Rs. 500 crores at Sector 63A in 2016-17. We shall keep you updated on this.

As far as the financial performance of your Company is concerned, it was a year of good all round performance. In line with the industry trend, there was a marginal drop in revenues. The Total Revenue for the year declined by 8.42 per cent to Rs. 443.30 crores compared to Rs. 484.08 Crores in the previous year. Profit After Tax (PAT) for the year was Rs. 64.18 crores against Rs. 142.38 crores in the previous year. What makes this year''s performance noteworthy is the fact that unlike last year, when the sale of land at 4 Bhagwan Das Road augmented the financial performance, this year, we have achieved this performance without the sale of any principal asset.

At Anant Raj Limited, we are at a good place. Against strong winds in the industry, we have stronger wings that will take us to greater heights in the days to come. Let us briefly explain this :

- We have a land bank of 1,038 acres which is amongst the highest in NCR. What makes this land bank special is the fact that it was acquired at a low cost. It is entirely paid for and is located within 50 km. radius of Delhi

- We have a highly balanced portfolio of real estate assets land plots, ready-to-lease commercial properties, hotel plots and our township project, Anant Raj Estate. What this diversified asset portfolio does is gives us a steady cash flow in the form of rental income as well as capital value appreciation

- Our low-cost land bank gives us massive advantage in the low-cost housing market, which is one of Prime Minister, Shri Narendra Modi''s dream projects. At Neemrana in Rajasthan, we have proven our expertise in low-cost housing by developing and delivering 3,000 flats

- With almost 5.5 million sq.ft. of ready commercial property of which only 30 per cent is leased, we are poised for a significant upside as the commercial subsegment has seen highest traction in the last year

- We have filed designs and applications for all our hotel plots where, with the new FSI rules, we have a potential to develop 7,000 rooms

What makes us stand apart is the fact that we are one of the few companies in our space who do not need any fresh capital expenditure. All our land bank is fully-paid and all our commercial projects are ready. We only need cash-flow for execution, which we are confident to generate from sales.

The outlook for the near and mid-term is promising. The economy is confidently surging ahead; the implementation of the 7th Pay Commission is expected to increase consumer demand; the regulatory changes and government initiatives are expected to start bearing results. Normal monsoon this year will also result in an all round boost for the economy.

As we look ahead, we see a lot of potential. There is significant value that stands to be unlocked at Anant Raj Limited in commercial real estate, in low-cost housing, in hotel plots and at Anant Raj Estate.

The Board of Directors of your Company at their meeting held on July 19, 2016 has approved the Composite Scheme of Arrangement between Anant Raj Ltd (ARL), Anant Raj Agencies Pvt Ltd (ARAPL) Promoter Group Company, Tauras Promoters and Developers Pvt Ltd (TPDPL) and Anant Raj Global Ltd (ARGL) and further on July 30, 2016 has approved minor modification in the said scheme. The proposed Composite Scheme of Arrangement provides for:

i) Demerger of Real Estate Division of Anant Raj Agencies Private Limited (ARAPL/De merged Company 1/ Amalgamating Company) into Tauras Promoters & Developers Private Limited (TPDPL/Resulting Company 1) and subsequent amalgamation of Remaining ARAPL with the Company

ii) Demerger of Project Division of the Company into Anant Raj Global Limited (ARGL/ Resulting Company 2) (a WOS of the Company, yet to be incorporated) and subsequent listing of ARGL at BSE Limited (BSE) and National Stock Exchange of India Limited (NSE)

The above scheme of arrangement shall be subject to the approval of Stock Exchanges, High Court (s), other regulatory Authorities, Shareholders and Creditors of all the Companies.

We believe that the restructuring under this scheme would enable business approach with greater focus and attention for maximization of benefits to all stakeholders and capitalize on the opportunity for the growth.

Indeed, we are set to soar, on Stronger Wings.

We thank you for your continued trust and confidence. We would also like to extend our heartfelt thanks to all our stakeholders : our investors, our partners, our employees, our customers and most of all, our shareholders, for their faith and support. Thank you very much.

Yours sincerely,

Ashok Sarin


Anil Sarin

Managing Director