G L BAJAJ INSTITUTE OF MANAGEMENT AND

RESEARCH
GREATER NOIDA

MINOR PROJECT REPORT

ON

Post Graduate Diploma in Management

Term-1 (Batch-2019-21)

Submitted by: Submitted to:

Monica Kamran Rais

Sec-D, Roll no-19097 (Assistant Professor)

1
 G L BAJAJ OF MANAGEMENT AND RESEARCH
GREATER NOIDA

CERTIFICATE
This is to certify that Ms Monica(PGDM 19097) PGDM 2019-
21,Term-1,work exemplified in Minor Project Report on Ashiana
housing ltd. under my mentorship in GL Bajaj Institute of
Management and Research, Greater Noida(U.P).

Mentor Section in Charge Faculty in Charge

Kamran Rais Mr Saurabh Mittal Dr. Dileep Singh

(Assistant Professor) (Assistant Professor) (Professor)

2
CONTENT
INTRODUCTION

History

3
AKNOWLEDGEMENT

The success and final outcome of this project required a lot of guidance and assistance
from many people and I am extremely privileged to have got this all along the
completion of my project. All that I have done is only due to such supervision and
assistance and I would not forget to thank them.

I respect and thank Dr. Ajay Kumar,Director GLBIMR for providing me an opportunity
to do the Minor project in two companies and giving us all support and guidance
which made me complete the project duly. I am extremely thankful to Kamran Rais for
providing such a nice support and guidance, although he had busy schedule managing
the corporate affairs.

4
 Introduction
Ashiana Housing Ashiana Housing Ltd. (AHL) formerly Ashiana Housing & Finance
(India) Limited is a real estate development company established in 1979 with its head
office in New Delhi, India. The company is involved in residential and commercial real
estate development projects ranging from group housing, senior housing, senior care,
retails and hotel. Its operations span across all aspects of real estate development, from
the identification and acquisition of land to planning, in-house construction & sale to
maintenance and resale of the property after possession. The Company has completed
more than 30 projects since inception and is currently engaged in 11 projects at
Bhiwadi(NCR), Jaipur, Jodhpur, Jamshedpur, Lavasa(Pune) and Halol(Gujarat). The
company has completed various prestigious residential projects like Ashiana
Utsav(senior Living),Bhiwadi, Ashiana Aangan, Bhiwadi, Ashiana Rangoli, Ashiana
Villas, Ashiana Garden, Ashiana Greenhill, Ashiana Residency Green, Ashiana Suncity
& Ashiana Woodland and has established its credibility in the sector.

5
 History[
Ashiana Housing Ltd.[3] is involved in middle to upper-middle income residential
housing projects in satellite cities and towns in India– around industrial hubs –
predominantly along the Delhi-Mumbai industrial corridor being promoted by the
Government of India. Its residential real estate development projects range from
apartments to group housing projects. In addition, it also develops limited retail and
commercial properties, including hotels as well as retirement homes for senior citizens.
The company was incorporated on June 25, 1986 under the Companies Act, 1956, as
Ashiana Housing & Finance (India) Limited. Subsequently, the name of the company
was changed to its present name in the year 2007.
As of December 31, 2014, the company completed 24 residential developments and 6
commercial developments, aggregating 10.74 million square feet of saleable area. Its
ongoing projects include:

 13 projects comprising 11 residential developments and 2 commercial

developments, aggregating approximately 6.38 million square feet of saleable area
 15 future projects comprising 13 residential developments and 2 commercial
developments, aggregating approximately 8.40 million square feet of saleable area

6
 Ashiana Housing Limited

Type Public

Industry Real Estate

Genre BSE: 523716

NSE: ASHIANA

Founded 1979

Founder Om Gupta

Headquarters New Delhi

India

Area served New

Delhi, Bhiwadi, Neemrana, Jaipur, Jodhpur, Jamshedpur, Lavasa, Kolkata, Chennai, Gujarat

Key people Mr. Vishal Gupta(Managing Director)

Mr. Ankur Gupta (Jt. Managing Director)
Mr. Varun Gupta(Whole Time Director)

Products Apartments
Retirement community
Assisted living
Retail
Hotels

Services Facilities management

Revenue INR1, 1614.18 million (FY 2012-13)

Net income INR 331.47 million (FY 2012-13)

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Total assets INR 574.06 million (FY 2012-13)[1]

Subsidiaries Ashiana Maintenance Services, Latest Developers Advisory Limited, Topwell Projects
Consultants Limited

Website https://www.ashianahousing.com

8
 Vision & Mission
 Vision –
To nurture an environment which brings a smile of
satisfaction to people who meet us, who live in home built
us, work with us, supply to us and invest with us.

 Mission–

 To develop and maintain homes which are functional,

aesthetically pleasing and environment friendly for
the middle income group.
 To create retirement communities where senior
citizen can lead active, fun filled and a secured life
with dignity.

9
 Core Values
 Happiness All Around
Importance to all; freedom to work and speak; being able to make a mistake; family-
like environment and good interpersonal relationships.

 Transparency
Honesty ; sharing information regularly; self-belief and delivery on time.

 Going the Extra Mile

Passion for everything we do; continuous improvement and adaptability to change.

 Never Give Up
Fulfilling commitment.

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 Company milestones

2017-2018

 WE have crossed 200 lakhs. Sq.ft. development since inception.

2016-2017

 Successfully obtained approval from shareholders for maiden issue of NCD. ₹20
Crores was raised in the first tranche till 31st March,2016.
 Started operations in Kolkata.

2015-2016

 Successfully raised ₹200 Crores from investor through QIP.

 Started operations in South of Gurgaon [sohna ,NCR].

 Started operations in Chennai.

2011-2015

 Acquired land in South of Gurgao[Sohna,NCR]

 Started operation in Halol[Gujarat].

 Acquired land in Chennai.

 Completed strategic branding exercise.

 Listed on NSE.

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 2006-2011

 Started operations in Lavasa

 Started operation in Jodhpur.

 Completed Senior Living Homes in Ashiana Utsav,Bhiwadi.

 Started operation in Jaipur.

1997-2006

 Started oprations in Neemrana

 Ashiana Maintenance Services Limited Became Subsidiary of our Company.

1986-1997

 Listed on BSE Small Cap Index

 Shifted Head Office to New Delhi

 Incorporation of Ashiana Housing & Finance Limited.

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  NDTV Property Awards 2016 felicitated “Ashiana Dwarka” as “Budget
Apartment Project of the year “ in tier 2 cities “2017 .
2016-2019  Received CIDC Vishwakarma Awards 2017 under the category
“Achievement Award for Construction Skill Development” 2017.

 Received CREDAI CSR Award 16-17 under the category “Education “2017

 Received Bhamashah Award for Contribution Made in the Field of

Education by Govt. of Rajasthan.

 Recevied FICCI “category “- CSR Award for Small & Medium Enteerprises
(SME).
2015-2016
 CNBC Awaaz felicitated Ashiana Housing Limited with one of the Most
Promising Company of the Next Decade.

 Rangoli Gardens , Jaipur awarded as The Best Budget Award Apartment

Project of the Year by NDTV Profit.

 Awarded as Realty Giants North India by Realty King North India .

 Recevied Bhamashah award for contribution made in the field of Education

by Govt. of Rajasthan.

 Ashiana’ Marketing Team Awarded as Most Talented Marketing Professional

(Real Estate ) by Lokmat.
2014-2015
 Awrded as Best Investor Communication Practice in the Emerging
Corporated Category by Professional (Real Estate) by Lokmat.

 Awarded as best Investor Communication Practice in the Emerging

Corporate Category by Research Bytes.

 Ashiana Utsav ,Lavasa awarded as Senior Living Project of the Year in India
by Realty Excellence Award. 13
  Received Bhamashah Award in Field of Education by Govt. of Rajasthan.

2013-2014
 Think Media Award for Outstanding Outstanding Corporate Social
Responsibility Work in Real Estate Sector .

 Honored by Bharat Vikas Parishad Rajasthan For Corporate Social Actiities.

 Ashiana Aangan, Bhiwadi awarded as Best Affordable Housing by CNBC AWAAZ

REAL ESTATE AWARDS.

2012-2013  Ashiana Utsav –Senior , Living ,Bhiwadi awarded as India’s Best Theme Based
Township based Township by CREDAI REAL ESTATE AWARDS (non-metro
Category).

 Recevied BMA-Siegwerk Award for Corporate social Responsibility.

 Ashiana Aangan, Bhiwadi awarded as India’s Best Residential Project (North)

by ZEE –Business RICS Awards.
2011-2012  Ashiana Woodlands, Jamshedpur Awarded as India’s Best Residential Project
(East) by ZEE- Business RICS Awards.

 Rated by FORBES’ among Asia’s 200 Best under a Billion Dollar Companies
twice in a row.

2010-2011  Rated by FORBES’ among Asia’s 200 Best Under a Billion Dolar Companies.

 Received BMA- Siegwerk award for Corporate Social Responsibility .

14
 Strengths & Opportunities
Execution
• Timely delivery

• In-house construction – Ensure high control over cost and quality and flexibility in
execution

Strong Balance Sheet

• Cash & Cash equivalent way higher than debt

• Raised capital of Rs. 200 Cr to pursue growth opportunities, further strengthen the
balance sheet.

Revenue Visibility
• Strong revenue visibility - saleable value of area sold in ongoing project : Rs. 440
Crore (AHL projects)

• Saleable value of area sold in partnership : Rs. 115 Crore

Healthy Project Pipeline

• Ongoing project of 24 Lakhs Sq. ft. (13.92 Lakhs sq. ft. already booked)

• Future projects of 80 Lakhs Sq. ft.

Brand Recognition
High Brand recall

• Customer assured of timely delivery, affordable offering and transparency in dealings.

Direct Sales Team

• In-house selling to actual users and investors

• Provides better market insights

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In-house Maintenance
• High quality maintenance at affordable rates

• Maintaining relationship with customer after sale

• Provides inputs to development team to improve quality

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 RERA- The Game Changer
•Bring back customer confidence and much needed transparency in the Real Estate
Sector

•Stringent provisions like prioritised usage of customer advances for the project,
registration before any sort of advertisement, timely delivery and more accountability
for builders

•It would lead to consolidation in the industry with only serious and long term players
surviving in the long run

•Ashiana fully geared up to comply with various RERA provisions. Already practising
several RERA requirements like timely delivery, transparency and usage of funds
primarily for the project

•Ashiana sees it is as an opportunity being a long term player in the industry.

GST
•One of the most important tax reforms in Independent India

•Improvement in GDP in the long run leading to boost in Real Estate demand as well

•Single market with ease of doing business, easy compliance, wider tax base and
improvement in productivity.

•More clarity and convenience for the buyer (VAT related complications in the Pre
GST regime)

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 MANAGEMENT DISCUSSION & ANALYSIS

ECONOMY

Financial year 2016-17 was a mixed bag for the economy. The country earned the
tag of Fast Growing Large Economy of the world with a GDP Growth of 7.1%. In
first half of the year there was optimism in the country on the back normal monsoon
and increased private investment. In November 2016, Govt. announced
demonetisation by banning old `500 and `1,000 currency notes. The historical
decision made 86% of currency in circulation illegal. This impacted consumption
and demand and eventually private investment slowed down.

However, demonetisation has long term benefits, it will increase digitisation in

economy, financial saving will increase and will add to investment cycle, as more
money will come to formal economy more tax will increase govt income and thus
spending and all of these factors will eventually lead to higher GDP growth, better
tax compliance and greater tax revenues. Demonetisation will lead to movement of
unorganised segments into the formal economy.

Outlook on the economy for next financial year is positive. Factors like falling
Inflation, receding impact of demonetisation, Budget 2017 announcements and GST
would drive growth of Indian economy going forward. Declining interest rates with
recent government stimulus announcements will push the growth of Indian
economy.

GST is expected to be applicable from 1st July, 2017 and will play most prominent
role in FY18 in Indian economy. It is biggest indirect tax reform in the country. It
will simplify indirect tax structure, bring more transactions into formal economy,
increase transparency and will eventually increase tax collection of Govt. GST
would also lower prices as it will help businesses in availing input tax credits due to
seamless transaction.

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REAL ESTATE REGULATORY ACT, 2016 (RERA)

RERA has come into effect from 1st May, 2017. It is a big reform in the real
estate sector in India. This Act is set to bring customer and other
stakeholder’s confidence back by increasing compliances and transparency in
dealings. It will help the buyer to take much more informed decision than
ever before. This will also attract investment in the sector.

The provisions of this Act require that only those projects which have all
approvals in place can be advertised and sold to home buyers. Also
information related to approvals, time taken for completion and master plan
of project have to be disclosed before the launch. Non compliance of the Act
would attract heavy monetary penalty and imprisonment.

Rules of RERA require that each project must have a separate designated
bank account. 70% of collections from customers are to be deposited in this
dedicated account. This rule will be game changer in the industry; it will help
industry in terms of ensuring timely delivery of projects, elimination of non
serious/short term players the real estate sector and bring about better and
cleaner financial management of customer advances

Many developers are dependent on the advances from buyer for the
completion of project, and funds were also diverted for purchase of land
parcels and launching new projects. Now under the new law, the developer
needs to ensure proper utilisation of money in the projects. Developers whose
balance sheet is leveraged and which are facing liquidity crunch, and are not
able to complete their unfinished inventory will suffer the most.

BUDGET, 2017

Government in Budget, 2017 announced various incentives which will boost growth of
real estate sector.

Status of Infrastructure to real estate sector - Govt has granted Infra status to
industry. This is very big boost for industry wherein gestation periods are long and
capital is in short supply. Infra status will attract cheaper and long duration capital
funds to invest in the sector. This will also help in getting approval faster for the
projects.

Tax Benefit on Long Term Capital Gain - Holding period for long term capital gains
for immoveable property has been reduced from 3 year to 2 years. This might lead to
more resale cases and hence increase in demand. It will attract more investors in the real

19
estate. Also indexation base year has been shifted from April 1984 to April 2001 for the
benefit of investors.

Tax relief on unsold inventory - Real estate developers are facing problem of huge
unsold inventory. Also they had to pay tax on notional rental income from unsold
inventory. In budget Govt. has relaxed time and taxability shall arise only after one year
from receiving completion certificate.

Deduction of 100% of profits for developers of affordable housing projects

(Section 80 IBA of

Income Tax Act, 1961) - Eligibility limits of 30 sq. Meters (4 metro cities) and 60 sq.
Meters (other than 4 metro cities) has been laid down. Built up area has been
substituted by carpet area. Time limit for completion extended from 3 years to 5 years.
This would help developers expand their customer base and also avail tax benefits.

Tax relaxation for land owner in Joint development

model (only for Individuals and HUF) - Land owner in case of joint development had
to pay tax on notional capital gain on the date of contract. In Budget 2017, Govt.
announced that land owner will pay capital gain after completion of projects. This
relaxation should improve supply of land for real estate projects

Besides, in a bid to boost housing post demonetisation the government announced

interest subsidy of up to 4 per cent on loans taken in the new year under the
Pradhan Mantri Awaas Yojana (PMAY). In urban areas housing loans of up to `9 Lakhs
and up to `12 Lakhs will receive interest subsidy of 4 per cent and 3 per cent
respectively, while in rural areas loans up to `2 Lakhs will get an interest subvention of
3 per cent.

All these incentives and policies should provide a fillip to real estate industry
in the years ahead and improve sentiments in the sector.

20
 FACILITY MANAGEMENT

‘Forever Care’ is one of the three brand promises of Ashiana. Ashiana Maintenance Services
carries out the facilities management of all our projects. Its more of a business support activity
primary aim being to efficiently maintain the projects and earn goodwill of customers. Apart
from routine maintenance, this division also provides the value adding services of resale and
rentals and organises several customer engagement events to ensure that all residents enjoy an
active and quality life in our projects. the appreciation we have earned over the years from our
customers for our quality of maintenance is a matter of pride for us and remains as one of the
key drivers for our potential customers to buy our properties.

Completed Projects

During the year the company has completed and recognised revenue of Vrinda Gardens (Phase - I), Ashiana
Umang (Phase-I) and Gulmohar Garden (Phase III & VI) in Jaipur, Ashiana Surbhi (Phase - I), Ashiana Town
(Phase II & III), Ashiana Town Plaza in Bhiwadi, Ashiana Aangan Plaza in Neemrana, Dwarka (Phase - I) in
Jodhpur, Ashiana Navrang (Phase - I & II) in Halol and Utsav Lavasa (Phase - III) in Pune. Area delivered for
revenue recognition was 11.68 Lakhs sq. ft. in AHL and 5.97 Lakhs sq. ft. in partnerships.

Land acquisitions and Expansion Plans

We realise that in order to fulfil our Pan India aspirations to become a credible middle income
housing player we need to actively look for growth opportunities. We continued scouting for
expansion
opportunities. While we continued to explore suitable land deals, we became
more cautious after demonetisation and went into wait and watch mode.

Project Launches for sale

Some of the key highlights pertaining to the business of our company, including its
subsidiaries and partnerships, for the year 2016-17 and period subsequent thereto are
given hereunder:

a) Ashiana Dwarka, Jodhpur (Rajasthan): Launched Phase-II of project

Ashiana Dwarka comfort homes project in Jodhpur (Rajasthan) comprising 2/3
BHK flats with total saleable area of approximately 1.09 Lakhs sq. ft.;

b) Gulmohar Gardens, Jaipur (Rajasthan): Launched two phases i.e. Phase - V

A and Phase - VII in Gulmohar Gardens, Jaipur (Rajasthan). Gulmohar Gardens
comprises comfort homes comprising 2 BHK plus study flats and 3BHK Villa in
Phase - V A and 2BHK in Phase - VII with total saleable area of approximately
1.15 Lakhs sq. ft.

21
c) Vrinda Gardens, Jaipur (Rajasthan): Launched Phase - III of project Vrinda
Garden comfort homes project in Jaipur (Rajasthan) comprising 3 BHK flats
with total saleable area of approximately 0.80 Lakhs sq. ft.;

Project Pipeline

Ongoing Projects Overview

Ongoing projects are the projects in respect of which

(i) all title, development rights or other interest in the land is held either directly by
our company and/or our Subsidiaries and/or other entities in which our company
and/or our Subsidiaries have a stake;

(ii) wherever required, all land for the project has been converted for intended land
use; and

(iii) construction development activity has commenced.

As on 31st March, 2017, we had 24.34 Lakhs sq. ft.

(57.18% booked) under ongoing projects:

22
 The details of ongoing projects are tabulated hereunder:
Location Project Phase Economic Project Saleable Area Area Booked Expected

Name Interest Type (Lakhs sq. ft.) (Lakhs sq. ft.) Completion

Time

Bhiwadi Surbhi 2 100% Comfort Homes 1.30 0.83 FY18

Bhiwadi Tarang 1 100% Comfort Homes 2.28 1.49 FY19

Bhiwadi Nirmay 1 100% Senior Living 2.18 1.24 FY18

Chennai Shubham 1 73.75% of

Revenue Share Senior Living 1.63 0.80 FY18

Gurgaon Anmol 1 65% of Revenue Share Comfort Homes 4.16 1.49 FY19

Jaipur Gulmohar Gardens 5&7 50% of Profit Share Comfort Homes 2.10 1.47 FY18

Jaipur Vrinda Gardens 2&3 50% of Profit Share Comfort Homes 2.65 1.53 FY18

Jaipur Umang 2&3 100% Comfort Homes 5.86 4.08 FY18

Jamshedpur Anantara Aries 74.5% of Comfort Homes 0.59 0.59 FY18

Revenue Share

Jodhpur Dwarka* 2 Area Share Comfort Homes 0.96 0.25 FY19

Pune Utsav - Lavasa 4 100% Senior Living 0.63 - FY18

Total 24.34 13.92

23
MANAGEMENT DISCUSSION & ANALYSIS
The challenge in sales in the Real Estate sector continued with our company registering
a sales volume of 6.96 Lakhs sq. ft. which was lower than expectations. The average
realisation price was `3,234 vs `3,293 in FY16; decline due to change in mix, resulting
in a sales value of `22,508 Lakhs.

We clocked an EAC (Equivalent Area Constructed) of 17.39 Lakhs sq. ft. (AHL: 14.01
Lakhs sq. ft. and Partnerships: 3.39 Lakhs sq. ft.). This was excluding area built for
EWS/LIG, which is a statutory requirement and not a business activity for the company.

FACILITY MANAGEMENT

‘Forever Care’ is one of the three brand promises of Ashiana. Ashiana Maintenance
Services carries out the facilities management of all our projects. Its more of a business
support activity primary aim being to efficiently maintain the projects and earn
goodwill of customers. Apart from routine maintenance, this division also provides the
value adding services of resale and rentals and organises several customer engagement
events to ensure that all residents enjoy an active and quality life in our projects. the
appreciation we have earned over the years from our customers for our quality of
maintenance is a matter of pride for us and remains as one of the key drivers for our
potential customers to buy our properties.

Completed Projects
During the year the company has completed and recognised revenue of Vrinda Gardens
(Phase - I), Ashiana Umang (Phase-I) and Gulmohar Garden (Phase III & VI) in Jaipur,
Ashiana Surbhi (Phase - I), Ashiana Town (Phase II & III), Ashiana Town Plaza in
Bhiwadi, Ashiana Aangan Plaza in Neemrana, Dwarka (Phase - I) in Jodhpur, Ashiana
Navrang (Phase - I & II) in Halol and Utsav Lavasa (Phase - III) in Pune. Area
delivered for revenue recognition was 11.68 Lakhs sq. ft. in AHL and 5.97 Lakhs sq. ft.
in partnerships.

Land acquisitions and Expansion Plans

We realise that in order to fulfil our Pan India aspirations to become a
credible middle income housing player we need to actively look for growth
opportunities. We continued scouting for expansion opportunities. While we
continued to explore suitable land deals, we became more cautious after
demonetisation and went into wait and watch mode.

24
Project Launches for sale
Some of the key highlights pertaining to the business of our company,
including its subsidiaries and partnerships, for the year 2016-17 and period
subsequent thereto are given hereunder:
a)Ashiana Dwarka, Jodhpur (Rajasthan): Launched Phase-II of project
Ashiana Dwarka comfort homes project in Jodhpur (Rajasthan) comprising
2/3 BHK flats with total saleable area of approximately 1.09 Lakhs sq. ft.;

b)Gulmohar Gardens, Jaipur (Rajasthan): Launched two phases i.e. Phase

- V A and Phase - VII in Gulmohar Gardens, Jaipur (Rajasthan). Gulmohar
Gardens comprises comfort homes comprising 2 BHK plus study flats and
3BHK Villa in Phase - V A and 2BHK in Phase - VII with total saleable area
of approximately 1.15 Lakhs sq. ft.

c)Vrinda Gardens, Jaipur (Rajasthan): Launched Phase - III of project

Vrinda Garden comfort homes project in Jaipur (Rajasthan) comprising 3
BHK flats with total saleable area of approximately 0.80 Lakhs sq. ft.;

Project Pipeline
Ongoing Projects Overview

Ongoing projects are the projects in respect of which

1) all title, development rights or other interest in the land is held either
directly by our company and/or our Subsidiaries and/or other entities in
which our company and/or our Subsidiaries have a stake;

2) wherever required, all land for the project has been converted for intended
land use; and
3 )construction development activity has commenced.
As on 31st March, 2017, we had 24.34 Lakhs sq. ft. (57.18% booked) under ongoing
projects:

25
 The details of ongoing projects are tabulated hereunder:

Location Project Phase Economic Project Saleable Area Area Booked Expected

Name Interest Type (Lakhs sq. ft.) (Lakhs sq. ft.) Completion

Time

Bhiwadi Surbhi 2 100% Comfort Homes 1.30 0.83 FY18

Bhiwadi Tarang 1 100% Comfort Homes 2.28 1.49 FY19

Bhiwadi Nirmay 1 100% Senior Living 2.18 1.24 FY18

Chennai Shubham 1 73.75% of

Revenue Share Senior Living 1.63 0.80 FY18

Gurgaon Anmol 1 65% of Revenue Share Comfort Homes 4.16 1.49 FY19

Jaipur Gulmohar Gardens 5&7 50% of Profit Share Comfort Homes 2.10 1.47 FY18

Jaipur Vrinda Gardens 2&3 50% of Profit Share Comfort Homes 2.65 1.53 FY18

Jaipur Umang 2&3 100% Comfort Homes 5.86 4.08 FY18

Jamshedpur Anantara Aries 74.5% of Comfort Homes 0.59 0.59 FY18

Revenue Share

Jodhpur Dwarka* 2 Area Share Comfort Homes 0.96 0.25 FY19

Pune Utsav - Lavasa 4 100% Senior Living 0.63 - FY18

Total 24.34 13.92

Note : Ashiana Utsav Lavasa Phase - IV construction has commenced, yet to launch for sales.

*Only AHL’s share

26
FINANCIAL REVIEW (Consolidated Financials)

First time adoption of Ind AS

The financial statements of Ashiana Housing Ltd. for the year 2016-17 have been
prepared in accordance with Ind AS. For the purposes of transition to Ind AS, the
company has followed the guidance prescribed in Ind AS 101-First Time adoption of
Indian Accounting Standard, with 1st April, 2015 as the transition date and Indian
GAAP.

The transition to Ind AS has resulted in changes in presentation of the financial

statements, disclosures in the notes there to and accounting policies and principles.
All those changes have been adequately explained in the Note on Accounting
Policies and Notes to Financial Statements.

Income

Revenue from Operations

Our revenue from operations include: a) revenue from completed projects
(residential/commercial); b) revenue from other real estate operations include
maintenance and hospitality services.
Revenue from Operations decreased by `13,366 Lakhs or 27.15% from `49,225
Lakhs in FY16 to `35,859 Lakhs in FY17. Out of this, revenue from completed
projects decreased from `45,842 Lakhs (FY16) to `32,347 Lakhs (FY17) or 29.43%
due to lower deliveries in FY17.
Revenue from other real estate operations increased from `3,384 Lakhs in FY16
to `3,512 Lakhs in FY17, an increase of 3.79%

Income from Partnership

Income from Partnership includes income earned from projects which

are executed in a separate Special Purpose Vehicle (only Partnership firms in
our case).

There was a decrease of `1,305 Lakhs or 35.53%, from `3,671 Lakhs in

FY16 to `2,366 Lakhs in FY 17 due to lower deliveries.

27
Other Income

Other Income increased by `106 Lakhs or 7.76 %, from `1,371 Lakhs in

FY16 to `1,477 Lakhs due to increase in profit on sale of investments.

Expenses

Total expenses decreased from `39,937 Lakhs to 30,555 Lakhs, a decrease of `

9,383 Lakhs (23.49%), primarily due to decrease in project expenses and purchases.

Purchases

Purchases decreased by 74.98 % from `9,795 Lakhs to ` 2,450 Lakhs. Last

year was higher due to procurement of 2 land parcels, Ashiana Tarang in
Bhiwadi and Umang Extension, Ajmer Road, Jaipur.

Project Expenses

A Decrease of` 1,569 Lakhs or 6.21%, from 25,270 Lakhs in FY 16 to `23,701 Lakhs
in FY17 line with lower construction under AHL projects by 18.60 % (14.01 Lakhs sq.
ft. vs 17.21 Lakhs sq. ft.).

Real Estate Support Operations Expenses

Real Estate Support Operations Expenses increased from `1,605 Lakhs in FY16 to
`1,804 Lakhs in, an increase of `199 Lakhs or 12.39% due to increase in expenses of
maintenance division (Ashiana Maintenance Services Ltd.) both in existing projects and
also handing over of new projects for maintenance.

Employee benefit expenses

The Employee benefit expenses increased by 5.32% (`3,347 Lakhs in vs. `3,176 Lakhs
in FY16). This was due to annual increment and new hiring.

Advertising and Business Promotion

Advertising and Business Promotion expenses were higher at `1,591 Lakhs vs. 1,414
Lakhs in FY16, an increase of 12.5%.

28
Financial costs

Interest cost increased by `381 Lakhs, from `286 Lakh in FY16 to `667 Lakh in FY17
primarily due to interest on `20 Crs debentures issued on 31st March, 2016 and `30 Crs
issued in FY17.

Depreciation and Amortisation

Depreciation decreased from `797 Lakh in FY16 to `788 Lakh in FY17.

Other expenses

Other expenses
Increase in other expenses by `133 Lakhs (6.50%), from `2,044 Lakhs to `2,177 Lakhs mainly
due to higher rental cost.

Gross Profit
At a total delivered area of 11.67 Lakhs sq. ft. (completed projects in AHL), the GP per sq. ft.
was `1,094, 39.48% (FY16: `1,030, 34%)

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 Area Sales Cost of Gross Amount
recognized (` in Good Profit (` in
Particulars as Sales Lakhs) Sold (` in Lakhs)
(in Lakhs (` in Lakhs)
sq. ft.) Lakhs)

Revenue from Real Estate and

Support Operations

Completed Projects 11.67 32,347 19,557 12,772 -

Other Real Estate operations - 3,511 2,409 1,102 -

Gross Profit 11.67 35,858 21,984 13,874 13,874

Add : Partnership firms 5.96 2,366

(Area recognized as sales
and after tax Profit share )

Add : Other Income 1,477

Less : Indirect Expenses 8,570

Profit Before Tax 9,147

Less : Tax Expenses 2,447

Profit After Tax 6,700

Other comprehensive income 577

Total Comprehensive Income 7,277

Less : Minority Interest 0.07

Profit after Minority Interest 7,277

Profit Before Tax (PBT)

Our PBT decreased from `14,330 Lakhs to `9,148 Lakhs due to lower revenues.

Tax Expense

Our tax expense for the year reduced to ` 2,447 Lakhs vs. `3,748 Lakhs in FY16 due
to low revenue booking.

Profit After Tax (PAT includes Other Comprehensive Income, Before Minority
Interest)

As a result of the foregoing, our PAT decreased from `11,080 Lakhs to `7,277
Lakhs

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31
 STRENGTHS AND OPPORTUNITIES

Ashiana continues to capitalize on the market opportunities by leveraging its key

strengths . These include

Goodwill of brand Ashiana

Brand Ashiana has been built over a period 30 years through impeccable track
record in execution, timely delivery, quality of construction, customer
centricity and transparency in dealings.

Healthy project pipeline

Ashiana has over 24.34 Lakhs sq. ft. (57.18% already booked) presently under
ongoing construction. Apart from this, we also have a pipeline of 80.97 Lakhs
sq. ft. in future projects. Future projects are those ones where construction is
yet to commence/approvals are yet to be obtained.

Revenue visibility

There is a strong revenue visibility in the company with saleable value

of sold units in ongoing projects to the tune of ` 440 Crs. Besides,
saleable value in partnership available against sold units is `115 Crs. In
case of partnership projects, only Ashiana share of profit post tax flows
into the top line.

Strong Balance Sheet

The company is low on debt and has a net cash position (cash/cash equivalents
are comfortably higher than debt) on its balance sheet to the tune of `12,091
Lakhs.

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In-house Maintenance

The company focuses on high quality maintenance at affordable rates, has

helped in keeping its customers happy and high resale rates compared to
similar projects. This is in line with our brand promise of ‘Forever Care’ and
over time this has allowed the company to command a premium for its
projects.

RISKS, THREATS AND CONCERNS

Risks are an integral part of any business. While no business can ever be
completely risk free, the management of the company takes various measures
to mitigate risks and protect interest of stakeholders . Ashiana perceives the
following inherent risks in the business:

Economic Risk

This is the risk of cyclical down turn in economic growth adversely impacting
the real estate sector which might lead to slow down in sales.

Mitigating Measure

Ashiana preserves cash during up cycles which helps it ride down cycles. Due to
strength in Balance Sheet owing to adequate cash and low gearing, company is able to
hold inventory of projects through cyclical down turns. The company is also
geographically diversified which leads to avoidance of concentration risk.

Capital Intensive Business

Real Estate is a capital intensive business needing huge investments in land and
working capital which might otherwise hamper smooth continuity of business.

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Mitigating Measure

Asset light model with land being considered as the key raw material and hence
warranting relatively lesser investment.

Models like Joint Development with partners to curtail capital requirements Low debt
to equity ratio (0.11:1) due to lower debt implying lower borrowing cost. Favourable
debt equity ratio with a credit rating of A (upgraded twice in last 2 years) leaves enough
headroom to borrow critical capital as and when required.

Regulatory Approvals

We require statutory and regulatory approvals and permits to execute our projects, and
applications need to be made at appropriate stages for such approvals. We further
require sanction from local municipalities, local bodies, pollution control boards as well
as clearance from airport authorities. There might be significant delays in such
approvals impacting our ability to launch a project.

Mitigating Measure

Our company tries to minimize such delays by investing in land parcels or Joint
Developments are already in place or the investments are linked to the approval
milestones. This reduces our upfront capital commitment.

Rising Manpower and Material Costs

We have seen a double digit YoY growth in labour costs and along with scarcity of
labour has led to time and cost overruns in several projects. The material costs have also
increaseed substantially over the last 4-5 years. The cost per square feet of saleable area
has almost doubled in the last 5 years.

Mitigating Measure

Regularly monitoring the cost and maintaining adequate quantity of material

so that last minute order at higher price can be avoided. Appropriate action
taken to minimize the wastage of material and also reducing idle time of
labour by making material available on time.

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Labour Scarcity

There has been a huge shortage of labour at project sites over the last 2-3
years. Due to success of the government MGNREGA scheme and
development of Eastern India, there has been a big reduction in the migratory
labour from states like Bihar, West Bengal & Odisha.

Mitigating Measure

The company ensures that it pays all wages on time, so that the people who
need the money for their day-to-day expenses have regular access to it. We
have improved labour efficiancy by around 60% in the last 5 years. Also, we
are working to improve living conditions of labourers to attract and retain
them. Because of these best practices, the company has fared better than
many of its competitors.

Establishment of operations/brand in newer locations specially Kolkata

and Chennai.

This is always going to be a challenge. More so in a completely newer

location like Kolkata and Chennai where rub off of the brand is not available
unlike at a conditions place like South of Gurgaon (Sohna) which is
proximate to our strong markets of Jaipur and Bhiwadi.

Mitigating Measure

The company mitigates this risk through simple and effective brand
communication which emphasizes our strength in middle income housing.
Moreover we also engage in various customer engagement programmes and
need based advertising. All these measures coupled with the strength of our
execution team should help us establish our brand in newer locations.

HUMAN RESOURCE

Ashiana is all about nurturing smiles and that’s what we have always done,
not just for our customers, vendors or associates but also for our employees.
Working culture of Ashiana lies in freedom to work which brings sense of
ownership among employees.

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Learning and Development (L&D)

This year, focus was on streamlining L&D process and we started as pilot process with
sales. We shortlisted Salto De Fee to help us in streamlining the L&D process and
classroom training. We also finalized our Learning Management System (Nuveda)
which will help to form a culture of blended learning.

Overall, at an average level, every individual was imparted training for 17.5 hours
during the year. 96 different training were organized in the year, Out of these, 54
trainings were around the internal processes aimed at strengthening the existing process
and in some cases, establishing the new ones. 42 different external trainings were
organized, which were focused towards strengthening the communication skills of
employees and to upgrade the level of other skills.
On technical side, under STEPS training program, 3 candidates were promoted as
junior engineer, post successful completion of 5 years long training program. 13 New
Graduate Trainee Engineers, have under gone their 10 months of ‘ON THE JOB’
training and will be learning internal process for Ashiana for another 8 months.
Through this training, we ensure that every single engineer understands the importance
of fulfilling our Brand Promise ‘On Time Delivery’.
Other than GTEs, 91 technical staff members underwent 2.7 hours of class room
training .
In track 2 reality Survey, under Consumer Connect, we stood at No 6, which clearly
reflects on development of existing competencies of employees which helps in better
connect with the customers.

Hiring/ Recruitment

While we continue to source our entry level staff from the campuses of various
Tier II & Tier III institutions across India, nevertheless, the process of hiring
has become more structured & revolves around competencies & attitude. This
year the hiring was majorly in AMSLLP. This year 20% of hiring was through
reference and our primary focus for next year would be to increase it to 50%.
The induction process is centralized at Head Office and takes around 1 to 4
weeks based on the level of entry. The process is carried forward through a
week of induction at branch/ project moving onto job shadowing / mentoring
phase till such time as the new entrant starts performing at an acceptable level
of proficiency.

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Employee Welfare

We further extended the group medical insurance scheme to parents of

Employees & 361 parents of our staff got covered under it. 617 no. of
employees & 1,314 no. of their dependents utilized benefits of group medical
insurance. We contributed towards helping in education of wards of our
employees by providing scholarship under the Manju Gupta Memorial
Scholarship Scheme up to the sum of `41 Lakhs in the year which benefited
249 students. This year 36 employees took benefit under Loyalty Grant
claiming a total amount of `60.35 Lakhs.

INFORMATION TECHNOLOGY (IT)

Several IT initiatives were successfully undertaken during the year:

• Disaster Recovery site build on cloud computing platform. Different seismic

zone data centre selected for this. Now replica of company’s business critical
application data will be sync online with cloud servers.

• Server infrastructure upgraded at Central Data Centre for better virtualization of

machines. Now more robust and high configuration server installed. These will
help in consolidating of application servers. Now at Data Centre all application
servers are on Vmware Virtualization platform.

• New “Sales Care” software developed for sales team, for better data entry and
customers tracking/management.

• Planning for moving out of MPLS services. Moving on to Secure IP-Sec VPN
over public internet. This will save on cost and help in achieving least
dependency on single telecom company.

• HTTPS (Secure layer) enabled on both internal and external customers website.
www.ashianaonline.in & www.ashianamaintenance.com

• BoQ (Bill of Quantity) check implemented on Project Phase level in Purchase (

ERP) software for material quantity control. This will help in avoiding
purchasing material beyond the approved quantity.

• e-Approval system for PO and other purchase related approvals. This will save
time in PO approval process, when authorities are on site visits.

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 INTERNAL CONTROL

The company has an adequate system of internal controls, commensurate with the
size and nature of its business, to ensure that all assets are safeguarded and protected
against loss from unauthorized use or disposal and to ensure all transactions are
authorized, recorded and reported correctly. company is maintaining function wise
Standard Operating Procedures (SOP). It has in place internal controls covering all
fields across all financial and operating functions ranging from procurement of land
to smooth execution of projects in time. Independent audit firms appointed by the
company conduct periodical audits encompassing various functions, at various
projects, branches and Head Office to ensure adequacy of internal control systems,
adherence to management policies and compliance with the applicable laws and
regulations. Their scope of work also includes internal controls on accounting,
efficiency and economy of operations. The key findings of their audit along with
implementation plan of their recommendations are discussed with the senior
management and also the Audit Committee. The Audit Committee of the Board
reviews the adequacy and effectiveness of the internal control systems and suggests
improvements for strengthening them.

CORPORATE SOCIAL RESPONSIBILITY

Ashiana remains deeply committed to CSR activities and always taken pride
in working with lesser privileged people. Broadly, our CSR activities fall
under the heads enumerated hereunder:
Education:

Phoolwari School:

• For the year 2016-17, an average of 390 students were provided with
basic education. Extracurricular activities were organized to help the
children to learn skills which would help them throughout their life.

• Children were also introduced to outdoor visits for exposure as being

outdoors can be an exciting sensory experience in the early years of age
and they can learn and explore new things.

• Outdoor Visits of Phoolwari kids were given importance and children

were taken to the places not only for enjoyment but also for knowledge
gaining. Total of 19 visits were organized during the year.

• Children actively participated in cleanliness drives and health and hygiene

activities.

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• All festivals are equally celebrated at Phoolwari whether it’s national,
religious or seasonal. Children enjoyed the festivals like Holi, Diwali,
Independence Day, Republic Day etc. They are also encouraged to
celebrate other special days which have significant impact and importance
worldwide.

HEALTH AND SAFETY

At Ashiana, we are proud of our health and safety record. Year after year, we
have made several conscious efforts to inculcate a safer environment and safe
place to work. As a result, number of injuries at workplace reduced
drastically over a period of time.

As a successful organisation, safety and health care has to be on priority. This

means focusing on what matters and what action will deliver meaningful
health and safety outcomes.

During the year we have focused on addressing the most important health and
safety priorities directing our activities to reduce ill health and workplace
injuries. We have concentrated on safe designs in our construction practices
and timely inspections and audits were inducted. Our performance measures
demonstrate the excellent progress we have made.

We will continue to take a sensible and appropriate approach to health and

safety management and keep developing and training our human-assets
related to safety.

PLAN

Our aim is to set and maintain sensible and proportionate standards of health
and safety management to ensure the welfare of our human resources and
others who may be affected by our activities, and to minimise the losses
(financial and reputational) to our business from ill health and injury.

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FRAMEWORK

1. Safety Audit – A quarterly safety audit is conducted with carefully chosen points
which are discussed annually, and a wave of seriousness regarding the compliances
of the audit is spread throughout the organization. It is reflected in the reduction of
incidents/accidents over a period of time.

2. Safety related changes in design/drawings – In a typical residential building, there

are several hazardous places with high risk. We have identified them and properly
designed the necessary precautions to make them safer. Areas such as maintenance
duct, shafts, lift openings, cut outs, etc have been reduced in risk with appropriate
designs, followed throughout Ashiana.

3. Awareness/Training – Every worker who enters the Ashiana site is made aware of
the risks and hazards of working, and also the precautions they must follow to avoid
it. We have implemented daily talks and trainings on various activities to avoid any
hazards. They are made aware about the assembly points in case of emergency and a
team is formed and ready in case of any incident.

4. Mock drills – Fire safety mock drills are conducted at site, and workers are made
aware of the protocols to follow in case of a fire.

5. Health – Routine site visits are conducted by a certified licensed doctor to monitor
the health of our human resources. Further, regular labour hutment visits are
conducted to ensure the proper living conditions of our workers.

SALES

Under the annual theme of Selling to Helping, Learning & Development of sales team
was one of the major priorities. This initiative was started with the following objectives:

• Streamline the Learning & Development culture in the organization

• Train the sales team on the identified processes so that they can help the customers
to take the right decision

• Enable the Sales Managers to train the sales team on a regular basis

40
WORK DONE UNDER THIS INITIATIVE IN LAST
YEAR

In April 2016, we started our search to find a right L&D partner, who could
guide us, hand hold us in our journey of streamlining the L& D culture in the
company. After meeting, more than 20 training companies, we finalized a
business enabling consultancy firm and we also got Manager Learning &
Development for the sales team to coordinate with the consultant and the
Ashiana. To start with, we made the training content on different processes
which are directly linked to sales and ‘Good to Go’ for any sales person in
Ashiana. The processes are:

• Soft skills:

• Home Loan & Eligibility

• Understanding Customer’s Finance

• Construction & Maintenance

We covered each sub process on these topics and benefit which customer gets
because of these processes. We scheduled 3 workshops (3 days each) for all
our Assistant Managers and Managers. We trained them on every process, not
only this also groomed them to train their team members in their respective
branches. We did these 3 workshops in 5 months of time. Post the workshop,
we also tracked that each member of sales team got the benefit out of it.
Way Forward

We are now working on more processes like;

• Need Analysis of Customer

• Architecture & Design

• Marketing

• Sales Processes

• Legal

• Learning Management System:

We have also signed with a leading Learning Management System (LMS)

solution provider. LMS will give us an opportunity to provide e-learning

41
option to our employees. With the help of this tool, employees will have the
advantage to learn anytime & from anywhere. It also helps us to monitor and
analyse the effectiveness in a better way.

MARKETING

New website

We have changed the entire website last year to make it informative, crisp, navigation
friendly and mobile friendly. We also put lot of pictures and videos to make it more
customer friendly and which will help the customer to take his first level decision
online which he needs to verify through site visit. This, we also measured by seeing the
time spent by customers on website.

Some of the key changes:

• Instead of lot of descriptive content on project pages we have confined it to

relevant information which should help customer for decision making

• Refined the gallery and bifurcated it further into under construction and
completed phases

• Added pages like NRI and Defence

• More focus on showing our projects and lifestyle we offer through pictures

• Online booking chart wherein customer can see the availability of units.

• Online booking form for ease of booking

• Live social media updates

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43
 REFERENCES

https://en.wikipedia.org/wiki/Ashiana_Housing

https://www.ashianahousing.com/real-estate-investors/press-releases

https://www.ashianahousing.com/download/Ashiana-Housing-Annual-Report-2016-17.pdf

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