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Updated:06 Dec, 2021, 15:50 PM IST

BSE
81.45
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0.30 0.37%

Updated:06 Dec, 2021, 16:00 PM IST

dearshareholder,

it gives me great pleasure to interact with you yet again

1. economic environment:

a, the general economic environment remained subdued during the year under review there has been a perceptible slowdown in the economy with the gdp being downgraded and pegged at growth rate of 5%, a rate lower than earlier estimated the deceleration is being witnessed across sectors including agriculture, industry, services and more particularly in infrastructure that includes real estate

b while there has been a drop in the industrial sector, it was some consolation that the construction segment saw an increase of 5,9% during 2012–13 asagainst5 2tvointhepreviousyear

2. road to improvement: if there has to beany tangible improvement in the macro–economic level, then it is essential to expectation and progress on many fronts–international economy, indian economy and real estate secror.

a international economy: as has been observed, international woes have been lowered considerably and quantitative easing is nearing its end the economy worldwide if not on growth path, is moving towards stability

b indian economy:the indian economy is struggling to balance growth and inflation.

i the government (finance minister) has been advocating higher liquidity (read, lower interest rates) this will keep india closer to our targeted growth rate but will risk higher inflation and higher costs of living and greater rupee depreciation versus world currencies

ii on the other hand, reserve bank of india is more concerned with immediate inflation and rupee depreciation rbi is recommending the tightening of liquidity for long term stabilization to natural levels of growth, inflation and currency but this will come at the cost of growth

lii both sides have its logic and reasoning as well as supporters from different quarters what is required is a cohesive effort from all concerned if the policies are aligned (government, rbi and industry) towards one of the two options there will be general consensus, a strategic planning by the industry can take such variables in to account for thefuture growth uncertainty in policy doesn't help anyone

c real estate sector: uncertainty is hurting real estate sector.

i u ncertainry and ma ki ng i mpend i ng leg i slatio ns a ppl icab i e wi th re tros pectiveeffortswillhelpnoone

ii in a developing economy, we need to continually update our legislation – removing age old acts and regulations which have outlived their purposes and no longer serve the current requirements also, implementing new acts and regulations which are non–existent but very much relevant to us today lead to faster approval systems and reduce corruption (read powers of officers and politicians) this would revitalize growth and restore business and customer confidence these are agreeable arguments by all sides

i i i troub i e brews d u ring tra n si tio n, ta ke for exa m pie – experience d u ri n g the dc regu i a tion cha nge i n m u mbai. al i ong oing p rejects of eve ry de vel oper were delayed resulting in cash–flow difficulties and higher holding costs, yet again, this has resulted in higher npas for the banks and delayed possession to the purchasers the government has good intentions at heart but no one benefits in this transitory period i have made this suggestion earlier and would like to emphasize that all new regulations be made applicable for new projects do not change rules of the game halfway intothegame

3. cu rrent scena rio:

a as per a study conducted by prop–equity, 3 67 lakhs residential units were sold during 2012–13 as against 3 98 lakh units in 2011 –12, with unsold nventory at 20 months as against 13 months in the previous year

b in the commercial office space segment, 30 2 million sq feet of area was sold as against 47 3 million sq, ft during 2011–12

c this situation has to dramatically improve for this sector to find its bearings despite the sector reeling under these problems, little help seem to be emanating from the powers that be on the contrary, there is a plethora of levies in theform of indirect taxes that have caused considerable hardship to the sec tor especially in the state of maharashtra these include the continuation of service tax and the retrospective levy of vat.there is no clarity in the levy of these taxes and are under litigation which adds to the hardship high input costs and dearth of funding adds to the woes of the inventory pile up,

d the real estate regulatory bill is on the threshold of becoming part of the statute while this is a welcome step, it will be effectively implemented only ifthe sector receives a single window clearance for projects which currently does not look very feasible

e the government is currently on a reform spree hopefully this will usher fn a path towards development that could help to lift the sagging economy and with it the fortunes of the industry

4. intangible assets: while we are here to approve accounts for the last financial year, i would like to say that business balance sheets hide many more assets than what chey display,only tangible assets no longer remain the competitive advantage forcompanies assets which balance sheets capture are no longer the limitations of key strengths of the company in today's environment, many critical assets are intangible a decade ago, your company was a sick industrial company overthis period it has successfully completed multi user projects in its lower parel facility marathon era –the residential project and marathon innova–the commercial project have won several accolades and are landmarks both have proved to be highly profitable and have created considerable wealth for shareholders in the process, your company has developed intangible assets like customer loyalty and experience that company creates, by the kind of talented and sincere people company employs, by the kind of innovative technology it possessesand many more

5. future projects: a joint venture fordeveloping a prime property in mumbai will commence shortly which will leverage not only the company's physical assets but also intangible assets the property in the western suburbs and bangalore will take a few more years to gather steam

6 the company has embarked on an ambitious programme of corporate social responsibility it sets aside a portion of its profits, which funds a trust setup for creating quality educational facilities senior personnel of the group impart counseling to aspiring students relating to their future educa tionaI and sociai pursuits this concept of csr wfli extend to other areas as weii.

7 marathon, as the word means, is not a sprint but a run of a steady and long duration similarly your company marathon nextgen is a long term player and will stay the course it will play a significant role in the housing requirements in the mumbai metropolitan region as ckprahalad has said, 'the future won't be an extrapolation of the past".

my sincere thanks for the faith that you have reposed in marathon and I urge you to continue to do so yours truly,

chetan r. shah

chairman & managing director

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