Kalpat. IPO

Objects of the Offer

• Maintain its focus on the Mumbai Metropolitan Region and Pune, Maharashtra while selectively pursuing opportunities in other high growth cities.

• Completing and selling its Ongoing Projects, Forthcoming Projects and Planned Projects in a timely manner and unlocking potential value in its existing land reserves.

• Deleveraging its balance sheet.

• Further growing its real estate development business by entering into redevelopment, joint venture and joint development projects with other landowners to develop their land.

• Continue to focus on all segments of residential projects while selectively developing retail, commercial and other projects as part of mixed use developments.

• Continue to create innovative, quality, green and sustainable real estate developments.

• Prominent real estate company in the Mumbai Metropolitan Region in Maharashtra with a portfolio of projects diversified across different micro-markets and price points in the Mumbai Metropolitan Region and Pune, Maharashtra

• Well-established brand with the ability to sell throughout the construction phase

• Strong project pipeline with visibility towards near term cash flows

• Proven end-to-end execution capabilities with continuous innovation and ability to deliver projects in a timely fashion

• Leading real estate company in implementation of green and sustainable buildings

• its affiliation and relationship with the Kalpataru Group and the strong track record of its Promoters enhances its reputation and enables it to derive synergies in terms of expertise and experience

• Experienced and qualified management team with strong human resource practices

• The company has incurred net losses in the past. Any losses in future periods could adversely affect its financial condition, results of operations and cash flows and the trading price of its Equity Shares.

• As of December 31, 2024, 94.84% of its real estate development projects were located in and around the Mumbai Metropolitan Region and Pune and the company is exposed to risks originating from economic, regulatory, political and other changes in this region which could adversely affect its business, results of operations and financial condition.

• The company has not acquired the entirety of the land or rights required to develop two of its Planned Projects, Kalpataru Platina and Kalpataru Espacio. In the event the company is unable to acquire all the land required, its may not be able to develop these projects as planned, or at all.

• Its Statutory Auditors have included matters of emphasis and negative observations in their audit reports on its audited consolidated financial statements for the nine months ended December 31, 2024 and the past three Financial Years.

• There are outstanding litigation proceedings involving the Company, Subsidiaries, Joint Ventures, Associate, Group Companies, Directors, Key Managerial Personnel, Senior Management and Promoters and an adverse outcome may adversely affect its reputation, business, financial condition, results of operations and cash flows.

• As of December 31, 2024, 95.41% of the total Developable Area and 95.11% of its total Sales across the company Ongoing Projects, Forthcoming Projects and Planned Projects are attributable to residential projects. The company depends significantly on its residential development business which is subject to needs and preferences of its customers. The company failures to continually anticipate and respond to customer needs may affect its business and results of operations.

• The company has had net negative cash flows in the past and any negative cash flows in the future could adversely affect its cash flow requirements, which may adversely affect its ability to operate the company business and implement its growth strategies.

• Its Group Companies and certain Subsidiaries have incurred losses in the past. Sustained losses in the future by such Group Companies or Subsidiaries could require it to provide financial support, which could adversely affect its business, financial condition, results of operations and cash flows. received from one of its lenders, HDFC Bank Limited, is conditional on a part of the Net Proceeds being utilized towards repayment of Rs.5,000 million to HDFC Bank Limited.

• The company has incurred penalties in relation to compliance with its debt financing arrangements in the past and its future inability to meet the company obligations under its debt financing arrangements could adversely affect its business, results of operations, financial condition, and cash flows. Further, the consent.

• The company intend to utilize Rs.11,925.00 million out of the Net Proceeds of the Issue towards repayment/prepayment, in full or in part, of certain borrowings availed by the Company and its Subsidiaries. Any default by such Subsidiaries in relation to their outstanding borrowings or adverse developments in relation to their credit ratings could adversely affect its business, financial condition and results of operations.

• The company is exposed to the risks pertaining to land acquisition due to limited supply of land, increasing competition and applicable regulations, which may adversely affect its business, results of operations and financial condition.

• Its projects have long gestation periods and any delays and cost overruns in relation to its Ongoing Projects, Forthcoming Projects and Planned Projects could adversely affect its business, results of operations and financial condition.

• Its commercial and retail real estate businesses are dependent on its ability to provide high quality space to its customers, forecast demand, and enter into suitable leasing arrangements. Its inability to do so may adversely affect its business, results of operations and cash flows.

• Its business is capital intensive and requires significant expenditure. Limitations imposed on it due to the company indebtedness or its inability to procure additional indebtedness could adversely affect its ability to conduct the company business and operations or pursue its growth strategy.

• The company does not own the "Kalpataru" brand including the trademark, the word mark and the logo, which among other intellectual properties, is owned and has been licensed to it by Kalpataru Business Solutions Private Limited. Any failures to enforce its rights to use trademarks and brand names could have an adverse effect on its business and competitive position.

• Its operations are labour intensive, and the company may be subject to strikes, work stoppages, increased wage demands or high attrition, which could adversely affect its business, results of operations and financial condition.

• Redevelopment projects are subject to risks involving existing tenants, occupants and applicable Government regulations which may affect its project completion times and costs, and adversely affect its business, results of operations and cash flows.

• Disruption or fluctuation in supply or prices of key building materials could affect its estimated construction cost and timelines resulting in cost and time overruns, thereby adversely affecting its results of operations and financial condition.

• The company has pledged equity shares of its Subsidiaries in favour of certain lenders. In the event that such lenders exercise their rights under the respective share pledge agreements upon a default or breach under the financing agreement, its business, results of operations, and cash flows could be adversely affected.

• Certain non-generally accepted accounting principle financial measures and other statistical information relating to its operations and financial performance have been included in this Red Herring Prospectus. These non-GAAP financial measures are not measures of operating performance or liquidity defined by Ind AS and may not be comparable with those presented by other companies and such measures may not compare favourably with its industry peer group companies, which could adversely affect its business, financial condition, results of operations and prospects.

• There have been instances of delays in payment of employee-related statutory dues by the Company in the past. Any failures or delay in payment of such statutory dues may expose it to statutory and regulatory action, as well as significant penalties, and may adversely affect its business, results of operations, cash flows and financial condition.

• There have been instances of delays in filing of goods and service tax returns by the Company in the past. Any failures or delay in such filings may expose it to statutory and regulatory actions and penalties, which could adversely affect its business, results of operations, cash flows and financial condition.

• It is difficult to compare its performance between periods, as the company revenues from operations and expenses fluctuate significantly from period to period.

• Its investments in partnership firms and LLPs, could expose it to risks relating to their financial performance, governance, taxation and regulatory compliance, which could adversely affect its financial condition, results of operations and cash flows.

• Its operations and the work force on project sites are exposed to a variety of hazards which may adversely affect its business, financial condition and results of operations.

• Certain of its corporate records, filings and instruments of transfer are not traceable. The company cannot assure you that legal proceedings or regulatory actions will not be initiated against it in the future, or that the company will not be subject to any penalty imposed by the competent regulatory authority in relation to such discrepancies.

• Its may be subject to third-party indemnification, liability claims or invocation of guarantees, which may adversely affect its business, cash flows, results of operations and reputation.

• Its inability to successfully implement its expansion and growth strategy could have an adverse effect on its business, results of operations, financial condition and cash flows.

• Unsold inventory in its projects if not sold in a timely manner may adversely affect its business, results of operations and financial condition.

• Its projects require the services of third parties, which entail risks that could adversely affect its business, results of operations and financial condition.

• The company enter into arrangements with various third parties to acquire land, and development and redevelopment rights, which entail risks that could adversely affect its business, financial condition and results of operations.

• Changes to the floor space index and transferable development rights by the relevant statutory authorities where its projects are located could adversely affect its business, financial condition and results of operations.

• 37.10%, 18.84% and 40.00% of its Sales value for the nine months ended December 31, 2024 and 43.26%, 35.99% and 16.32% of its Sales value for the Financial Year 2024 was attributable to highend, luxury and ultra-luxury residential projects, respectively, which are targeted at high-income customers. Any adverse developments affecting customers for such projects could have an adverse effect on its business, financial condition, results of operations and cash flows.

• The company is required to obtain statutory and regulatory approvals, licenses or permits at various stages in the development of its projects. If the company fails to obtain, maintain or renew our statutory and regulatory approvals or permits, its business, results of operations, financial condition, and cash flows could be adversely affected.

• A significant portion of its working capital needs are funded by presales. Any cancellation of sales or change in the laws or regulations governing the use of presales could adversely affect its results of operations and financial condition.

• The company is subject to safety, health, environmental, labour, and related laws in its business. Compliance with, and changes to, these laws may increase its compliance costs and may adversely affect its results of operations and financial condition.

• Its business and results of operations could be adversely affected by the incidence and rate of property taxes and stamp duties.

• Sales of its projects are dependent on and will be affected by the ability of its prospective customers to receive cost effective financing and favourable tax treatment.

• High levels of inventories and trade receivables may adversely affect its liquidity, cash flows and profitability.

• Title insurance is not available at commercially viable terms in India. The uncertainty of title to land makes the acquisition and development process more complicated, may impede the transfer of title, expose it to legal disputes and adversely affect its land valuations.

• The failures, inadequacy or breach of its information technology systems or its business processes regarding confidential information and other data, unauthorized access to its confidential information or violations of data protection laws could have an adverse effect on its business, results of operations, financial condition and cash flows.

• The company benefit from its relationship with the company Promoters and its business and growth prospects may decline if the company cannot benefit from this relationship in the future.

• The company is dependent on its Key Managerial Personnel, Senior Management and other qualified and skilled employees. Its inability to attract or retain such persons could adversely affect its business, results of operations, financial condition and cash flows.

• Its Promoters, Directors, Key Managerial Personnel and Senior Management may have interests other than reimbursement of expenses incurred and receipt of remuneration or benefits from the Company. Its Promoters and Directors may have interest in entities that are engaged in similar lines of business, which may result in conflicts of interest, adversely affecting its operations.

• Its insurance coverage may not adequately protect it against all risks, and the company may be subject to losses that might not be covered in whole or in part by its existing insurance coverage, which could have an adverse effect on its business, financial condition, results of operations and cash flows.

• A percentage of the Net Proceeds of the Issue will be used for repayment/pre-payment, in full or in part, of certain borrowings availed by its Subsidiaries, which may not be the most optimal use of funds and may not enhance its profitability or cash flows.

• The company will continue to be controlled by its Promoters after the completion of the Issue, who will continue to have significant influence over its business after the completion of the Issue and any substantial change in its Promoters` shareholding may have an effect on the trading price of its Equity Shares which could have an adverse effect on its business, financial condition, results of operations and cash flows.

• Its may be unable to obtain "green" certifications for new projects, which could have an adverse effect on its business.

• The company faces a variety of threats and challenges in the Indian residential real estate sector and an inability to address these challenges could adversely affect its business, financial condition, results of operations and cash flows.

• The company has entered into, and will continue to enter into, related party transactions and there can be no assurance that such transactions will always be in the best interests of its minority shareholders and will not have an adverse effect on its business, financial condition, results of operations, cash flows and prospects.

• The company has contingent liabilities, which, if materialized, may adversely affect its results of operations, financial condition and cash flows.

• The company has provided guarantees to lenders for loans granted to its Subsidiaries and Group Companies, and any failures to repay such loans by such Subsidiaries and Group Companies may adversely affect its business, results of operations and financial condition.

• Certain statements contained in this Red Herring Prospectus are based on current management plans and estimates and may be subject to change. Adverse deviations from its management`s estimates may result in it not achieving results as anticipated, which could have an adverse effect on its business, financial condition, results of operations and cash flows.

• Its business is highly competitive and the company cannot assure you that its will be able to compete effectively with other real estate companies.

• Corrupt practices or fraud or improper conduct may delay the development of a project and adversely affect its business and results of operations.

• This Red Herring Prospectus contains information from third parties including an industry report prepared by an independent third-party research agency, Anarock Property Consultants Private Limited, which the company has commissioned and paid for purposes of confirming its understanding of the industry exclusively in connection with the Issue and reliance on such information for making an investment decision in the Issue is subject to inherent risks.

• The company has received complaints post the filing of the Draft Red Herring Prospectus with SEBI and any legal action initiated by the complainant may have an adverse impact on its reputation and would require the company to incur expenditure in defending such legal claims.