Aurum PropTech Limited — Capital/Financing Update 2024

Sep 12, 2024

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Date: September 12, 2024

To, Listing Department Listing Department BSE Limited National Stock Exchange of India Ltd. Phiroze Jeejeebhoy Towers Bandra Kurla Complex Dalal Street, Fort, Bandra East Mumbai - 400 001 Mumbai – 400 051 NSE Symbol: AURUM

BSE Script Code: 539289

Dear Sir/Madam,

Sub: Media Release

We attach a copy of the media release along with a presentation issued by the Company, titled “Aurum PropTech undertakes the strategic realignment of K2V2 Technologies to enhance focus on its core technology offerings and consolidate its distribution business.”

This is for your information and dissemination on your website.

Thanking you.

Yours faithfully, For Aurum PropTech Limited

Sonia Digitally signed by Sonia Hitesh Jain Hitesh Jain Date: 2024.09.12 18:01:28 +05'30'

Sonia Jain

Company Secretary & Compliance Officer

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MEDIA RELEASE

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Aurum PropTech undertakes the strategic realignment of K2V2 Technologies (“K2V2”) to enhance focus on its core technology offerings and consolidate its distribution business

• K2V2 is a leading PropTech business and provides enterprise tech through its flagship product Sell.do to 650+ developers.

• Sell.do offers a combination of Gen AI and CRM that enhances efficiency across functional domains of marketing, sales, commerce, service, and customer success, therefore enabling a better connection between brands and customers. It leverages technology and data to streamline property search, scheduling visits, rent payments and service requests.

• This realignment is part of the strategic objective of the Company to consolidate and dominate the distribution vertical. It will create a tech-focused distribution cluster offering improved profitability and a better working capital management cycle.

This strategic realignment has the following 6 key underlying benefits:

1. Improved path to profitability : The exited services offerings were impacting the profitability of K2V2 and the distribution vertical, bringing the overall net margin to negative growth. Post the realignment, core tech offerings with established scale and brand have put K2V2 and the distribution vertical on a profitable growth path.

2. Improved cash flows: The nature of the exited business was impacting the cash flow cycle as service delivery to revenue collection was a longer period. K2V2 will have an improved cash flow that will ensure that the working capital cycle for the distribution business will improve and will have a self-sustainable growth model.

3. Enhanced talent efficiency: There is a ⁓40% increase in revenue per team member per year with this strategic realignment. ( INR 22 lakhs v/s INR 16 lakhs).

4. Commitment to Entrepreneur focus: Aurum PropTech’s model is anchored around Entrepreneurs. With this strategic realignment, two out of three K2V2 founders are committed to building and scaling up the technology business.

5. Efficient equity realignment : With this strategic realignment, our equity shareholding in K2V2 has increased to 83.6% for a total consideration of INR 24 crore. With this realigned equity and focus on core technology operations, Aurum will be able to put more growth momentum into the distribution vertical.

6. Synergies for International GTM: The distribution cluster at Aurum has now core tech offerings with the potential for a joint international GTM. The enterprise-level offerings of data analytics, property management, marketing and sales automation will help real estate developers sell and manage their real estate properties at scale.

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Speaking about the acquisition, Mr. Onkar Shetye, Director of Aurum PropTech said “ The realignment of K2V2 will ensure that our distribution cluster offerings have key elements of fundamentally sound and sustainable businesses with improved revenue, profitability, efficient cashflow management, proven and potential for scale and leadership drive and put more growth tailwinds within the Aurum PropTech ecosystem and take us to the next phase of growth scale ”.

Journey of value creation in K2V2/Sell.do

Date of event	Particulars	Amount (INR)
23.07.2021	Approved the acquisition of a 51% equity stake in tranches	43 Crore
23.07.2021	Acquired first tranche of 44% equity stake	18 Crore
29.08.2022 to 30.06.2024	Provided convertible debt Incubated business of ‘BeyondWalls’ and ‘Kylas’ under the leadership of Vikram Kotnis (Vikram)	10 Crore
12.09.2024	Aurum PropTech increases their shareholding to 83.6% in K2V2/Sell.do Aurum PropTech retains 15% shareholding in Kylas SPV Sale of Business of ‘BeyondWalls’ to separate SPV owned by Vikram and others	-
15.09.2024 to 31.03.2026	Aurum to be repaid from K2V2 (based on the cash flow)	4 Crore

Aurum will hold 83.6% shareholding of K2V2/Sell.do for INR 24 Crore

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MEDIA RELEASE

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About Aurum PropTech:

Aurum PropTech Limited is a listed company with BSE Limited (Scrip code: 539289) and National Stock Exchange of India Limited (Scrip code: AURUM). It aims to bring transparency, trust and digital transformation to the real estate sector through its Integrated PropTech Ecosystem.

For more information, visit www.aurumproptech.in

About Aurum Ventures:

Aurum Ventures is a privately held Real Estate Investment, Development and Asset Management companies in India. They own, operate and develop high-quality assets through their in-house teams in Design and Development, Investment Management, PropTech and Asset Management.

For more information, visit www.aurumventures.in

Key Contact:

Aurum PropTech Limited Sonia Jain Investor Relations Sonia.jain@aurumproptech.in

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STRATEGIC REALIGNMENT K2V2 BUSINESS

Distribution Cluster: Features Before Realignment of K2V2

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Awareness Discovery Transaction Post Sales
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• Marketing automation • Bulk marketing

• • Campaign management • ROI analysis • Consumer Profiling • Data analytics • Lead Generation

• Inventory Management

• • Negotiation management • Launch management • EOI Suite • Sourcing Management • Channel Partner Management • Loyalty program

• Document Management

• Demand Letters

• • E-KYC • Referral programs • Ticketing • Construction Updates • Loan Approvals

• Digital marketing

• • Strategy Planning • Web development

• Launch strategy

• • Launch Events

• Site visit services

• • Transaction services • Channel activation • Broker management

Technology and Product offerings

Our Distribution business across the real estate distribution value chain included technology, products, tech-enabled services and services to real estate enterprises.

Technology enabled services offerings

Only Services offerings

1

Distribution Cluster: Features After Realignment of K2V2

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Awareness Discovery Transaction Post Sales
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• Marketing automation • Bulk marketing

• • Campaign management • ROI analysis

• Consumer Profiling

• • Data analytics • Lead Generation

• Inventory Management • Document Management

• • Negotiation management • Demand Letters • Launch management • E-KYC • EOI Suite • Referral programs • Sourcing Management • Ticketing • Channel Partner Management • Construction Updates • Loyalty program • Loan Approvals

• Digital marketing • Launch strategy

• • Strategy Planning • Launch Events

• Web development

• Site visit services

• Transaction services

• • Channel activation

• Broker management

The realignment of K2V2 business will ensure that our offerings focus on core tech, tech-enabled service and will be exiting pure services-led businesses. This is to ensure that K2V2 becomes a core tech and product company.

Technology and Product offerings

Technology enabled services offerings

Retain

Exit

Only Services offerings

2

Distribution Cluster: Profitability Before Realignment of K2V2

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Growth FY23-24

Performance FY24

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₹ 56.7 cr

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1.12x
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₹ 64 cr

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	Total	Aurum	Sell.do	BW	BW Digital	Kylas
		Analytica
Revenue	64.0	22.0	15.4	18.8	4.0	3.7
CAGR		92%	10%	160%	2%	71%
COGS	40.5	12.5	8.5	14.9	2.8	1.6
Fixed	17.6	8.3	2.2	2.3	0.2	4.5
Costs
GnA	11.4	1.5	2.1	3.5	1.1	3.2
Net	-8.8%	-1.3%	16.5%	-10%	-7%	-155%
Margin

FY23 FY24

Aurum Analytica

The distribution segment comprising of 5 brands had two successful scale-ups with one also ensuring profitable growth. The consolidated net margin of negative 8.8% was also impacting the cash flow cycle as service delivery to revenue collection extended over a longer period.

Sell.do

Others

3

Distribution Cluster: Profitability After Realignment of K2V2

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Growth FY23-24

Performance FY24

			Kylas	Kylas
Total Aurum Analytica Sell.do Revenue 37.4 22.0 15.4 CAGR 92% 10%	BW	BW Digital	Kylas
	18.8	4.0	3.7
	160%	2%	71%
COGS 21.1 12.5 8.5	14.9	2.9	1.7
Fixed Costs 10.5 8.3 2.2	2.3	0.26	4.5
GnA 3.6 1.5 2.1 Net Margin 5.8% -1.3% 16.5%	3.5	1.1	3.2
	-10%	-6.5%	-155%

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1.53x
Analytica
Revenue 37.4 22.0 15.4 18.8 4.0 3.7
₹ 37.4 cr
CAGR 92% 10% 160% 2% 71%
COGS 21.1 12.5 8.5 14.9 2.9 1.7
₹ 24.3 cr Fixed 10.5 8.3 2.2 2.3 0.26 4.5
Costs
GnA 3.6 1.5 2.1 3.5 1.1 3.2
Net 5.8% -1.3% 16.5% -10% -6.5% -155%
Margin
FY23 FY24 The realignment is part of the strategic objective to consolidate and
dominate the distribution vertical. It will create a tech-focused
distribution cluster offering with improved profitability, a better working
Aurum Analytica
capital management cycle and the potential for scale to make the
business more agile for the next phase of growth.
Sell.do
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4

Distribution Cluster: Cash flow Management

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Delivery to Collection Cycle
Before realignment
Prepaid
29% 38%
Within 45 days
Beyond 45 days
32%
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Delivery to Collection Cycle
After realignment
Prepaid
6%
Within 45 days
41% 53% Beyond 45 days
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Revenue collection for technology and product offerings along with tech-enabled services were majorly either prepaid or within 45 days of the services rendered. Whereas in services offering, these were delayed with most of the revenue being collected post 60 days of the services rendered. This combined with operations and people heavy nature of the services business resulted in long working capital cycles and limited growth and scale.

The realignment of the Distribution segment will ensure that our working capital cycle improves with a better collection of revenue, thus bettering our prospects for free cash flow and self –sustainable growth model.

5

Distribution Cluster: Talent Efficiency

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⁓
40%
₹ 22 lakhs
₹ 16 lakhs
Before After
realignment realignment
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75 out of 245 techies

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⁓
46%
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Before realignment
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About 31% resources were technology oriented, rest were of services and operations in natures

55 out of 72 techies

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After realignment About 70% resources are technology oriented, rest in customer success and operations

Revenue per team member for K2V2 business

Employees with technology skills and scope in K2V2 business

The realignment has improved our resource stack and resource-to-revenue ratios. Post realignment, our revenue per employee for the distribution business has increased from INR 16 lakhs to INR 22 lakhs per team member. Additionally, the technology-oriented individuals have also increased by 46%

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Two out of three founders retained by Aurum in the K2V2 business

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60% technology and operational founder capabilities retained by Aurum

6

Distribution Cluster: Equity realignment

Equity status pre-realignment

Technology and Scale barometer

• High on core Technology with proven scale

• 44% Shareholding with Aurum

Real Estate specific agnostic Sales Automation features

• 100% features including technology, tech-enabled services and services with Aurum

High on core Technology with the potential scale

Industry agnostic Sales Automation features

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Low on core technology with Services features no scale

• Core technology , and tech operations and services capabilities

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Equity status post-realignment

• 83% shareholding to retain core tech business with proven scale

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15% shareholding retained with no additional equity infusion to retain core tech business with potential scale

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0% retained in business low in core tech and no scale

The realignment of K2V2 business segment has retained and increased Aurum’s stake in core technology offerings with proven scale in domestic markets and potential in international markets. Additionally, we have retained 15% stake in the business with core tech and potential scale for expansion in an industry agnostic product. We have completely exited the services business with no tech and low scale.

7

Distribution Cluster: Enterprise Tech Suite for International GTM

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Synergies for Enterprise Offerings

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Data analytics enabled Marketing automation Artificial Intelligence enabled Sales automation

Tech focused founders, teams, technology offerings with potential to scale domestically and internationally..

Machine Learning enabled Property Management Exit of Services business

Exiting non tech services business with no synergies with teams and markets for Enterprise Offerings

The realignment of the K2V2 business segment has opened an opportunity to offer product and core tech offerings to real estate enterprises internationally. With the combined synergies of Analytica, Sell.do and Monk Tech Labs, Aurum will be able to offer data analytics, property management, marketing and sales automation which will help real estate developers sell and manage their real estate properties at scale.

8

Thank You

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Aurum PropTech Limited Investor Relations

Sonia Jain E-mail: sonia.jain@aurumproptech.in