Rays of Belief allocates Rs 24.576 crore to centre rents

Rays of Belief will allocate Rs 24.576 crore of net proceeds for lease and licence payments at existing centres during Fiscal 2027 to Fiscal 2029. The plan assigns Rs 14.445 crore to 136 centres in India and Rs 10.131 crore to three existing centres in Virginia, United States, acquired on June 23, 2025.

How much will Rays of Belief spend on centre rents?

Rays of Belief plans to spend Rs 24.576 crore on lease and licence payments for operating centres over three projected fiscal years. The allocation is for existing centres, rather than leases at new centres, and comprises Rs 14.445 crore for India and Rs 10.131 crore for the United States.

India had 136 centres as of March 31, 2026, while the US operation had three centres in Roanoke, Salem and Lynchburg, Virginia. India represents 58.8% of the combined Rs 24.576 crore allocation and the US represents 41.2%, despite the materially smaller US network; the disclosed amounts are based on existing lease and leave-and-licence agreements.

The projections use amounts payable under valid, existing agreements with landlords and lessors. A leave-and-licence agreement is an arrangement allowing use of premises, and Rays of Belief says its Indian centre arrangements generally range from 11 months to three years. The estimates assume 5% escalation in India and approximately 3% escalation in the US under the respective agreements.

What does the Indian centre-rent allocation cover?

Rays of Belief will use Rs 14.445 crore for lease payments associated with all 136 existing Indian centres in Fiscal 2027, Fiscal 2028 and Fiscal 2029. Although the allocation covers the existing network, 91 of the 136 Indian centres were leased as of March 31, 2026.

Company Learning Centres and Company Learning Centres with Licensed Professionals accounted for 123 of the 136 Indian locations, including 78 leased centres. This category had paid Rs 4.169 crore in lease amounts through March 31, 2026, of which 77 centres in premises procured by Rays of Belief accounted for Rs 4.149 crore.

The remaining 12 Company Learning Centres in premises provided by Licensed Professionals had no reported lease payment, because Rays of Belief did not lease those sites. One centre operated under a revenue-sharing arrangement, called an EIC, had paid Rs 2 lakh. The network also included one leased Centre of Excellence and Research with Rs 12.9 lakh in lease payments, 11 leased School Collaboration Centres with Rs 20.3 lakh, and one leased Upskilling Academy with Rs 16 lakh.

Reported Indian-centre lease expenditure rose from Rs 2.326 crore in Fiscal 2024 to Rs 3.482 crore in Fiscal 2025 and Rs 4.661 crore in Fiscal 2026. The Fiscal 2027 projection is Rs 4.582 crore, below the Fiscal 2026 reported amount, before rising to Rs 4.811 crore in Fiscal 2028 and Rs 5.052 crore in Fiscal 2029. The projected pattern depends on existing agreements remaining in force and the stated 5% escalation applying.

Why is Rays of Belief allocating Rs 10.131 crore to US rents?

Rays of Belief will invest Rs 10.131 crore in Mom's Belief US Inc. to meet lease or licence payments for three existing US centres during Fiscal 2027 to Fiscal 2029. The centres in Roanoke, Salem and Lynchburg entered the group through the June 23, 2025 acquisition of subsidiaries.

The three US centres incurred Rs 2.465 crore of lease payments in Fiscal 2026. The projected expenditure increases to Rs 3.283 crore in Fiscal 2027, Rs 3.373 crore in Fiscal 2028 and Rs 3.475 crore in Fiscal 2029, using an assumed escalation of approximately 3% under the applicable agreements.

The US allocation is 41.2% of the Rs 24.576 crore combined lease budget while covering three centres, compared with Rs 14.445 crore for 136 Indian centres. Rays of Belief provides the contractual projections and different escalation assumptions, but does not disclose comparable floor area, lease terms or other data explaining the difference in projected cost per location.

The capital infusion into Mom's Belief US Inc. may be made through equity, debt or another permissible instrument. Rays of Belief has not finalised that structure, so the use of funds and recipient subsidiary are identified but the final funding instrument is unresolved. The company also plans to establish behaviour-therapy support services at the three acquired US centres over the next three years.

What could change Rays of Belief's rent-proceeds use?

Rays of Belief says net proceeds will initially not be used for lease payments at new centres. However, if an existing Indian-centre agreement terminates before its term ends, or is amended to reduce the lease amount, management may deploy remaining or surplus proceeds for lease payments at new centres, subject to applicable law.

The flexibility is linked to the method used to calculate the Rs 14.445 crore Indian allocation. The estimate is based on actual amounts payable under existing leases and leave-and-licence agreements, rather than a fixed allowance per centre. Any early termination or rent reduction could therefore create an amount not required for the original existing-centre purpose.

Rays of Belief identifies continuity of operations as the rationale for the allocation because centres are its primary service-delivery channel. The planned spending will persist only if the relevant premises continue in use, agreements remain operative, and the projected escalations broadly follow the contractual terms. Directors, key managerial personnel, senior management personnel and the group company have no interest in either lease-payment object.

Suri and Sudhir, Chartered Accountants, certified the lease-payment details in a certificate dated August 18, 2026. The rent allocation is separate from Rs 4.443 crore earmarked for technology hardware and Rs 10.208 crore planned for brand awareness and inclusive outreach during Fiscal 2027 to Fiscal 2029.

Conclusion

Rays of Belief has assigned Rs 24.576 crore of net proceeds to maintaining existing operating sites, with Rs 14.445 crore directed to the Indian network and Rs 10.131 crore directed to three US centres. The planned annual lease expenditure rises from Rs 7.865 crore in Fiscal 2027 to Rs 8.527 crore in Fiscal 2029, reflecting the stated country-specific escalation assumptions.

The next disclosed point to watch is the form of the investment in Mom's Belief US Inc., which may be equity, debt or another permissible instrument and has not been finalised. It will also matter whether any Indian existing-centre agreements end early or are amended, because the stated plan permits surplus funds to support new-centre leases, subject to applicable law.