Amit Sarin, Director of Anant Raj Industries said there has not been any cooling off in Delhi or in NCR region in rentals. He added that rentals in Delhi are stable and are going up. 

He added that by the end of Q2, the company should be getting a lot of rental income.

Excerpts from CNBC-TV18’s exclusive interview with Amit Sarin:

Q: The bulk of your revenues i.e 70%, comes from the National Capital Region (NCR) in the form of rentals. In the last three months, have you seen any cooling off in those rental revenues? Going forward, what is your view on that front?

A: There has not been any cooling off in Delhi or in the NCR region rentals. Rentals in Delhi are quite stable and in certain areas they are going up and that is our model going forward.

We want to take the company on a lease model and are focused in NCR and the area around it. 

Q: Nearly 33-35% of your revenues comes from the residential space, so are planning to shift in that sphere?

A: It’s not actually a shift; we have some land bank, which is going to be exploited for residential. But our major revenues will always be leased from the leased income.

Q: What is your land bank at this point in time and in terms of revenues, how are you seeing it shaping currently and in the next 24 months?

A: The land bank as of now is about 982 acre; fully owned by the company and focused on locations. We feel location is a very important factor for making a land bank. So, we are in and around Delhi and a lot area is coming up in the industry. Also because of our location we feel that we will be able to sustain. After the second quarter of this year is when the real lease income for the company will start. These are the projects, which are in the pipeline and will get completed after the second quarter.  

Q: Considering the amount of construction happening in that area, do you see any cooling off of rates happening? People are speaking of a cooling off already.

A: As far as the residential market goes, there has been some cooling off in certain areas. As of now, there is no cooling off in commercial. Especially when you talk about a lease model, there is not much available right now.

In the future, there could be a lot of supply coming in but locations is going to be the key factor, which will decide which areas cool on and which do not. This is one of the strength that we have here.

Q: You spoke about locations where you acquire a lot of your land at a pretty low cost around the NCR region. Are there any locations outside this NCR and Delhi region that you are looking at acquiring land bank and making your next measure base?

A: We are looking at certain areas outside Delhi; some in Haryana and Rajasthan and these are basically the locations where infrastructure growth is happening. Fortunately, there is a lot of infrastructure growth happening in the NCR and that is what basically helps us in finding better locations. Wherever you get connectivity in the future is where one should try and move in. This gives you an advantage over getting into the landbank at cheaper cost and then finally getting better returns from it.

Q: Can you finally leave us with some kind of revenue and profit projection for the next 12 months?

A: I cannot be very specific but there are lot of projects, which are now getting completed, which we have started last year and are now going to be leased out. So, by the end of this second quarter, we should be getting a lot of rental income.