Dhaval Ajmera of the Ajmera Group inherited a 50-year old legacy and a solid foundation. He is hoping to take that to greater heights and set his sight on the international markets.

 

He is 27 years old and a Director at Shree Precoated Steels Ltd. He wishes to see his company in the top three developers of India over the next five years.

 

A USD 450 million group, with interest in steel and real estate, the Ajmera Group is synonymous with mega residential projects in the financial capital. Taking the 45-year old family legacy forward is Dhaval Ajmera, who joined the family business right after his MBA from Cardiff University. He is spearheading the realty business and is responsible for taking the Ajmera Group beyond Mumbai and Maharashtra.

 

“After finishing my studies from abroad, when I came back, we started something that the family decided in Bangalore. That’s when I entered and Bangalore was booming at that point of time. We entered the Bangalore market about three years back, which was actually the right time. Also, the real estate business in Mumbai is doing well.

 

“Bhakti Park Gardens is the name of the project located in Central Mumbai. This is one of the largest private gardens in Mumbai of about 25 acres,” he added.

 

For Dhaval, being the third largest landowner in Mumbai is not enough. So, he is all set to bite into the real estate market in the Middle East. He will soon be ready to serve up a 50-60 storey wonder in Bahrain and that is not bad for a guy who loves spending time off digging into the humble vada pav.

 

According to him, “It is a beautiful master plan complex spread on 100 acres of reclaimed land. The project’s name is Bahrain Bay, wherein we are having a gateway tower of about 50-60 storey towers.”

 

With a group turnover of approximately Rs 1,327 crore, Dhaval is keen to give the competition, a run for their money. Expect large townships and affordable housing from this man on the move. Malls, multiplexes and entertainment hubs will also be given a push.

 

“In fact, we were the ones who started the first multiplex and mall concept in Mumbai. Fame Adlabs in Andheri was the first one started by us and of course the entire Fame Adlabs. Now, we have plans and for need to give integrated townships. We need all the malls and multiplex theatres together,” he stated.

 

Excerpts from CNBC-TV18’s exclusive interview with Dhaval Ajmera:   

 

Q: Is it a second township for you in Mumbai?

 

A: No, it’s not the second township. We have done a lot of townships. In fact, during the 1980s, we had done one of Asia’s largest townships of about 15,000 apartments in Mira Road, wherein there was no road and no infrastructure. That is why we developed about 15,000 apartments in one complex. Then, we did Yogi Nagar and Shastri Nagar, which had above 4,000-5,000 apartments. We were concentrating more on townships rather than doing single building projects.

 

Q: Was that just in Mumbai or across wherever you operate?

 

A: It was pretty much across. Even in Pune, we did the first township in the year 1985. Now, we are also doing townships in Bangalore and the one which is going on is about 5.5 lakh sq. ft. We have another 20-lakh sq. ft township going on. So, we are concentrating on huge townships rather than doing a single building project.

 

Q: You have a substantial land bank. You are apparently the third largest owner of land in Mumbai?

 

A: That is all thanks to my father and uncles.

 

Q: Is land acquisition the hardest part of this business?

 

A: Yes, it is and we never got into the race of bidding in today’s market because we never needed to. All our properties are at historic prices and we are enriching it every year and trying the make the most value out of it.

 

Q: I believe there is some corporate restructuring that we are going to see. What is the rationale behind it and when do you actually see it happening?

 

A: We have two main businesses that are realty and steel. All our steel and real estate businesses are merged in our listed entity- Shree Precoated Steels Ltd. Because of these two different segments, we are not getting the right valuation. The fund managers and all are insisting that we should have two different businesses and two different companies. That is why we are changing this company’s name to Ajmera Realty & Infra Ltd and we would demerge our steel business. This would be our core real estate company.      

 

Q: By when do you expect all of this to happen?

 

A: This should happen in another three-four months time. We have already got an approval from the board and Sebi.

 

Q: It’s the Burj Dubai in Bahrain?

 

A: We are planning to do better than Burj Dubai in Bahrain. We are doing that with one of our co-developers in Mumbai which is Mayfair Housing.

 

Q: Is Bahrain going to be a big focus area or are you also looking at other areas?

 

A: Bahrain is currently a focus area because we see a good boom happening in Bahrain. That is what Dubai was five-six years back. The same is going to happen in Bahrain and we pretty much entered at the right time because from the time we entered the price is almost double today.

 

Q: You have aggressive expansion plans, not just domestically but internationally as well. Are you looking to raise capital because a lot of real estate companies have either gone in for an Alternative Investments Market-AIM listing or are looking at the Real Estate Investment Trust-REIT route? Given the global market volatility, those plans are on hold for a lot of those companies.

 

A: We have plans on our drawing board. We have not executed much about it because of the volatility in the market. We thought let’s see how the market goes and then we will take a right step because we don’t think someone is giving us the right valuation of our company.

 

Q: Would you like them to get involved in specific projects? It seems to be the trend that we are seeing private equity players coming in and tying up with specific projects?

 

A: Currently, we are trying to do it at the entity level. Probably, going down the line, we might do something project-specific. But, right now, we are just seeing if we can find someone with the right valuation at the entity level.

 

Q: It’s a fairly competitive business, isn’t it? You are planning to move to Pune and Bangalore. You have got big players in all of these markets.

 

A: Of course, competition has increased. When the market booms competition has to come and people are giving good projects.

 

Q: How do you deal with that? How competitive are you?

 

A: In Mumbai, we are considered to be giving the highest carpet areas ratio to the sellable area. So, we give true value to the money of the customers.

 

Q: How do you manage that? How do you give the customer the best deal the money can buy?

 

A: Our planning is done well in advance. We try to see that we give minimum wastage spaces and see that they get optimum utilisation of the spaces wherever in the apartment. All these properties are brought at historical prices, so we can afford to be a little less than the market.   

 

Q: Give us a sense of the projects that you are sitting on? What are the numbers going to look like at the end of year?

 

A: We are expecting good profit next year as well, of about Rs 400-500 crore.

 

Q: What is been the biggest lesson that you have learnt?

 

A: Personally, I wanted to get more into marketing of our Group because my uncle and all were not too much into marketing; they were more traditional. Earlier, there was not too much of emphasis on marketing and that is why now we want to get into it.  

 

Q: That is your contribution in a sense?

 

A: Yes, that is my contribution. Besides looking at different projects, I concentrate more on marketing of the Group.

 

Q: There seems to be a sense that overall asset classes are going to correct. Is real estate going to be one of them?

 

A: In Mumbai, we don’t see any correction happening. Mumbai is a market that still has a lot of demand, being the financial capital. Other places, where prices are actually right and affordable would be not be affected.