On target to sell 3m sq ft in FY11: Sobha Developers

The company hopes to garner Rs 200 crore from land sales in FY11. The company has targeted to deleverage its balance sheet.

In Q4 FY10, it clocked revenues of Rs 406.3 crore and net profit of Rs 55.7 crore.

In an interview with CNBC-TV18, JC Sharma, MD, Sobha Developers gave his perspective on the real estate market and the way forward.

Below is a verbatim transcript. Also watch the accompanying video.

Q: Take us through the business prospects – are you seeing a sizeable improvement in demand for residential housing in the Bangalore area and other areas you operate. What kind of increased offtake of flats did you see in this quarter say in the last three months and what kind of price improvements have you been able to manage?

A: As far as improvement in the demand in our sector is concerned, we started getting that kind of a comfort level from the third quarter of the last financial year. That trend continues.

But if you look at from the kind of market that Bangalore or the southern market where we are currently operating provides, we still feel that while other indications are there that the market will pick up but still we presume that we are living in a very healthy and normal market, not in boom like conditions where there is a demand-supply mismatch or where there are increase in the prices by the developers and where the customers are not finding right products in the right location.

So it is a tailor made situation that is what we are telling to our customers that everything has turned in their favour. Interest costs are low, salary rises are there, availability is there and this has resulted in a quantum jump from where we were prior to that.

We have been doing 100 units plus sale on a month on month basis and we feel we are well on our target to achieve the 3 million square feet of fresh sales in this financial year vis-à-vis what we have achieved which was 2 million sq feet in the last financial year.