On track to double revenue in FY14: Anant Raj

Real estate developer Anant Raj had received license from Haryana government to set up a residential colony in Gurgaon, Sector-63 A. Amit Sarin, Director & CEO, Anant Raj Industries told CNBC-TV18 that this is just one part of the township.

The township was launched by the company in January last year and the project has already been launched, he said. Raj also informed that the total integrated township project is worth Rs 5,000 crore. He explained that the first phase and the second phase is already launched, which is the plots and villas and the total revenue generated from that is Rs 60 crore. Now the company will be launching group housing and commercial projects there soon. He further said that last year company took a jump of 100 percent in revenues and this year he is expecting the same. The company is on track to get close to the four figure mark, he said. Talkin about the debt books of the company Anant Raj said that currently the debt of the company stands at Rs 1300 crore and is not looking to add any more. "Our residential projects are self-funding and we do not need anymore money now," he added. Also read: Trump to launch first Indian real estate project in Pune Below is teh verbatim transcript of his interview to CNBC-TV18 Q: As of now you all have only got the license. Could you tell us the timeline before the company can actually generate any kind of revenues from it? Just walk us through how you are planning to monetise this. A: This is an integrated township. We got this license just a few days back. This is one part of the township. The township was launched by the company in January last year. So the project has already been launched and this is an integrated township that the company is doing in Gurgaon, Sector-63 A. The first phase of this township was plots which have already been launched. The second phase is villas which we have just launched and we are getting good revenues from it and now we are going to be doing group housing as well as commercial also. So, the project as such the integrated township has already been launched and this group housing and all would be launched by Diwali this year. Q: How does this operate? Do you get a fee for construction or have you bid for the entire project? If it is a bid for the entire project then what is the amount you have paid Haryana Government? A: No, it is not like that. Here you buy the land first. Haryana is pretty simple that way. It is not like other states where you bid and then you get projects and the government requires land, it is not that complicated. It is builders like us who go and buy land and then subject to fulfilling the conditions we are given permissions to build townships and group housing and commercial. In this case the company is already invested into the land and this is a process which has been going on within the company for almost two-two and half years now. So, that part is now done and the investment part is over. Now we are launching this project in phases and the revenues will now start getting recognised. Q: When will Phase I be and how much are you expecting from it? Thereafter can you Phase II, the timeline of launch and how much are you expecting? A: This project as such is going to be a Rs 5,000 crore plus project and our initial stage was when we launched just plot. The plot part has already been launched. We have only sold about 20 percent and now the company is very strictly following the recognition rules. So, we have not actually started booking revenue from this project as such. The total revenue we booked from this project so far is just about Rs 60 crore. The revenue recognition is yet to come and which is now going to be coming from future quarters. Q: How did the last quarter pan out for you? Can you give us some guess on the whole of FY14 itself? A: Last quarter was pretty decent. The board meeting is not done as yet, so we cannot talk about those numbers, but this project has not contributed in the last project. We have to first get the percentage completion method in place and then start recognising revenue. Almost 95 percent or more of this revenue is yet to be recognised by the company. This year looks pretty good, because from next quarter we will start recognising our revenues from this and this project plus the other residential projects which the company is doing. That is in Manesar, Sector-91 Gurgaon, Neemrana and Rajasthan would be contributing. So, this year looks very good for us. Our revenues will definitely take a good jump from what they were last year. _PAGEBREAK_ Q: Any kind of figure that you would put to the revenue growth that we could see in FY14? A: The figures would be very good compared to last year. Last year we took a jump of almost 100 percent in our revenues, which is as per the audited results and this year we should be able to repeat the same. Q: So you mean you would do in terms of rate of growth that much, because you did Rs 500 crore, so should we expect that you are going to get close to the Four figure mark? A: Yes, we are on track for that. Q: Is the company planning to make any additional investments in perhaps a land bank in the coming few months? A: Nothing major. We have been this land for almost two and half years and the company in this period has invested close to Rs 1,000 crore in terms of land banking and now all our projects are on their way. Now we are focusing fully on execution. All the four residential projects are now up and running and we are getting good response from the market as well. Q: What kind of margins do you make? A: This varies from project to project. On an average say anything between 35-40 percent, but you cannot put a pinpoint figure here like the Rajasthan project which is in Neemrana. That is low-cost housing so there the margins are not like this, but the turnover is very high and selling those flats is very easy. It sells like hot cakes. So, the margins depend on project to project. Q: Unlike other real estate companies debt is never your problem. Therefore will you be assuming a little more debt for FY14? A: Not really. We do not need anymore debt now. We are done with debt and nowthe debt levels in our company are very comfortable. We have a Net Asset Value (NAV) of about Rs 4,000 crore against which the total debt is about Rs 1,300 crore. So, we are very comfortable that way and now from this year onwards we will start reducing debt. We are not going to prepay anything, but as and when it is due it will be repaid and that is it. Our residential projects are like self-funding projects. So, we do not need anymore money now.