To launch 3 new projects within Q4: Nitesh Estates

Latha: How is the Bangalore market doing?

A: The Bangalore market is flat in fact I would not say that it is declining, it is just about flat. We don’t see the change in leads; I am not seeing that the number of leads is going down or that bookings are going down. If I am to talk of our own experience we had launched two projects over the last few months, one is what we call Melbourne Park and another is what we call Chelsea and both of them have done fairly well in terms of the initial bookings that we got. If you look at the old projects there it has gone into a relatively slower mode.

Again I would say the price does have an impact so the moment the ticket size is of the unit goes up to more than Rs 2-3 crore then that is where we find that the decisions are not being taken by the customers. However, in this space of about let us say Rs 5000-6000 per square feet what I would call as the mid-income home segment, there we are seeing that transactions are happening.

Sumaira: In the last one year your average realisations have come off from over Rs 6000 a square feet in the last quarter now to about Rs 5600 a square feet. Is there a danger that it could go down still further as your peers are indicating that they have seen?

A: If you look at the price points in the market they are not falling down as such. If you look at our own company information, if you are seeing that there is a slight reduction that is a function of the kind of unit which has got sold in the basket. However, the price point for a particular project that is not declining. We have been able to only marginally raise it in some of the cases where the construction has accelerated to a near completion stage otherwise the price points are practically flat.

Latha: So what do you think you will do or what have you done last quarter in terms of Bangalore and overall sales?

A: You know, roughly we are doing about, in terms of sales roughly about 0.2-0.3 million sq ft. That is the range in which we have been doing and I expect hat we will continue to retain that rate for another couple of quarters. The ups and downs happen at times, depending on the launches that you do. If there is a particular quarter where a launch has kicked in, of course that does make the numbers a little different. So we are looking forward to launching another three projects within this quarter so that might give us once again another Philips so that will raise the sales but as far as the broader market is concerned, I would say that in the mid-income space, it is just holding. It is not declining but it is just about flat.

Sumaira: I know you are predominantly focused on residential segments but a lot of the people we have been speaking to are sounding increasingly bullish on the prospects of commercial projects. Now I know you have a few but are you seeing incremental positive flow on your commercial space as opposed to residential?

A: Very certainly. As far as commercial space is concerned, it has done extremely well. Over the last one year about eight million sq ft got leased out in Bangalore, which is a fairly good number and again if leasing happens then obviously one knows that those spaces will get filled up by employees and Bangalore is a lodestone so people come to the city and eventually they also look for homes, So, as far as commercial space is concerned we do see an improvement in activity in Bangalore and I expect that that will also be followed by the residential space.

Latha: You have a goodish number of projects coming in next year is it? When is there a quantum leap in project recognition?

A: In the project recognition I expect in the early part of FY16 we will have quite a few projects which are getting completed so that is the time when there will be a significant amount of recognition which is going to happen. FY16 is going to be a significant year.

Latha: What is the revenue growth outlook for FY16?

A: I expect that FY16 as compared to the current year could be even 60-70 percent higher on account of the fact that recognition is going to be happening at a higher space.