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Last Updated : Feb 11, 2013 06:00 PM IST | Source: CNBC-TV18

Q4 target at 4m sqft; Rajasthan revenue to rise: Ansal

Dinesh Gupta, COO, Ansal Properties announced a target of achieving 4 million sqft in pre-sales in Q4. Speaking to CNBC-TV18 after the announcement of quarterly results, he adds that the company is on track to meet a target of 20 million sqft for FY13.

Dinesh Gupta, COO, Ansal Properties announced a target of achieving 4 million sqft in pre-sales in Q4. Speaking to CNBC-TV18 after the announcement of quarterly results, he adds that the company is on track to meet a target of 20 million sqft for FY13.

Gupta says that the revenue contribution from Meerut, Ghaziabad and Haryana is in line with increased revenue contribution from Rajasthan on the receipt of licences that were pending for the past two years.

Below is an edited transcript of the interview on CNBC-TV18

Q: Can you break-down the revenues for the quarter? Revenues on a quarter-on-quarter (q-o-q) basis perhaps were a bit of a disappointment as compared to Rs 331 crore last quarter? Why did it drop to Rs 277 crore?

A: Revenue recognition is a function of the percentage of the completion method. During this year, starting April 1, there have been some revisions in the guidance on the accounting practices where land cost is not to be considered as a part of the percentage of completion. Keeping that fact in mind, certain projects have been deferred in their impact on profitability. Therefore, there has been some erratic movement during the year.

Q: Can you give a like-to-like comparison in terms of square-feet (sqft) sold, what was your performance in terms of volume in Q2 and Q3?

A: In Q2, though they have no relation to revenue recognition, the presales in Q2 was about 5 million sqft and in Q3 it was about 7 million sqft across all our territories. So there has been a jump of about 40 percent.

Q: Would you be able to repeat that performance in Q4?

A: Our target is about 4 million sqft. The third quarter has been slightly better because of the festive season and the spurt in the B2B business especially on the floor space index (FSI) sales where we are the master developer. It may not be possible to repeat that performance in Q4 but the retail sales will definitely receive a boost as some new launches have been lined up and the impact of the launches that have already been done is starting to take effect.

We are also starting to see good traction in big segment products. So all this assures us of being able to do achieve our target of about 4 million sqft. Our full year guidance stands at 20 million sqft.

Q: Geographically, can you break it up in terms of sales this quarter and the traction expected going forward?

A: In terms of sale according to territory, Uttar Pradesh leads with a contribution of about 60 percent in volumes from cities like Lucknow, Greater Noida, Meerut and Ghaziabad. Next comes Haryana with Essencia and a few other townships on NH-1 (connecting New Delhi to the town of Attari in Punjab).

Punjab and Rajasthan constitutes only 5-7 percent of revenues. But there has been a spurt in revenues in the Rajasthan with certain licences that were pending for almost two years have been received and will now allow us to be able to go ahead and launch the product. We hope the revenue-contribution from Rajasthan will increase after the launch.

Q: The margins and EBITDA improved quite significantly this quarter on y-o-y basis. Can you explain how exactly realisations have performed this quarter and is 14 percent sustainable?

A: In the last one-to-one-and-a-half years, the average realisation has been increasing by almost 10-15 percent annually. That has been the reason for the gross profit margins and EBITDA margins going up and also due to new sales where the cost-estimations have been kept in line with what the market is today comparing it with four-to-five-year old sales where the costs have increased tremendously. So therefore, the margin looks squeezed on these accounts.

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First Published on Feb 11, 2013 04:18 pm
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