Big launches to aid growth in H2FY16: Kolte-Patil

Sujay Kalele, Group CEO, Kolte-Patil Developers said the second quarter earnings were impacted by delay in revenue recognition for two large projects to Q3. The company’s total income for second quarter was Rs 155 crore as against Rs 158 crore in the same period last quarter. The earnings before interest, tax, depreciation and amortization (EBITDA) was Rs 40.8 crore against Rs 41.8 crore year-on-year. Kalele is positive of doing better in second half of the year. Large launches in Mumbai and Pune will help volume and income growth, he said. He expects realisation of 3.5 million square feet at an average price in range of Rs 5,750 to Rs 6,000 for FY16.Below is the transcript of Sujay Kalele’s interview with Sonia Shenoy on CNBC-TV18.Q: You have not seen any growth in your income this time. Have none of your projects come in for revenue recognition and what has the pre-sales been for the quarter?A: Two projects which were supposed to be hitting the revenue recognition threshold got postponed to Q3. As a result of that the revenues and earnings before interest, taxes, depreciation and amortization (EBITDA) have been pretty flat as compared to the same quarter of last year. Profit after tax (PAT) however, has increased 3.7 percent year-on-year (Y-o-Y) to Rs 13 crore. As far as the pre-sales goes, what was positive was the average price realisations in this quarter, which was up at about Rs 6,174 per square feet as compared to Rs 5,750 in the same quarter last year. Collections also, were pretty decent at Rs 223 crore in this quarter as compared to Rs 201 crore in the same quarter of last year.However, on the volume side, the volumes declined to 0.46 million square feet in this quarter as against, 0.6 million square feet that we had done the same quarter of last year. So, it was a mixed quarter.Q: So, volumes have declined and the revenue recognition for two projects got postponed to the next quarter. Which two projects are these?A: These are 24k province, of which one is 100 percent-owned project and Stargaze, a million square feet project that we are developing in Pune.Q: As you said, your volumes have fallen to 0.46 million square feet this time. Will you be able to meet your year-end revenue and volume target and what could the second half volumes look like?A: There are two large launches lined up in the second quarter, mainly the project at Wakad that we are doing and the second phase of Life Republic which is an integrated township. So, with these two large launches along with a Mumbai launch of Jay Vijay that is planned in Q3, we are pretty optimistic on the full-year sales guidance as far as value and volume goes.Q: What is your full-year guidance?A: 3.5 million square feet of total at an average price realisation between Rs 5,750 and 6,000.