New players have entered Mumbai real estate market and we welcome their presence: Abhishek Lodha

Post-COVID-19, the real estate market across the country saw several listed real estate developers expand beyond their home turfs.

Abhishek Lodha, Managing Director and CEO of listed real estate firm Macrotech Developers, operating under the Lodha brand, said that there are new players who have entered the Mumbai real estate market and the Lodha group welcomes their presence. He added that there is a long way for consolidation in the Mumbai market.

Lodha was speaking during the earnings call for Q4FY24 last week.

He said that Lodha’s market share in Mumbai is at around 10% and the market share of the top five developers in Mumbai is still in the mid-20s. “So, there is a long, long way of consolidation to go. As more high quality players come in, they will certainly benefit the market,” he said.

"We believe that our journey of growing our market share in our core markets will continue to be aided by the consolidation in the market and the market having good quality players serving a majority of the demand. So, we very much welcome the presence of better quality players in the marketplace," Lodha said.

Lodha is currently active with projects in the Mumbai real estate market covering Mumbai Metropolitan Region, Pune and Bengaluru. The company, in January 2024, had said it will also think about entering a fourth city.

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Competition in Mumbai real estate market

Post-COVID-19, the real estate market across the country saw several listed real estate developers expand beyond their home turfs. For example, Gurugram-based DLF has entered the Mumbai real estate market, and Mumbai-based Oberoi Realty had announced land acquisition in Noida. Godrej Properties has also expanded its base in several tier-2 cities.

Going further, Bengaluru-based Prestige Group, Puravankara, and Brigade Group have entered or have announced their plans to enter the Mumbai real estate market. Prestige Group and Brigade Group also have plans for the Pune real estate market.

Also read: Resurgence of Indian real estate: A strong showing in 2023 sets the stage for 2024

Lodha on macro situation

According to Abhishek Lodha, the Indian economy continues to perform strongly and while India continues to remain a beacon of economic strength in the world, the global situation has been full of various challenges, including geopolitical tensions.

This is a risk that is pervasive and in front of our eyes and from time-to-time it is definitely likely to have an impact on the overall sentiment as well as the direction of several macroeconomic indicators, he said. However, in spite of these global risks and challenges, global growth has continued to surprise on the upside, Lodha added.

Q4FY24 performance

Macrotech Developers reported a 11 percent year-on-year decline in consolidated net profit to Rs 665.5 crore in the quarter that ended on March 31, 2024, according to a regulatory filing on April 24.

However, in FY 24, the company registered a three-fold jump in profit to Rs 1,549 crore. Its net profit stood at Rs 744.4 crore in the fourth quarter of FY2022-23 and Rs 486.7 crore in the entire FY2022-23 fiscal.

The company's total income grew to Rs 4,083.9 crore in the quarter under review from Rs 3,271.7 crore in the year-ago period, the regulatory filing said. During FY2023-24, the company's total income rose to Rs 10,469.5 crore from Rs 9,611.2 crore in the 2022-23 fiscal.

In FY24, the company achieved pre-sales of Rs.14,500 crores, which is about 20% growth from last year.  "We are guiding to pre-sales growth of a little over 20% with Rs 17,500 crore as a pre-sales target for FY25," Lodha said during the call.

During this year, we have planned launches from sites that we have already identified and have GDV (gross development value) of about Rs 12,000 crores, Lodha added in the call.