Bengaluru-based real estate developer Puravankara plans to launch 7.6 million square feet (msf) of residential development with a topline of about Rs 5,000 crore within FY24.
Abhishek Kapoor, executive director and chief executive officer at Puravankara, told Moneycontrol, "Last year the company did Rs 3,107 crore of business and opened 3 msf of inventory for sale out of 6 msf approved launches. This year we are almost doubling the inventory open for sale to 7.6 msf out of 15 msf launches. We are also anticipating Rs 11,200 crore of surplus from operations within 3-4 years."
The upcoming launches will be in Bengaluru, Hyderabad, Chennai, Pune and Mumbai, with the majority in Bengaluru.
In the quarter that ended June 30, Puravankara posted a loss of Rs 17 crore with revenue of Rs 323 crore, which was up by 50 percent year on year.
Explaining the loss incurred, Kapoor said the cost has gone up for new launches and sales. "The sales and marketing cost went up by Rs 15 crore that cannot be capitalised. Additionally, the increased general and administrative (G&A) expenses added up to a dip in the collection."
However, with a strong pipeline over the next few quarters, as we deliver more projects, the collections will start reflecting in the financials, he added.
Pipeline for FY24
In Q1 FY24, Puravankara did 58 percent of all sales in Bengaluru, about 21 percent in Chennai, 13 per cent in Kochi and 7 per cent in other markets.
By the end of this financial, Kapoor said about 35 percent of launches will be in Bengaluru, 33 percent in Chennai, 19 percent in Kochi and the balance towards western parts of India.
The upcoming launches in Bengaluru will take place mainly towards the northern parts of Hebbal, IBC Road and Medahalli. At the same time, a few projects will also be launched towards south-eastern parts like Bellandur and Saukya Road.
Out of the launches in the pipeline, the company will have about 3.7 msf in Provident Housing and the balance in Puravankara and Purva Land. For Puravankara, the average rate per square foot for the launches will be between Rs 9,000-9,500 per sq ft while Provident Housing will see about Rs 7,200 per sq ft.
Kapoor added that compared to last year the average cost realisation for launches has also gone up, roughly by 11 percent across the verticals.
In Q1 FY24, the company saw about 37 percent of sales in ticket sizes less than Rs 1 crore and the balance in inventories above Rs 1 crore in Bengaluru. "More homebuyers are looking forward to upgrading to higher ticket sizes, however, we continue to see an uptick across all verticals," Kapoor said.
Debt to remain stable, AIF
Net debt in the first quarter of FY23 stood at Rs 2,119 while dipping by Rs 89 crore compared to the previous quarter.
While debt largely remained the same across the residential segment, the capital expenditure of ongoing constructions added to a marginal increase in debt value. Kapoor believes that in the coming quarter, the construction costs will further increase debt towards commercial projects.
"However, our target is to keep the debt stable in a similar range over the next 2-3 years. The capex towards commercial projects will be recovered from sales in residential verticals," he added.
In the commercial segment, the company currently has 3 msf under construction in the Kanakapura Road area in Bengaluru and about 2.1 msf towards the airport road in the north.
In March 2022, Purva Asset Management, a subsidiary of Puravankara, launched a Rs 750 crore alternative investment fund to invest in affordable housing projects and plotted developments across projects in Bengaluru, Pune, Chennai, Hyderabad and the Mumbai Metropolitan Region.
While it has already deployed Rs 93 crore in Chennai, Kapoor said the company is looking forward to deploying another Rs 300 crore in Bengaluru and Chennai before the end of FY24.
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