Mahindra Lifespace Developers Limited


(aadhar.aggarwal) #1

Mahindra Lifespace Developers (MLF) is the Real Estate company of Mahindra group. The company benefits from the strong pedigree, brand name, trust and reputation of the Mahindra group. We also believe that over last few years, the company has shaped and executed its business strategy very well, positioning it for strong revenue and earnings growth, as well as market share gains over the coming years.

Speedy execution & even speedier sales: The company has diversified its portfolio well by taking-up multiple small to mid-sized residential projects across multiple cities (currently 11 projects are under implementation in cities like, Chennai, Delhi NCR, Nagpur, Pune, Hyderabad, Bangalore, Mumbai). The company’s project- wise data shows that it has maintained a consistent and relatively fast completion of the projects (4-4.5 years in Mumbai, other-wise 3-3.5 years across other cities), compared to other listed/ unlisted developers. More positively, the sales cycle has in 83% of the projects been even faster than execution cycle, contrary to industry trends. Even in a market like Delhi NCR, the company’s Luminare P-I project has sold 73% since 6 quarters of launch, ahead of completed 41%. This strategy of fast executionandsalesinourview istheoptimalstrategy,asithelpsthecompanyinrevenue recognition, inventory cycle (better than Oberoi, DLF), cash flows and profitability. Even more importantly, it helps in consolidation of the company’s brand image and create virtuous cycle of continuous fast growth and translate to market share gains.

For more check out the attachment below

Disc: Invested

20160822_Mahindra-Lifespace-Developers-Limited_4_InitiatingCoverage-2.pdf (180.0 KB)


(Manish Vachhani) #2

Your content is not sufficient for the new thread on a company. Please put your work in detail by editing the first post itself. Till then this thread will remain closed.


(Manish Vachhani) #3

(Manish Vachhani) #4

(aadhar.aggarwal) #5

Mahindra Lifespace Developers Limited (MLD) is the Real Estate company of Mahindra group. They operate in both commercial as well as the residential space. They have manageable debt on their books.

They are right now executing a number of residential as well as commercial projects.

Pros:

  • Fast execution - Average project completion in Mumbai is 4-4.5 years and 3-3.5 years in other cities. (Source - please read the report by Angel Broking attached below). Also they sell units faster than they can complete them. So sales cycle is faster than project completion cycle.
  • Future revenue visibility - They currently have 20.3 million sq ft of saleable area. On top of it they have 11.3 million sq ft of land bank (Source - please read the report by Angel Broking attached below).
  • Building in phases - They depend on cash flow from sales to complete project execution. For e.g. - If a building has 3 towers then they will first build 1 tower and then sell that tower substantially. The cash generated from this 1st tower will then be used to start work on the 2nd tower. This ensures minimal cash is blocked. This point shows the conservative way of thinking by management
  • Strong commercial property play - MLD is currently developing two integrated business cities called Mahindra World City. One is in Chennai and the other is in Jaipur. The Mahindra World City in Chennai is almost completely leased out. The company now is trying to replicate the same success for Mahindra World City Jaipur.

Cons:

  • The company is professionally managed and therefore lacks the fast paced growth that an entrepreneur may bring to the company.

Current situation of the sector:

  • There is a genuine shortage of residential units in India. Therefore demand for the sector seems favourable in the future too.
  • Due to the reduced availability of cash in the Indian economy real estate transactions using black money will reduce. This may mean that demand from black money hoarders will go down and therefore prices for real estate will continue to remain subdued.
  • Due to increased digitisation more Indians will have a credit rating. This will make it easy for them to get formal credit especially housing finance. This would enable people to buy a house thereby increasing demand from lower middle class and economically backward sections.
  • Due to the new Real Estate Act being implemented by the Govt. small developers will find it difficult to use money raised for one project for the construction of another. This would put pressure on their cash flows and they would find it difficult to launch multiple projects at one go. This is good news for developers who are already in the habit of following clean and conservative processes.

Some claims by the company in their last con call on Oct 27, 2016. The transcript of the con-call is also attached below:

  • The CEO Ms.Anita said that in this financial year the company will spend Rs.350-400 crores on construction.
  • In Chennai the company has a residential property called Iris. It only has 15-20 units left to be sold.
  • In Mumbai the company has a residential property called Vivante. In Vivante Phase 1 the company has 10 unsold units.

20160822_Mahindra-Lifespace-Developers-Limited_4_InitiatingCoverage-2.pdf (180.0 KB)
MahindraLifespaceDevelopersLimited-3.pdf (283.7 KB)


(smehta) #6
		       Mahindra Life space Development LTD
  • Discussion Financial Result of 2nd quarter of 2018 and first half of financial year 2017-18
    o Indian accounting standard is applicable for company from April 2016 Hence certain key properties in Valtari Chennai , Valtari Jaipur , Mahindra homes pvt lid and Mahindra developers are now consolidated on line by line basis on the basis of the equity method consolidation.
    o During Second quarter company has register all his on going projects across nation and registration across state wherever is has been applicable to our projects we complete the registration Due to the time required to complete the various projects during which period marketing was not permitted and also coupled in increase in price about 2-3 % with GST So Q2 sales is low June and July it was actually very low. In September it has come to nor-mal on overall basis. While residential sale was lower in Q2 comparing to Q1 .
    o Demand in the Premium and Luxury segment has been week but demand has peek up in the lower ticket size. In this quarter we have seen 36 % of sales coming from below 50 lakh segment and we have contributed around 55 % of sale from 75 lakh segment and balance is come from other segment.
    o We had two announcement during the quarter. Both of these partnership are done for growth in business.
     Strategic Partnership with International Finance Corporation where Mahindra life Space will partner in Industry life business for development of upcoming industrial projects .
     We had done a Joint Venture platform with HDFC Capital to focus on affordable housing segment below 50 lakh segment.
  • Consolidated results :-
    o Total revenue for the quarter is 129.1 Crore compare to 144.8 Crores in Q2 Fy 17 and 148.7 in Q1 Fy 18.
    o PAT was 13.6 Crores for quarter compare to 32 Crores in the previous year Q2 FY 17 and 13.8 in Q1 of this year.
  • Segment wise Performance
    o Residential Building sold about 200 units in current quarter amounting to 111 Crores of sales value with an APRO of 5129 Rs Per SQ ft. 36% of sales volume came from affordable housing below 50 lakh segment around 55 % of sale from 75 lakh segment and balance is come from other segment.
    o There has been focus on selling finished goods. 37.5 % of revenue came from finish goods and over continue to grow at good pace and total 875 we had handed over the customer and another 700-750 u\nits we will be handing over to customers this year.
    o In term of Industrial segment, Jaipur we find three customers in retail totalling about 6 acre of sales. In Chennai we found one customer and done 4 acres of sales .So total contribute 10 acre of sale with value of 20 Crores.
    o We get approve for new industry park in Chennai . So construction activity started at the ground level.
    o Stock marketing has also comment we reach out two customers We wil be formally launching the project in this quarter.
    o Land acquisition has completed in Ahmedabad , we are in process of getting various approval so we will launching the project this Financial year.
  • Financial Performance for the quarter
    o EBITDA margin for FY 18 Q2 stood at 11.2 % versus 12.2 % in Q2 of FY 17 and 11.7 % of Q1 of FY 18
    o PAT margin FY 18 Q2 stood at 10.5 % versus 22.2 % in Q2 of FY 17 and 9.74 % of Q1 of FY 18
    o Reduction in EBITDA is mainly due to lower revenue and contribution in absolute terms keeping the PAT margin at similar level. The PAT margin improve marginally during the quarter due to other income. Cost of debt stands at 9.6 %.

Q&A

  • This quarter results are very poor in Pune and NCR , However Bangalore has some what perform good , So is it purely because of GST or demand and supply has been slow down ?
    o In Bangalore we have launch Phase 2 of a project in the last week of September . In phase one there were about 40 odd units and right now 18 odd units has been sold. In the last one month in terms of nearly least inventory so that’s the difference as far as Bangalore is concerned .
    o Across it two thing were happening
     Our all projects are getting registered , the website was ready earlier and we get most of our approvals in one week of submission. So we were effectively in a better position right from day 1. There has been delay also in approval like Bangalore project got approval in September. There also some confusion under RERA like customers should register as broker or not registered to broker.
     On GST side we were the early one to go out and put out the input tax credit in terms of what customer could get. Fact is most ongoing projects which see upward of price were nearly 4000-5000 Rs sq ft you do have a input tax credit nearly about 2-4 % from starting of project till the life cycle and we did not absorb that factor into pricing so the time taken to customer itself to take decision and to convert.
  • Did we do something regarding sales ?
    o In September sales should be 110-120 % of what we do in a month , October should be inline or baseline performance on monthly Basis .
  • Still there is no clearity on GST in ready to move property and we are sitting on 200-220 Unit . So how that will impact the demand ?
    o In ready to move segment it is easier because there is no GST applicable. If somebody buy your product after you get your certificate and first payment instalment is post OC then there is no burden of 12 % GST. Today our 6 units in Hyderabad and 76 units still active in Chennai , Nova 53 will be completed in next two months that something which has a normal run rate of 10-15 units per month in this financial year. Hyderabad there are been few challenge in local environment on registration of projects the government has put strictness on registration . NCR 5-6 units that will be completed in this financial year.
  • Any specific comment regarding NCR as we have under construction project over there and market is not picking up from two years ?
    o Things will perform slower in NCR at the moment is concern as specially in luxury segment it is even more difficult . In our Nova Project If we look at Phase-1 we do have units left over today are specifically the lower flows. We have specific schemes to complete the lower floor units. We have been able to hold on the prices but in lower floors there are some units like 1st floor and 3rd floor inventory , we are trying to convert it back this inventory into sales.
  • Is there any MOU is in pipeline ?
    o We are working on about One MOU for a land parcel of about 9 acres in Mumbai .Our existing project will get approval till the end of this year and then we will launch our new project in the next year. We are now working on newer opportunities and affordable housing platform. As far as mid segment is concern we have 3 project working One in Bangalore , One in Hyderabad .All work is completed in these two project only one move from land owner is going on to move it completely in our book. The other two land parcel in Bangalore are in earlier stage of registration. Pune we are looking in the pipeline but nothing right now to disclose.
  • Is there is timeline in HFC platform or is it finite life ?
    o No there is a time line in terms of investment commitment of 3 years . We have to put 125 Crores in project because we are 26 % of the overall economic platform though we hold 50 % of the equity . We will be funding 25 % of the total funds but 50 % of the equity.
  • In other income the substantial income is from divend income itself or is it from Chennai project.
    o We have other income come from Jaipur as dividend we also have divind income from Mahindra Inclusive township Ltd on consolidate base. There has been also interest income from Gujarat SPA with IOC coming and taking 50 % of stake and we have taken out the 50 % that was given to acquire the project as interest income has also been taken out from it.
  • How do you see outlook in Mumbai ,Pune ,Jaipur, NCR as we are in process of RERA registration when do you see the volumes coming out ?
    o In Mumbai we don’t have any reference because we had only one project in Mumbai and that is completely sold this month expect 2-3 units.
    o In Pune it is back to that volume as it was in pre-july
    o In NCR it is on 10-15 units per month which is typically done in October same kind of volume will br there
    o In Pune we will sustain more volume , Mumbai we have to see as we are launching new project so how the market react.
  • What is your visibility about Kandiwali and Sakinaka in Mumbai ?
    o We have no visibility as both case are going on in supreme court regarding dumping. In kandiwali we expect that High court will resolve it and next announcement we will hear on 13th November from High Court. We are confident that it we be free consent as developers will take the responsibility .
    o In Sakinaka it has one of its two hurdles reomove the second one is the height approval which lie with the high court. We had listen that Maharashtra government will set a committee and close it soon but it still not happen.
    o We do have height confirmation from the Civolution as per the height require but civil avation is not allow to complete until the matter is in High Court.
    o In Pune and Chennai, Pune our new project BCMC is confirmed we have received all approvals and clearance . Only environment clearance is waiting for approval if we get the environmental approval then we will be launch in Q4 other all building approvals are done.
    o In Palgar , all approvals are done only environment clearance is pending. After approval it will also launch in December – January.
    o In Chennai again we have a Million Sq Ft to launch that is in approval so we will be able to launch it earliest during the financial year.
  • So as we don’t see much volume rising in H 2 so we have to be more aggressive on selling ?
    o In case of Under Construction projects and ready inventory my answer will be yes.
  • Any strategy toward selling specially in our ready inventory ?
    o We have plans ready for it and we are working already on ready inventory. I think attraction of almost 80 Cr coming in quarter we will be ready to push that we edevaour will be to complete the value of the ready inventory of 190 Cr of books at current selling prices. Efforts will be to push all that and close to no inventory.
  • In leasing side we also see slow down so what is the strategy there or look over that ?
    o We are now doing outreach by meeting customers who are looking for expansions . So there is a higher outreach in market . Because in case of new capital investment there has been sluggishness in this financial year .
    o In Jaipur we see smaller local Indian players for looking at small slaps of land and we are getting customers who are in need of average 42 acre.
    o In Chennai we find it little better and also larger in size nearly to 5 acres all of them are multinational . Decision time take more time and Chennai customers are not seeking land they want Built up solutions. It become three way conversation the Developer who build for them ,us and the client . So it take long time and it impact on average per acre price as you have intermediary who also has to look over his profit also .
  • There is not seen anything large in Chennai and Jaipur so what is the outlook over there ?
    o From current league I would say Chennai will continue to see customer in buying range of 3-4 acre land .
    o Jaipur would be in the 2-3 acre kind of mode .
    o We are working on larger reach requirement but currently the pipeline is not much large that I can commit at the time.
  • As a pure residential business which can be operate by a JV (Joint Venture) strategic model one is in star cluster and another in affordable business which other listed players are doing so what is your direction your play in the business in terms of margin and business ?
    o Its not like exclusion of residential real estate it will be significant part of business . It’s a mix about less than 10 % come from affordable housing and 20 % come in from the industry cluster and balance is from residential.
    o The IFC and HFC partnership is announced in this quarter so this is higher in visibility. If you look back we do have a partnership with Stanfy of around 1000 Crores and 3 years back we had deploy 70 % of that and still 30 % is pending. We also define partnership with one another partner for funding in next projects.
    o We need MOU to be done soon to announce that partnership . From Capital view residential will be a important part and we will definitely follow a more asset light model either in terms of partnerships and joint ventures. So lot of the transaction in the residential model are on JV model and the intend is to look at significant scale up in that business.
    o In case of national cluster is concern it can take care of its own strategic planning and investment regarding it so it does not require more efforts from our side and affordable housing we will we build it from scratch to scale with our partners.
  • So as Joint venture and partnership so does we see scale up in that ?
    o Yes and also in terms of capital on era of residential the relationship has been finalised and the term sheets has been done but normally we don’t go in public domain . We actually have a investment check in the platform.
    o Since HDFC platform coming we have been moving to it . We completed the documents and declare the announcement . In IFCA the investment from Mr Bhansali is happening in Ahmedabad project.
  • What effect you see on the ground as RERA effect and GST ?
    o There has been huge structural changes in compliance and a lot of new ways of doing business coming out .
    o Now you have three baskets of players.
     One basket who clearly want exit and not want to be part of the industry.
     Second want to structure in JV , partnership be willing to put their land to more creditable name who can drive sales who can drive market who can drive execution and maintain relationships.
     Third is the Organised players like Corporate and some of the traditional player who had been professional from the beginning are recently looking to scale up their own business from the opportunity arises from Bucket One and Bucket Two.
  • In your new projects you have mentioned the ticket size would be around 50 lakh . What happiness kind of product it would be better if it around 20-25 lakh . From a deployement prospective HDFC is doing similar thongs with other Corporates. So all projects will be doing under this platform or some would be from different platform ?
    o So far 50 lakh is concern this a focus of state between us and parties and we will be focus on that. Currently the thing is to stay with the happiness segment so it would be 25. Over a period of time and depend on location we choose I would say that 25 would go to some 30 or some 40 so that catergory of projects we would have. Two categories of projects are coming those which are extend to suburps and those which are nearest to city in different price tag and different places .
    o In terms of scale we are looking for 500 Crore investment as of now we are looking for land which could be between 5 million to 10 million sq ft over the investment period because if you get closer the town you will get land more expensive. In Suburps we looking to expand upto 10 Million sq ft .
  • Any restriction on investment ?
    o Currently we are focusing on Chennai and Mumbai ,then that restriction is based on to create certain scale up in these market first rather than others.
  • Most of the Joint ventures will be outline or you will do it ?
    o In this platform we will be focus on outline . The affordable housing platform there would be mid-premium segment and focusing on JV.
  • What is your vision to grow in next 3-5 years as we are now done JV with IFCI and HDFC is concern ?
    o We do not share our forward looking statement as policy but wht we will be looking the year is to working on schedule a strategic call where we will share with the investor community our plan for next 3-4 year. For each of business segment and for each of decision we take we are targeting multiple growth.
  • I want to know some sense about operating margin on affordable housing we re focusing on ?
    o In affordable housing in our star cluster our EBITDA margin would be very good as far as industry cluster as we are in maturity stage in Chennai and Jaipur . We will be seeing 40-45 % margin iin our EBITDA . In that segment greater investment would be come so greater volume will pick up .
    o So our PAT margin have to come about 10 % because of the interest burden to be serviced.
    o Apart from it we are also being involved with IFC so we can see greater volume. This business is clear about the macro economic environment
    o In case of residential business including affordable housing , if you look at the current quarter our EBITDA stood at 30 % .If you look at current marketing cost , managing and admin cost the current issue is our operations are not scale up and established at the organisation scale . If you look at Our challenge is to increase volumes , increase land parcels and pushing our operations to scale up which optimise our fix cost .
  • Operational cost that you mention has come down to what level I mean at neck level would be higher than 10 % you mention over there or lower than it ?
    o At EBITDA level it comes down to 10 % depend on what the fix cost of marketing and sales cost of a company . Both sales part and marketing man power has coming down to 10 % . So at PAT level it comes around 6-7 % only .
  • What you are planning to follow the method in case of manpower and strategies to run business in case of macro ?
    o We will scale up by adding projects on projects. If you go on 2-3x cost structure then who is going to lend you so we will be looking to scale up our business.
  • How is your Case running in one of your issue in Bombay and do you have any partner involve in it ?
    o In case of Construction Contract business we have Contractor as a partner there and he was handling the case , yes we have lost 7-8 months as he was going to First bench then another then high court and at last we don’t get any stay with respect to construction contract . So now we both have to go on arbitration in respect to construction contract of claims on either side , as far as the shareholdes is concern we are trying to work with them solve things going forward so that become easier and smoother for us to run the business without any dispute and doing commitment to customers to deliver on time .
  • What is our planning on land parcel ?
    o In Thane the hearing is done by the tehsildar who has given the judgement to the idea of reviewing his whole decision , But some issue are there as that tehsildar has been promoted by government and new tehsildar has to come . So somebody else will review his judgement
  • After RERA and GST only few players remain at national level , so from a view of 5-7 years will we be the top among national players ?
    o In scale up yes , In case of footprint in next 3-5 year we would be focus on South and west in terms of building market share today we have around One to two projects in every city which is not optimise scale from a organise player concern . While rather have 8-10 projects running in the core cities. We will be focused on 10 cities , Yes if economy changes at significant level and job creation happen , people start going formal real estate then we will have 1-2 projects in that region but not more than that.
  • In Jaipur , what are the updates on second part of DTA project details ?
    o We got all the approvals done in second DTA , In fact what we were selling from the last 9 months have been from the new DTA so I think it has been total of about 15-20 acres sold from the new DTA so far .
    o Unless the first DYA where we were having certain large customers coming in so we had customers like 20 acre taken by Roto , 20 acre taken by Rickson so we have seen something 100 acre large taken by JCA . So there we saw the large customers coming in and we will complete the first DTA very quickly .
    o The second DTA has been slower because we are not seeing the larger customer coming into make significant investments. So it has been function of overall investment climate , as new investment come new manufacturing will done. And second that they are looking at some other 5-6 state cities with a smaller pipe with other state.
    o As far as chennai is concern the industry is pretty more mature and city is more mature which is why international players with limited capital are looking for opportunities in Chennai but decision time are been longer.
  • Disclosure :-
    o In next six month we will be focus on increasing sales volume and increase our ability to launch new projects at the earliest so that we start contributing toward the revenue and profits .
    o In residential business including affordable housing we will bw focus on adding new inventory to be able to scale up the business significantly these two are the really most focused area for the company

([email protected]) #7

(hegman12) #8

MAHLIFE has announced new affordable housing project along with HDFC Capital.


(hegman12) #9

Mahindra lifespaces reported encouraging set of numbers for Q418 and financial year in general. Revenue reported was steady 180.6cr Q4 vs 185.6cr Q3. EBITDA margin increased to 48% Q4 vs 24% Q3 and 19% Q417. Revenue dropped significantly to 644cr FY18 vs 831cr FY17. Operating expenses reduced significantly. Debt to equity stood at 0.20 vs 0.38, with debt dropping from 25cr to 5cr. Board also approved 60% dividend on shares of face value 10 each. More details can be found here.

Mahindra Life Detailed investor presentation and press Release.


(hegman12) #11

Agree, but you have to look at the number in the context of what is happening with real estate sector in general. Demand is low, small developers getting bankrupt due to various reasons and RERA is pain. In such condition, if you are able nearly double EBITDA margin and keep numbers steady, its great achievement. I was expecting debt and interest to go up for above reason, but it has actually come down. Going by the momentum, i think both premium residential and commercial office complex demand will pick up by next quarter. CEO of MAHLIFE already spoke on affordable housing ventures of the company and said the margin will be low. So, i think things are overall encouraging.

PS: Invested


(hegman12) #13

As a investor, i look at context of the business environment, business model as well as financial result to judge a result. So, that’s there.


(hegman12) #14

(hegman12) #16

It was undervalued and not all the development projects were in price. I think its fairly valued now.


(gadakalpeshk) #17

Check out @CNBCTV18News’s Tweet: https://twitter.com/CNBCTV18News/status/1009342230388019200?s=08
Mahindra Lifespace commences pre-sales of ‘Roots’ in Mumbai. Sangeeta Prasad, CEO of the company says they are looking at a revenue potential of around Rs 200 cr. @life_spaces https://t.co/cw9adHokfM


(rskothari) #19

Highlights from AR 2018:
• Company sold 1,357 units aggregating 1.16 million square feet of saleable area in 2017-18 against 863 units / 0.91 million square feet in 2016-17
• The Company sold 721 premium units in 2017-18 compared to 613 units in 2016-17. 636 units and 250 units are figures in Affordable segment for the two years. The premium segment includes all residential projects of the company, barring the three affordable housing projects in Avadi, Boisar and Palghar marketed as Happinest.
• The sales growth of 57 percent and 27 percent by area sold was achieved inspite of the Company having to defer the launch of three of its projects in Mumbai due to High Court related restrictions and two of its projects, one each in Pune and Chennai, due to pending approvals.
• The Bombay High Court placed restrictions on (a) granting permissions for new construction due to solid waste management issue in Mumbai, and (b) granting building height approvals in the funnel area of the airport in Mumbai.
• The Company handed over total 3846 units during last 2 years 2016-17 and 2017-18. This marked a significant uptick from the achievement during 2014-15 and 2015-16 when it handed over only 1364 units. It reflects company’s focus on execution.
• Company has launched a new brand of industrial clusters called ‘ORIGINS by Mahindra World City’. These are relatively smaller clusters - one near Chennai and the other near Ahmedabad. The former has received all its approvals and we expect it to get its first set of customers in 2018-19, and the latter is in the process of getting its approvals.
• Looking forward to launching five new residential projects on receipt of requisite approvals in 2018-19. The total estimated saleable area of these projects amounts to 1.97 million square feet.
• The Company is currently developing 3.97 million square feet with another 4.44 million square feet available in the form of forthcoming projects, new phases of ongoing projects and new projects that are in various stages of planning, for launch in the future.
• In addition to above, the Company has a landbank with a development potential aggregating around 10.44 million square feet, 91 percent of which is within Mahindra World City, Chennai.
• The Company seeks to grow its presence significantly in Mumbai, Pune and Bangalore and add to its presence in Hyderabad and NCR before exploring any other geographies.
• Integrated Cities and Industrial Clusters (ICIC) recorded 62 acres of land leases during the year, compared to 74 acres in the previous year.
• The Company will focus on increasing its deal pipeline and closures in the balance inventory of industrial land in Chennai and in leveraging the enhanced product-mix at Jaipur to add more customers in its DTA and multi-product SEZ.
• During the year, the Company expanded its post possession value added services that had been piloted in 2016- 17 — both, in terms of number of projects and types of services. These now encompass complete interior solutions, electrical fittings, lighting solutions and modular kitchens. Going forward, the Company shall further increase the bouquet of value added services available to customers.
• During the year, the Company entered into two partnerships. The first partnership is with International Finance Corporation (IFC), a member of the World Bank Group, for the development of multiple industrial parks across Gujarat, Rajasthan and Maharashtra. This entails an investment commitment of USD 50 million, with the first investment in Origins, Jansali — the 268-acre industrial cluster near Ahmedabad. The second partnership is with a fund managed by HDFC Capital Advisors Limited for projects in the affordable housing space, with joint commitment of Rs 500 crore that can deliver development footprint of 5-10 million square feet. Happinest, Palghar (I & II), in the Mumbai Metropolitan Region, which has an estimated saleable area of 1.05 million square feet, is the first project to be implemented under this partnership.
• Consolidated total revenue reduced from Rs 831 crore in 2016-17 to Rs 644 crore in 2017-18, primarily due to decline in project activity during the year and a one time revenue of Rs 176.71 crore through sale of land in the previous year.
• Operating Margins improved from 14.3% in 2016-17 to 21% in 2017-18.
• Residential Operations’ share was 79% in Total Income and 57% in PAT while Integrated Cities and Industrial Clusters (ICIC)’s share was 21% and 43% respectively.
• The average cost of consolidated debt reduced from 9.86 percent in 2016-17 to 9.49 percent in 2017-18.
• Finance Cost increased from Rs 20 Cr to 41 Cr due to less allocation to cost of projects.
• Legal and other professional cost (Other Expenses) increased from Rs 8.6 Cr to Rs 10.9 Cr
• Project Management Fees increased from Rs 12.7 Cr to Rs 28.5 Cr
• Income from Projects reduced from Rs 729 Cr to Rs 519 Cr
• The amount of inventories recognised as an expense Rs 37,344 lakh (31st March, 2017: Rs 56,589 lakh) include Rs 1,190.14 lakh (31st March, 2017: Rs Nil) in respect of write down of inventory to net realisable value.
• Current Trade Receivables increased from Rs 76 Cr to Rs 145 Cr
• The Company had entered into an agreement to acquire a parcel of land near Thane, Maharashtra, at a consideration of Rs 20cr. While full consideration was paid, the land was not conveyed pending completion of certain formalities. The amount currently standing in the books as a current assets is Rs 28079cr. Tahsildar (Thane) has issued an order against the registered owner alleging non-adherence of certain conditions pertaining to Bombay Tenancy and Agricultural Lands Act, 1948 and changed the land records to reflect Government of Maharashtra as the holder of the land. The Company has been legally advised that the said order and the demand thereunder is grossly erroneous and not tenable.

Disclosure: Tracking Position, 1% of my Equity Portfolio.