As far as Inventory at Signia Pearl BKC is concerned they had already sold 76% of total units & only 19 units amouting to Rs.416crs are unsold as of 31st March,2020.
N these court or RERA cases r not a anomaly, earlier also they had mentioned in past annual reports.
Many other reputed players like Oberoi Realty ,Kolte Patil even Godrej Properties have RERA cases against them.That doesnt mean any fraud or poor CG practices. Recently there was an article regarding case Against Godrej Trees where court directed the builder to refund full money to the buyer.
Thanks for sharing this Vivek. I tried checking the current status of the case on High court database, but could not find the mentioned suit either by case number or by Petitioner / respondent. Even when I do a websearch, nothing conclusive comes up. Would be nice if you can share the source of your information so that we can dig more to see if its one of the routine cases that most companies get pulled into, or it it something more significant.
Meanwhile, here is some analyst activity on the company. CLSA has initiated coverage on Sunteck and has issued a target price of Rs 345, i.e. an upside of about 25% from current price.
Second large acquisition in past few months. This too is planned for affordable housing. Company had similarly built up its projects pipelin very carefully during earlier downturns.
Signia High, Borivali witnessed pre-sales of 30 units worth ~INR 112 cr in Q2 FY21List item
Q-o-Q Collections growth at 117%
For 1H 21 Naigaon project: Sales 80.5 crores, collections - 76 crores, area sold - 1.48 million sq ft, units sold - 191
VASIND project - Residential development of ~2.6 million square feet SBUA, strategically located along a national highway under asset light model.
Estimated revenue potential: ~INR 1,200 crores.
Cost - 550 crores, 80% sharing for the company.
Project timeline: 4-5 years.
Area- 50 acres of land.
Revenue recognition method change to project completion from % completion. Going forward, all the new projects will be under project completion. Avenue 1, Avenue 2 and Westworld are reported using percentage completion method. These projects are almost completed.
1H 21 Mix: Presales 31% ODC, 27% Naigaon, 37% Borivali
Collections: 21% - BKC, 29% -ODC, 37% Naigaon and 11% Borivali
For the qtr: Area sold - 1.87 million sq. ft, Units sold - 127, Sales - 200 crore and collection - 141 crore
Sunteck City: achieved significant sales in Avenue 1 and avenue 2 which is nearing completion. 27 units sold in the qtr(26 in Avenue 1 and 1 in Avenue 2). Revenues - 53 crores and for first half - 94 crores.
BKC commercial - there was delay due to pandemic, constructions are back to normal. Will be completed 15-18 months
Launch pipeline - Phase 3 Naigaon(1 & 2 launched), Vasai and VASIND project. Approvals for these projects are at advance stage and will launched in the next 9-12 months. VASIND project has moved past approval side, launch will be in less than 9 months
Estimated operating cash flows from completed projects - 2200 crores, ongoing - 2000 crores, upcoming projects(approvals are received and will be launched soon) - 4000 crore
One question, if they are about to have 2200 crores of earnings in the near future and market cap is 5,000 crores, then why aren’t the greatest investors buying ?
Positive for Real Estate players in Maharashtra. Sunteck is a good proxy for playing the Affordable Housing theme. It has shifted its focus towards high volume premium affordable housing segment(Naigaon, Vasai & Vasind projects).
Constant stream of news flow from diverse set of sources on positive uptick in real estate sector, especially within Mumbai zone. Even if its partially true, it will be a booster dose for the beleaguered sector… As a corollary, the trend could directly influence Housing Finance sector and home improvement sector too…
Affordability index has improved everywhere. The only thing that indicats is that prices have been stagnant / reduced while loans have become cheaper and incomes have increased.
That does not necessarily mean that people will buy
Correct. If affordability increases the probability of buying also increases.
This is quite evident from the qoq performance of the company wherein prebooking sales have increased sequentially in the last 3 qtrs.
Sunteck caters only to Mumbai and nearby places. Mumbai had a very little breathing space available i.e 94% of Income compared to other markets. This has fallen to 61% as correctly pointed out by you due to several factors like stagnant prices, increase in per capita income, reduction in interest rates, etc
Total registration in Mumbai from January 1 – December 30, 2020 was recorded at 64,906 units, despite the fact that April 2020 saw no sales registrations and May 2020 recorded registration of just about 200 units. In 2019, total registrations were 67863 units.
Can someone briefly explain how are they going to get around 2,000 to 4,000 crores of surplus ?
Management has announced this many times, but my question is how ?
