Good performance. Bottom line in coming qtr. will be better as inventories are ready for sale as project are completed/near completion and having occupancy certificate !
Another quarter of strong performance despite no new launches
Participants
Ambit Capital
Morgan Stanley
Motilal Oswal
CLSA
Prospero Tree
QnA
The sales saliency in the Thane project will only get better as customers have appreciated the Kolshet Road project and similar demand should be seen for the Pokhran Road project
Expecting better sales in the 360 West project since partner has exhausted all inventory and the new projects are 2-3 years into delivery
In the Glaxo Worli project doing a mixed-use development with a small boutique hotel, a mall and an office project. The developable area should be between 1.6-1.8 million sq foot carpet area
Currently thinking of 6-8 lakh sq foot of mall, 1 lakh sq foot of hotel and 1 million sq foot of office space in this mixed use project in Worli
Since company is not allowed to borrow to buy land cash is conserved to take use of an opportunity when it becomes available
As far as leasing goes will be done 80-90% by this year itself
As of June 2024 70% area in Commerz III is leased out
In terms of launches one tower in Goregaon, one tower in Borivali and two towers in Pokhran Road during the festive season will be launched
Oberoi Realty has successfully acquired Nirmal Lifestyle Realty Private Limited (NLRPL) through a corporate insolvency resolution process.The company has committed to paying Rs. 273 crores to creditors and will fully own NLRPL post the acquisition.
Back of the envelope workings:
Nirmal acquisition gives Oberoi access to 20,262.40 sq m land for INR 273 Cr.
This comes to aprox. 12517 per sq ft cost for Mulund west.
avg cost of construction in Mumbai, keep INR 6000 per sq ft.
So total cost of development will be 18517 per sq ft.
Current prices in Mulund West, on avg is 26900 psi (as per 99acres).
so 45% margin. Oberoi current avg OPM is 58%… to reach it, they must sell it at 8% premium psf rate at around 29256 psf, which is possible with Oberoi brand.
This project will add INR 638 Cr to topline or aprox 40 cr per quarter over next 4 years… or around 2-3% increase to Oberoi sales.
Hi Reem,
Thanks for the analysis. Appreciate if you can share how you arrive at the #s.
My rough calculation is as follows:
Total built up area = 20262 sq m of land x 2.5 FSI (assumption) = 50655 sqm = 546000 sqft of built-up or saleable area.
Potential sales realization at 100% sale: 546K sft x Rs.26900/psf = Rs.1468Cr
Potential sales realization at 80% sale: Rs.1468 Cr x 0.8 = Rs.1175Cr
Operating profit (at 58% OPM) = Rs.681.5Cr for 80% sales realization
Translates to Rs.73.4Cr of sales/quarter for 16 quarters and Rs.43.6Cr Op profit/quarter for 16 quarters, on an average.
Being a novice, I may be missing something here. Appreciate if you can kindly clarify. Thanks in advance.
Nothing wrong in your numbes.
The only difference is you took 2.5 FSI while I refused to multiply any FSI in these type of post nclt land deals, as am more conservative in valuing such deals.
So consider my numbers as simply “minimum” value point of view.
So if we assume Oberoi adds 73.4 C per quarter basis your workings, this comes to 5% incremental addition in topline per quarter.
I was studying all luxurious real estate serving companies and I found Oberoi realty as interesting company.
Promoter holding - 67.71%
Vikas Oberoi - 58.55%
Financials as of 27-Feb-2025:
Market cap 54649 Cr
Stock price down by 36% from ATH
EBIDTA margin above 45% which is very impressive
Debt to equity 0.14, free cashflow above 2000 Cr, Div yield 0.5%
ROE and ROCE in double digit
All numbers are very impressive.
Oberoi is very renowned name in MMR region.
Would like to know your opinion compared to other luxurious real estate players.
Ok, so Oberoi will have rental and retail income of 1000+ crores from next year. Their work in Mulund, Goregaon and Borivali 360 West is winding down, though they will still be able to milk it for a year or two. Thane and some redevelopment projects will take up the slack. Expensive stock, but proven player. For me it is about 8X in 11 years(This thread was originally initiated by me). I am holding it, but it’s expensive
Can someone share ORL financial model? Need it for learning purpose and nothing else. Here is my email id - caabhishreekalantri@gmauil.com.
Thanks in advance.
