Prestige Estate - Will it increase the Prestige of Retail Investors

National Real estate Player

Prestige Estate Projects is in the business of real estate development encompassing the development and construction of properties, leasing of office and retail properties.The Company is maintaining a leadership position in Bengaluru and has a significant presence in Hyderabad and Chennai. It has also extended operations in recent years to Kochi, Mangalore, Goa, Mysore, Pune, Mumbai, Ahmedabad, NCR and Udaipur.The Co will be starting its malls in Tier-II cities such as Ahmedabad, Amritsar, Bhubaneswar, Chandigarh, Indore, Mysuru, and Kochi. The Co will be launching Prestige Smart city on the HDFC platform for targeting mid-income buyers.he Co has signed to invest alongside its JV partner in building one of India’s largest hotel and convention centres at DIAL AeroCity in Delhi.The co is initiating office projects in popular locales and increasing its presence in Mumbai, NCR and Pune.

Keys Risk :

  1. Real estate cycle turn unfavourable
  2. Debt might go up to finance 15000 Crore capex.
  3. 70% of per sales come from banglore hence there is a geographical concentration risk which is slowly going away with new projects being launched in other parts of the country,

Having said the there have greate Free cash flow. AS much as 50% of FCF coming from pre sales of the residential portfolio can be used to complete the rental portfolio. Ie. This may give legs to the annuity portfolio completion.

Also the debt to Pre-sales is the right number to see. That way Debt is negligible to the size of the business.

Donny forget they have pre-sold projects in the past to black rock to clear debts too

2 Likes
















Keys Risk :

  1. Real estate cycle turn unfavourable
  2. Debt might go up to finance 15000 Crore capex.
  3. 70% of per sales come from banglore hence there is a geographical concentration risk which is slowly going away with new projects being launched in other parts of the country,

Having said the there have greate Free cash flow. AS much as 50% of FCF coming from pre sales of the residential portfolio can be used to complete the rental portfolio. Ie. This may give legs to the annuity portfolio completion.

Also the debt to Pre-sales is the right number to see. That way Debt is negligible to the size of the business.

Donny forget they have pre-sold projects in the past to black rock to clear debts too

Disc: Invested

5 Likes


Disc:Invested

Dated 06.03.2024


Disc:Invested

Concall Notes - Feb 2024 (Source:Screener Notes)

Financial Performance:

  • Total sales for the 9 months at INR16,333 crores, up by 81%
  • Collections up by 20%, totaling INR8,478 crores
  • Average realization grown by 19% to INR10,143
  • Debt equity remains at 0.6
  • Unrecognized revenue of INR32,000 crores expected to have gross margins of 30-32%
  • Debt outside books on JV projects around INR1,900-2,000 crores
  • Other income includes REIT units, interest income, and dividends, with REIT contributing INR90-100 crores

Operational Highlights:

  • Sold 16.13 million square foot of area and 8,402 units
  • Launched over 30 million square foot of area in the fiscal year
  • Completed 12 million square foot, crossing 300 projects totaling 180 million square foot
  • Under construction and planning projects equal to 170 million square foot
  • Sales already made close to INR32,000 crores of revenue
  • Highest-ever launches during the fiscal year
  • Prestige City format expanding to various cities

Strategic Initiatives:

  • Looking to expand operations to new regions and add new projects
  • Evaluating potential equity raise for hospitality portfolio monetization

Stakeholder Value:

  • Strong focus on growth and creating value for stakeholders
  • Continuing efforts to grow and create value for all stakeholders.
    Keys Risk :
  1. Real estate cycle turn unfavourable
  2. Debt might go up to finance 15000 Crore capex.
  3. 70% of per sales come from banglore hence there is a geographical concentration risk which is slowly going away with new projects being launched in other parts of the country,

Having said the there have greate Free cash flow. AS much as 50% of FCF coming from pre sales of the residential portfolio can be used to complete the rental portfolio. Ie. This may give legs to the annuity portfolio completion.

Also the debt to Pre-sales is the right number to see. That way Debt is negligible to the size of the business.

Donny forget they have pre-sold projects in the past to black rock to clear debts too

4 Likes

Detailed risk analysis is missing. The thread remains locked till you comply.

RECENT DEVELOPMENT:
Bengaluru, April 1, 2024 - Prestige Group, one of India’s leading real estate developers, is proud to announce a significant milestone in its growth trajectory through a strategic deal with the Abu Dhabi Investment Authority (ADIA) and Kotak AIF. The INR 2,001 crores (~$240 million) deal is dedicated towards the development of residential projects in prominent locations across 4 cities in India. The collaboration with ADIA and Kotak AIF represents a considered move towards adopting strong and organic growth for Prestige Group. The deal, with its substantial size, upholds company’s vision to sustain its leadership position in the industry. It is aimed at catalysing the development of early-stage residential projects, ensuring company’s commitment to prudent expansion and diversified growth.

Bengaluru, 4th April 2024: Prestige Group, a leading real estate developer in India, is pleased to announce its latest acquisition of approximately 21 acres of prime land in Whitefield, Bengaluru. The acquired land will be planned for Residential Development spanning approximately 4 Mn Sft of developable area, comprising around 1800 apartments. The cost of acquisition is ₹450 Cr. Commenting on the acquisition, Mr. Irfan Razack, Chairman and Managing Director of Prestige Group, said, "The prime land in Whitefield, Bengaluru presents an excellent opportunity for us to expand our presence in a large IT corridor. This large-format project spans over 4 Mn Sft of developable area, with a projected Gross Development Value (GDV) of ₹4,500 Cr.” Mr. Venkat K Narayana, Group CEO of Prestige Group, said, “The project will strengthen our sales in our home market and we look forward to launching the project within the next three quarters and completing the development in 4-year time.”

Disc- Invested

1 Like



Disc- Invested

1 Like
2 Likes

Q4FY24 concall summary
https://twitter.com/radireddy/status/1800573734073360528

2 Likes