Girish Choudhary · demand
Congratulations on the strong presales. I mean, firstly, if you -- obviously, you
have had a strong start to the year. So, if you could just give us the presales growth or the booking value
you’re targeting for fiscal ’27? And as a follow-up, you mentioned about 8 million square feet of
launches for the remaining 9 months. So, if you could give the GDV and also the timelines and the key
projects, which we should look forward to?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
Thank you, Girish. The last quarter, I mean, like end of the financial year, so we
have guided for at least 30% growth in the presales. That I think we should be able to continue to achieve.
And if all the launches happen within time, probably we can do slightly better than that. But as of now,
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I think we continue to aim for that in terms of presales. Now coming to the exact timing of these
remaining project launches of about 8.2 million square feet, like in the opening comments I have given,
those most -- all these about 9 projects, we would be able to do it within the next 9 months.
So most of them would be -- I mean, this quarter would be about 3 projects and which are a couple
of projects in Kerala and plotted development in Bangalore and probably a small 0.4 million square feet
project in Bangalore. But other than that, the remaining projects would be coming in Q3 and Q4.
No answer was attributed to this question in the transcript.
Girish Choudhary · guidance
Got it. That’s useful. And secondly, what we noticed also collections were
relatively modest considering the presales. So, was this primarily a timing issue because a large part of
sales came towards the end of quarter? And should we expect a material improvement from this quarter
onwards?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
Yes, that’s right. What you mentioned was right. One is the collections from new
sales have come towards the end of the quarter. And hence, I mean, there is more collection that would
be coming from these new sales, but part of the collections only have come in this Q1. Second is
typically, our milestone billing collections this time were relatively lower because some of the
milestones we could not achieve due to labor shortage in -- mainly in April and May.
And hence, the billing, corresponding billing could not happen. And hence, there is a small
shortfall there also. Otherwise, in general, things seem to be good in terms of overall cash flow visibility.
No answer was attributed to this question in the transcript.
Girish Choudhary · other
Okay. So, we are on target to do the INR2,000 crores, I think, which was guided
in the past, for the year?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
INR2,000 crores of operating cash flow?
No answer was attributed to this question in the transcript.
Girish Choudhary · other
Yes, yes.
No answer was attributed to this question in the transcript.
Jagadish Nangineni · margins
Yes. I mean that is on an average for the next few years, if you take an aggregate
level of what is the marginal cash flow. But we should, as we grow, we should be able to do, we should
be able to touch that number.
No answer was attributed to this question in the transcript.
Girish Choudhary · other
Yes. Lastly, if I may, on the land payments, we have seen around INR370 crores
during the quarter, higher than the normal run rate. So if you could explain, I mean, for fiscal ’27 and
’28, what are the commitments, and then from a business development point of view, what are you
seeing?
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No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
Yes. I mean, this quarter, in addition to our current -- I mean, normal
commitments of the existing land, we have invested in couple of new lands. One small land we have
bought in Mumbai, and we have invested in a new opportunity in Greater Noida. So put together, these
are the 2 new ones. Otherwise, the rest are towards commitments of the future forthcoming projects that
we have already declared.
No answer was attributed to this question in the transcript.
Moderator · other
The next question is from the line of Puneet Gulati from HSBC.
No answer was attributed to this question in the transcript.
Puneet Gulati · margins
My first question is one with respect to your disclosures on the forthcoming project,
where you talk about potential sales value of INR295 billion. And versus that, the margin that you talk
about in Slide 15 is INR68.3 billion. This is a lot lower than what you had in the previous presentation
at close to INR86 billion of margin and a smaller saleable value for forthcoming project. What is the
change here?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · margins
You’re right, Puneet. So, the main difference for the new forthcoming majority -
- I mean, the mix of the projects, a greater mix is towards joint development. And hence, that’s the
marginal cash flow, you would have seen reduction. Second is earlier in this marginal cash flow for
forthcoming projects, we had Hoskote and Hoskote as one of the main projects, which had, which was
our own land and hence, the marginal cash flow was much higher.
No answer was attributed to this question in the transcript.
Puneet Gulati · other
Okay. So, the GDV that you state is basically including the landowner share?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
Yes. This is the gross value of the all the projects -- of the entire project.
No answer was attributed to this question in the transcript.
Puneet Gulati · other
Okay. That’s fine. And secondly, while you talked about potential 2 acquisitions this
quarter, one in Mumbai and one -- sorry, the other one I missed out.
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
In Greater Noida.
No answer was attributed to this question in the transcript.
Puneet Gulati · other
And have you paid for both of them?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
Yes.
No answer was attributed to this question in the transcript.
Puneet Gulati · other
Okay. So how should one think about full year allocation of capital towards land? What
is the run rate one should assume?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
See, we have done last year. I mean, we would -- from a land payments point of
view, we would be roughly similar to land for last year. And going forward, there would be an
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incremental from a -- I mean, last year, we did about INR1,160 crores. And this year, we already did
about INR370 crores. And we have identified a couple of opportunities where I think we can invest in
Bangalore and in NCR. So, if we are able to complete those transactions, then we might look at closer
towards INR1,500 crores to INR1,600 crores this year.
No answer was attributed to this question in the transcript.
Puneet Gulati · other
Okay. That’s very helpful. And lastly, your 9 project launches, does that also include
the balance phase of One World or that’s separate?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
No, that doesn’t include balance phases. Like I said, we have taken the entire
project of SOBHA One World in the new project launches in Q1.
No answer was attributed to this question in the transcript.
Moderator · other
The next question is from the line of Parikshit Kandpal from HDFC Securities.
No answer was attributed to this question in the transcript.
Parikshit Kandpal · demand
Jagadish, congratulations on a great quarter on presales. So, my first question is, I
mean, the way we were forecasting this quarter, the first half was a washout because of geopolitical
issue. So just wanted to understand what led to the strong demand coming back towards the second half
of the quarter, so both in Gurugram and Bengaluru.
And also wanted some color on Noida, how the Rivana has done after there were some delays.
You said the sales could have got pushed out. So just your sense on the demand, what has just surprised
us positively? And where do you think the real estate cycle currently is?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · demand
Thank you, Parikshit. So, like you have seen in Q1 or, let’s say, Q1 of this calendar
year, right? We had been preparing for these launches for some time. And hence, the time advantage
that we had got in terms of preparation is what I believe is what led to a stronger performance in this
quarter. So, for any new launches, like you know, it’s not only dependent on the timing of the launch,
but also the extent of preparation for that.
So, in that aspect, we were much better prepared and hence, there is a stronger response is what
we can see in Q1. Otherwise, the overall demand scenario seems to be quite stable from what we have
seen in terms of the launches and also what we are witnessing post the launches also. It’s been quite
steady. So, we believe that it is a reasonably good demand scenario.
What we would like to see is how the supply is going to come up. Specific to your question related
to Rivana, Rivana has also been quite steady. It’s not a project where it is a much higher -- we have not
seen much higher sell-through at the launch. But post that, during the quarter, it has been quite steady
in terms of monthly sales and the quarterly sales.
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No answer was attributed to this question in the transcript.
Parikshit Kandpal · capex
My second question is on the INR1,500 crores tentative. I mean, you said that the
deals could get close, the INR1,500 crores capex on land may happen this year. So just wanted to
breakup of how much will be Bengaluru and how much is the contribution from NCR and MMR on
this? And whether is it right to assume that out of INR1,500 crores roughly INR15,000 crores worth of
GDV INR12,000 crores to INR13,000 crores GDV addition will happen?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
Yes. I mean, from a remaining capital allocation, part of that is towards our current
commitments for the 20.77 million square feet, that’s roughly about another INR400 crores. And our
past commitments, those are also that’s about another INR200 crores. So, I mean, those are about
INR600 crores plus already we have done about INR370 crores. So, remaining is about INR600 crores.
So that INR600-odd crores, we will -- we should look at the current opportunities that we are pursuing.
It’s still, I mean, a little early to disclose that, but it’s at a good valuation and hence, we should be able
to -- typically, in any new land buy, we see that the value of the land is between about 15% of the total
sale value. So that it would be in the similar range.
No answer was attributed to this question in the transcript.
Parikshit Kandpal · exports
So, this will be largely in NCR, the INR600 crores, INR700 crores incremental
beyond the existing in the past commitments, which you said. So out of the INR600 crores, INR700
crores, where -- how will be the geographical breakup of this?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
It’s part of it is -- majority is in Bangalore and the remaining is split largely
between NCR and a little bit portion to Mumbai.
No answer was attributed to this question in the transcript.
Parikshit Kandpal · other
Okay. And just a third question on this Hoskote. So how much was the contribution
from the SOBHA One World out of the total INR2,000-odd crores of sales. So how much was the
contribution? Because the numbers look little lower than the number that we have. So was there any
spillover you’re going to book in Q2 out of this? Just wanted the total cumulative sales on this and how
much has been recognized in Q1?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
About, you have seen about 45% of the overall sale is from One World sale and
the remaining is from both, like Bangalore and NCR have contributed close to 87%.
No answer was attributed to this question in the transcript.
Parikshit Kandpal · other
Sorry, I didn’t hear you how much?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
Bangalore and NCR together have contributed about 87%.
No answer was attributed to this question in the transcript.
Parikshit Kandpal · other
This thing, out of the total INR3,600 crores, 45% comes from your SOBHA One
World.
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No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
Yes.
No answer was attributed to this question in the transcript.
Parikshit Kandpal · other
And is there any pending sales to be recognized because this number then looks a
little slightly on the lower side compared to what you have released, it’s about INR1,600 crores. So, was
there, I mean, were you able to book the entire sales or there’s a pass-over which will happen in Q2 from
this, which you could not realize in the Q1 numbers?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
Yes. So, like I mentioned, we have released about 3.4 million square feet of the
total. And within that, we have done about 40% of the sales.
No answer was attributed to this question in the transcript.
Parikshit Kandpal · other
That’s about totally INR1,800-odd. So, about INR200 crores, INR300 crores could
be a spillover, which may happen in the Q2 quarter?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
Yes, Parikshit.
No answer was attributed to this question in the transcript.
Parikshit Kandpal · other
So, there was some spillover into Q2, that means the entire...
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
That is a characteristic of any new launch or ongoing operation. So, there would
be naturally be some spillovers from that are being put in the previous time period.
No answer was attributed to this question in the transcript.
Moderator · other
The next question is from the line of Biplab Debbarma from Emkay Global.
No answer was attributed to this question in the transcript.
Biplab Debbarma · other
Congratulations on the great start to FY ’27. First question is on the Mumbai and
Greater Noida business development you did in this quarter. Could you give us some details like are
these outright projects? And how much you paid for these projects? What would be their GDV, when
they are expected to be launched?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
The Mumbai project is about 1.3 acres and we bought the land for about INR180
crores. And the Greater Noida project is a joint development for which we have paid certain dues for
the authority and for the landowners. So, both -- so each one -- both put together, the GDV for this would
be about INR2,700 crores to INR3,000 crores.
No answer was attributed to this question in the transcript.
Biplab Debbarma · other
And they would be launched in this financial year?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
The Greater Noida one, we are envisaging to launch this financial year. Mumbai
one, we would endeavor to do it. But considering the approvals, uncertainty, a clear timeline from --
there is a lot of work to be done there. And hence, although our endeavor is to launch it this financial
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year. So currently, I have not included that in the projection that I have given in terms of 8.2 million
square feet for this remaining 9 months.
No answer was attributed to this question in the transcript.
Biplab Debbarma · margins
And second question is on the margin. I mean, last quarter, you mentioned that
margin will see revival from the second half of this financial year. Margin continues to be low. Sir, do
you maintain that margin you will see uptick in second half of this financial year? And what kind of
margin do you think we’ll see in the second half of financial year, reported margin?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · margins
Right. Biplab, you’re right. I mean I still expect the margins to be significantly
better in the second half means sequentially, it should start looking better. Q2 might be similar or
depending on the number of completions that we can do, Q2 might be similar. But Q3 and Q4
sequentially should become better as we complete some of our high-margin projects and start handing
over. So, our expectation is that by Q4, as we currently, we are at about 9.7% EBITDA. So, as we leave
the end of Q4, maybe hopefully, we should be able to do closer towards 17% to 20%.
No answer was attributed to this question in the transcript.
Biplab Debbarma · other
Okay. That’s great. And my third question is on the remainder of the year, you
said 8.2 million square feet launches. That translates into how much of GDV?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
At the current average of INR15,000 crores, it should be about another INR12,000
crores.
No answer was attributed to this question in the transcript.
Moderator · other
The next question is from the line of Fenil Brahmbhatt from Choice Institutional Equities.
No answer was attributed to this question in the transcript.
Fenil Brahmbhatt · other
Congratulations for the good set of numbers. I have 2 questions for you. First is
on this approved NCDs of INR1,000 crores. So, when we are planning to issue these NCDs in the next
quarter or there is any timeline? So, if you can throw some light on that, that would be helpful.
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
Yes. We envisage the usage coming in the next couple of quarters. So, we would
do it in tranches as and when we identify the acquisition opportunity or, let’s say, firm up the acquisition
opportunity, we would go ahead with the funding of NCD. So, it’s not -- need not be at one shot, but as
and when it’s required. But at least I would think that we will break it into at least 2 tranches.
No answer was attributed to this question in the transcript.
Fenil Brahmbhatt · other
Okay. All right. And I just want to understand the project completion for FY ’27,
’28. So which projects are at the finishing stage or we are planning to deliver in next 3 quarters or next
remaining FY ’27? And if possible, you can give some highlights for FY ’28 projects as well?
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No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
So, for FY ’27, like I mentioned, we would endeavor to complete about 6 million
to 6.5 million square feet versus what we have done about 5.4 million square feet last year. So, I mean,
there is a list of projects that we would complete as per the timeline of the completion. We can provide
you that list separately, Fenil, if that’s okay.
No answer was attributed to this question in the transcript.
Moderator · other
The next question is from the line of Pritesh Sheth from Axis Capital.
No answer was attributed to this question in the transcript.
Pritesh Sheth · other
Congrats on a great start to the year. Just dwelling some more on launches again. So,
second phase of SOBHA Crescent is planned for next year or this year?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
Pritesh. Crescent Phase 2 will happen during this financial year, most likely in
Q3, towards the end of Q3 or beginning of Q4.
No answer was attributed to this question in the transcript.
Pritesh Sheth · other
Okay. So, 2 million square feet in NCR, which you said is basically second phase of
Crescent and the Noida project, Greater Noida Project and Bangalore will have the Crystal Meadows
now converted into those apartment projects also included in current year’s pipeline?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
That’s right.
No answer was attributed to this question in the transcript.
Pritesh Sheth · other
Okay. Perfect. And just on Mumbai, I can’t see the new latest addition in our
forthcoming or subsequent pipeline or rather there is 1 acre of Mumbai, but I thought that’s the second
part of the Parel project. So, is this included in the current pipeline? Or since we are not sure of the
timeline, we don’t -- we have not included in the forthcoming subsequent land right now?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
Right. So, the one that you are seeing in the forthcoming pipeline is the second
phase of the current project, which is Inizio. And the one that we have just acquired that we have not
yet included basis the timeline once it gets firmed up, we would include it subsequently.
No answer was attributed to this question in the transcript.
Pritesh Sheth · other
Sure. Got it. And one last again on launches. I think last time we had a 6 lakh square
feet of commercial project in Gurgaon that I don’t see currently in the pipeline. Has the plans been
shelved for that commercial project now? Or has anything changed there?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
Good observation, Pritesh. That particular project, it’s still the endeavor to launch
and develop it. We have, in fact, the entire TDR for it, and we can develop the entire project. But
currently, we are looking at an option -- evaluating an option of launching it, but not actually selling it,
but retaining for our rental income. So that we are in an evaluation phase. And once that is -- and hence,
we have removed it. So, if we decide to do part of the development as a sale model, we’ll bring it back.
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No answer was attributed to this question in the transcript.
Moderator · other
The next question is from the line of Shubham Selvadia from Tikri Investments.
No answer was attributed to this question in the transcript.
Shubham Selvadia · other
Sir, my question is regarding labor law. Sir, in Karnataka recently in May month,
there was a hike of 60% in minimum wages. So, have you evaluated any impact on cost?
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
Yes, there has been, and we are still under the evaluation phase. But largely, our
technician force that we have, that is above the minimum wage. However, it would have a little bit of
impact on our overall cost. That is yet to be assessed. But I think we are considering -- it should be --
we should be able to absorb it within the budget that we have allocated for the projects.
No answer was attributed to this question in the transcript.
Moderator · other
Ladies and gentlemen, that was the last question. I would now like to hand the conference
over to the management for closing comments.
No answer was attributed to this question in the transcript.
Jagadish Nangineni · other
Thank you, everyone, for participating in today’s call. I hope we have answered
most of the questions that you had. In case of any further queries or more details, you can please reach
out to us and wish you the very best. Thank you, and have a good evening.
No answer was attributed to this question in the transcript.
Moderator · other
On behalf of ICICI Securities Limited, that concludes this conference. Thank you for
joining us, and you may now disconnect your lines.
No answer was attributed to this question in the transcript.
