Newsdetail

We now have our strongest ever residential project pipeline,’ says Godrej Properties MD

Priya Singh | 2024-01-16

We have already achieved 52% of our annual booking value guidance in the first half of fiscal 2024, which puts us on track to achieve our best ever year in terms of booking value,” Pandey said
"The recent BD(business development) deals have been more skewed towards outright purchases," he said. (Godrej)
The Godrej Properties management has said it will cross its full year guidance of Rs 14,000 crore for its sales bookings for FY24 .The company has also lined up a series of new launches in the coming months. In an interview, Gaurav Pandey, managing director and CEO, tells Raghavendra Kamath that the company will continue to focus on mid-premium and premium-plus categories. Excerpts:
We have already achieved 52% of our annual booking value guidance in the first half of fiscal 2024, which puts us on track to achieve our best ever year in terms of booking value. This was driven by some key launches like: Godrej Tropical Isle, Noida, which was GPL’s most successful ever launch, achieving a booking value of over Rs 2,000 crore from 1.5 million square feet of area sold; Godrej Parkland Estate, Kurukshetra, which was GPL’s most successful plotted launch, achieving a booking value of Rs 628 crore from 1.39 million sq ft of area sold; Godrej Park Retreat, Bengaluru, which achieved Rs 573 crore of booking value in Q2FY24 from 0.66 million sq ft of area sold, that is, 96% of the launched inventory. In addition, we have a robust launch pipeline for the second half of the financial year and resilient demand. We are confident of exceeding our annual booking guidance of Rs 14,000 crore. Similarly, for other metrics like cash collections, business development and deliveries, we have achieved nearly 50% on all of them in the first half alone. Some of the project deliveries tend to be back ended in the year and could give disproportionate increase to collections in the second half.
We have been focusing on very rapidly gaining market presence across our focused markets and have witnessed consistent growth. We are seeing good demand across various price points and micro-markets. Our main focus remains largely in the mid-premium and premium-plus segments, while we have some projects in the luxury segment also. All of these have been doing very well for us. Moreover, for group housing projects, we will continue to focus on our existing markets, that is, Mumbai, NCR, Bangalore, Pune where we have a reasonable scale. We may look at the Hyderabad market at some stage. For plotted development projects, we are open to a larger set of markets. We bought land in Kolkata which will also come up in the future.
The recent BD(business development) deals have been more skewed towards outright purchases. We continue to evaluate deals of both outright nature as well as joint venture structure. We are driven by return metrics and the quality of deal than anything else and we have been very focused to create a robust portfolio of deals in great locations. We now have our strongest ever project pipeline that can deliver our growth aspirations for the next few years. The most important objective going forward will be to get all of our recently added projects launched in the upcoming quarters.
We have given guidance that we are comfortable to maintain a net-debt-to-equity between 0.5:1 to 1:1. We were at 0.65 times as of September 30, 2023, giving us a comfortable head room. We believe that the current market has presented us with great opportunities, and we have followed through and executed our strategy through high-quality transactions. Some of these have translated into launches already and have done well. Our collections have grown strongly, and we have taken decisive action to create long-term value.
It may not be accurate to take a long-term view on the prices as they are dependent on several factors and vary with micro-market to micro-market. However, the recent price hikes have been easily absorbed. In the near term, there seems to be some opportunity to continue with some amount of price expansion
The real estate sector goes through cycles. The sector had gone through a period of de-growth to stagnant market size in many cities, post global financial crisis till covid. We are now seeing the sector turning around and it would be fair to say that the market would do good in the coming years.