Godrej Properties sees sturdy gross sales this yr regardless of COVID-19; money circulation might pose challenges
New Delhi: Buoyed by report gross sales bookings of Rs 5,915 crore final fiscal, realty agency Godrej Properties expects to repeat its sturdy efficiency on gross sales entrance this yr regardless of coronavirus pandemic, however sees money circulation as a problem resulting from sluggish building actions.
In an interview with PTI, Godrej Properties Government Chairman Pirojsha Godrej mentioned there shall be a slowdown within the trade however individuals who need to purchase properties throughout this time will definitely choose actual property firms with sturdy monetary capabilities to execute tasks.
“Our gross sales bookings within the first two months of this fiscal have grown over the past yr. Even over the past 10-15 days in March, we had various gross sales,” he mentioned.
The nationwide lockdown was imposed from March 25 to curb the unfold of COVID-19, bringing building actions in addition to bodily gross sales to a grinding halt.
Godrej expressed confidence that the corporate would have one other good monetary yr in gross sales perspective regardless of the present scenario.
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“We hope for an excellent efficiency this yr as effectively. Hopefully, we will do even higher than that,” he mentioned when requested about gross sales bookings outlook for the present fiscal.
The corporate is witnessing various curiosity from potential patrons, notably non-resident Indians (NRIs).
Godrej Properties has been witnessing 10-15 % gross sales bookings by NRIs by means of digital route, he mentioned, including that this expertise helped the corporate loads throughout this lockdown interval.
Godrej, nonetheless, mentioned the money circulation scenario and pace of building can be difficult this yr.
“Money flows shall be one thing that we have to focus loads on. Its two months now, and barely any building has occurred. On this trade, money circulation is linked to reaching sure building milestones,” he mentioned.
That mentioned, the corporate doesn’t have any liquidity points as round Rs 2,000 crore money is within the stability sheet, with a wholesome debt-equity ratio, Godrej acknowledged.
Requested in regards to the general influence on the housing market, Godrej feels that the residential phase won’t be severely affected, as broadly believed, regardless of the powerful financial state of affairs.
“Most individuals predict the residential phase to do extraordinarily badly this yr. My very own view, whereas we now have to attend and watch and which may be the case, I might not take that as a given,” he mentioned.
“Clearly financial sentiments are weak, folks shall be considerably reluctant to commit for big-ticket purchases. Individuals are shedding jobs, wage cuts are taking place, so affordability will worsen.
“However, alternatively, the form of safety dwelling possession presents, it turns into much more engaging in a pandemic like this,” Godrej noticed.
One must wait and watch to see the way it performs out between financial difficulties and having a safety of dwelling possession, he mentioned.
Godrej mentioned the federal government has taken a variety of measures on the provision entrance, however there’s a want for demand-side intervention. He recommended that stamp responsibility/GST charges must be relaxed for the subsequent six months to encourage folks to put money into the property market.
On the launch pipeline, Godrej mentioned the corporate has not launched any new tasks over the past two months and slightly specializing in promoting inventories in present tasks by means of engaging cost plans.
Nonetheless, Godrej mentioned the corporate is holding on to its steering to launch 15 million sq ft space throughout this fiscal yr in comparison with 11 million sq ft within the earlier yr.
He mentioned a lot of the launches might get bunched up within the second half of this fiscal yr.
This isn’t uncommon for the corporate, he mentioned, including that even over the past fiscal yr, its fourth-quarter gross sales bookings had been thrice greater than the first-quarter gross sales.
“We will make up for the misplaced time within the second half,” he mentioned.
Godrej Properties has acquired many tasks, both outright buy of land or by means of joint ventures with landlords, within the final three years throughout main cities — Delhi-NCR, Mumbai, Pune and Bengaluru.
“Now we have a powerful portfolio. Our focus now shall be launching these tasks and producing money flows from these tasks,” Godrej mentioned.
Nonetheless, he didn’t rule out buying extra tasks if there are good alternatives within the present market scenario.
“The sector was already going through a disaster. The coronavirus outbreak is a double whammy to the sector. General, the sector could have sharp liquidity points. The method of consolidation will grow to be sooner,” he mentioned.
In the meantime, Godrej Properties, the actual property arm of enterprise conglomerate Godrej group, posted a internet revenue of Rs 267.21 crore on a turnover of Rs 2,914.59 crore over the past fiscal yr.
On the operational entrance, Godrej Properties” whole gross sales bookings rose to Rs 5,915 crore final fiscal yr from Rs 5,316 crore within the earlier yr, probably the best reserving worth achieved by any publicly listed actual property developer in India in FY20.