Realty firm Macrotech Developers Ltd aims to reduce its net debt by around 40 per cent to approx. 5,000 crore in the current calendar year with the help of surplus cash flow from strong housing sales, said MD and CEO Abhishek Lodha.
Mumbai-based firm markets its properties Lodha brand.
Macrotech Developers In an interview with news agency PTI, MD and CEO Abhishek Lodha was upbeat on the long-term growth potential of India’s residential real estate market.
The firm saw a reduction in debt 753 crore in the December quarter 8,042 crore due to strong sales bookings and cash flow.
“We are hoping to further reduce the debt 1,000 crore by the end of this financial year 7000 crore,” said MD, CEO Abhishek Lodha. The company plans to cut debt 500-800 crores every quarter.
“We would expect to be close 5,000 crore net debt sometime by the end of this calendar year,” he said.
MD and CEO Abhishek Lodha said there are no plans to become a zero-debt company.
On the overall operational performance during the current financial year so far, Lodha said the company has performed well across all three key metrics – sales bookings, embedded EBITDA margin and new land parcels for future development.
“In pre-sales, we had our strongest third quarter ever with sales exceeding 3,000 crores. So far, we have 9,000 crore sales in the first nine months of this financial year, which is higher than what we did for the full year of FY22 and definitely leads us to exceed guidance for FY23 which is 11,500 crore,” he said.
Macrotech Developers’ sales bookings up 16% 3,035 crore in the December quarter.
The company sold assets worth 9,039 crore in the first three quarters of this financial year as against Rs. 5,570 crore in the same period last year.
There was a huge amount of sales booking or pre-sales for housing projects.
Lodha said the embedded EBITDA margin was 31 per cent in the third quarter and 33 per cent during April-December. “If we translate this for the whole year, it will be approximately 3,500 crore plus EBITDA.”
On new business development, Lodha said the company has added several land parcels so far in the current financial year which could generate projected sales revenue. 17,800 crore against full year new business growth guidance of Rs. 15,000 crores.
Asked about the new sales guidance for FY23, Lodha said the company is now on track to exceed the FY’22 target, but has not set any new targets.
Demand for residential properties continues to increase on strong consumer sentiments, Lodha said, adding that supply-demand consolidation is taking place for credible developers.
Similarly, the company has not set any new target for project additions for the entire FY’23, but there will be some land acquisitions.
Macrotech developers acquire land outright and also form joint ventures with landowners to create a land bank for future development.
The company will continue to focus on the Mumbai Metropolitan Region (MMR) and Pune markets. It has recently entered the Bengaluru residential market with one housing project and is in talks to add one more.
Last week, Macrotech Developers reported a 41 percent increase in its consolidated net profit. 404.98 crore for the quarter ending December 2022.
it has a net profit 286.38 crore in the year-ago period.
However, total income fell 1,902.44 crore in the third quarter of this financial year 2,155.70 crore in the same period last year.
Macrotech Developers has delivered around 90 million sq ft of real estate and is currently developing around 107 million sq ft under its ongoing and planned portfolio.
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