There were many positives in the December quarter earnings of Bengaluru-based Prestige Estates Projects Ltd. One of the highlights was the highest quarterly sales. 4,270 cr and record-high collections 2,430 crores. This strong performance is attributed to good response to the company’s newly launched projects in Bengaluru and Hyderabad and good sales momentum in ongoing projects in these regions.
In a post-earnings conference call with analysts, the company’s management said it expects to close FY12 with pre-sales of Rs 10,000 crore.
Although its net debt grew on a sequential basis due to investments in land acquisition and approval costs, the company’s management said it would use the net proceeds from the Blackstone deal to pay off part of the debt, and this would increase the gross debt by Rs 625. expected to decrease. crore in 4QFY22. In Q3FY22, net debt stood at Rs 4,172 crore as compared to Rs 3,090 crore in 2QFY22.
While all is well now, going forward, success in its new venture market of Mumbai Metropolitan Region (MMR) will be a key factor for Prestige stock.
Analysts at Antique Stock Broking Ltd said in a report, “The termination of Phase II of the Blackstone deal and the Starttech deal will lead to increased liquidity in the system and loss of balance sheet. However, successful execution of Mumbai projects is critical.” ,
He adds, “While MMR is a lucrative market, it is also one of the toughest markets with unique real estate landscape from land disputes and complex regulations governing land use and development perspective; and Prestige’s geographical expansion in MMR.” Rather aggressive.” Hence, analysts caution that any significant delay in planned projects could hit the company’s growth.
Sharing an update about its Mumbai foray, the management said that its Project Jasdan Classic has been launched and so far 12 units worth IRN0.7bn have been sold. The company expects to start projects in Pali Hills, Mulund and Marine Lines in April 2022. The management said that the company’s total investment in MMR projects so far is Rs 2500 crore. In all, the company will launch in 30 million sq ft in the next 12-15 months.
As far as its partnership with DB Realty is concerned, the Prestige management said it has five deals with DB for its projects located in Marine Lines, BKC 1 & 2, Mahalaxmi and Delhi Aerocity. Prestige Management said money from the family office in DBR is not stuck at the entity level to ensure Prestige-DB projects.
Investors would recall that DB Realty was in the news recently after Godrej Properties Ltd terminated its partnership with the company for a slum rehabilitation project.
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