The financial year 2015-16 has been a challenging year for companies the state thecountry & the world. Most countries in the world are struggling with troubledeconomies. There is lot of turmoil in Europe due to the migrant crisis & terrorismand they are busy grappling with the problem. This year saw fluctuation in oil prices.While low oil prices have benefited oil importing countries like India it has createdproblems to several oil producing countries in the Middle East South America and Russia.All this is bound to result in continued economic uncertainty witnessed across the worldduring the last few months. The silver lining seems to be United States (the largesteconomy contributing to 25% of the global economy) whose GDP is growing at a healthy rateof 2.4%. Though Chinas GDP is growing at 6.5% & Indias at 7.5% bothcountries have the problem of excess manufacturing capacities which were built to meet theexpected demand of higher growth rates. Indias growth rate is questionable after thegovernment changed the base data for calculations. What is surprising & distressing isthat the State of Karnataka generally considered as a progressive state had a growthrate of 6.5% last year which is below the national average.
While the Indian economy is in a relatively better shape in terms of GDP growth it islikely to become a case of missed opportunities to reach double digit growth in spite ofits huge potential. Other than creating the much needed positive sentiment the singleparty majority government at the Centre hasnt succeeded in kick starting major infraprojects in implementing major policy changes and living up to the election promisesmade. It is rather sad that opposition parties have unfortunately blocked importantinitiatives like GST which could have had far reaching positive impact on Indian economyand its GDP growth rate.
Brigade Enterprises Limiteds Consolidated Revenues for the year ended 31stMarch 2016 was Rs. 1700 Cr. up from Rs. 1331 Cr. recorded during the previous year. TheConsolidated Net Profits stood at Rs. 148 Cr. as against Rs. 116 Cr. Revenues as well asprofits witnessed a growth of 28% over previous year. The Debt Equity ratio of the Companyon 31st March 2016 is 1.36:1. CRISIL & ICRA have assigned Arating with stable and positive outlook respectively for the credit facilities availed bythe Company. The Board of Directors declared an Interim Dividend of Rs. 2.00 per equityshare which was paid to shareholders on 29th March 2016.
Our Real Estate business has done relatively well and the two joint venture projects -Brigade Orchards the first Smart Township in Bangalore and Brigade Cosmopolis (along withGIC Singapore) continues to contribute to the top-line and the bottom-line. Brigadelaunched a total of 4 million sq. ft. in the financial year 2015-16 and sold 2.25 millionsq. ft. of real estate space aggregating to Rs. 1249 Cr. with an average realisation rateof Rs. 5554 per sq. ft. for the financial year 2015-16. Brigade Group completed BrigadeMeadows Phase 1 - the first integrated enclave on Kanakapura Road Bangalore and AzureTower at Brigade Exotica on Old Madras Road. Your Company acquired a 16 acre propertyalong with GIC Singapore in Perungudi the prime commercial corridor of Chennai fromKansai Nerolac Paints Limited through a special purpose vehicle for a consideration of Rs.538 Cr.
Our Lease Rental segment has contributed Rs. 197 Cr. to the top-line of the Company.About 1.2 million sq. ft. of commercial and retail lease space is currently underconstruction. Brigade Groups second mall - Orion East at Banaswadi Bangalore waslaunched recently. The Hospitality segment revenues for the financial year stood at Rs.182 Cr. The occupancy levels at Grand Mercure Bangalore and Sheraton Grand Bangalore areamong the best performers in their respective categories with average occupancies of over80%. The Grand Mercure Mysuru with a total of 146 keys was launched recently. The Groupwill have 1000 plus operational keys over the next 2 years. We plan to launch 6.85 mn.sq. ft. of residential commercial and hospitality space in the financial year 2016-17.
The Real Estate Bill which was in the offing since 2013 has today become a reality. Itis bound to protect the customers by answering their concerns and regulate the waybusiness is conducted by the Developers. It is pro long-term players and antifly-by-night operators. Even then developers fear that it will add timeand cost to launch projects and may become one more window to face harassment as the Actcontains several draconian clauses for non-compliance. However the future looks excitingwith a plethora of opportunities for organised players like us.
It is a matter of pride to note that our Group has received a number of Awards duringthe year and the significant ones are as follows:
Orion Mall won the Best Shopping Mall of the Year Award in SouthIndia at the 4th Indian Retail & eRetail Awards 2015
Orion Mall received two of the coveted trophies IMAGES Most AdmiredShopping Centre of the Year: South and IMAGES Most Admired Shopping CentreMarketing & Promotions of the Year- South at the IMAGES Shopping Centre Awards2015
Brigade Group won the Hotel Owner of the Year Award at TheHospitality Leaders Industry Choice Awards2015
Brigade Group has been Ranked No. 1 in the Real Estate Industry and No. 28across all industries in India as Indias Great Companies to Work for 2015 by GreatPlace to Work Institute and The Economic Times
Brigade Caladium received the Best Ultra Luxury Project of the Year- NorthBangalore at the Silicon India Bangalore Real Estate Awards 2015
Brigade Exotica won the ICI (KBC)-BIRLA SUPER Award for OutstandingConcrete Structure of Karnataka (Building Category)-2015 from Indian Concrete Instituteduring the Concrete Day Celebrations
Brigade Group won both CREDAI National Awards for CSR at the CREDAI Conclave2015. The Environmental Impact Award for rejuvenating Sitharampalya Lake in Whitefield andthe redevelopment of the Sangolli Rayanna Park in Malleswaram and the SocialInfrastructure Award for the redevelopment of the Shri Nadaprabhu Kempegowda Playground inMalleswaram and the Skywalk with escalator across Dr. Rajkumar Road in Rajajinagar
Brigade Exotica won the Luxury Apartment Project of the Year Awardat the NDTV Property Awards 2015
I would like to thank all the stakeholders who have reposed confidence and strength inBrigade Group which will motivate us to work harder to scale up the business to newerheights
M. R. Jaishankar
Chairman & Managing Director