Godrej Properties commits $700-900 million investment in last three years

Realty firm Godrej Properties Ltd has committed investments worth USD 700-900 million in the last three years and continues to be extremely bullish on the Indian real estate sector, a senior company official said.

Addressing a CII-Anarock conference, Godrej Properties Ltd (GPL) MD and CEO Mohit Malhotra said the company is looking to form partnership to acquire projects and is also exploring to enter new cities for development of housing projects.

He highlighted that the company achieved a record sales bookings of Rs 6,725 crore last fiscal despite the COVID-19 pandemic.

"We have been bullish all throughout...If you look at last three years, we would have deployed close to or committed close to 700-900 million dollar in real estate sector and we continue to remain bullish," he said.

Malhotra was replying to a query by Anarock Chairman Anuj Puri about the company's recent announcement to invest USD 1 billion (about Rs 7,450 crore) in the next 12-18 months.

"The only constraint in our company today is ability to get a project launch ready. After that its auto pilot, sales happen on its own. So for us, the whole focus is can we get more and more projects in the pipeline," Malhotra said.

He noted that land is available at attractive terms, not undervalued but fairly valued.

"We always had a view that real estate cycle is going to turn. We shifted our strategy in 2018 when we said we would like to deploy more capital in this business. And we were betting on cycle turning," Malhotra said.

There is a broader consensus within the industry that cycle is turning, he added.

"Overall we remain actually extremely busllish and looking forward to partner more people and develop more projects for our consumers," he said.

Asked about expansion to newer markets, Malhotra said: "While there is a lot of growth opportunities in cities where we are present, we feel that there is an opportunity now to look at next set of cities. We are evaluating it."

He said the company is also evaluating entering some of the new cities through plotted developments.

"Next leg, we would like to look at new cities," he said.

On input cost, Malhotra said the company has raised prices in several of its housing projects due to rise in input cost.

Pointing out that profit margins are very thin in real estate, he said the customers can absorb a small hike.

Godrej Properties, the largest listed realty firm last fiscal in terms of sales bookings, had raised Rs 3,750 crore in March last year through a Qualified Institutional Placement (QIP).

Its net debt is mere Rs 313 crore as on December 31, 2021. The debt to equity ratio is 0.04.

During the first nine months of the current 2021-22 fiscal year, GPL has clocked a sales bookings of Rs 4,613 crore -- up 13 per cent from the year-ago period.

Mumbai-based Godrej Properties Ltd has successfully delivered around 20 million square feet of real estate in the past five years. It currently has around 186 million square feet of developable area in 81 projects across India.