Lodha group forms 4 JVs in Q1 for realty projects, eyes 2 JVs every quarter

Macrotech Developers, which sells properties under Lodha brand, has formed four JVs in April-June to build projects of Rs 3,500 crore, eyes two such tie-ups every quarter, a top company official

Macrotech Developers, which sells properties under Lodha brand, has formed four joint ventures in April-June to build projects with a sales value of Rs 3,500 crore and is looking at two such tie-ups every quarter to expand presence in Mumbai and Pune regions, a top company official said.

Mumbai-based Macrotech, erstwhile Lodha Developers, is one of the leading real estate companies in the country. It got listed on the stock exchanges in April after launching Rs 2,500-crore initial public offering (IPO).

In an interview with PTI, Macrotech Developers Managing Director and Chief Executive Officer Abhishek Lodha said he remained bullish on the growth prospects of the housing segment, notwithstanding the disruption caused by the COVID-19 pandemic.

"We want to expand our presence across the Mumbai Metropolitan Region (MMR) and Pune for future growth," Lodha said.

During the first quarter, he said the company entered into four joint development agreements (JDAs) with landowners and local realtors to build projects, comprising a total of 3.3 million square feet, in micro-markets of MMR and Pune regions.

"The estimated sales value in these four projects will be around Rs 3,500 crore," he added.

In the MMR market, it has signed two JDAs in western suburbs with sales potential of around Rs 2,100 crore and one in eastern suburbs worth Rs 450 crore.

One JDA has been formed in Pune with sales potential of around Rs 900 crore.

Asked whether the company would add more projects through this route, Lodha said, "We are targeting to form 2 JDAs every quarter on an average."

Macrotech Developers has huge land bank in MMR and Pune, but not in all micro-markets of these two major cities in Maharashtra.

"Our focus on the JDA is to serve all the parts of the Mumbai region and Pune where we are not present," he said.

In MMR, Lodha said the company has a strong presence is in south central Mumbai, Thane and the extended eastern suburbs.

The company is looking to grow in the western suburbs, the eastern suburbs and Navi Mumbai.

"Similarly, in Pune, we only have one development, Lodha Belmondo; and the rest of the city, we don't have enough presence. So, we are looking to grow in almost all parts of Pune," he said.

Macrotech will share revenue with JV partners and is looking at around 20 per cent profit margins in JDA projects.

On sales bookings, the Macrotech MD was confident of achieving the guidance of Rs 9,000 crore during this fiscal year, despite the second wave of pandemic.

It sold properties (largely housing) worth Rs 5,968 crore during the last financial year.

To speed up the pace of construction, Lodha said the company would almost double its investment on construction to Rs 2,700 crore in this fiscal.

The company's construction spend stood at around Rs 1,400 crore during the last fiscal year.

On debt, Lodha said the company was on track to bring the net debt to below Rs 10,000 crore levels this fiscal from around Rs 12,500 crore at the end of the June quarter.