'Macrotech Developers aims to generate surplus cash in Q4, reduce debt'

Realty firm Macrotech Developers Ltd will focus on generating surplus cash flow and reducing debt by at least 11 per cent this quarter to Rs 6,000 crore helped by strong housing demand, its MD and CEO Abhishek Lodha said.

In an interview with PTI, he expressed confidence in achieving sales bookings guidance of Rs 14,500 crore for this fiscal year on the back of a strong launch pipeline in the current January-March quarter.

Mumbai-based Macrotech Developers markets its properties under the Lodha brand. It is one of the leading real estate developers in the country with a major presence in Mumbai Metropolitan Region (MMR) and Pune.

"Under new business development, we have already added many land parcels in the first nine months of this fiscal with an estimated revenue potential of Rs 20,300 crore as against the full-year target of Rs 17,500 crore. We will not be adding any meaningful projects this quarter," Lodha said.

Macrotech Developers buys land outright and also partners with landlords to create a land bank for future development.

"So, our focus now in this quarter will be to generate surplus cash flow and further reducing debt," he outlined.

The net debt of Macrotech Developers remained almost flat at Rs 6,750 crore during the October-December period compared to the previous quarter.

"We are looking to reduce our net debt to around Rs 6,000 crore by March," Lodha said.

The company's MD and CEO noted that housing demand continues to be buoyant on strong economic growth and people's desire to have home ownership.

"Business is steady. Consumers sentiment is good. Price growth is reasonable," Lodha said.

He noted that the reasonable growth in housing price means that affordability to purchase homes remains intact while ensuring decent capital appreciation.

Lodha said the real estate sector is in the third year of the long-term growth cycle.

Looking to tap rising housing demand, Macrotech Developers will launch 11 projects in Mumbai, Pune and Bengaluru this quarter with an estimated revenue potential of Rs 6,260 crore.

The company will launch a 4.4 million square feet area during the January-March quarter, of which 1 million square feet would be in Bengaluru where it has recently forayed into, and 0.8 million square feet in Pune. The remaining area will be in MMR.

During the first nine months of this fiscal, Macrotech has already launched a 6.6 million square feet area with a topline of Rs 8,850 crore.

The company has achieved a 14 per cent growth in its sales bookings to Rs 10,300 crore during the April-December period of 2023-24 from Rs 9,040 crore in the year-ago period.

It has given a sales bookings guidance of Rs 14,500 crore for the current fiscal against Rs 12,060 crore in 2022-23.

On Saturday, Macrotech Developers reported a 25 per cent increase in its consolidated net profit to Rs 505 crore in the latest December quarter from Rs 405 crore in the year-ago period.

The total income rose to Rs 2,958.7 crore in the October-December period of 2023-24 from Rs 1,902.4 crore in the corresponding period of the previous year.

Macrotech Developers has delivered 95 million square feet of real estate and is currently developing more than 110 million square feet under its ongoing and planned portfolio.