Lodha to Sobha: Net debt of India's top realty players down 43% in 3 years

The market share of large listed and large unlisted developers has increased from 17% in FY17 to 36% in FY23.

Thanks to housing sales hitting an all-time high, the net debt of India's top eigh listed developers have declined a whopping 43 per cent in the last three years, shows data analysed by Anarock Research. 

The top eight developers include Brigade, Godrej, Mahindra, Prestige, Puravankara, Sobha, Lodha and DLF. 

Source: Anarock

" This decline in net debt is essentially because of boosted sales and revenues. These developers’ sales volumes have surpassed pre-pandemic levels and are headed for a new peak. With improved cash flows over the last few years, their debt has reduced significantly," said Anuj Puri, Chairman – ANAROCK Group.

Listed developer’s revenue collectively have gone up up by 7% on yearly basis – from approx Rs 281 billion in FY22 to over Rs 301 billion in FY23; but it is yet to come back to pre-pandemic levels of FY20 (Rs 329 billion).

Meanwhile, the periodic interest rate hikes since April 2022 have led to a marginal rise in the cost of debt, though it remains lower than the pre-pandemic levels of FY20. This, however, will not impact large and listed players’ execution capabilities. 

 "Interestingly, the widening gap between the gross and the net debt also indicates a comfortable financial position for these players. For instance, the difference between the gross and net debt of the developers was approx Rs 74 billion in FY20 which has widened to almost Rs 152 billion in FY23, said Puri. 

Cumulatively, the market share of large developers, both listed and unlisted, has nearly doubled  from 17% in FY17 to 36% in FY23.

The unlisted companies include ATS Green, GM Infinite, Myhome, Piramal, Runwal, Signature Global, Shapoorji Pallonji, Wadhwa Group, Provident Housing, Goel Ganga, and Casa Grande, among others. 

Overall, as per ANAROCK Research, the last fiscal (April 2022 to March 2023) recorded sales of approximately 3.65 lakh units across the top 7 cities - the highest in the last 5 years. The first quarter of the current fiscal (April to June 2023) saw approximately 1.14 lakh units sold in these cities - the highest-ever quarterly sales recorded. 

Meanwhile, listed players' sales share has grown from 6% in FY17 to 15% in FY23. Sales by listed players grew from 57 Mn Sq. ft in FY 22 to 68 Mn Sq. ft in FY 23 - annual growth of 19%