As I share my thoughts with you in this annual letter the world is unfortunatelycoming to terms with an unprecedented health and economic catastrophe. Amid overwhelmingchallenges in the operating landscape we at Peninsula Land remain steadfast in ourapproach to long-term value creation for our customers and other stakeholders.
FY 2019-20 saw India's GDP growth rate decline below 5% a sharp slide from 6.8% in FY2018-19. This happened owing to global trade uncertainties translating into limited exportgrowth weak consumer demand and investor confidence limited credit offtake and very lowprivate sector capex in the country. Despite these headwinds when there were early signsof growth bottoming out the last quarter of the financial year was disrupted by theCOVID-19 induced lockdown adversely impacting supply chains and further reducing demand.
The lockdown dragged down economic activities across India in March 2020 and PeninsulaLand felt the recessionary impact as well. The COVID-19 scenario is still evolving andits real impact will be felt in the next financial year. Like all other sectors of theeconomy real estate too will be adversely impacted due to the pandemic. In a sluggisheconomy COVID-19 has brought unprecedented challenges. Nevertheless we at Peninsula Landtook necessary steps during the year to focus on business continuity and manage liquidity.
Following Demonetisation RERA and GST the Government of India has tried to streamlinethe real estate sector. Understandably these changes brought in a set of challenges forthe sector. However thanks to its core strengths of being self-reliant inherentphilosophy of providing the best and always being one step ahead of the curve Peninsulaland showed profound resilience and grit in facing these challenges.
YEAR IN REVIEW
We sold ~199000 sq. ft. during FY 2019-20 down from 965773 sq. ft. during FY2018-19. Sales bookings across projects stood at Rs 342 crore during FY 2019-20 comparedto Rs 588 crore during FY 2018-19. Collections (operations and monetisation of non-coreassets) were at Rs 1159 crore for FY 2019-20 as against Rs 731 crore during FY 2018-19.
We received occupancy certificate (OC) for Carmichael Residences project and part OCfor Bishopsgate project at Mumbai. We started handing over the possession of readyapartments in Peninsula Heights project Bengaluru.
I am happy to report that we are taking measures to reduce our overall debt by steppingup efforts towards collections from customers accelerating project closure and monetisingassets. During the year the Company faced many challenges in managing its overallliquidity to support project construction and meeting debt obligations. The Company'scredit rating was downgraded during the year. We completed the surrender of land lease inGoa sale of land at Nashik sale of Peninsula Spenta office building with an eye on debtreduction. We reduced the overall debt by Rs 612 crore during the year and it stands nowat Rs 1761.26 crore.
With people being restricted to their homes for such long periods and health expertsclaiming that we must learn and unlearn things to survive the coronavirus the new normalhas made people watchful about their lifestyle choices question their financial planningand seek a safer and more reliable environment. These thought processes are going todirectly influence the home-buying pattern. Wellness homes integrated townships andaffordable housing units are emerging as some of the most popular choices. Buyers arekeenly interested in sustainable and environment-friendly living units. These developmentsaugur well for the residential market and Peninsula Land is well placed to tap thisopportunity going forward.
We believe that timely sales need to be complemented with timely delivery. The latteris where the role of execution discipline is maximised. Over the years we invested inprocesses and systems automated construction technologies and focused teams thattranslated into more streamlined workflows. Our commitment towards the adoption of bestcorporate governance practices goes beyond compliance with the law. We endeavour toembrace responsibility for corporate actions and the impact of our initiatives on allstakeholders. We continuously strive for betterment of our corporate governance mechanismsto improve efficiency transparency and accountability of our operations.
A DEDICATED WORKFORCE
Having a modern diverse motivated and engaged workforce where everyone is given theopportunity to realise their potential is fundamental to our business success. PeninsulaLand recognises and nurtures talent across hierarchies. It provides training makes sureteams get best-in-class equipment and provides a congenial work environment to itsemployees so that they feel a sense of pride and ownership in the Company.
At Peninsula Land we are constantly learning and coping with the COVID-19 scenario;and gearing up to respond to new challenges. Going forward we remain motivated to getback to growth by taking focused steps for the strengthening of our balance sheetcompletion of ongoing projects and debt reduction.
I would like to thank our Board members for their valuable guidance and insights. Iwould also like to take this opportunity to thank the entire team for their continuedcommitment and relentless efforts. It is because of their dedication hard work anddetermination that we are able to sail through the crisis with resilience; and areconfident of scaling new heights in the near future.
Our customers investors communities and other stakeholders continue to repose theirprecious trust in our vision and capabilities and that gives us the confidence to drivetransformational synergies to sustain business growth.
Rajeev A. Piramal
Executive Vice-Chairman & Managing Director