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Prozone Intu Properties Ltd.

BSE: 534675 Sector: Infrastructure
NSE: PROZONINTU ISIN Code: INE195N01013
BSE 00:00 | 20 Mar 30.75 -0.10
(-0.32%)
OPEN

31.00

HIGH

31.40

LOW

30.45

NSE 00:00 | 20 Mar 30.75 -0.10
(-0.32%)
OPEN

30.90

HIGH

31.45

LOW

30.30

OPEN 31.00
PREVIOUS CLOSE 30.85
VOLUME 20110
52-Week high 55.10
52-Week low 25.55
P/E 279.55
Mkt Cap.(Rs cr) 469
Buy Price 30.75
Buy Qty 200.00
Sell Price 31.05
Sell Qty 1225.00
OPEN 31.00
CLOSE 30.85
VOLUME 20110
52-Week high 55.10
52-Week low 25.55
P/E 279.55
Mkt Cap.(Rs cr) 469
Buy Price 30.75
Buy Qty 200.00
Sell Price 31.05
Sell Qty 1225.00

Prozone Intu Properties Ltd. (PROZONINTU) - Chairman Speech

Company chairman speech

Dear Shareholders

I am delighted to present the Annual Report for FY2018 which was asuccessful year for Prozone Intu in terms of our expectations and objectives. Mostsignificantly we emerged as a multi retail asset company with the launch of ourCoimbatore Mall and at the same time showcased our ability to grow across sectoralcycles.

India's real estate sector saw two major radical reforms come intoforce - the Real Estate Regulatory Authority (RERA) and the Goods and Services Tax (GST).The landmark GST tax is expected to have far-reaching implications for the real estatesector and the complete impact is likely to unfold over the coming years. Undoubtedly inthe long term it is likely that the benefits of efficient supply chains and lowercompliance costs will eventually positively aid businesses in India. We are now observingsigns of recovery as the triple effects of demonetisation RERA and GST have begun toshape up the sector with new standards of delivery accountability and transparency.

With these measures and progressive intent in place the real estateindustry is estimated to grow at a healthy pace providing various growth opportunitiesfor your Company. In addition to this rapid urbanisation growing personal income and theGovernment's focus on infrastructure should further drive the sector positively goingforward.

The retail real estate industry in India is also gradually maturing andmoving towards its next phase of evolution. With the tastes of Indian consumers rapidlymaturing coupled with the in_ux of international brands we sense a growing confidence inthe future trends of Indian retail real estate. At Prozone Intu we have always beensensitive to consumer sentiments. Through our continuous brand churning and upgrading wehave ensured that we are aligned to the important emerging retail trends. This hasreflected well on our performance metrics meaningfully improving our KPIs. For FY2018 Iam pleased to inform you that we reported the highest ever annual revenue with a growth of46% from

RS 73.92 crore in the previous fiscal to

RS 107.71 crore in FY2018. We also produced record high EBITDA at RS49.19 crore with EBITDA margin of 46%. We have delivered EBITDA growth of 214% overprevious year during the year. Our numbers also reflect our tight control on costs andimproved operational efficiencies introduced during the year.

Our Strategic Reinforcements

As a highly focused developer owner and operator of mixed-useproperties we are always looking for better ways of delivering sustainable growth inshareholder value.

Firstly we are increasingly convinced that our strategy for developingtransformational mixed-use projects primarily in Tier 1 and Tier 2 geographies is theright one. With this strategy we have created projects which we believe have thenecessary scale mix of uses and favourable locations to become key destinations that cantransform the areas in which they operate.

Furthermore we are maximising the earnings and value out of ourcompleted properties through active asset management and by reinforcing these assetsthrough enhancements re-layouts and new additions. During the year our Aurangabad Mallunderwent strategic alterations in brand mix and mall layout. As a result this propertycontinues to enjoy its preeminent position as the most attractive and relevant retaildestination in the city.

Additionally we concentrated on management of our completed propertiesactively. We achieved this by optimising the mix of retail occupiers at both our malls.With a long term view we consistently maintained high levels of consumer service at ourmalls to enhance and reinforce our brand. In doing so we hope to maximise theconsumption occupancy and earnings potential of each of our properties.

We also aim to be at the forefront of sustainable development bydesigning energy efficient buildings through the innovative use of design materials andnew technology. With this view we installed solar panels on our Aurangabad Mall toincrease energy efficiency reduce our carbon footprint and simultaneously reduce ourtotal energy bills.

Our measured approach for land purchases in the past also gives us acompetitive edge. Having potential of developing 17.79 mn sq. ft. 88% is still availablefor future monetisation. We intend to do this at appropriate junctures in time byleveraging the benefits that come from developing large-scale mixed-use projects.

In following all these strategies we continue to manage our capitalbase conservatively and prudently. We intend to maintain a strong balance sheet with aview to invest and finance our projects in a disciplined manner. This has helped us inmaintaining our debt equity ratio at 0.40x which is one of the lowest in the sector. Aswe look at new opportunities in the future our balance sheet strength provides us a goodheadroom to raise capital as and when we need it.

Way Forward

With strong strategies already in place to create long-term value ouremphasis will be on project execution and asset monetisation. Looking ahead we also seethe horizon of our opportunities expanding at fast pace. With the launch of our CoimbatoreMall we expect strong revenue traction from the asset going forward. We also have astrong pipeline of residential properties under development. We have progressed well onour residential projects in Nagpur Coimbatore and Indore; and they are in the differentstages of execution. We expect to see consistent free cash flow generation over the nextfew years from these projects. Our future growth will be backed by our fiscal prudence;strong balance sheet with low debt; and ample liquidity in form of cash and cashequivalents.

Over the years we have created a legacy of trust - and we willcontinue to build on it. We will continue to create spaces that are aspirational and setbenchmark for the industry. The foundation of our core existence is composed of manyenablers such as our strong investors supporting bankers focused employees andsupportive retail partners. I take this opportunity to thank each of you for being highlysupportive pillars of this organisation. With your constant backing we are sure towitness further growth in customer delight and shareholder value in the years to come.

Sincerely

Nikhil Chaturvedi

Managing Director