Macrotech Developers to invest Rs 5,000 cr in construction this yr
The realty firm which sells properties under the Lodha brand, is targeting to deliver more than 10,000 apartments during 2024-25
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Abhishek Lodha, MD of Macrotech Developers, anticipates that the demand will continue to be strong, as India's housing sector is likely in the third year of a long-term upswing. This trend is fuelled by robust economic growth and an increasing consumer inclination towards home ownership rather than renting
Realty firm Macrotech Developers will step up its investment this fiscal year on construction of projects to over Rs 5,000 crore in line with growth in sales and new supply, its MD and CEO Abhishek Lodha said.
Macrotech Developers, which sells properties under the Lodha brand, is targeting to deliver more than 10,000 apartments during 2024-25, he said.
In an interview, Lodha highlighted that the company achieved all its major targets for 2023-24 related to pre-sales, new land acquisition and debt reduction amid strong housing demand. He noted that demand would sustain as India's housing sector is probably in the third year of a long-term upcycle, driven by high economic growth and rising consumer preference towards home ownership over renting. Lodha said the company would be launching more projects and also adding more land for future development to maintain "consistent and predictable" growth trajectory.
Asked about guidance for construction spend, he said, "We spent around Rs 3,700 crore on construction last fiscal year. We are going to invest more than Rs 5,000 crore during the current fiscal." Lodha said the company spent less than the targeted Rs 4,500 crore last fiscal due to some delay in launch of few projects. "We will make up for that," he asserted.
Macrotech Developers handed over around 8,500 units to customers during 2023-24 and the target is to scale it up to more than 10,000 units, he outlined. Macrotech Developers, one of the leading real estate developers in India, is developing housing projects across Mumbai Metropolitan Region (MMR), Pune and Bengaluru. "Our foray into the Bengaluru property market has been successful. Sales in our initial two projects have been good. We will be expanding our presence in this IT city," Lodha informed.
Encouraged by the response from Bengaluru, he said the company would evaluate whether to do a pilot housing project in one more major tier I city or not. A final decision in this regard would be taken in the next few months. During the 2024-25 fiscal, Lodha said the company has set a target to sell properties worth Rs 17,500 crore during the current fiscal, a 21 per cent growth from the previous year. It registered a 20 per cent growth in its sale bookings (also called pre-sales) to a record Rs 14,520 crore last fiscal, from Rs 12,060 crore in the 2022-23 financial year.
"Our best-ever quarterly and annual performance showcases the buoyancy in demand for high quality homes in India from branded developers," Lodha said.
To encash this consumer demand, Macrotech Developers would launch multiple housing projects this fiscal. Lodha said the company would continue to add land parcels, through outright acquisitions and also partnerships with landowners, for future development.
Last week, Macrotech Developers reported an 11 per cent decline in consolidated net profit at Rs 665.5 crore in the March quarter, from Rs 744.4 crore in the year-ago period. The company's total income grew to Rs 4,083.9 crore in the quarter under review, from Rs 3,271.7 crore in the year-ago period. During the 2023-24 fiscal, Macrotech Developers registered a three-fold jump in profit to Rs 1,549.1 crore, from Rs 486.7 crore in the 2022-23 fiscal. The company's total income rose to Rs 10,469.5 crore last fiscal, from Rs 9,611.2 crore in the 2022-23 fiscal.
On debt, Lodha said, "...we have achieved our guidance of reducing our net debt well below 0.5 times of equity. Robust operating cash flows and our capital raise led to net debt coming down by over Rs 4,000 crore during the 2023-24 fiscal year to Rs 3,000 crore which is less than 0.2 times of equity." The company has also added new projects of over Rs 20,000 crore during the last fiscal year. "This makes us a unique housing company to achieve the troika of significant pre-sales growth, robust business development, along with significant debt reduction showcasing our brand strength and operational prowess," Lodha said.
Macrotech Developers has delivered around 100 million square feet of real estate and is currently developing more than 110 million square feet under its ongoing and planned portfolio.
