Page 37 - Kolte Patil AR 2019-20

Overview 25% in two years. The Company’s
The Company entered Mumbai Bengaluru sales grew nearly 3x
in 2013 and Bengaluru in 1994. in three years, growing from 0.8
While the entry into Mumbai Lakh sq ft in FY17 to 2.2 Lakh sq
was justified on the grounds of ft in two successive years ending
the high realisation per sq ft, the FY20; the Mumbai story continues
Bengaluru presence was validated to shape well with OC for the Jai
by a rapidly growing residential Vijay project at,Vile Parle. The
appetite. The Company customised Company seeks to add projects in
its approach for each market: its Mumbai and Bengaluru through
Bengaluru presence was marked by outright/structured deals and JVs/
direct ownership and outright sale DMAs with land owners and other
(conventional approach), while the developers.
Mumbai presence was customised
around society redevelopment Outlook
(relatively asset-light). The latter The Company remains focussed on
approach has been validated: the increasing its footprint in Mumbai
Company emerged as the largest and Bengaluru.
listed Company operating in the In FY21, the Company plans
society development space in a to launch three redevelopment
mature Mumbai realty market in projects in Mumbai, namely Hari Big numbers
just seven years. Ratan, Om Shree Gokul and Sagar
Vaibhav. These projects possess
Attractiveness a top-line potential of ~C1,100 0.6
The Company circumvented Crore. Together, with Jai Vijay
the challenge of high land costs RTMI inventory, these three Msf of properties redeveloped in
related the development of projects could significantly improve Mumbai until FY20
properties in Mumbai. The society the Company’s average price
redevelopment model adopted realisation as well as revenues,
by the Company warrants no profitability and return ratios. In 2.5
upfront costs while rentals are Bengaluru, in FY21, the Company
triggered post demolition. Besides, plans the launch of Raaga, Phase Msf of properties constructed in
the Company has developed a 3. As a strategy, the Company Bengaluru until FY20
competence in managing tenant- intends to add new projects
linked complexities related to the through outright/structured deals
business and customised offerings and JVs/DMAs both in Mumbai 9.4
comprising reasonable carpet and Bengaluru. The Company is
area, deferred payment schedules, focussed on doubling its pre-sales % of aggregated revenues from
flexible terms towards shops and throughput and generate 20-25% of Mumbai and Bengaluru, FY20
incremental FSI for the developer. overall revenues from these markets
in the next few years.
Throughput 20-25
The Company is presently engaged In view of this expansion blueprint,
in the redevelopment of 1.1 msf in we believe we are attractively % of projected aggregated
Mumbai and the development of placed to make the big leap,
1.1 msf in Bengaluru. During the following which we could grow revenues from Mumbai and
year under review, the Company faster, enhancing value in the Bengaluru, FY23
generated 9.4% sales from these hands of those associated with our
markets; this is expected to rise to Company.

Perspective
“The Company received OC approvals for the Jai Vijay and IOD for
Goregaon and Dahisar redevelopment projects. Our Mumbai projects
under approval are expected to be launched in 3-6 months with an
aggregate topline potential of ~C1,100 Crore (KPDL economic share)
to be achieved through the capital-light society redevelopment model.
From the Mumbai portfolio, the Company expects to generate 25%
EBITDA or C250-275 Crore.” – Gopal Sarda, Group CEO

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