Realty firm Godrej Properties is planning to invest over USD 1 billion in the next couple of years to develop new projects as part of its goal to achieve higher growth, executive chairman Pirojsha Godrej said.
Godrej Properties is India’s largest developer by value and volume of sales achieved, as per the company’s annual report. The sales bookings grew 14% to record Rs. 6,725 crores in the previous fiscal despite the pandemic disrupting the industry, surpassing the Rs. 6,000 crores clocked by Macrotech Developers (erstwhile Lodha Developers).
“We sold 9,345 homes, an average of 25 per day,” said the executive chairman. The company raised Rs. 3,750 crores via Qualified Institutional Placement (QIP) process in March, allowing it to end the year with a net cash balance sheet.
“With the equity this provides us, we can invest over one billion dollars into new projects in the upcoming years, substantially more than what the company has invested in the past”, he added.
“We expect this to play a role in ensuring we scale our revenues quickly while also continuing to improve our business's margin profile by increasing GPL's economic interest in each project,” Pirojsha said. GPL buys land outright from the market to expand its business, as well as partnering with landowners to add more projects to its portfolio for future development.
The two medium-term goals of the company are to consistently remain among the leading developers by the value of housing sales in the focus markets and to achieve more than 20% Return on Equity (RoE).
The focus markets for GPL are Mumbai, Bengaluru, Pune, and Delhi-NCR. The company sold properties worth more than Rs. 1,300 crores in each of these markets in the last fiscal. The company posted a loss during FY2021 and ROEs are expected to remain muted this fiscal.
Pirojsha told shareholders, "However, we remain confident that the steps we have taken to strengthen the company's balance sheet, enhance the project pipeline, and build execution capabilities, will help ensure higher returns, lower risks, and stronger growth." He added that the company expects a significant increase in reported earnings starting next year.
Source: Telangana Today