Godrej Properties Limited details report
Godrej PropertiesGodrej Limited is the real estate development arm of Godrej Group, which was started in 1897 and the company was established in 1990. It is engaged primarily in construction and real estate development. It focuses on developing residential, commercial and township projects. The company is headquartered in Mumbai and is present in 11 cities in the country. The company maintains an asset light model through joint development and joint venture projects. As of March 31, 2024, the company had 102 active and upcoming projects with a combined developable area of ~223 million square feet with a focus on four core region- Mumbai Metropolitan Region (MMR), National Capital Region (NCR), Pune and Bangalore. It has delivered ~47 million sq ft of real estate since FY18. It has added 66 residential projects with ~136 million sq ft of saleable area since FY18. It has added 10 new residential projects with a saleable area of ~18.9 million sq. ft. and with an estimated booking value of ~โน21,225 crore in FY24. It entered Hyderabad market with 2 land deals with estimated booking value of ~โน5,000 crore. They have ventured into hospitality development via Taj The Trees at Vikhroli (151 keys). The company recognizes revenue upon transfer of control of promised products to customer in an amount that reflects the consideration which the group expects to receive in exchange for those products.
Godrej PropertiesGodrej Limited is the real estate development arm of Godrej Group, which was started in 1897 and the company was established in 1990. It is engaged primarily in construction and real estate development. It focuses on developing residential, commercial and township projects. The company is headquartered in Mumbai and is present in 11 cities in the country. The company maintains an asset light model through joint development and joint venture projects. As of March 31, 2024, the company had 102 active and upcoming projects with a combined developable area of ~223 million square feet with a focus on four core region- Mumbai Metropolitan Region (MMR), National Capital Region (NCR), Pune and Bangalore. It has delivered ~47 million sq ft of real estate since FY18. It has added 66 residential projects with ~136 million sq ft of saleable area since FY18. It has added 10 new residential projects with a saleable area of ~18.9 million sq. ft. and with an estimated booking value of ~โน21,225 crore in FY24. It entered Hyderabad market with 2 land deals with estimated booking value of ~โน5,000 crore. They have ventured into hospitality development via Taj The Trees at Vikhroli (151 keys). The company recognizes revenue upon transfer of control of promised products to customer in an amount that reflects the consideration which the group expects to receive in exchange for those products.
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#SALES #GROWTH
In FY24, revenue grew by 35% YoY to ~โน3,036 cr, led by project deliveries totaling ~12.5 million sq ft. The pre-sales improved by 84% YoY to ~โน22,527 cr. Whereas, the sales volume stood at 20 million sq ft i.e., an increase of 31% YoY. marking a 84% year-onyear growth. The average realization during FY24 was โน12,674 per sq ft for group housing and โน4,280 sq ft for plotted lands. The company launched its first ever hospitality development project Taj The Trees in Vikhroli, Mumbai with 151 keys. The company added 10 new projects of business development with estimated booking value of ~โน21,225 cr. In 9M FY25, the company did a booking of ~โน19,281 cr up 48% YoY with a total area sales of 18.21 million sq. ft. It delivered 11.9 million sq ft. Average realization was ~โน10,588 psf. The revenue registered was โน2,801 cr.
In FY24, revenue grew by 35% YoY to ~โน3,036 cr, led by project deliveries totaling ~12.5 million sq ft. The pre-sales improved by 84% YoY to ~โน22,527 cr. Whereas, the sales volume stood at 20 million sq ft i.e., an increase of 31% YoY. marking a 84% year-onyear growth. The average realization during FY24 was โน12,674 per sq ft for group housing and โน4,280 sq ft for plotted lands. The company launched its first ever hospitality development project Taj The Trees in Vikhroli, Mumbai with 151 keys. The company added 10 new projects of business development with estimated booking value of ~โน21,225 cr. In 9M FY25, the company did a booking of ~โน19,281 cr up 48% YoY with a total area sales of 18.21 million sq. ft. It delivered 11.9 million sq ft. Average realization was ~โน10,588 psf. The revenue registered was โน2,801 cr.
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#EBITDA #GROWTH
Cost of material consumed contributes the highest of the total expense which majorly includes Land and development rights, construction, material and labor, architect fees and other costs.Whereas in case of other expenses, project maintenance cost, advertisement and marketing expense and consultancy charges are major contributors. In FY24, the EBITDA loss was of โน129.7 cr. In Q1 FY24, EBITDA adjusted for provision done of โน155 cr for (repair, maintenance and customer claims against one its project Godrej Summit in Gurugram which was found to have high chloride content in concrete, resulting in corrosion of steel. The company has made an offer to buyback the sold units and has bought back 100 apartments so far and spent โน20- โน25 cr till date. In 9M FY25, the EBITDA loss registered was โน65.6 cr.
Cost of material consumed contributes the highest of the total expense which majorly includes Land and development rights, construction, material and labor, architect fees and other costs.Whereas in case of other expenses, project maintenance cost, advertisement and marketing expense and consultancy charges are major contributors. In FY24, the EBITDA loss was of โน129.7 cr. In Q1 FY24, EBITDA adjusted for provision done of โน155 cr for (repair, maintenance and customer claims against one its project Godrej Summit in Gurugram which was found to have high chloride content in concrete, resulting in corrosion of steel. The company has made an offer to buyback the sold units and has bought back 100 apartments so far and spent โน20- โน25 cr till date. In 9M FY25, the EBITDA loss registered was โน65.6 cr.
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#PAT #GROWTH
FY23 PAT stood at โน661.3 cr. Effective tax rate being 21%. In FY24, PAT stood at ~โน719 cr and the profit from JV was ~โน27.7 cr due to which the net consolidated PAT stood at ~โน725 cr (this also included minority interest adjustment of โน21.8 cr). In 9M FY25, the PAT registered was at โน1,094 cr excluding share associate loss of โน83.2 cr. The other income for Q1 FY25 was ~โน960 cr which was due to sale of 5% equity stake held by it in Godrej Green Homes Private Limited ('GGHPL") (one of its joint venture entities), resulting Into gain of โน46.66 cr which has been included in other income. The group's remaining investments have been fair valued as per IND AS 109 and resultant gain has been recorded under the head other Income.
FY23 PAT stood at โน661.3 cr. Effective tax rate being 21%. In FY24, PAT stood at ~โน719 cr and the profit from JV was ~โน27.7 cr due to which the net consolidated PAT stood at ~โน725 cr (this also included minority interest adjustment of โน21.8 cr). In 9M FY25, the PAT registered was at โน1,094 cr excluding share associate loss of โน83.2 cr. The other income for Q1 FY25 was ~โน960 cr which was due to sale of 5% equity stake held by it in Godrej Green Homes Private Limited ('GGHPL") (one of its joint venture entities), resulting Into gain of โน46.66 cr which has been included in other income. The group's remaining investments have been fair valued as per IND AS 109 and resultant gain has been recorded under the head other Income.
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#EBITDA #MARGIN
On account of following project completion method, expenses are accounted in the current year itself irrespective of the project getting completed or not. Completion of companyโs owned projects other than the oneโs in joint venture and joint development will help in improving the margins. The booking value achieved in FY24 is expected to yield over โน6,000 cr EBIT and โน3,300 cr net profit in due course. Additionally, their pursuit of sustained growth was evident through the addition of 10 new projects, with an estimated revenue potential of approximately ~โน21,225 Cr. In 9M FY25, the EBITDA margin was at negative 2%.
On account of following project completion method, expenses are accounted in the current year itself irrespective of the project getting completed or not. Completion of companyโs owned projects other than the oneโs in joint venture and joint development will help in improving the margins. The booking value achieved in FY24 is expected to yield over โน6,000 cr EBIT and โน3,300 cr net profit in due course. Additionally, their pursuit of sustained growth was evident through the addition of 10 new projects, with an estimated revenue potential of approximately ~โน21,225 Cr. In 9M FY25, the EBITDA margin was at negative 2%.
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#ROE
The company raised โน3,750 cr through Qualified Institutional Placement (QIP) in March 2021 and another round of QIP in June 2019 of โน2,100 cr. The equity raised was specifically timed to take advantage of a countercyclical investment strategy and the proceeds are being used to fund growth opportunities ahead. In FY24, the net worth was at โน9,993 cr and net profit was at โน747 cr (this includes profit of share associate of ~โน28 cr). The ROE for the year improved to 7.7%.
The company raised โน3,750 cr through Qualified Institutional Placement (QIP) in March 2021 and another round of QIP in June 2019 of โน2,100 cr. The equity raised was specifically timed to take advantage of a countercyclical investment strategy and the proceeds are being used to fund growth opportunities ahead. In FY24, the net worth was at โน9,993 cr and net profit was at โน747 cr (this includes profit of share associate of ~โน28 cr). The ROE for the year improved to 7.7%.
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#COMPANY #POTENTIAL
โข The market size of Indiaโs real estate sector is expected to reach USD 1 trillion by FY 2030 and the market is projected to increase at a CAGR of 19.5%. The market is anticipated to reach USD 650 Billion by FY 2025 and contribute 11-13% of the countryโs GDP. โข Housing sales in CY24 stood at ~4.60 lakh units, a 2% decline from CY23's figure of 4.77 lakh units. However, the total value of housing sales rose by 16%, from โน4.88 lakh cr in 2023 to โน5.68 lakh crore in 2024. This reflects increased prices despite a minor sales volume dropโโ. Top cities contributing to these sales were MMR, Pune, Bengaluru, Hyderabad, and NCR, accounting for 92% of total salesโ. โข New launches in CY24 saw a decline of 7%, with 4.13 lakh units compared to 4.46 lakh units in CY23. This reduction is attributed to slower approval processes during election periodsโ. There was a strong focus on premium and luxury housing, with a significant rise in homes priced above โน2.5 cr, which saw a 66% increase in new launches in 2024. limited new supply, improving market efficiency. โข Inventory across the top 7 cities decreased by 8% in 2024, with 5.53 lakh units available in the primary sales market. Pune recorded the highest decline, with a 20% reduction in unsold stockโ. This reduction in inventory was driven by high demand and โข Mumbai, being the largest real estate market in the country is set for a major boom, which will further add to the overall surge. For close to 5 years, Mumbai has resembled a gigantic construction site. A new coastal road, a metro rail and a trans harbor link are among the many ongoing infrastructure projects that are meant to transform Indiaโs commercial capital into a modern and efficient city. As these projects complete over the next few years, new micro markets will open in and around Mumbai, as commuting would become easier. That will boost real estate development further.
โข The market size of Indiaโs real estate sector is expected to reach USD 1 trillion by FY 2030 and the market is projected to increase at a CAGR of 19.5%. The market is anticipated to reach USD 650 Billion by FY 2025 and contribute 11-13% of the countryโs GDP. โข Housing sales in CY24 stood at ~4.60 lakh units, a 2% decline from CY23's figure of 4.77 lakh units. However, the total value of housing sales rose by 16%, from โน4.88 lakh cr in 2023 to โน5.68 lakh crore in 2024. This reflects increased prices despite a minor sales volume dropโโ. Top cities contributing to these sales were MMR, Pune, Bengaluru, Hyderabad, and NCR, accounting for 92% of total salesโ. โข New launches in CY24 saw a decline of 7%, with 4.13 lakh units compared to 4.46 lakh units in CY23. This reduction is attributed to slower approval processes during election periodsโ. There was a strong focus on premium and luxury housing, with a significant rise in homes priced above โน2.5 cr, which saw a 66% increase in new launches in 2024. limited new supply, improving market efficiency. โข Inventory across the top 7 cities decreased by 8% in 2024, with 5.53 lakh units available in the primary sales market. Pune recorded the highest decline, with a 20% reduction in unsold stockโ. This reduction in inventory was driven by high demand and โข Mumbai, being the largest real estate market in the country is set for a major boom, which will further add to the overall surge. For close to 5 years, Mumbai has resembled a gigantic construction site. A new coastal road, a metro rail and a trans harbor link are among the many ongoing infrastructure projects that are meant to transform Indiaโs commercial capital into a modern and efficient city. As these projects complete over the next few years, new micro markets will open in and around Mumbai, as commuting would become easier. That will boost real estate development further.
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#COMPANY #OUTLOOK
โข In FY25, the company had envisaged to grow residential bookings to over โน27,000 cr through the launch of many new projects combined with strong sustenance sales and it achieved โน29,444 cr of bookings for the year wth 25.7 million sq ft of sales. โข The Ashok Vihar project Phase 1, Worli, Carmichael, Vikhroli project are expected to be launched in FY26. โข The company targets ROE of 20% going forward. โข They focus to deliver atleast 15% net profit margin, going forward. โข It is comfortable with net gearing ratio between ~0.5:1 to 1:1 which gives them the room for further addition of debt. The company will have a cap on net debt of โน10,000 crore. โข The EBITDA margin is expected to be in the range of 25%-30% for residential projects but for plotted developments it would be higher. This can also be higher with change in mix of projects in different cities. โข The company acquired ~53 acres of land in Joka, Kolkata. It offers ~1.3 million sq ft of saleable area comprising primarily residential plotted development with an estimated revenue potential of ~โน500 cr. โข In 9M FY25, they have added 12 new projects with a total estimated saleable area of ~16.9 million sq ft and total estimated booking value potential of ~โน23,450 crore and have thereby surpassed the full year guidance of โน20,000 crore.
โข In FY25, the company had envisaged to grow residential bookings to over โน27,000 cr through the launch of many new projects combined with strong sustenance sales and it achieved โน29,444 cr of bookings for the year wth 25.7 million sq ft of sales. โข The Ashok Vihar project Phase 1, Worli, Carmichael, Vikhroli project are expected to be launched in FY26. โข The company targets ROE of 20% going forward. โข They focus to deliver atleast 15% net profit margin, going forward. โข It is comfortable with net gearing ratio between ~0.5:1 to 1:1 which gives them the room for further addition of debt. The company will have a cap on net debt of โน10,000 crore. โข The EBITDA margin is expected to be in the range of 25%-30% for residential projects but for plotted developments it would be higher. This can also be higher with change in mix of projects in different cities. โข The company acquired ~53 acres of land in Joka, Kolkata. It offers ~1.3 million sq ft of saleable area comprising primarily residential plotted development with an estimated revenue potential of ~โน500 cr. โข In 9M FY25, they have added 12 new projects with a total estimated saleable area of ~16.9 million sq ft and total estimated booking value potential of ~โน23,450 crore and have thereby surpassed the full year guidance of โน20,000 crore.
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Godrej Properties 1800-2100
Expected level 2600
Support 1680
Expected level 2600
Support 1680
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