Page 23 - Kolte Patil AR 2019-20
P. 23

our Company and          sized slightly bigger than   Our Company was placed
                                     competition.             their then needs.       most competently in
                                                                                      its business when the
                                     The principal message that   The time has come when   pandemic broke.
                                     I wish to send out to our   people who wish to buy
                                     stakeholders is that even   apartments will be more   The Company reported
                                     as the COVID-19 impact is   demanding than ever. There   a record sales year in
                                     sweeping and significant,   will be a greater focus on   FY20 when one compares
                                     Kolte-Patil possesses the   apartment configuration;   across years when no fresh
                                     resilience and agility to   there will be a larger focus   launches were made. The
                                     emerge quicker and stronger.   on the quality of lifestyle   Company reported its
                                                              supports; there will be a   highest collections in any
                                     Relevant asset class     bigger stress on apartment   single year. The Company
                                     One of the most telling   spaciousness. By the virtue   reported the highest profit
                                     realities to have emerged   of having built apartments   after tax in its existence. The
                                     from the pandemic is the   with precisely this focus, we   Company moderated its net
                                     importance of a home.    will be attractively placed   debt by C83 Crore in FY20.
                                     As people have had to be   to capitalise on the sectorial   The Company protected its
                                     confined inside their homes   transition.        credit rating at CRISIL A+/
                                     for weeks on end, the    Apartment prices have   Stable possibly one of the
                                     experience has highlighted   not increased for nearly   highest accorded to any
                                     the importance of buying   half a decade, possibly   Company in India’s real
                                     into a home constructed by   the longest period of price   estate sector.
                                     the right brand. This new   stability seen in decades.   By the virtue of this
                                     normal has brought home   On the other hand, personal   outperformance and cost
                                     the learning that a home   incomes and prosperity   austerity, we possess one of
                                                              have increased year-on-  the lowest break-even points
             As the importance of this                        year; the rate of housing   among large real estate
             asset class has deepened                         finance loan has declined   developers in India. Even
                                                                                      if we achieve 60%-65% of
                                                              from around 11% to around
             what we are seeing is an                         8.5% even as incomes have   last year’s collections, we
                                                                                      can sustain our operations
                                                              grown. The transparency
             inflection point towards bigger                  and compliances related to   comfortably. Further, we
             and better homes                                 product sale have increased.   possess C260 Crore of ready-
                                                              Real estate is now a credible
                                                                                      to-move-in inventory.
                                                              investable asset class.   Going ahead, our objective
                                                              Besides, apartments in India
                                     needs to be not just a shell in   generate a steady 2.5-3.5%   will be to consolidate our
                                     which one seeks to live some   yield on rent, making this an   presence for the first nine
                                     leisure hours but a holistic   attractive asset for NRIs.   months of the current
                                     lifestyle experience instead.                    financial year, cap costs,
                                     Besides, as people work   I am optimistic that India   moderate debt, enhance
                                     increasingly from home,   will be one of the earlier   efficiencies, protect liquidity,
                                     there is an expressed need   economies to recover from   sustain construction pace
                                     for a ‘home office’.     the pandemic. By the    and wait for an upturn to
                                                              virtue of a large captive   make new launches.
                                     As the importance of this   consumption appetite,
                                     asset class has deepened   India’s economic de-growth   Outlook
                                     what we are seeing is an   could be less pronounced   At Kolte-Patil, we will
                                     inflection point towards   than in other countries.   continue to do what we
                                     bigger and better homes   Besides, as the country   have always done: deepen
                                     – not just a place where   begins to co-exist with   our governance, select our
                                     one may live, unwind,    the virus, some personal   battles, remain responsibly
                                     rest and recoup but also   economic decisions will be   cautious and wait for the
                                     a place where one may    taken quicker, one of them   tide to turn.
                                     work. Following extensive   being the decision to move   We have done so
                                     engagements with those   into a new, larger and better   successfully in the past,
                                     who brought into our     home.                   returning to vigorous growth
                                     apartments in the last few                       each time.
                                     years, a recurring response   Competitive
                                     was a sense of relief about   positioning        We are optimistic that this
                                     the way we had designed   ‘So how will Kolte-Patil   time will be no different.
                                     and configured apartments;   capitalise on this new
                                     our buyers considered    reality?’ is what I have been   Rajesh Patil, Chairman
                                     themselves fortunate to have   asked frequently during the
                                     brought into apartments   last few months.

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