Page 37 - Kolte Patil AR 2019-20
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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.

              “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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