We will develop about 15 million sq. ft across affordable and luxury...

We will develop about 15 million sq. ft across affordable and luxury segments: Ashish R. Puravankara, Puravankara

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Puravankara Limited, one of India’s leading listed real estate company headquartered in Bengaluru embarked on its remarkable journey by offering quality homes.Puravankara caters to the premium end of the spectrum.Puravankara has a presence across India – Hyderabad, Bengaluru, Chennai, Kochi, Coimbatore, Mangaluru, Kolkata, Mumbai, Pune and Goa with an overseas presence in GCC and Sri Lanka.

Yash Ved of Newsbarons provides the highlights of an interaction with Ashish R. Puravankara, Managing Director of Puravankara Limited who informed, “We will develop over 10 million square feet of affordable housing under the Provident brand in the next few quarters.”

NB: What is your outlook for the real estate industry for 2018?

Ashish: Change is always good, but at the same time adopting to change has its own set of challenges. The real estate industry experienced its share of change this year with demonetization and the introduction of policy reforms which consisted of RERA and GST. The growth curve of the industry saw a gradual drop in terms of sales and enquiries, creating a temporary market slow down. During this phase, customers treaded with greater caution when it came to the buying of new homes.

Post this sluggish phase, the real estate market picked up pace with a positive vigor in terms of renewed consumer confidence which lead to an increase in new property bookings for the remaining part of the year. Taking after this positive buyer sentiment, 2018 brings with it the promise of progress and a zealous year ahead for the industry in whole

NB: What are your new project launches?

Ashish: We have a robust plan for development in the next 12-15months. Last year, we saw completion of most projects that we launched 2-3 years back. But the coming 12-15 months will witness several new launches across markets. Our focus markets will be Pune, Mumbai, Bangalore, Hyderabad, Goa and Chennai. We are going to develop about 15million sq. ft of land across affordable and luxury segments.

NB: What is your total area under development?

Ashish: As a Group, we have completed 57 residential projects and 4 commercial projects spanning 34.06 million sq ft. The area under development totals to 21.64 million sq ft and the upcoming projects total to 23.11 million sq ft.

NB: What will be the total area for affordable housing?

Ashish: Realizing the burgeoning need of high-quality affordable homes in the country, we launched Provident Housing Ltd., a wholly-owned subsidiary of Puravankara, in 2008 to meet the aspirations of mid-income and first-time home-owners. Out of total planned launches, 10.32 million sq ft will be affordable housing under the Provident brand in the next few quarters.

NB: Brief us about your plans for other key markets?

Ashish: Real estate in India has wide opportunities if tapped rightly. At the back of our successes in Pune, Hyderabad and Chennai, we are soon going to launch in Mumbai and Goa. With Tier 2 markets growing rapidly, we will witness larger buyer interest in the coming years in markets such as Kochi and Coimbatore. As an organisation, we are constantly on the lookout for deals which are viable and profitable.

NB: Comment on your Capex plan?

Ashish: The capital expenditure for the current financial year would be in line with last year’s capital expenditure at roughly about INR 1000 crore.

NB: What were the sales bookings for the quarter?

Ashish: Our sales volumes have grown 75% y-o-y this quarter, while sales volumes grew 33% y-o-y for the half year till Sept’17. Completed and near completion inventory grew 80% y-o-y for the half year Sept’17.

The company’s sales booking rose to INR 736 crore in the first half of this fiscal as against INR 579 crore for the same period last year. Provident sales grew 148% y-o-y for the quarter. Puravankara sold 357 units, Provident sold 264 units.

NB: Your mix in terms of residential and commercial?

Ashish: Traditionally, we primarily have been a residential focused Company with a smaller share of our portfolio being commercial. The company has completed marquee commercial projects in Bangalore, Chennai and Hyderabad.

NB: What is your strategy going forward?

Ashish: As a strategy going forward, we would increase the percentage of commercial office space in our portfolio. We currently have various commercial projects which are at the design phase in Bangalore and Pune and are evaluating future commercial projects in other viable markets too.

NB: Brief us about your financials?

Ashish: For Q2 2018, the revenue stood at INR 371 crore; while EBITDA was at INR 98 crore. The company sold 803,966 sq.ft. in Q2FY18, led by sales of Provident and completed inventory
The Net Debt declined by around 9% to INR 2,008 Crore in Q2FY18 vs. INR 2,208 crore in Q2FY17.