PURVANSEQ4 FY2022May 27, 2022 Puravankara Limited
6,600words
108turns
9analyst exchanges
3executives
Management on call
Abhishek Kapoor
EXECUTIVE DIRECTOR AND
Neeraj Gautam
EXECUTIVE VICE PRESIDENT - FINANCE
Rupesh Sankhe
ELARA SECURITIES PRIVATE LIMITED
Key numbers — 40 extracted
3.52 million
ever sales value for the company since inception. We sold 2616 units corresponding to a volume of 3.52 million square feet. The sale value grew to Rs.2407 Crores which is 9% higher on a year-on-year basis.
Rs.2407 Crore
We sold 2616 units corresponding to a volume of 3.52 million square feet. The sale value grew to Rs.2407 Crores which is 9% higher on a year-on-year basis. The sales realization improved to Rs.6838 per square
9%
esponding to a volume of 3.52 million square feet. The sale value grew to Rs.2407 Crores which is 9% higher on a year-on-year basis. The sales realization improved to Rs.6838 per square feet from Rs
Rs.6838
w to Rs.2407 Crores which is 9% higher on a year-on-year basis. The sales realization improved to Rs.6838 per square feet from Rs.6420 per square feet a year ago which is an improvement of 7% in price rea
Rs.6420
9% higher on a year-on-year basis. The sales realization improved to Rs.6838 per square feet from Rs.6420 per square feet a year ago which is an improvement of 7% in price realization.
7%
ved to Rs.6838 per square feet from Rs.6420 per square feet a year ago which is an improvement of 7% in price realization. Our operating inflows for the year were the highest since
Rs.2231 Crore
Our operating inflows for the year were the highest since our inception and stood at Rs.2231 Crores up by 74% compared to Rs.1289 Crores last year. In terms of our financial performance for the ye
74%
ating inflows for the year were the highest since our inception and stood at Rs.2231 Crores up by 74% compared to Rs.1289 Crores last year. In terms of our financial performance for the year our tota
Rs.1289 Crore
r the year were the highest since our inception and stood at Rs.2231 Crores up by 74% compared to Rs.1289 Crores last year. In terms of our financial performance for the year our total revenue from operations
Rs.1381 Crore
ar. In terms of our financial performance for the year our total revenue from operations stood at Rs.1381 Crores compared to Rs.1054 Crores for a similar period in the last financial year, implying a year- on
Rs.1054 Crore
performance for the year our total revenue from operations stood at Rs.1381 Crores compared to Rs.1054 Crores for a similar period in the last financial year, implying a year- on-year growth of 31%. EBITDA s
31%
Rs.1054 Crores for a similar period in the last financial year, implying a year- on-year growth of 31%. EBITDA stood at Rs.6638 Crores compared to Rs.374 Crores for the previous year implying year-on-
Guidance — 20 items
“I will start with a brief update on the business and highlights of the quarter and for the year, following that my colleagues and I will be happy to answer any questions that you may have and take suggestions you would like to give us.”
“Loss for the quarter was due to operating expenses incurred on new launches, revenues of which will be recognized only on completion of as per revenue recognition accounting standard.”
“Sir what is the delivery target for next two years based on whatever ongoing projects we have like this year we have done about 1 million deliveries so what is the delivery target for FY2023 and FY2024?”
“Total we are looking at delivery in this year in the current financial year of over 3000 units and that will again be in fact above the previous pre-COVID level delivery, if you talk about 2019 so it will be in excess of about 3 million square feet.”
“So average realization would be lower, but I think somewhere in the range of 6000 per square feet in the Puravankara and about Rs.5800 to Rs.6000 will be Provident and Purva land would be somewhere in the range of about 4500-4600 per square foot.”
“So we will be delivering about 3 million square foot and then you can do the math, but the point is that we will be back in terms of delivery on pre-COVID levels and we definitely see improvement there.”
“And most of the costs we have already provided for the ongoing projects that is why we are having losses in the P&L in this year so next year EBITDA should much better result, right?”
“When I am saying most of the costs mean f the costs related to sales and marketing and G&A has been provided.However construction cost and other direct cost will be recognized, when we will recognize l recognize the revenues.”
“Existing Provident sales also include a plotted project, Tivoli Hills , which we launched during the period as I e mentioned in my opening remarks .”
“Lastly on balance sheet side what is your target for debt reduction next year?”
Risks & concerns — 2 flagged
In addition, we are making efforts to further professionalize our work pressure and we have brought in some of the best brains in the industry to oversee the different functions of our business and fuel our growth in the coming years.
— Neeraj Gautam
My last question I do not know if I might have missed it but what is the impact of the construction cost due to the commodity prices I mean the rise of prices globally?
— Aryan Sharma
Q&A — 9 exchanges
Q
Good evening Sir. Sir what is the delivery target for next two years based on whatever ongoing projects we have like this year we have done about 1 million deliveries so what is the delivery target for FY2023 and FY2024?
Abhishek Kapoor
Total we are looking at delivery in this year in the current financial year of over 3000 units and that will again be in fact above the previous pre-COVID level delivery, if you talk about 2019 so it will be in excess of about 3 million square feet. So 3 million square feet and if you take that Rs.7000 average realization so can we do about 2100 kind of revenue in P&L? See if you look at average realization would not be 7000 because it also includes Purva land projects. So average realization would be lower, but I think somewhere in the range of 6000 per square feet in the Puravankara and abou
Q
Good afternoon and thank you so much for taking my questions. Sir my first question would be on the debt profile. The debt profile has been consistently improving over the years. I would like to know what kind of debt to equity or the debt to EBITDA ratio can we look for maybe for short-term and long-term let us say two to three years down the line?
Abhishek Kapoor
On the debt piece, I think we are currently in the range of about 0.9 and we will continue to maintain that level of 0.9 and as we obviously launch projects and our networth goes up the number will start looking better but having said that I think debt to EBITDA number at this point, is an anomaly per se because revenue recognition happens on the quantum of delivery that you do. What one should look at really again I will repeat myself in continuation with what I said earlier is we need to look at what kind of sales volume are we doing, what kind of burn are we doing and what is the square foo
Q
Sir my question is first can you give the collections for the full year?
Neeraj Gautam
We have collected 2231 Crores we mentioned in our slide if you look at slide #24 we have collected 2231 Crores for the entire financial year including all collection, collection from the residential projects, collection from our strategic exit from commercials assets, collection from our construction arm, all put together we have collected 2231 Crores for the entire financial year. But Sir out of the presales can you give the figure how much have you collected? About 1400 Crores. And what was the figure last year Sir. Last year it was about 1200 Crores. Sir in terms of launch pipeline you have
Q
Good afternoon. Sir if I remember correctly you had given a guidance of 1 million square feet of sales every quarter is it correct? Am I remembering it correctly?
Abhishek Kapoor
We normally do not give guidance but yes last quarter we did about 1.2 million square foot of sales and the quarter before that we did 0.99 million square foot which is about a million square foot of sales. You are right on that number. So you are saying that this year you will do 3 million square foot of sales? No. 3 million square foot of delivery. Let me just explain I will take a step back again. When we look at our accounting system, we book revenues on the basis of quantum of square footage delivered which is handed over with OC to the customers so therein that is a separate number than
Q
Thanks for taking my question. Sir actually I have one comment about slide #23 where we have the cash inflows mentioned of 2200 Crores one of the thing is that has seen that happening in the presentation in the PR that we do is that there is a little bit of a confusion between what is the commercial land sale be it in Chennai and then how you present the information. Just one humble request that if you can segregate information better for the analyst community so we understand what the business inflow outflow here and what is the onetime inflows, outflows are.
Abhishek Kapoor
Sure absolutely please send us a mail and we will respond to you with the breakup and going forward we take that feedback. Thank you. The other question I have is with respect to slide #42 where you have mentioned all the new heads of latest businesses that we have any particular thinking behind it because I think this is something new that we are seeing in the company say many senior level designations? As a strategy in the last year, I think we have strengthened two things one is we are professionalizing the management and strengthening the bandwidth of the management of the company. The obj
Q
I have one question, what is the status of your commercial project Sir?
Abhishek Kapoor
On the commercial side there are two projects we are launching this year one is a little over 2 million square foot. We are getting the sanctions which is in Bengaluru and the other one which we have just started construction is again in Bengaluru which is at about 800000 square foot so this year we will definitely take about almost about 3 million square foot to under construction. Thank you Sir.
Q
Sir I wanted to know your Q4 FY2022 sales was around 829 Crores, would it be right to assume that by the end of FY2023 we will achieve an annual sales of 3000 Crores?
Abhishek Kapoor
Again as we mentioned earlier we do not give guidance but if you extrapolate definitely the business will be higher than what we have done this year which is over 2400 Crores definitely it will be higher. One last question on the plotted development. Off late, You have entered into this plotted development business so what is the kind of market that you are looking in terms of size? When you ask in terms of size are you asking generic market size or you are asking what business we are looking at going from this asset class? Sir what business you are looking at? From our point of view, we are d
Q
Good evening. So, my question was regarding the overall demand environment like how is the initial response, was this 40 BPS hike in interest rate are customers a bit hesitant or has inducing any impact regarding this?
Abhishek Kapoor
So far we have not seen any impact on the sales numbers. I think the environment in general is in a mode where people have come back to take a buying decision and that is on multiple reasons I think one of them are really that COVID reason and second has been the overall real estate environment per se, the demand supply situation you do not have the kind of supply you used to have earlier and also the fact that generally the savvy does not have seen significant jump in the last two quarters, I mean if you just read the papers especially in IT sector lot of employment has been generated over 20
Q
Thank you, ladies and gentlemen. Hope me and my colleagues have been able to answer all your questions. We are always available to reply your questions if you reach out to me. Our mail ID is given in the presentation. Thank you once again and wishing you all happy weekend. Thank you.
Opening remarks
Rupesh Sankhe
Good evening everyone. I would like to welcome the management of Puravankara Limited and thank them for this opportunity. I shall now hand over the call to Mr. Neeraj Gautam for the opening remarks. Over to you Sir!
Neeraj Gautam
Thank you Rupesh. Good evening and warm welcome to all. I hope all of you and your family members are safe as well. Thank you for joining us at Puravankara Limited’s fourth quarter and FY2022 earnings conference call. My name is Neeraj Gautam. I am the Executive Vice President - Finance of Puravankara Limited. The presentation and financial results for the quarter ended March 31, 2022, have been uploaded on the stock exchanges. I will start with a brief update on the business and highlights of the quarter and for the year, following that my colleagues and I will be happy to answer any questions that you may have and take suggestions you would like to give us. During the financial year 2021-2022 we as a company demonstrated immense resilience. I am happy that our robust performance across key parameters met all our expectations. Continued dedication by our team members and our renewed the strategic business approach have helped us overcome hurdles presented by the pandemic along with th