GANESHHOUNSEQ3 FY23JANUARY 24, 2023

GANESH HOUSING LIMITED

7,152words
125turns
9analyst exchanges
4executives
Management on call
Rajendra Shah
CHIEF FINANCIAL OFFICER - GANESH HOUSING CORPORATION LIMITED
Neeraj Kalawatia
VICE PRESIDENT FINANCE
Ravi
CORPORATE AND FINANCIAL ADVISOR - GANESH HOUSING CORPORATION LIMITED
Rajat Gupta
GO INDIA ADVISORS
Key numbers — 40 extracted
INR 6,500 million
Company has become a net debt free in Quarter 3 financial year 2022-23 from a peak debt of over INR 6,500 million around three and a half years back. On gross debt side: We have a minor deb
Rs. 143 million
ree and a half years back. On gross debt side: We have a minor debt of only Rs. 143 million as we speak which after cash balance and fixed deposit is a negative debt position for the Compan
Rs. 674 million
formance for Quarter 3 and 9 months ended December 2022: Our revenue for Quarter 3 '23 came in at Rs. 674 million versus Rs. 761 million in Quarter 3 for the financial year '22, slightly lower on account of high
Rs. 761 million
and 9 months ended December 2022: Our revenue for Quarter 3 '23 came in at Rs. 674 million versus Rs. 761 million in Quarter 3 for the financial year '22, slightly lower on account of high sales velocity from ou
91%
ee during that period. During the nine months ended for financial year 22-23, our revenue grew at 91% and came in at Rs. 4,378 million versus Rs. 2,293 million in nine months ended financial year 21-
Rs. 4,378 million
. During the nine months ended for financial year 22-23, our revenue grew at 91% and came in at Rs. 4,378 million versus Rs. 2,293 million in nine months ended financial year 21-22. Our EBITDA grew at 48% year-o
Rs. 2,293 million
s ended for financial year 22-23, our revenue grew at 91% and came in at Rs. 4,378 million versus Rs. 2,293 million in nine months ended financial year 21-22. Our EBITDA grew at 48% year-on-year and came in at Rs.
48%
78 million versus Rs. 2,293 million in nine months ended financial year 21-22. Our EBITDA grew at 48% year-on-year and came in at Rs. 475 million for Quarter 3 financial year 22-23 versus Rs. 322 mil
Rs. 475 million
ion in nine months ended financial year 21-22. Our EBITDA grew at 48% year-on-year and came in at Rs. 475 million for Quarter 3 financial year 22-23 versus Rs. 322 million in Quarter 3 ended financial year 21-22
Rs. 322 million
grew at 48% year-on-year and came in at Rs. 475 million for Quarter 3 financial year 22-23 versus Rs. 322 million in Quarter 3 ended financial year 21-22. During the nine months ended financial year 2022-23, EBI
82%
3 ended financial year 21-22. During the nine months ended financial year 2022-23, EBITDA grew at 82% and stood at Rs. 1,514 million versus Rs. 831 million in nine months ended financial year 2021-22
Rs. 1,514 million
year 21-22. During the nine months ended financial year 2022-23, EBITDA grew at 82% and stood at Rs. 1,514 million versus Rs. 831 million in nine months ended financial year 2021-22. Our PAT for Q3 financial ye
Advertisement
Guidance — 20 items
On gross debt side
opening
“761 million in Quarter 3 for the financial year '22, slightly lower on account of high sales velocity from our project Maple Tree during that period.”
On the project update
opening
“In Malabar 3 project, we have received RERA approval and permission to commence Construction in February 2021.”
On the project update
opening
“During 22 odd months actual construction post these approval, we are happy to announce that we have completed 100% construction in this project across six towers.”
On the project update
opening
“In Malabar Exotica project, we have received RERA approval and permission to commence construction in July/August 2021.”
On the project update
opening
“During a 17 odd months' period, we have managed to complete more than 40% of the project, and we have been progressing ahead of the scheduled completion.”
On the project update
opening
“Our planning for the new project is nearly completion, and we will be able to launch these projects very shortly.”
On the project update
opening
“As of December 2022, we have no inventory in ongoing project.”
On the project update
opening
“The master plan is under progress, and we will soon be rolling out our plans in relation to this project including layout plan and floor plans.”
On the project update
opening
“We have, as we mentioned earlier, Tishman Speyer's first project in Ahmedabad which will enable us to collaborate for the SEZ development, property and lease management in phased manner.”
On the project update
opening
“Having worked with global giants like Meta, Amazon, LinkedIn, JPMorgan, Accenture, Nike and some of the very, very notable Indian Blue-Chip companies, Tishman would bring along with them practice of international standard for benchmarking, monitoring project progress and quality assurance.”
Risks & concerns — 1 flagged
It is very difficult to say, but it can be much higher.
— Neeraj Kalawatia
Advertisement
Q&A — 9 exchanges
Q
Thank you so much and congratulations on good numbers. My first question is with respect to your project ongoing and plans. So, you said there is only 0.1 million square feet which is unsold. So, what are you going to do for the next, you know, a couple of quarters?
Rajendra Shah
Thank you. See, though we have, we don't have much of inventory which is left in completed or ongoing project. However, we are planning to launch a few projects. I will just give you a brief about those. About four and a half lakhs square feet of residential project called Retreat is underway. And apart from that, we will be soon launching SEZ project, which is in partnership with Tishman Speyer which will have about 1.2 million square feet of gross leasable area minimum. This area may increase, but 1.2 is the minimum for what we will be constructing over there. So, these two projects are ther
Q
I think, I wanted to understand, you know, the ongoing projects, sir, which are going in Ahmedabad. If you could give some color on the kind of average prices, you know, which you are getting? I mean, just to get a flavor of how the real estate market in Ahmedabad is fairing, you mentioned in your opening remark that despite rising interest rates, you know, demand is not affected. So, if you could give some idea about what are the kind of average rates are prevailing currently? And what is the kind of outlook for the next say two to three quarters?
Neeraj Kalawatia
Thank you for your question. See, if you see in our projects where we are operating, our current prices are ranging from somewhere around 3,800 to 4,500. That is how we are pricing our projects. On an overall if you see from an Ahmedabad prospective during year 2022, the average pricing in Ahmedabad was somewhere between 3,000 to 3,200, which is basically because of they are low pricing pockets are also there in Ahmedabad plus they are the medium segments are also there which are operating. If I average out, these are lying between 3,000, 3,200. So, even if you compare with a city like Bombay,
Q
Hi. Thank you for the opportunity. I have a couple of questions. So, first is both our residential projects are booked, and we don't have much inventory as well. I have seen players like Godrej emerging really strong, doing extremely good in terms of sales booking for their new projects in Ahmedabad and are very confident of upcoming projects in Ahmedabad as well. So, why are we not launching new projects and planning it for later down the year? So, first question is that.
Rajendra Shah
Sure. So, we are in process of launching our Retreat project, and once we have launched our SEZ project in processing zone, in non-processing zone we are underway meaning on our drawing board, there is a plan to launch a phase of non-processing zone, which will be mostly residential. So, in fact, there is under current, and we are planning to show. In a short time you will see one residential project in terms of Retreat and other residential project in terms of development of non-processing zone in SEZ which will be mostly residential is also underway. And secondly, just wanted to understand,
Q
So, firstly, congratulations on the good set of numbers and becoming net-debt free. Sir, I am a little new to the Company. So, please, pardon me. Sir, just on this Tishman project, right, just wanted to understand how did this partnership come into being, like, so have they done other projects in India? Did they approach you? Or what were the synergies that you identified? And a little bit on the commercials that you mentioned. So, for the sales and marketing and the DM, what will be the basis of payments, sir? Like, in the sense, would it be a percentage of rentals? Or how would it be?
Rajendra Shah
So, thank you, Amanjit. Basically, see, Tishman Speyer is known as a reputed, one of the very well-known global brand to construct AAA-graded commercial buildings. They have done umpteen number of projects in U.S. and other geographies. And their clients, as we mentioned, are who’s who of world. So, basically, if you see as compared to Tishman Speyer, Ganesh Housing has been a conservative developer who is based out of Ahmedabad, and we have completed very large development of real estate in Ahmedabad. However, as far as dealing with globally reputed meaning occupants, we wanted some sort of s
Q
Sir just wanted to understand a couple of things. One is that, while you have done a good job in terms of becoming net debt free, what will be the peak capital requirement for your IT SEZ, because obviously you are building it for that thing? And what will be the peak capital requirement for the project?
Rajendra Shah
So, we expect that each phase of meaning 600,000 square feet, which we are going to launch immediately, would cost somewhere about Rs. 300 crores. There we may need, meaning even if we have debt equity ratio of say 60-40, we may need somewhere around 100 crores as new meaning capital to be invested, and we have enough resources to meet even that. Sure, sir. And just to understand on the residential project also, do you expect a peak capital requirement? Because I am just trying to understand the cash flows. No, no. Because from your current two projects, I think because you have received 100%
Q
Sir, I just wanted to understand when you decide on the project, do you have any return metrics in mind like a target ROE which you think should generate over the life of the project, or any other written metric which you look at?
Rajendra Shah
No, return metrics is generally, meaning, is kind of deceptive at times, because if you are looking at leasehold property for development, your returns will be different. Again, see, project payback period is completely ignored if you are looking only at meaning kind of return on investment. So, basically, there are many other parameters which are to be looked at other than only return on investment kind of peak investment required, peak debt, which is required, kind of turnaround time which this project will take, or meaning title to the land, what would be time which will be required to secu
Q
Hi. Thank you for the opportunity. I just wanted clarification that you mentioned that for the first phase of SEZ, we will be having a cost of around 300 crores for 6 lakh square feet. So, that comes to around Rs. 5,000 per square feet, the development cost. So, isn’t it on a very higher end compared to what we are doing for the residential projects earlier?
Rajendra Shah
So, yes. Thank you, Rushabh. First of all, this is going to what we are, meaning, what we are trying to construct here is a Grade A building, which has not been seen in Ahmedabad. And this will have flat slab construction with more than 3 meter clear floor-to-floor height with spread- out beams, which will give a floor plate of roughly about 30 odd thousand square feet. These kind of construction Ahmedabad has not seen. We would have commercial buildings, which are called, meaning, superior commercial buildings, but kind of construction what we are envisaging would take that kind of constructi
Q
No, I don’t any questions right now. All my questions are answered.
Management
Q
Thank you, ladies and gentlemen, for showing interest and joining with us on this Quarter 3 and 9 months for financial year '22-'23 operational and financial performance call. See you again. Thank you so much.
Management
Speaking time
Rajendra Shah
36
Neeraj Kalawatia
21
Puneet
14
Amanjit Sethi
13
Moderator
11
Ashish Kumar
9
Gaurav Somani
6
Jay
4
Rushabh Shah
3
Ravi
2
Advertisement
Opening remarks
Rajat Gupta
Thank you, Nirav. Good afternoon, everyone, and welcome to Ganesh Housing Corporation Limited Earnings Call to discuss the Q3 and 9 months FY '23 Results. We have on the call with us today Mr. Rajendra Shah – Chief Financial Officer, Mr. Neeraj Kalawatia – Vice President Finance, and Mr. Ravi – Corporate and Financial Advisor. We must remind you that the discussion on today's call may include certain forward-looking statements and must be therefore viewed in conjunction with the risk that the Company faces. We now request Mr. Rajendra Shah to take us through the Company's business outlook and financial highlights. Subsequent to which we will open the floor for Q&A. Thank you, and over to you, sir.
Rajendra Shah
Thank you, Rajat, and good afternoon, ladies and gentlemen. We thank you all for joining us on this call today to discuss our Quarter 3 and 9 months financial for FY '22 - '23 operational and financial performance. I would like to begin by sharing my thoughts on the current real estate environment, especially in Ahmedabad. The current market trend is very favorable, and we believe that upcycle in the real estate market is going to continue demand and upgrade to large homes' price hikes across the sector has been very well absorbed by the consumers even in a rising interest rate environment. The salaried class and the users are driving the demand in mid income segment. The luxury market also continues to do well in, and history tells us that luxury real estate market generally picks up in up market cycle. The GIFT City has seen increasing demand from foreign investment, and there is a high degree of interest from the banking and financial sectors. We have occupied more than half of the
Coming to our quarterly performance
We are happy to report another quarter of robust performance. Our aspiration and focus for last few quarters were to deleverage our balance sheet, and we are very happy to announce that the Company has become a net debt free in Quarter 3 financial year 2022-23 from a peak debt of over INR 6,500 million around three and a half years back.
On gross debt side
We have a minor debt of only Rs. 143 million as we speak which after cash balance and fixed deposit is a negative debt position for the Company. The Company continues to maintain an extremely healthy debt equity profile and other parameters when it comes to deleveraging the balance sheet. Coming to our financial performance for Quarter 3 and 9 months ended December 2022: Our revenue for Quarter 3 '23 came in at Rs. 674 million versus Rs. 761 million in Quarter 3 for the financial year '22, slightly lower on account of high sales velocity from our project Maple Tree during that period. During the nine months ended for financial year 22-23, our revenue grew at 91% and came in at Rs. 4,378 million versus Rs. 2,293 million in nine months ended financial year 21-22. Our EBITDA grew at 48% year-on-year and came in at Rs. 475 million for Quarter 3 financial year 22-23 versus Rs. 322 million in Quarter 3 ended financial year 21-22. During the nine months ended financial year 2022-23, EBITDA gr
On the project update
Both our projects namely – Malabar County 3 and Malabar Exotica currently under development were 100% booked. In Malabar 3 project, we have received RERA approval and permission to commence Construction in February 2021. During 22 odd months actual construction post these approval, we are happy to announce that we have completed 100% construction in this project across six towers. It is also a reflection of underlying value in the Company given that we have achieved construction milestone well ahead of scheduled timelines. We have applied for building use permission, which is the Occupation Certificate and expecting the same to get from Ahmedabad Municipal Corporation during this quarter itself. In Malabar Exotica project, we have received RERA approval and permission to commence construction in July/August 2021. During a 17 odd months' period, we have managed to complete more than 40% of the project, and we have been progressing ahead of the scheduled completion. Our planning for the
Advertisement
← All transcriptsGANESHHOU stock page →