Release Date: February 13, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- PAT increased to INR27.8 crores in Q3 FY24 from INR27.35 crores in Q2 FY24, indicating improved profitability.
- Total comprehensive income improved to INR28.08 crores in Q3 FY24 from INR27.52 crores in Q2 FY24.
- Pretax operating cash flows for the 9 months of the current financial year were at INR212.27 crores, significantly higher than INR84.85 crores for the full year FY23.
- New project launches are planned in Q4 FY24, including Ashiana Nitara in Jaipur and Ashiana Amarah Phase 3 in Gurgaon, which are expected to boost sales.
- The company is actively looking to expand its senior living projects, with potential new projects in Bangalore and closer to Mumbai.
Negative Points
- Area booked for Q3 FY24 was significantly lower at 3.35 lakhs square feet compared to 5.92 lakhs square feet in Q2 FY24 and 9.03 lakhs square feet in Q3 FY23.
- Total revenue for Q3 FY24 was INR189.25 crores, a substantial decrease from INR351.02 crores in Q2 FY24.
- Limited inventory in key markets like Chennai and Gurugram affected sales performance in Q3 FY24.
- Some ongoing projects, such as Ashiana Anmol Phase 2 and 3, and Ashiana Malhar, remain low-margin, impacting overall profitability.
- The company faces challenges in land acquisition due to rising land prices, which could affect future project economics and growth.
Q & A Highlights
Highlights from Ashiana Housing Ltd (BOM:523716, Financial) Q3 FY24 Earnings Call
Q: How do you see the next 2-3 years in terms of area of sales booked and construction? Which cities will you focus on?
A: The future looks bright with multiple project launches planned in Gurgaon, Jaipur, and Chennai. Gurgaon is expected to play a larger role due to higher sales prices. We anticipate good sales and construction across the board. (Varun Gupta, Whole Time Director)
Q: Can we expect a 15-20% growth in the value of area booked per annum?
A: Growth may be lumpy due to the nature of the business. While a straightforward 15-20% annual increase is not guaranteed, a 3-4 year view suggests a fair expectation of such growth. (Varun Gupta, Whole Time Director)
Q: What are the plans for new launches in Q4 and FY25?
A: In Q4, we plan to launch three projects totaling about 24-25 lakh square feet. For FY25, we have around 30 lakh square feet planned for launch, with detailed planning to be finalized in March. (Varun Gupta, Whole Time Director)
Q: How do you see the demand for senior living, especially in Pune? Are there plans to expand to other cities?
A: Demand for senior living is strong and improving, driven by increased awareness and financial independence among retirees. We see good demand in Pune and are actively looking at Bangalore for future projects. (Varun Gupta, Whole Time Director)
Q: What are the pricing trends in Jaipur and Chennai, and how do you see gross margins evolving?
A: Pricing in both cities has improved, with new projects launching at higher prices. Gross margins are expected to improve due to higher sale prices and favorable revenue share agreements. (Varun Gupta, Whole Time Director)
Q: What is the progress on the HSIIDC land payment?
A: We have until June to make the payment and expect to conclude all payments within the next 3-4 months. (Varun Gupta, Whole Time Director)
Q: How do you approach land acquisition given the rising land prices?
A: While rising land prices pose a challenge, we remain disciplined and conservative in our assumptions. We are actively seeking transactions where unit economics make sense. (Varun Gupta, Whole Time Director)
Q: What are the current realizations in senior living, premium homes, and kid-centric homes?
A: Senior living projects range from INR 5,000 to INR 7,000 per square foot. Premium homes range from INR 3,500 to INR 7,000 per square foot, and kid-centric homes range from INR 4,500 to INR 8,000 per square foot. (Varun Gupta, Whole Time Director)
Q: Will you meet the guidance of INR 1,500 crores of presales this fiscal year?
A: If we receive RERA approval for Ashiana Amarah in Gurgaon, we will exceed INR 1,500 crores. Without it, we expect around INR 1,250 to INR 1,300 crores. (Varun Gupta, Whole Time Director)
Q: What is the expected debt-equity ratio for future projects?
A: We are comfortable with a debt-equity ratio of 0.3 to 0.4, excluding project-level capital provided by IFC. (Varun Gupta, Whole Time Director)
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
