Release Date: October 21, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Oberoi Realty Ltd (BOM:533273, Financial) reported a strong quarter driven by healthy residential sales momentum and robust performance across annuity assets.
- The company received full Occupation Certificate for the Enigma project at Mulund, indicating progress in project completions.
- There is strong leasing interest across office assets, with occupancies ramping up, showcasing demand for commercial spaces.
- The launch of Oberoi Garden City in Thane received an overwhelming response, with sales of close to INR350 crores, representing almost 50% of the launch inventory.
- The company is planning to deploy INR6,000 crores for expansion and growth, indicating a strategic focus on scaling operations and acquiring new properties.
Negative Points
- The fundraise of INR6,000 crores was unexpected, raising questions about the immediate need and deployment strategy.
- There is uncertainty regarding the exact timeline for deploying the raised funds, with a tentative plan to utilize them in the next four to five months.
- The company is cautious about committing to new project launches within the current financial year, indicating potential delays or strategic holdbacks.
- Revenue recognition for Three Sixty West is lower than expected despite strong sales, due to criteria not being met for recognition.
- Pricing trends in some projects have not increased as significantly as in others, potentially affecting overall profitability.
Q & A Highlights
Q: Can you explain the purpose of the INR6,000 crores fundraise and how it will be utilized?
A: The fundraise is intended to expand, acquire new properties, and accelerate the company's growth. We plan to deploy this capital in the next four to five months, focusing on purchasing large land parcels to support our growth strategy. - Vikas Oberoi, Executive Chairman and Managing Director
Q: What is the launch pipeline for the rest of the financial year, particularly for Borivali and Goregaon?
A: We have two towers in Goregaon, one in Borivali, and two in Thane ready for launch. While there is strong demand, we are not committing to specific launch dates yet, but we are prepared to launch when the time is right. - Vikas Oberoi, Executive Chairman and Managing Director
Q: Are there plans to expand outside the Mumbai Metropolitan Region (MMR), particularly with the new funds?
A: We are aggressively looking at opportunities outside MMR, including NCR. We are in the design and approval stages for a project in Gurgaon, which we aim to launch in the first or second quarter of the next financial year. - Vikas Oberoi, Executive Chairman and Managing Director
Q: What is the status of the Sky City Mall in Borivali, and when is it expected to open?
A: Leasing is progressing well, and we aim to open the mall by mid-December or January. We expect to reach 80-90% occupancy within two to three quarters of opening. - Vikas Oberoi, Executive Chairman and Managing Director
Q: How is the pricing trend for your projects in MMR, and what is the outlook for land prices?
A: Both project and land prices are stable. We have strategically priced our Thane launch, which has been well-received. The market has depth and width, and we expect this trend to continue. - Vikas Oberoi, Executive Chairman and Managing Director
Q: Can you discuss the revenue recognition for Three Sixty West, given the sales and collections reported?
A: Revenue recognition depends on meeting certain criteria, which may not have been fulfilled due to timing, such as the Shradh period. However, we expect to recognize this revenue in the next quarter. - Saumil Daru, Chief Financial Officer
Q: What is the strategy for the Nirmal Lifestyle land acquisition, and are there additional opportunities there?
A: We are planning an interesting development for the Nirmal Lifestyle land, leveraging our experience in the market. We also have a commercial development planned within the existing projects. - Vikas Oberoi, Executive Chairman and Managing Director
Q: How do you decide on the timing of new project launches, given the strong demand?
A: We have inventory in Borivali and Goregaon and are monitoring resale prices. We are ready to launch but are waiting for the right moment to maximize pricing and demand. - Vikas Oberoi, Executive Chairman and Managing Director
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
