Release Date: October 22, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Aurum Proptech Ltd (BOM:539289, Financial) is consolidating its market dominance in the rental vertical, managing 32,000 rental units and aiming to exceed 50,000 by FY 2026.
- The company projects its co-living business to generate INR500 crores in ARR by FY 2028, with strategic capital allocation planned for growth.
- The distribution vertical has been realigned with a focus on technology, with Sell.Do leading as a real estate CRM in India and exploring international expansion.
- Aurum Proptech Ltd is preparing to launch its first asset as an SM-REIT, leveraging its tech stack and expertise in real estate management.
- The company has improved its ESOP adjusted EBITDA from minus 5.9% to minus 4.1%, showing progress towards profitability by FY26, '27.
Negative Points
- The revenue from operations for the quarter decreased slightly to INR64 crores from INR64.9 crores in the previous quarter.
- The company reported a loss before tax of INR12.1 crores, although this was an improvement from the previous quarter's INR13.8 crores.
- Despite improvements, the rental and capital segments still reported losses of INR1.2 crores and INR2.5 crores, respectively.
- The company let go of a revenue-generating services arm, resulting in a loss of INR9 crores in revenue for the quarter.
- There is a considerable debt on the company, with total borrowings at INR65.6 crores, although it has decreased from INR193.9 crores as of March 31, 2024.
Q & A Highlights
Q: Can you explain the strategic reasons behind selling Wisetechno Private Limited to Aurum Facility Management Private Limited?
A: Wisetechno is a property rented by a third party, and the rental income goes to investors and lenders. Aurum PropTech doesn't benefit from managing this property, so it was transferred to Aurum Facility Management, which specializes in such activities.
Q: How does Aurum PropTech plan to fund future acquisitions given the current debt levels?
A: We plan to fund acquisitions through a rights issue in Q4 and monetizing our buildings. We remain conservative with valuations and will not use debt for acquisitions.
Q: What is the business model and growth potential for HelloWorld, the co-living platform?
A: HelloWorld operates an asset-light model, managing 16,000 rental units across 17 cities. It serves students and young professionals, with a gross margin of 30%. The business has grown from INR38 crores in revenue in April 2022 to INR135 crores in H1 FY25.
Q: What are the plans for NestAway, and how does it fit into your growth strategy?
A: NestAway has been stabilized and is now profitable. We are focusing on increasing revenue streams and improving customer experience. We aim for controlled growth and may consider a 3-digit growth trajectory in the future.
Q: How is Aurum PropTech integrating advanced analytics into its platforms, and what value does it create?
A: We focus on creating unique consumer profiles and asset data across our ecosystem. This data strategy enhances consumer experience and operational efficiency, driving monetization opportunities across our business models.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
