After many quarters, the big higher-margin projects (Amrapali/7 GPRA) which have been an overhang on the stock are seeing a meaningful pick-up in execution. Apart from better execution in Amrapali, monetization of commercial real estate (RE) inventory has also improved significantly, which would expedite execution of the redevelopment projects.
- Naoroji Nagar – Commercial RE inventory worth Rs. 1000 crores sold (vs Rs. 340 crores in Q1) and Rs. 5500 crores till date. At Q1 end, 50% was completed and upto Sept. ’22, 64% completed.
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Sarojini Nagar – Started selling commercial RE inventory just a month ago (Rs. 64 crores so far). Work going on in all 3 projects. (This indicates that the commercial RE cycle is finally improving).
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Amrapali – Funding arrangements are finally in place. Again, this was an old project where only 3400 flats had been completed upto Aug. ’22, but as of October ’22, 6000 flats have been completed. The improvement can also be seen in the segmental revenue. Projects worth Rs. 4700 crores remaining and to be completed by FY 24.
The company had to face various execution headwinds over the past few years, but these are encouraging signs.
Disclosure: Invested
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