I believe some misunderstanding.

That was not the intension of Surender Sir’s reply.

Shall delete this post.

ITC Hotels presentation
https://www.bseindia.com/xml-data/corpfiling/AttachLive/4d49cbf2-b1ad-4b1b-8c8b-705d0f20a3eb.pdf

If you don’t offer your best to customer, not go beyond your call of duty to be so good that he becomes your permanent customer, you may kiss your business good-bye.

Came to Gurgaon today to drop my daughter for her CAT exam. I had 2 hours with me, so I thought of relaxing with a coffee and continue writing my upcoming book. Dropped into the below CCD outlet that was around 5 minutes drive from the CAT center. As soon as I entered it, there was a fungus smell all over. I didn’t complain. I asked for a small cappuccino. The staff said that they can’t give a small cappuccino since they only have large size take away cups. But I didn’t want to take the large one. I said, I don’t want a take away, I will have it here. Pls give me a ceramic cup. The staff clarified that they can’t give a ceramic cup since there is no water and those are unwashed. I said leave it then. Give me an Americano if your cups are unwashed. The staff again clarified that even glasses are unwashed, so that’s also not possible. Making one last attempt, I asked, can you give me my small or medium cappuccino in your large cup. They refused mentioning that cups are counted. Frustrated, I asked, “What can you give me?” “We can give you only large coffee and that too only in take away.” Left with no choice, I had to take the large one by spending almost an extra Rs 100. This is
@CafeCoffeeDay

CCD is dying!

Do you know why their order book has reduced so significantly? Are they pivoting more towards shorter duration orders?

Growth in presales is coming back after a gap of few quarters, they reduced FY25 launch guidance to 7000 cr. (vs 8000 cr. earlier). Management is expecting 1800 cr. sales recognition with 11-12% EBITDA margins in FY25. Concall notes below

FY25Q2

• Reduced FY25 launch guidance to 7000 cr. (vs 8000 cr. earlier), only launched 1800 cr. inventory in H1FY25, expect H2FY25 to be heavy on launches. Maintain presales guidance of 3500 cr. in FY25 with 30% contribution from MMR and Bangalore

• Highest ever quarterly presales of 770 cr., growing by 22% over Q2FY24

• Expect mid-teen margins in H2FY25; Reported revenues of 1800 cr. in FY25 with 11-12% EBITDA margins (recognized 650 cr. in H1 implying 1150 cr. in H2)

• Life Republic contributed ~50% of Q2FY25 sales (385 cr., seems now Q1 sales of 300 cr. was an aberration)

• 24K segment is doing very well, 24K contributed 28% to Q2 presales and 30% to H1FY25 presales (vs 12% in FY22)

• Launched a project in Sector 2 in Vashi marking entry in Navi Mumbai market

• Interest costs will be 70-75 cr. in FY25, they recognize interest costs on delivery of projects (with rest remaining in WIP)

• Seeing tremendous demand in Hinjewadi and western Pune markets which have contributed to better realizations in Life Republic

Their last few quarters have been very disappointing. However, Kolte should be reporting very good nos because their flagship project Life Republic is witnessing amazing traction, this land bank is very old implying that the good gross margins should be very high. Their premium projects (24K) now account for one-third of their presales (again higher margin), and the Mumbai redevelopment (lower margin) is very asset light as they dont have to buy land. Logically, once these new projects start getting delivered, they should report better margins and ROCEs. However, their reported nos portray a completely different story which maybe because they are recognizing lower margin projects, which should END NOW and next 2-3 year numbers should improve. Lets see if my judgement is correct or not.

Disclosure: Invested (no transactions in last-30 days)