Aiming to strengthen its presence in the Mumbai Metropolitan Region and Pune, realty firm Macrotech Developers has formed two joint ventures to build projects with sales value of Rs 1,500 crore and is looking for more such partnerships to grow business.
Mumbai-based Macrotech Developer, earlier known as Lodha Developers, got listed on the stock exchange last month after successful launch of its Rs 2,500-crore initial public offering (IPO).
In an interview with PTI, its managing director and chief executive officer Abhishek Lodha said the company has entered into two Joint Development Agreements (JDAs) in Mumbai Metropolitan Region (MMR) and Pune with two real estate companies.
He said the company has huge land bank in MMR and Pune, but not in all micro-markets of these two cities.
"We want to focus on MMR and Pune for the next 2-3 years. We have land in certain parts of these two cities but not everywhere," Lodha said, adding that the company would enter into more such JDAs to widen presence.
He did not disclose the names of two real estate firms with whom it has partnered with.
Lodha said the company would go for outright land purchases only if there are good opportunities.
In an investor presentation, Macrotech Developers informed that it has entered into two JDAs, first at Western Suburbs (Malad) having an estimated GDV (Gross Development Value) of around Rs 600 crore and second at Pune (NIBM) with estimated GDV of around Rs 900 crore.
During a conference call with investors, Lodha said the company would share revenue with landowner partners in these two projects.
"We see in both these projects, while the structures are different, approximately 20 per cent of the topline will be a margin for the company," he said.
Lodha expects to add several other such joint development projects over the next 12-24 months.
Lodha expects that joint ventures will contribute in the range of Rs 3,000 to Rs 4,000 crore of annual sales in 2023-24.
Macrotech Developers is targeting to bring down its net debt to zero over the next three years from the current borrowing level of around Rs 16,000 crore.
"Our aim is to become debt free by 2023-24 fiscal," he said.
Macrotech Developers sold properties worth Rs 5,968 crore during the financial year 2020-21 as against Rs 6,570 crore in the previous year.
"We believe that for FY22, we will do Rs 9,000 crore or upward of sales," he said.
To speed up the pace of construction, Lodha said the company will double its investment on construction to Rs 2,800 crore in this fiscal.
The company''s construction spend stood at around Rs 1,400 crore during the last fiscal year.
It delivered 2.7 million sq ft area last fiscal year as against 15.7 million sq ft in 2019-20.
Copyright©2021 Living Media India Limited. For reprint rights: Syndications Today