Raymond Realty (NSE:RAYMONDREL) Q1 2027 Earnings Call

0:00 Ladies and gentlemen, good day, and welcome to the Raymond Realty Limited q one and FY twenty seven earning conference call hosted by Anand Rati. As a reminder, all participant line will be in the listen only mode, and there will be an opportunity for you to ask question after the presentation conclude. Please note that this conference is being recorded. I now hand the conference over to mister from. Thank you, and over to you, sir. Thank you. On behalf of, I would like to welcome all the participants in the q one FY twenty seven conference call of Raymond Realty Limited. Today, we have with us from Raymond Realty Limited senior management, mister Rakesh Tewari Group CFO, mister Har Mohan Sani, MD and CEO, mister Ankur Jindal, CFO, and mister Sunny Desa, Head Investor Relations.

0:58 Without taking further time, I would like to hand over the call to Mr. Harmohan Sahni. Over to you, sir. Today on this call for Raymond Realty's performance for the first quarter of financial year twenty twenty seven. Very happy to share that we have entered FY 'twenty seven with strong operational momentum. We have carried forward the scale execution and the strategic clarity that we achieved in Q4 of last year and which defined our entire last year's performance, the same momentum going forward continues. Our performance this quarter reflects sustained home buyer confidence in Raymond Realty's brand and validates the deliberate execution of many years' work that we have put in over the last six years. The growth is finally coming to fruition, all the work that we have done.

1:55 Across MMR, buyers continue to prioritize developer reliability, execution velocity and product quality. And these are the exact areas where we, as your company, Raymond Realty, continue to lead and outperform a lot of other market participants. Let's look at our financial performance highlights for Q1. It has been underscored by both top line expansion and the operational efficiency that we have brought in. We achieved a robust booking value of INR 700 crores, representing a 129 percent year on year growth compared to Q1 of FY 'twenty six, which was INR $30.06 crores and Q1 FY 'twenty seven, we have achieved INR 700 crores, which is a significant achievement over the last year.

2:50 If you look at customer collections, customer collections reached INR $5.50 crores for Q1, which is a 47% year on year growth compared to Q1 of FY 'twenty six. Similarly, if we look at revenue booking, which is the total income that we have disclosed for Q1, the total income stood at INR $5.36 crores as compared to INR $3.90 crores in Q1 FY 'twenty six. This is a 37% year on year growth, and it is backed by sustained demand and project delivery and execution that we have shown. And last but not the least in the highlight is EBITDA.

3:36 EBITDA increased by 70% year on year to INR 70 crores as compared to INR 41 crores in FY 'twenty six. The EBITDA margins also compared to Q1 FY 'twenty six expanded from 11% to 13%. So we have managed to increase the profitability, even though we launched a lot of projects in Q4 of FY 'twenty six. So all those projects that we launched in Q4 FY 'twenty six, there were four projects that we launched during that quarter and quite a few of them in the month of March itself at the back end of the year. So the current year's initial profitability will reflect the upfront marketing and construction setup costs.

4:27 And the margins will progressively normalize over subsequent quarters as project construction process revenue recognition thresholds, which is what we would be doing in Q2, Q3 and Q4. So we are firmly and completely on track to achieving our full year EBITDA margin guidance of 17% to 19%. And this is a number that we have committed to the market over the last few interactions that we've had, that this is the range of margin that you can EBITDA margin that you can expect from us. And we are completely on course to achieving that target for FY 'twenty seven. Now let's look at the balance sheet prudence and liquidity position, what has your company achieved.

5:18 So our expansion remains completely backed by strict financial discipline, while we have expanded quite aggressively, and we continue to do so as we go forward, but we have maintained the financial discipline. The net debt at the end of Q1 closed at INR $8.24 crores, maintaining a healthy debt to equity ratio of 0.7% of in Q1 FY 'twenty seven. This number, 0.7x, is comfortably below our internal target of 1x that we have decided that we will maintain that discipline. So it does provide enough headroom for our future expansion also going forward.

6:05 Apart from other tools, which are available to the company, this debt headroom also helps. We also hold a INR $2.71 crore liquidity buffer at the end of the quarter. So that ensures our ongoing construction pipeline is fully funded for the year ahead. And it will continue at the breakneck speed that we have achieved over the previous year, we will continue to do so in the current year as well. Now let's look at our cost of debt. The cost of debt also remains stable and quite competitive compared to the market and our peers. The cost of debt stood at, on an average, 9.6%, so below 10%, which shows the confidence of the market and the lenders as well as the rating agencies in our business model as well as our performance.

7:02 It is clearly reflected in the cost of debt that we have been able to achieve. Now let's look at the update on our overall portfolio, the GDV that we have. So our total GDV, which is the gross development value, now stands at INR 52,000 crores. This provides us a multiyear growth visibility. And we have worked going forward at least six to seven years of growth is already there. The total work, if we see that your company will have worked for at least seven to eight years going forward. The key engine of our strategic pivot is the asset light joint development agreement strategy.

7:51 And if you look at just the JDAs, the JDAs, GDV today is about 52% of the total GDV of out of the INR 52,000 crores total GDV. So JDAs have already overtaken the own land, and that just shows you the growth momentum that we have in building our pipeline for future growth. So our JDA engine now encompasses eight projects with a combined revenue potential of INR 27,000 crores, which is the exact number, 52% of the GDP. If we look at our own land, which is the 100 acre Thana land parcel, which served as a cornerstone for our initial success and gave us the courage to move out of Thana and expand rapidly and demonstrate our ability to perform and get the brand acceptance done in the other markets also.

8:51 That represents an aggregate revenue potential of INR 25,000 crores. So INR 25,000 plus INR 27,000 of JDAs total to 52,000 crores of overall GDV that we have. Our demand across all our three core brands that we have built, NX, Address by GS and Invictus by GS, remains strong, whether it is or whether it is the larger MMR, both these places, wherever we have launched our new projects, we have seen tremendous brand pull and a lot of confidence is shown by the consumer in our brand. Now let's look at the asset light JDA model performance and what is the kind of performance we've been able to achieve.

9:41 If you look at Q1 FY 'twenty seven sales numbers, presales of INR 700 crores total. Out of that, 64% contribution came from these JDA models asset light. So now our presale, if you look at the entire bouquet, clearly, the expansion through the asset light JDA model has proven our point that we are quite successful in that. And a very large chunk, almost twothree of our sale is now coming from the larger MMR and onethree comes from We also secured a flagship JDA project in Paril during this period with an estimated GDV of INR 8,500 crores.

10:34 This agreement actually is quite historic as far as the company goes because it marks our strategic foray into South Bombay's premium housing market. This is a market that we've been trying to break into for the last one or two years. And this is the Parail project is going to be a very, very marquee project. It's a great location, and the project also is pretty large. It gives us work for seven, eight years in that micro market. Now if you were to look at the larger JDA portfolio and the execution status of that, out of the total eight projects that we have signed so far, including the recent one, Paril and the one before that, Kandivoli, these are very, very recent deals signed.

11:25 So out of the eight deals, four projects have already been launched, and they are all at marquee location, one in Bandra East, one in BKC, one in Wadala and the fourth one in Syan. All of these four projects put together represent about 2,800,000 square feet of Rara cafeteria. And the revenue potential of all these projects is INR 11,500 crores. And all this most of this has been launched last year, barring one project in Bandra East, which was launched two years ago, everything else has been launched last year and most of it in Q4 itself. Still, if you look at the sales numbers out of the revenue potential of INR 11,500 crores, which we have launched, the cumulative sales have already reached INR 2,900 crores.

12:18 So that just reflects the confidence that the consumer is showing in our brand. Not only that, we've already done revenue I mean, the collections, the actual cash collections against these of approximately $6.92 crores or you can say close to INR 700 crores of collection has been done while these projects are at very, very early stage, except like I said, one project, which is progressed. The other projects are all at nascent stage where only the excavation work is going on. Then if you look at the recent signings, which is the Kandivali and the Parral one, put together, these are about INR 11,500 crores of GDV, both the projects put together.

13:05 All this combined together provides a clear long term growth visibility across prime MMR micro market. And all these are very, very strong deep market and the kind which will be attuned to our brand portfolio of 10x address by GES and Invictus by GES. Now let's look at the Thana land parcel a little bit. I'll tell you bit about that at an overall telescopic level. Out of the 100 acres that we have, 65 acres are currently under active development. Now this constitutes about 6,700,000 square feet of RAYRA carpet area, and the revenue potential of this is INR 16,500 crores.

13:53 Now against that, since this is what we started earlier, this is actually started getting monetized in 2019 itself. So obviously, it is a little ahead of the curve compared to rest of the MMR market. So out of the total potential of INR 16,500 crores, we have already sold INR 9,400 crores worth of stock. And we have collected INR 7,460 crores of collection, the cash against these sales. A lot of delivery has also taken place. We as we speak today, we have already delivered 11 towers, and that is close to almost 4,000 homes that we have delivered.

14:39 And going forward, we will be delivering many more. Even the customer experience there also has been pretty good in terms of delivery of the product. Now as it remains a key pillar of our growth, it's delivering 36% of our total booking value in the current quarter. And like I had said, twothree and onethree. So onethree of our sale come from Thunder Land going I mean, Q1. And going forward also, we see a similar trend. But as we launch more projects in MMR, as a percentage, this share may drop, while the absolute numbers may remain close to what they are today also.

15:26 Now if we look at future growth visibility for the entire company, apart from just now, we looked at the JDM model and own land model. But if we look at the overall future growth visibility, both these put together, if we look at unsold GDV that we have is about which is already launched but unsold, is about INR 15,700 crores of sales. And on top of that, we have unlaunched GDV, which is neither sold nor launched, about INR 24,000 crores. So there is a significant amount of projects that we have in different micro markets.

16:11 So it is well diversified portfolio. And that gives us a lot of confidence that we have a multiyear pre sales and cash flow visibility as far as your company is concerned. Now let's look at specific to FY 'twenty seven guidance and outlook. For the full year FY 'twenty seven, I would like to reiterate that we are committed and very, very confident that we will be delivering a pre sales growth of upward of 20% year on year. So these are minimum numbers that we will definitely deliver as compared to last year. Even revenue growth on the P and L, the total turnover, you will see a minimum 20% year on year growth.

16:58 EBITDA margin, as I mentioned earlier, the guidance for EBITDA margin is between 1719%. We will achieve somewhere in between over there. And the return on capital employed will be 20% or upward of that. So that's the these are the minimum growth numbers that we are giving guidance to the market. Now to conclude, I'm happy to say that Raymond Realty remains steadfast in commitment to operational excellence and financial discipline. We want to ensure that we continue to create lasting sustainable value for our shareholders, various stakeholders and also our home buyers because eventually, if the home buyers are happy, then everybody gets to benefit from the value.

17:52 Now with that, I come to the end of my briefing for all of you. So thank you once again for your time and continued trust in us. We can now actually Thank you so much, sir. Ladies and gentlemen, we will now begin with a question and answer session. If you wish to remove yourself from the question queue, you may press star and two. Participants are request to use handsets while asking a question. Ladies and gentlemen, we'll wait for a moment while the question queue is assembled. First question comes from the line of Sukriti Deepaatil with EyeSight Fintech Private Limited.

18:56 Good morning to the team. I have two questions. My first question to Mr. Sani is, your regular outlook, I just want to understand the forward looking guidance on what are the top two to three execution priorities you are focusing on the immediate quarters? And alongside that, what do you see as the biggest risk in demand shifts, regulatory changes or competitive pressures? And how are you preparing to mitigate them by strengthening the company's position in residential and commercial real estate space? That's my first question. I'll ask my second question. Yes. Thank you very much for your question. Now I mean, what the question you asked is very, very wide, and it could take a couple of hours to answer that also, but I'll try and give you a short answer on that. As the easy part is to tell you what we are focusing on in the current year. The current year focus is primarily on execution of all the launch projects that we did launch in Q4 of last year.

20:04 If we just put our head down and execute them well, the growth and the guidance will be met for sure. The demand as of now looks pretty strong in all the projects that we have launched, and we are not seeing any significant change in our projections as far as demand is concerned. So in fact, we've only been pleasantly surprised even if you look at Q1, what we were expecting to do, we have done a little better than what we were expecting to do. So market continues to remain supportive in all the micro markets that we are. And we've chosen very deep markets to be in. As far as execution is concerned, today, the challenge in execution only remains the cost pressures that you see because of the war, which is going on the global conditions, which are there. But they are essentially temporary pressures.

21:04 They are not going to remain over the entire project life cycle because we have seen time and again and have been now doing this for thirty years. And one learning, if I have got is that things always change. They never remain the same. So on a five, six year project life cycle, you will see some cost hikes and then you will see cost dips and all of that will happen. So and we budget for that. So even if there are some challenges on the cost front, I think we are geared up and well prepared for that. There are enough buffers we take into our cost estimates because it's a five, six year period. So then the contingencies have to be provided for. Other than that, as far as government is concerned, that was part of your question.

21:54 I think as of now, there is a fair bit of stability as far as policy is concerned. See 2034 TCR is there, which provides maximum clarity that one could ask for. And what we have seen in the last two, three years that this government in Maharashtra is pro growth and in a sense, pro development, whether it is infrastructure, whether it is real estate. So physical assets are doing quite well under this government. So if you have a supportive government, then rather than hurdles, you have to look at what are the opportunities. And that's what we are focused on today. And this state and the city is currently providing tremendous opportunity.

22:45 I mean, my personal hypothesis is that Bombay is going to be the best city to live in, in the country within few years itself, the kind of infrastructure work that is going on. I hope I've been able to answer your question. Thank you. My second question to Mr. Jindal is, again, a forward looking guidance. From a project financing point of view, how are you aligning capital allocation and funding with the company's growth pipeline? And what risks do you see in execution time line, financing conditions or industry dynamics? And how are you planning to mitigate them? Thank you. Yes. I'll only take that.

23:33 I think Ankur is traveling. So he may not be able to get proper connectivity. See, as far as the capital profile of the company is concerned, today, like I mentioned in my opening remarks also that our debt to equity is 0.7, the net debt to equity, which is there. So we are well below one:one debt to equity. Now we have maintained an internal discipline of not going beyond one:one as far as debt to equity is concerned. And all our projections, I mean, we do look at long term planning and it's done on a rolling basis. If I look at that plan, we don't see any significant danger of going beyond one:one.

24:25 And we have not even scratched the surface as far as other means of raising capital is concerned. Now there are a lot of AIFs also who are approaching us to participate in the growth that we have undertaken at an STV level. So we have that opportunity also if, let's say, the debt seems to be getting close to one:one, we can always look at deploying that strategy so that we continue to maintain the financial discipline that we want to maintain. Apart from that, the company will always have eventually, I mean, as of now, we have no plans, but the equity bucket is always available.

25:13 Of course, it comes at the most expensive cost. So that's why it will be our last resort. And as of now, we don't have any plans. As far as the cost of debt is concerned, the cost of debt has only been going down for us and not up. Our rating has also been pretty strong. So given the rating and the operations, the way we are running the business, there is a very acute focus we have on cash flows. We have a manufacturing mindset towards this business. So we are not looking to hold land and just sit on it. And our time to market is pretty fast for all the JDA projects that we sign on To the extent our counterparties submit, we go at top speed and launch our projects.

26:04 So that all that helps. Thank you. And best wishes. Thank you. Thank you. Our next question comes from the line of with Swan Investments. Please go ahead. Hello, sir. Thank you for the opportunity. My question is with respect to the project. So what are the ticket sizes that we are planning, and what will be the free sale component, and how many units are we planning to sell? How much inventory will you open at the time of launch? And when are we planning to hit the market? Thank you for your question.

26:51 So the Parail project is close to about eighteen months away as far as hitting the market is concerned because we just now have what signed it. And the planning and the approval process and getting the land ready and the launch and all. Typically, we have seen that it follows roughly about an eighteen month cycle the city of Bombay or rather in our country itself. So that would be the time line. As far as the ticket size is concerned, the ticket size will really depend on what the pricing at that point in time would be. But broadly, I can tell you, when we underwrote the project, the ticket sizes that we were looking at is starting somewhere around INR 6 crores and going all the way up to INR 20 crores.

27:45 These are going to be all reasonable sized apartments because the product is going to be a combination of address by GS and Invictus by GS. We are not doing a 10x over here. So since the sizes are going to be slightly on the upper side, so the ticket size will also go up. Was there any other part of your question, which is left unanswered? Yes. So what is the realization that we have underwritten? Sorry, the total GDV is INR 1,500 crores. That's what we have underwritten. Okay, sir. And are we on track to launch the Mahim project? What is the status on the approvals?

28:32 Yes. So we are on track to launch two of the Mahim projects this year. The first one should get launched towards the latter part of Q3. And then Q4, we will have the second Mahim, which will launch. The approvals are all completely on track, and they are all fast paced. And just now, we are in the middle of monsoon. So naturally, we have to make sure that all this also settles. So somewhere around November, December, we should see first Mahim launching and then February, March the second Mahim should launch. Okay. Thank you so much. Thank you. Ladies and gentlemen, anyone who wishes to ask a question may press star and one on their touch tone telephone.

29:28 Our next question comes from the line of Bhavin Modi with Anandrati. Please go ahead. Yeah. Thank you for the opportunity. Sir, there was a recent announcement, you know, with respect to the incorporation of 10x, you know, Mahalakshmi Limited. So is it like, you know, we are looking for a, you know, new business equation? Or can you just help us, you know, describe what is it related to? See, we are always looking at opportunities as far as business development is concerned. So there is always something in the pipeline. Specific to your question on incorporation of this company, I mean, we have many SPVs, and we have to in anticipation of new projects, we have to keep SPVs ready.

30:14 So it was incorporated. And beyond that, we have not done any announcement in the market. And my request will be to show a little patience with us. And naturally, whenever there is a deal signed, we will come back and we will be the first ones to know. Yes. Got it. So second thing is if you can give us a tentative launch calendar from Q2 to Q4 and what will be the tentative GDV if you can help us with that? So would it be okay if we gave you those details? See, broadly, if you see, there are two projects we are launching this year because we have already so many projects ongoing. So there is a strong pipeline in any case.

31:03 So two projects are the Mahim projects. And the first Mahim project is roughly about a GDV of INR 2,500 crores. And the second Mahim is also very close to INR 2,000 crores, INR 2,100 crores, 2,200 crores of GDV. So these two projects will be launched this year. And apart from that, there is already enough inventory that we have in the market at various micro markets, the four projects, which we have launched in where the out of the JDAs that we have done. So this would take us to six JDAs would have been launched by the end of this year, which is FY 'twenty seven out of the total eight.

31:50 And the other two, which are not launched, are the ones we have just recently signed. So they will take some time for approvals to be in place. They are not at a late stage projects. Yes. Got it. So, the last question, the JDA portfolio now almost contribution of 27,000 crore of the total JDA. And the last part of the future launch pipeline, right? So how should we, you know, think about the margin and the capital profile of the GDA, you know, relative to the online, you know, engine? And can GDA, you know, lead growth help improve, you know, ROC while, you know, you know, restricting the leverage? So can you just help us with that?

32:37 Yes, certainly. See, if I compare JDA versus buying land, naturally, JDA will always win when it comes to return on capital and capital deployment efficiency because you will not be paying for land and sitting on it for a long period of time. You typically, you pay 10%, 15% of the land value as a deposit when you get into that deal. And then bulk of your money goes towards approvals and construction, getting it ready for launch. Typically, the kind of deals that we are signing today, 2,000 upward, the ballpark number for each JDA, the capital required is somewhere in the range of INR 300 crores to INR $3.50 crores.

33:25 Now if we look at a very large project, maybe I mean the recent large one we have signed is INR 8,500 crores, the per rail one. There the peak requirement will be slightly larger. So but it will not be proportionately in line with the because you will do the launching in phase wise manner. So maybe INR $3.50 crores will go to INR $4.50 crores or close to INR 500 crores of peak investment. So those are the kind of capitals you will be deploying. Now Parel is 1,700,000 square feet of carpet area. If I was to buy that land and pay for it upfront, that itself will run-in thousands of crores. So clearly, capital efficiency is there.

34:14 And then what happens in all these deals is because the capital efficiency is good, so naturally, your return on capital employed goes up. And as far as the margin profile is concerned, once we are in a stable, steady state real estate organization, which I think we could be in a position to hit in a year's time now because last year was actually a watershed year for us where we launched a lot of projects, and they've been very well received in the market. Execution has also progressed well. So I mean, everything single cost is going well and doing well. And this year itself, we are hitting a margin profile of 17% to 19%.

35:01 So our desire is to be as close to 20% as possible and maintain that. And since we are a very capital efficient model, the ROCE will definitely be higher than that because, a, you are not deploying that much capital and b, it is a combination of equity and debt. And debt, as we said, is available to us at 9.6% per annum. So a blend of that will clearly give us ROCE, which will be upward of 20%, which is there is no other company in the country today who can consistently give you 20% ROCE. And I'll be happy to be proven wrong if somebody comes forward and shows me because that is really the true measure of how well a company is doing if it's consistently giving ROC of a certain number or not. Now for the last six years, if you see our ROC has been upward of 25.

36:03 And going forward, we are making a commitment of 20% is what we will do, and we are very, very confident that we will achieve that. Got it. Got it. Thank you, sir. That's it from my side. Thank you. Our next question comes from the line of Deepak Podda with Sapphire Capital. Please go ahead. Yes. Am I audible, sir? Yes, sure. Yes. Just one question I have on the interest cost. I mean how should one look at your interest cost going forward? I mean last two quarters, it has been on the elevated levels, right? So this time we expect to income going forward? See, interest cost has been quite stable, actually, not on the higher side. If you're referring to the absolute number, the absolute number will be linked with how much debt we draw. If you see the cost of debt is about 9.6% on an average blended basis, which is very, very competitive for a real estate company.

37:04 And as we draw more debt, the interest obviously, the interest component will go up. But all this money is going towards growth. None of this is for expenses or any other reason. We are not building capital assets and then sitting on them. It's all going into JDAs, all going into growth. So it is only going to increase the profitability and EBITDA levels going forward. And like I said, once we reach a steady state and all these projects are throwing out cash, the debt level will also start to moderate. It may not moderate for another year or so because we still continue to aggressively grow. Yes.

37:51 So I was not talking about the cost of I mean, that is stable, the absolute number. So what would be our current debt levels? Our current debt levels, our net debt is in the range of INR $8.24 crores. That's what I said in my opening remarks also. And cash how much cash you would have? INR $2.50 crores. Cash is INR $2.71 crores. So the gross debt is INR $10.95 crores. $10.95 crores. And you mentioned this debt may not moderate for another one, two years because we are growing. So kind of the absolute interest cost that we are incurring, that we expect to continue, right? No, absolutely.

38:36 Okay, okay. Fair point. That would be it from my side. I would like to Thank wish you all the you so much. You. Our next question comes from the line of Prateek with Motilal Loosevelt Financial Service Limited. Please go ahead. Good morning, sir. Thank you for giving me an opportunity to speak. Sir, actually, are you looking for development in any market other than this Mumbai area so so that for diversification or will be continuing here only, sir? I think for the foreseeable future, we are very focused in MMR. Additionally, for the last, let's say, about two years, we've been looking at Pune as a market. We've been studying and observing and a lot of deals we have seen.

39:24 But we have not found anything which meets our financial criteria in terms of returns that we look for. But other than that, as of now, we don't want to venture out of Maharashtra for obvious reasons: a, there is enough growth that we are getting here. In fact, everybody else from outside is coming into Maharashtra and Bombay. So we wouldn't want to vacate space for other people where this is our home ground. And there is no dearth of growth. Only if my growth appetite is not being met, I have to think of going out. So as of now, that's not the situation. Okay. And sir, just I wanted to understand technical issue, just in this joint development strategy, what you are speaking about.

40:14 So what happens that we jointly develop with some other developers, is So if you could explain, otherwise, if it's L and D and you can just cover it? So I'll tell you very quickly. I mean, what are the kind of deals we do? I mean, there are many, many forms of joint developments, which as you know others will be taking on, but I'll tell you what we are doing. Very clearly, any joint development contract that we get into, the first thing is that we need to have 100% control as far as the development is concerned. So there is no even if there is another developer who's worked on it in the past, he has to become a sleeping and a passive partner. So otherwise, we will walk away from a deal because we are putting our brand on the product, and we are making a promise to the ultimate consumer.

41:06 Now that promise needs to be delivered. Otherwise, the brand itself gets spoiled. So we need to have absolute control. We will do everything that is needed for the deal. In some of the deals, if there is a rehab component, sometimes we have allowed the partner to finish the rehab part. But we always have step in rights, let's say, if his obligations are getting delayed somewhere, we can step in and execute that part. So this kind of mitigates any kind of execution risk, which is there or eliminates possibilities of disputes and projects getting delayed. So typically, that's how the duties are divided. Okay, sir. Thank you, sir. Thank you.

41:55 Thank you. Our next question comes from the line of Preet Shah with Bluestar Capital. Please go ahead. Am I audible, sir? Yes, sir. You are. Yeah. First of all, congratulations from good set of numbers. So I just want to understand. For full year, what would be the interest cost? If you could explain me, what would be the full year interest cost for FY 'twenty seven? Can we get back to you on that number? We don't have it readily available. But safe to assume in the range of about 100 crores, INR 1,000 crores is the gross debt and 9.6%.

42:41 But don't hold me to it. Allow us to come back to you on this number. But it will be in that range. Around INR 100 crores for full year, right? Yes, INR 100 to INR 120 crores max. That should be the range. I don't have it readily available. Otherwise, I would have shared it. Sure. So sir, should we assume that in Q1, interest cost was 47 crores. So from Q2, Q3, Q4, the cost would be lower than Q1? It will be thereabouts only, yes. So between INR 100 crores and 120 crores of each dollar is crore to INR 100 So my point is like it will be less than Q1, right? Yes, yes. Yes, yes. You can assume that.

43:32 Okay. Got it. Thank you, sir. Thank you. Our next question comes from the line of Gunjal with Aryan Capital Markets Limited. Please go ahead. You may please proceed with the question. Hello, sir. Thank you for the opportunity. Sir, sir, the question was, borrowing have gone from INR $3.82 to Thousand 97 Road,. Is this construction, finance, project level debt, or corporate debt? What's the repayment schedule? And does the 52,000 gold GDV pipeline more leverage from here or does incremental collection largely self funded?

44:27 Ma'am, your voice was not clear. I didn't get the question at all. Can you repeat that, please? Can you hear me now? Yeah. Slightly better. Yes. Okay. So borrowings have gone from $3.80 to 2,097 to Y and Y. And is this construction finance project level debt or corporate debt? And what's the prepayment schedule? And does the 50,000 crore GBG pipeline require for leverage from here or does incremental collection largely self funded? Yeah. Okay. Got it. See, I mean, I don't know what you mean by corporate debt because all the debt that we have taken is going for expansion, either signing of JDAs or construction of the existing projects.

45:22 So I don't know what you mean by corporate debt. We are not taking any debt for expenses or building fixed assets or anything like that. All this debt is going into work in progress for the actual projects that we are signing as JDA. So that's my response to your first question. As far as your overall question of the total GDV, how will it be executed, how much debt we will use, that's the question you asked, right? Yes, sir. So for that, we have already given a guidance that we will maintain the discipline of not going beyond one is to one debt to equity. So we will remain within that. Okay, sir. So there is one more follow-up question with that. What is the margin difference in own land project and JDA engines?

46:18 So our blended margin is the guidance that we have given. It will be between 17% to 19% is the blended margin for the current year. If you look at our own land, it is in the range of about 25%, 26%. And as far as the JDAs are concerned, it should be 20%. But since they are all at early stage, they are currently not giving 20%, and they will scale up in the next year after this. So by FY 'twenty eight, you will see a higher margin profile on the JDAs because they would have all matured. Just now in my opening remarks, I mentioned that out of the four JDAs that we have launched, we are at very initial stage where we have just begun the excavation.

47:05 And only the launches have taken place. It's only been a few months of sales that we have seen. And in a project cycle, you see that the project gets launched at a certain price, and then the profitability of the project builds over a period of time as the price keeps on changing because we need to sell a certain inventory at the launch stage. And that's how typically the industry operates throughout. So we are no different than that. Thank you. Our next question comes from the line of Manwarajan Bate with Samman India PMS. Please go ahead. Good morning, sir. I wanted your view on the demand environment presently.

47:58 Has there been some softness? And also, think recently you ran sort of home fest. So, what was the response and the purpose of running that? Is it because there's some softness and one wants to accelerate sales or something on those lines? Yes. So the demand remains quite strong all through. And as far as Homefest is concerned, Homefest is an annual feature we do. So I don't think we need to attach any story to it and start thinking otherwise. It was there last year also. It was there a year before that also. It was there a year before also. It is for the last three years, we are doing home fest around monsoon because this is a period when the footfalls are not so great.

48:47 And this is a way of creating some kind of urgency in the consumer. So that even in a lean period, we keep on getting inquiries in our sales pipeline, the top of the funnel remains strong. So that's the reason that we do. But we have not seen any softness or any difficulty in any of our projects. Like I mentioned, that so far, whatever we have projected for Q1, we have actually done better than that in terms of presales. Mr. Vease, have you done with your question? Yes. And how was the response to the HomeFest?

49:37 HomeFest response was pretty good. I mean, we've been able to get a very strong response as far as top of the funnel is concerned. Like I mentioned, see, these kind of events, what they do for us, they will drive footfalls. And then those inquiries over a period of time turn into sales. It's not as though in the Homefest itself, you will suddenly see some great bumper sale that will happen. During the Homefest, you will let's say, thousand people walk in during the Homefest, you will probably be able to see a conversion of only 20% during that time. Rest of the 80% conversion happens over the next two months, people who have walked in. So the purpose of these events is really not to do sales while it is happening. It is the purpose really is to top up your sales funnel.

50:36 Got it. Right. Thank you. Thank you. Our next question comes from the line of An individual investor. Please go ahead. Yes, am I audible? Hello? Yes, you are. Are. Yes, sir, you are. Yes. So good morning, Harman, sir, and compliments for good operational performance. I have a couple of questions. So one is, sir, when our EBITDA and operating profit is growing, but at the same time, because of debt increase, our interest cost is also increasing at a faster pace than that of the growth of revenue and EBITDA.

51:34 So while you have given a growth guidance related to revenue and EBITDA and all, what as a shareholder, we are interested to know is also about the cash profit growth as well as the the growth on the the operating cash flow side as well. So any guidance on that front, sir? Because I can see the revenue and EBITDA both are doing well. But when it comes to net profit or profit after tax, that's why because of higher interest coverage, we don't have sufficient net profit. So if you can give some guidance on the net profit and cash. Yes, sure. See, any company which is growing will obviously need capital. Now if I dilute equity, which is that is going to be more detrimental to you or any shareholder, not just you.

52:27 So obviously, the first preference is that growth whatever capital is needed, you go for the lower cost, and that's why debt really needs to get contracted. So the choice really in front of management is whether to grow or not to grow. And the answer is obvious that the market is good, you have tailwinds. So you should grow. And we are in a cyclical business, and we don't know the timing of when the cycle will turn. But just now that it's going well. So naturally, the best time to grow is when you have tailwinds. So this will continue. As far as guidance of net profit is concerned, we have so far not given any guidance on net profit. We have given guidance on EBITDA. And we have broadly mentioned that our interest cost will also be range bound. And I didn't have the exact number, but I kind of tried to extrapolate that it will be in the range of 100,000,000 to 120,000,000 maybe 10%, 20% here and there.

53:31 And if we are growing our EBITDA at 20%, last year, our EBITDA was how much was our EBITDA? Just give me a minute. INR 500 crores roughly. I'm just getting the exact number. I think INR $4.80, $4.90, yes, so INR $4.90 So if you take 20% or 17% growth on that, So that will give you a number.

54:23 And if my interest is going to be 120%, you can do the math yourself. Let me not give you a number because we have not given that guidance so far, and we are not we don't have the policy just now of giving that out. Yes. But then you don't expect any PAD deceleration, PAD growth deceleration because of higher interest cost, Right? Sorry. I didn't get that. You're saying the pad will No. What I am Go ahead. So what I'm asking is the pad growth will be lower than that of revenue growth. You don't expect any deceleration in the pad growth, right, because of this higher interest cost? It... I mean, I I don't have that number just now, so I can't answer it.

55:08 But I can get back to you on that. If you write to us, we will share it with you. Yeah. Sure. Fine. Sir, one more observation what we have also seen is the the FII and DIA holding on the company has has continuously falling. Just to give you a number, when last year last year, quarter one, it was combinedly 22%. And from there, it is consistently falling to now it is around 8% an hour. So while our narrative has become positive and performance is also improving, somehow the institutional investors have not reversed any fear from the company performance. So so is there any effort that we are making, sir? Because we are the small shareholder. We may not have all the information related to the company, but because of any information asymmetry maybe they did the management leadership or corporate governance, the institutional investors are keeping away from this company.

56:04 So is there any thoughts from your side how we can improve this? Because this is a question which has been asked repeatedly in several on call ever since we have listed a separate company. Yes. Yes. So yes, I mean, obviously, it is a matter of concern as much as it is to you, it is to us also. And see, there are two couple of things here that we have to look at. One is the moment we demerged, we became in terms of market cap, not even a mid cap entity. So what happens is a lot of these DIs and all, they have their internal limits and all. Some of them sold out of compulsion. So it's not relating to performance that they have been exiting.

56:52 But a lot of family offices have bought, a lot of retail investors have come in. And as far as shoring this up is a true wrong approach. One is to continue showing the growth. And with the support of investors like you and the others as the market cap of the company also grows, it has already gone beyond INR 4,000 at one point in time, it was INR 3,000 crores. Now there is a renewed interest that we are seeing from people. We have even bolstered our investor relation department. There is now a dedicated resource. Earlier, we had one gentleman who was handling the entire portfolio.

57:37 But now at the group level, decision has been taken that there will be an independent investor relation focus for each company. So we've also hired there is a gentleman by the name of Amit Sabarwal, who has joined us, who is just now present on the call. He's joined only a few weeks back. So from next call, you will be seeing and hearing more from him. And his primary focus is going to be an outreach to all these institutions and telling our story consistently. So far, I think there was this effort also was not in a very planned and concerted manner.

58:27 So that should make an impact. Yes. So just a thought continuing with your earlier point that in some of the project level, we can bring in some institutional investors similar like what our embassy has done in bringing in Blackstone in some of their project funding. I think we're bringing some PE fund and all will certainly boost the confidence on the company. AI is fine, but I unless we bring in some high level big PE funds into our into the equation, I think that that would help, sir. That is what we feel about this company. Yes. No, no. That's an extremely good suggestion. We will definitely work on it. Yes. Our next question comes from the line of Akshay Jawahar, an individual investor. I just had one question on the finance cost.

59:27 So the finance process for the annual report for FY 'twenty six has two components to it. One is the interest and term loans, which is about 50 odd crores, and there's about 35 odd crores, which is interest expense on dues to government. Could you elaborate on what is the interest expense on on dues to government? Because that, as I'm trying to calculate for q one, basically, the 9.6% math and everything worked out to a cost of about INR 20 crores. And the balance then is something that I'm not able to follow-up. So could you first explain what the interest expense on dues to government is? And then how the what is the cost for the current quarter of that? Use to government is nothing but the installments that the government gives us on the various approval costs.

1:00:18 Now the banks will not lend against that, and the government gives that facility to all the developers. And the cost of that is in the range of 8%, 9%, which is actually lower than what the banks would be offering. So it is quite attractive. And we also avail of that because that enables me to keep my ROCE high. Okay. And the full year cost, I think, including this would be broadly INR 100 to INR 120, including the plus or minus 10%, 20% that you're referring to? Yes, it should be. But we will share a better number. We'll disclose that. Just give us some time. I don't have it readily available here.

1:01:05 We will work out that number and put a disclosure out so that all of you have visibility of it. All right. Okay. Thank you. Thank you so much. Ladies and gentlemen, that was the last question for today. I now hand the conference over to Mr. Harmon Sani for the closing remarks. Thank you, and over to you, Mr. Sani. Yes. Thank you so much for being patient and listening to our narrative for Q1, and hope to see you for the next quarter. Thank you very much. Thank you so much, sir. Ladies and gentlemen, on behalf of that conclude this conference. Thank you for joining us and you may now disconnect your