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Godrej Properties registered highest-ever quarterly sale of 1.6 million sq ft in the fiscal ended March 2011, despite concern over a slowdown in the realty sector due to increase in interest cost.
The company has registered a sale of 3.2 million sq ft in FY-11 excluding its share from the joint ventures which add up to another 0.8 million sq ft.
Mr Adi Godrej, Chairman, Godrej Group, said the sale in the fourth quarter was higher than all the three preceding quarters put together largely due to good demand for residential properties in Ahmedabad, Kolkata and Haryana (Gurgaon).
“There may be a slowdown in realty sales in Mumbai and part of Delhi, but we cannot judge the entire country based on this. About 50 per cent of the demand for residential property is in the range of Rs 2,500 to Rs 4,500 a sq ft,” he added.
The company has floated a special purpose vehicle for undertaking redevelopment projects in Mumbai. With scarcity of land in Mumbai, the Government should consider increasing the FSI (floor space index) from the current 1-1.5. Mark up in FSI with required infrastructure will boost supply and bring down the cost, making real estate more affordable for common man, said Mr Pirojsha Godrej, Executive Director, Godrej Properties.
India has a huge scope for rising FSI, considering that the fast growing countries such as Hong Kong and Shanghai has a FSI of 10 while it is 30 in Manhattan, the US, said Mr Adi Godrej.
To raise funds
The company plans to raise funds in next 18 months and may advance the fund raising programme if the demand remains buoyant.
The company has a huge scope to raise equity considering that 83 per cent of the ownership still rest with the promoters. However, the company will exhaust the debt option before considering any equity dilution, he said.
Allying fears that raise interest rate will slowdown realty sector, Mr Godrej said, it will only temper the aspiration of the buyers.
The company's net profit in the fourth quarter was up five per cent at Rs 60 crore (Rs 57 crore), while sales doubled to Rs 318 crore (Rs 150 crore).
Full-year net up
For the fiscal 2010-11, net profit was up six per cent at Rs 131 crore (Rs 123 crore) and sales more than doubled to Rs 441 crore (Rs 215 crore).
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