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Sobha Limited, a listed real estate developer, is undeterred in spite of sitting on a huge inventory of 17.21 million square feet.
“Overall, we have an unsold ongoing project inventory of 17.21 million square feet, which is adequate in the given market scenario,” JC Sharma, Vice-Chairman and Managing Director, Sobha Limited told BusinessLine .
“As on March 31, we have an unsold completed projects inventory of only 0.27 million square feet valued at ₹117 crore, which is probably the lowest in the sector. This speaks of our capability to sell the projects before completion. Committed receivables from sold units stands at ₹4,122 crore as of March 31, 2019. This ensures good cash inflow,” he added.
The unsold completed projects inventory includes, 0.12 million square feet of plotted development projects. “We have achieved 51 per cent sales on the area which is released for sales in the ongoing projects,” said Sharma.
Sharma said, “The real estate revenue has grown at a CAGR of 22 per cent since FY16. Our contracts and manufacturing verticals have witnessed a strong performance during FY18-19 with a revenue of ₹1,177 crore.”
“This is the highest ever revenue achieved by these verticals (contracts and manufacturing) . These verticals have grown at a CAGR of 24 per cent since FY 16 and the order book during Q4 FY 19 stood at ₹2,588 crore.”
Sharma said, “We expect our operational performance to improve in FY 19-20. Bengaluru market will continue to grow and is expected to remain the top contributor with contribution from other regions.”
Double digit growth
“In the last three financial years, we have achieved almost double digit growth and hope to continue the momentum in the coming financial year as well. Our liquidity position remains strong. All the banks/financial institutions continue to support our funding requirement of our ongoing projects. Our un-drawn sanctioned limit is sufficient to meet the cash flow requirements of the company,” explained Sharma.
Post GST/RERA regulations, Sharma said developers are becoming aware of their responsibility and working within their competencies. “Now they are realistic in offering the products at the right price point. This is facilitating speedy execution of projects and on time delivery, creating a win-win scenario for developers and home buyers. We are confident that the sector will witness a significant growth on a sustainable basis in this new liberalised post-reform era.”
Sharma stressing the need for industry status for real estate sector said, “Additionally, single window clearance for faster approvals has been a long-awaited demand of developers. Together, they will propel economic growth, creating more demand and supply of new homes.”
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