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Godrej Properties sees strong sales this year despite COVID-19; cash flow may pose challenges – Firstpost



New Delhi: Buoyed by file sales bookings of Rs 5,915 crore final fiscal, realty agency Godrej Properties expects to repeat its strong efficiency on sales entrance this year despite coronavirus pandemic, however sees cash flow as a problem as a consequence of sluggish development actions.

In an interview with PTI, Godrej Properties Executive Chairman Pirojsha Godrej mentioned there can be a slowdown within the trade however individuals who need to purchase properties throughout this time will definitely choose actual property firms with strong monetary capabilities to execute initiatives.

“Our sales bookings in the first two months of this fiscal have grown over the last year. Even during the last 10-15 days in March, we had quite a lot of sales,” he mentioned.

The nationwide lockdown was imposed from March 25 to curb the unfold of COVID-19, bringing development actions in addition to bodily sales to a grinding halt.

Godrej expressed confidence that the corporate would have one other good monetary year in sales perspective despite the present scenario.

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“We hope for a good performance this year as well. Hopefully, we can do even better than that,” he mentioned when requested about sales bookings outlook for the present fiscal.

The firm is witnessing numerous curiosity from potential consumers, notably non-resident Indians (NRIs).

Godrej Properties has been witnessing 10-15 p.c sales bookings by NRIs via digital route, he mentioned, including that this expertise helped the corporate so much throughout this lockdown interval.

Godrej, nonetheless, mentioned the cash flow scenario and pace of development can be difficult this year.

“Cash flows will be something that we need to focus a lot on. Its two months now, and barely any construction has happened. In this industry, cash flow is linked to achieving certain construction milestones,” he mentioned.

That mentioned, the corporate doesn’t have any liquidity points as round Rs 2,000 crore cash is within the stability sheet, with a wholesome debt-fairness ratio, Godrej acknowledged.

Asked concerning the general affect on the housing market, Godrej feels that the residential phase may not be severely affected, as extensively believed, despite the powerful financial state of affairs.

“Most people are expecting the residential segment to do extremely badly this year. My own view, while we have to wait and watch and that may be the case, I would not take that as a given,” he mentioned.

“Obviously financial sentiments are weak, folks can be considerably reluctant to commit for giant-ticket purchases. People are shedding jobs, wage cuts are taking place, so affordability will worsen.

“But, then again, the sort of safety residence possession presents, it turns into much more engaging in a pandemic like this,” Godrej noticed.

One must wait and watch to see the way it performs out between financial difficulties and having a safety of residence possession, he mentioned.

Godrej mentioned the federal government has taken quite a lot of measures on the availability entrance, however there’s a want for demand-aspect intervention. He instructed that stamp obligation/GST charges must be relaxed for the subsequent six months to encourage folks to put money into the property market.

On the launch pipeline, Godrej mentioned the corporate has not launched any new initiatives over the past two months and reasonably specializing in promoting inventories in current initiatives via engaging fee plans.

However, Godrej mentioned the corporate is holding on to its steerage to launch 15 million sq ft space throughout this fiscal year in comparison with 11 million sq ft within the earlier year.

He mentioned many of the launches may get bunched up within the second half of this fiscal year.

This is just not uncommon for the corporate, he mentioned, including that even over the past fiscal year, its fourth-quarter sales bookings had been thrice larger than the primary-quarter sales.

“We can make up for the lost time in the second half,” he mentioned.

Godrej Properties has acquired many initiatives, both outright buy of land or via joint ventures with landlords, within the final three years throughout main cities — Delhi-NCR, Mumbai, Pune and Bengaluru.

“We have a strong portfolio. Our focus now will be launching these projects and generating cash flows from these projects,” Godrej mentioned.

However, he didn’t rule out buying extra initiatives if there are good alternatives within the present market scenario.

“The sector was already facing a crisis. The coronavirus outbreak is a double whammy to the sector. Overall, the sector will have sharp liquidity issues. The process of consolidation will become faster,” he mentioned.

Meanwhile, Godrej Properties, the true property arm of enterprise conglomerate Godrej group, posted a internet revenue of Rs 267.21 crore on a turnover of Rs 2,914.59 crore over the past fiscal year.

On the operational entrance, Godrej Properties” complete sales bookings rose to Rs 5,915 crore final fiscal year from Rs 5,316 crore within the earlier year, presumably the best reserving worth achieved by any publicly listed actual property developer in India in FY20.

Updated Date: Jun 01, 2020 16:44:09 IST

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