Godrej Properties: Exiting launch pipeline

Godrej Properties: Exiting launch pipeline

Mumbai-based Godrej Properties reported muted earnings in the December quarter inspite of sales improving by 25% year-on-year basis. It’s topline and bottom line performance was marred by limited new launches and subdued revenue recognition.
The company, which is seen among the key beneficiaries of the temporary stamp duty cuts in Maharashtra, launched three new projects/phases in Q3FY21. However, to tap into the improving consumer sentiment, the company has planned a slew of new launches.

The company aims to launch around 12 projects in Q4FY21 spread across nearly 8million square feet.
In order to fund its construction activity, the company’s board has approved a resolution for fundraising up to Rs 3,750 crore though various modes including a qualified institutional placement. Though long-term, the company will not shy away from taking net gearing, a key debt metric up to 1 times.
In the December quarter, the company’s net-debt increased by Rs 340 crore sequentially, to Rs 3,080 crore. It’s net gearing at 0.64 times was at a seven-quarter high.
Meanwhile, the company expects profits to improve as the projects acquired/launched in recent years enter revenue recognition from late FY22/FY23.

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