We did highest net sales in real estate segment last year: Abhisheck Lodha
On the sidelines of project launch on the plot the company bought from DLF last year for Rs 2,727 crore, Abhisheck Lodha, managing director, Lodha group, talks to Raghavendra Kamath about the company and its strategy.
What is giving you the confidence to launch new projects when property market in Mumbai is down for a long time?
We are still doing good sales. Last year, we did net sales of Rs 8700 crore, which is highest in the country. This year, we are looking to cross those numbers. I think all credible players are doing well. Be it Tatas, Sobha or Prestige, everyone is doing good numbers.
How many apartments you handed over last year and how many you are planning to deliver this year.
Last year, we handed over 3000 apartments and this year, we will do 5500 apartments.
A rating agency said you have a debt of Rs 4750 crore on account of projects you have undertaken in the last couple of years.
Do you have sufficient cash-flows to service your debt.?
We have one of the healthiest debt to equity, debt to sales and debt to cashflows ratios. We will have cashflows of Rs 3000 crore in FY 2014 and we had Rs 2500 crore cashflows last year. I can no talk on the exact debt to equity ratio and total debt. We have the best credit facilities in the country and our average cost of funds ranges between 10.5% to12%.
Do have any plans to go public?
We do not have any plans. Why should we go for IPO when we have surplus cash-flows of Rs 3000 crore. What you do with public money?
Do you think you have gone overboard on land buying and launches especially when a couple of Mumbai developers have defaulted on payments?
We feel ultimately we are in the business of buying land, building properties and selling it. Our land buying, sales and construction/deliveries are in perfect sync. We are strong position because we bought land at very good rates. When we did deal with DLF, we bought the property for Rs 5,500 a sq ft while people were buying land for Rs 15,000 to Rs 20,000 a sq ft.
Tell us about the project on land bought from DLF?
We got applications worth Rs 5,500 crore the project ‘The Park’ which was earlier code-named at ‘Blue Moon’. We accepted applications worth Rs 3,500 crore. WE launched two towers and sold 700 apartments. Average sales realization was Rs 28,000 per sq ft in that project. People would have got returns of over 20% since the pre-launch.
Source : Business Standard
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