Macrotech to double its investment in construction to ₹2,800 crores in FY22
Realty firm Macrotech Developers will double its investment on construction to ₹2,800 crore in this fiscal to speed up works at various projects which were hampered last year due to the COVID-19 pandemic and a nationwide lockdown.
Mumbai-based Macrotech Developer, earlier known as Lodha Developers, is one of the leading real estate firm in the country. The company got listed on the stock exchange last month after successful launch of its ₹2,500-crore initial public offering (IPO).
In an interview with PTI, the company’s Managing Director (MD) and Chief Executive Officer (CEO) Abhishek Lodha said the company remains bullish on the real estate sector, especially the residential property market, despite the second wave of the pandemic.
He added that the housing demand has been slow during April-May, but it is likely to pick up from the next month.
“Sales are happening but there is an impact as prospective homebuyers cannot go for site visits because of the restrictions on movement.”
Lodha said the company will mainly focus on the development of residential and warehousing properties in the Mumbai Metropolitan Region (MMR) and Pune over the next few years.
Like e-commerce sector, he said these two segments have gained importance during this pandemic.
Asked about the investment on construction during the last fiscal, Lodha said the company’s construction spend stood at around ₹1,400 crore.
“In the current fiscal year, our construction spend is estimated at about ₹2,800 crore,” he told PTI.
Lodha pointed out that the total expenditure on construction declined last fiscal as works on the projects sites were impacted for almost six months.
The company delivered 2.7 million sq ft area last fiscal year as against 15.7 million sq ft in 2019-20.
“In 2019-20, our construction spend was north of ₹3,000 crore, which is our normal annual run rate,” he said.
Asked about sales bookings, Lodha said the company clocked pre-sales of about ₹5,970 crore during the last fiscal year.
About 90 per cent of pre-sales came from the residential segment and that too in affordable and mid-income category, while 10 per cent contribution was from land monetisation in warehousing and industrial space.
In the 2019-20 fiscal, the company’s sales bookings stood at ₹6,570 crore.
On debt, Lodha said the company’s net debt stood at around ₹16,000 crore at the end of the last fiscal.
“Our net debt is likely to come down to around ₹12,000 crore at the end of the April-June quarter with the help from the IPO proceeds and fund infusion by promoters,” he said.
Lodha said the company will continue to trim its debt number.