Shriram Properties Ltd. · NSE:SHRIRAMPPS
Shriram Properties — Q2 FY24 Earnings Presentation
50 slides from Shriram Properties's earnings presentation, November 2023
Slide 1: Shriram Properties Limited Corporate Presentation
Shriram Properties Limited Corporate Presentation November 2023 STRICTLY PRIVATE AND CONFIDENTIAL
Slide 2: SPL: An Introduction
SPL : An Introduction Top 5 c. 90% players in core markets of portfolio2 in Among the Top 5 in South India1 Affordable housing About Us Part of the well known c.9% Shriram Group of Equity held by globally and Mid Market renowned PE housing segment c. 22.4 msf c. 51 msf 3 c. 21 msf over 40 projects o
Slide 3: SPL: Significant Competitive Strengths
SPL : Significant Competitive Strengths Leadership in Core Focus on Mid Market Markets and Affordable Housing Strong Parentage and Established Beneficiary of RERA- Partnerships led industry consolidation Experienced & Asset Light Business Professional Model Management Team Demonstrated Execution Tra
Slide 4: Shriram Properties: The Journey so far
Shriram Properties (‘SPL’): The Journey so far… • Creation of credible residential real estate growth platform, over the last 2 decades – Among the Top-5 players in core markets of Bangalore, Chennai and Kolkata – Focused Mid-Market & Affordable housing player (88% of completed projects; 93% of Proj
Slide 5: Building Scale in the Post-RERA Environment
SPL – Building Scale in the Post-RERA Environment Sales Volume (msf) Sales Value (Rs. Cr) 4.0 3.8 1,846 3.6 3.2 3.0 1,432 1,482 2.4 1,244 1,173 1,149 1,066 1.9 1.3 472 FY17 FY18 FY19 FY20 FY21 FY22 FY23 H1FY24 FY17 FY18 FY19 FY20 FY21 FY22 FY23 H1FY24 Collections (Rs. Cr) Construction (Rs. Cr) EBITD
Slide 6: Demonstrated Capabilities in Project Execution
Demonstrated Capabilities in Project Execution Shriram Properties has delivered 40 completed projects | c.22.4msf of Saleable Area 2 Completed no. of projects Total saleable area for completed projects Significant project 7 area delivered in the 1 6 6.9 2 years before 5 COVID 4 4 4 3.5 3.8 2.4 1.8 1
Slide 7: H1 FY24 Performance Highlights
Budget Housing Budget Housing Property Awards of Best Gated Visionary Leader Integrated Best Efficient & Lifetime Most Admired Developer Project of the Community of the Sustainable Smart MD of the Year Project of the year – the Year Plotted of the year (1) Township Project of Achievement Upcoming Pr
Slide 8: Key Highlights & Developments – H1 FY24
Key Highlights & Developments – H1 | FY24 Operational Performance Project Execution • Sales volumes up 15% YoY; Sales Value up 43% YoY in H1. • Customer handover at 470+ units in Q2, pushing H1 • Successful launch of Shriram Esquire, Shriram Hebbal1, handover to 830+ units. Pre launch of Paradiso, a
Slide 9: Performance Snapshot: H1 FY24
Performance Snapshot: H1|FY24 Pre-Sales Volume (msf) Sales Value (Rs. Cr.) 2,330 14% 4.8 43% 1,066 1.9 1,846 4.0 1.7 747 494 1.3 +43% 605 1.0 +14% 1.7 1.9 107 747 H1FY23 H1FY24 FY23A FY24P H1FY23 H1FY24 FY23A FY24P Sales by Segment Sales by Dev. Model Sales by Region Others 1% Others DM 10% Kolkata
Slide 10: KPI Half-yearly Trends: H1FY24
KPI Half-yearly Trends : H1FY24 Pre-Sales Volume (msf) Sales Value (Rs. Cr.) 2.4 1,099 1,066 1.9 15% 43% 1.7 747 H1FY24 H1FY23 H2FY23 H1FY24 H1FY23 H2FY23 Gross Collections (Rs. Cr.) Construction (Rs. Cr.) 721 276 2% 272 13% 639 228 556 H1FY24 H1FY23 H2FY23 H1FY24 H1FY23 H2FY23 Continuing growth mom
Slide 11: Performance Snapshot: Q2 FY24
Performance Snapshot: Q2|FY24 Sales Volume (Msf*) Sales Value (Rs. Cr.) Collections (Rs. Cr.) Construction (Rs. Cr.) +48% +32% +48% +12% 1.15 146 QoQ Trends 608 430 0.78 459 291 131 Q1FY24 Q2FY24 Q1FY24 Q2FY24 Q1FY24 Q2FY24 Q1FY24 Q2FY24 +8% +37% YoY Trends +14% +40% 146 608 430 135 1.15 435 315 1.0
Slide 12: Launch Outlook & Launch updates
Launch Outlook & Launch updates FY24 Launches Impressive Sales-at-Launch Launch Sold at Projects Type Launch % sold Area launch 48% 44% 44% Shriram Esquire New May’23 1,31,870 57,835 44% 38% 34% Shriram Hebbal 1 New May’23 1,44,328 63,750 44% Shriram Paradiso New Sep’23 6,07,243 ^^ ^^ Average Sales-
Slide 13: Encouraging Response to Ongoing Launches – New Phases
Encouraging Response to Ongoing Launches – New Phases ✓ Shriram Esquire, Koramangala, B’lore (Apartments) - Exceptionally strong launch response - EOI since Apr’23; Formal Launch in May’23 - 75,000+ sft - Nearly 57% sold already ✓ Shriram Pristine Estates, Bengaluru (Plots) - New Phase (premium plot
Slide 14: Encouraging Response to Ongoing Launches – New Projects
Encouraging Response to Ongoing Launches – New Projects ✓ Shriram Paradiso, Chennai (Apartments) - Launch efforts commenced during End-Sep’23. - Encouraging initial response. - Likely to boost Q3 sales volumes ✓ Shriram 122 West (Apartments) - Pre launch activities under full swing - EOI to commence
Slide 15: Encouraging Pricing Trends: Realisation up 14%
Encouraging Pricing Trends: Realisation up 14% from Mar’23 levels Price Increase by Project – Top Projects only Avg. Portfolio Price increase Trends % chg. Project Development Type Sep'23 from Sep'22 (H1) FY'23 (H1) FY'23 Shriram 107 Southeast -Phase 3 Apartment 4,175 4,300 5,055 18% 14%* Shriram So
Slide 16: Project Execution Trends: H2FY24 Handover Readiness
Project Execution trends: H2FY24 Handover Readiness % work Project Name Total Area RERA date % sold Project Current Status done Shriram Greenfield Phase II 7,04,355 30-Dec-23 100% 83% OC Ready, Handover by Dec’23 Chirping Wood Tower 5 2,20,740 30-Mar-24 99% 94% FIRE NOC applied & OC Application stag
Slide 17: Financial Highlights | Q2FY24
Financial Highlights | Q2FY24 o Earnings growth exhibits a consistent and remarkable upward trajectory. o Healthy quarterly improvement since IPO/Q3FY22 continues; Driven by improving operating leverage and project execution. o Revenue recognition momentum strong, helped by robust execution and hand
Slide 18: Financial Highlights: Profit & Loss | Q2 & H1FY24
Financial Highlights : Profit & Loss|Q2 & H1FY24 H1FY24 Particulars (Rs. Crores) Q2FY24 Q1FY24 QoQ (%) Q2 FY23 YoY (%) H1FY24 H1FY23 YoY (%) FY23 EBIDTA Total Revenues 231.3 157.2 47% 275.9 -16% 388.5 420.9 -8% 813.9 Rs. 118.6 Cr Cost of revenue 120.8 60.7 185.8 181.5 257.5 453.2 Employee benefit ex
Slide 19: Financial Highlights (contd.): Profit & Loss | H1 FY24
Financial Highlights (contd.): Profit & Loss|H1 FY24 ❑ Total Revenues marginally lower in H1, but has grown sequentially between quarters (Q2 vs Q1). • Higher base of H1/Q2 last year impacted YoY growth - Shriram Southern Crest (B’lore) received OC in Q2FY23. • H2 Revenue growth will be stronger wit
Slide 20: Financial Highlights (contd.): Profit & Loss | Q2 FY24
Financial Highlights (contd.): Profit & Loss|Q2 FY24 ❑ Sequential growth trends encouraging (Q2 vs Q1 FY24): • Total Revenues higher by 47% QoQ – at Rs.231crs. • Catch-up in registration & handover lost in Q1 due to Kaveri2.0 snag issue and continued registration in recently completed projects. • DM
Slide 21: Financial Highlights: Consolidated Cash Flows
Financial Highlights: Consolidated Cash Flows | Q2 & H1 FY24 (Excl. DM & JV cashflows) Amount in Rs. Crores Q2FY24 Q1FY24 H1 FY24 H1 FY23 FY23 Collection Trends SPL Own & JDA / JVs / DM Collections 171 139 310 273 524 DM Income 26 70 97 37 57 Other Inflows 1 0 1 0 1 430 1,194 721 Operating Inflow 19
Slide 22: Financial Highlights: Balance Sheet | H1FY24
Financial Highlights : Balance Sheet|H1FY24 Particulars (INR Cr) 30-Sep-23 31-Mar-23 ROCE Trends (%) 11% 12% Fixed Assets 82 81 10% Investments and loans 187 153 7% Inventories 2,635 2,221 5% Cash and Bank Balances 100 120 Other Assets 1,028 1,068 Total Assets 4,024 3,643 FY20 FY21 FY22 FY23 FY24e L
Slide 23: Ongoing efforts to reduce debt and cost of debt
Ongoing efforts to reduce debt and cost of debt Gross & Net Debt trends Debt Equity Ratio* Cost of Debt (%)** Cr. 13.7% 700 656 0.7 12.5% 600 86 553 11.9% 532 11.4% 481 500 120 100 400 141 0.4 0.4 0.3 300 569 200 432 432 341 100 - Mar-21 Mar-22 Mar-23 Q2FY24 Mar'21 Mar'22 Mar'23 Sep'23 Mar'21 Mar'22
Slide 24: Growth Outlook Going Forward
Budget Housing Budget Housing Property Awards of Best Gated Visionary Leader Integrated Best Efficient & Lifetime Most Admired Developer Project of the Community of the Sustainable Smart MD of the Year Project of the year – the Year Plotted of the year (1) Township Project of Achievement Upcoming Pr
Slide 25: Residential Real Estate Sector: Strong Undercurrent Continues
Residential Real Estate Sector: Strong Undercurrent Continues… Growth momentum strong despite ambivalent global economy * KEY EMERGING TRENDS – Largely remain intact • Top-7 City sales at decade high - 1.20 lac units, Up 36% YoY • Housing affordability favorable, Rate hike impact minimal • Supply gr
Slide 26: SPL's Core Market Trends
SPL’s Core Market Trends • Positive absorption trends in SPL’s core markets Pricing & Segment wise Trends 2023– Core Markets Bengaluru Chennai Kolkata • Remarkable drop in inventory levels, at a near decade low − Chennai & Kolkata among lowest across Tier-1 cities − Bengaluru inventory levels have r
Slide 27: Key Strategies
Key Strategies 6 1 Leverage established Stay focused on mid-market and relationships with financial affordable housing investors for growth funding 2 5 Continued focus on core Build scale and enhance markets of South India execution capabilities 4 3 Unlock value from ongoing Enhance focus on Develop
Slide 28: Encouraging Earnings Visibility for H2FY24
Encouraging Earnings Visibility for H2FY24 A. FY24 Revenues: 5 projects to account for 90% of projected revenues in H2FY24 and are under control Key Projects Occupancy Certificate status Sale Deed Registrations Over 6.8 lacs sft registered. Grand One Partial OC Received Registrations to gain further
Slide 29: FY24 Outlook | Context & Strategic Objectives
FY24 Outlook | Context & Strategic Objectives Strategic Objectives ➢ Sustain growth momentum: Target 20%+ CAGR in sales over the next 2-3 years ➢ Ensure sustained profitability; Positive net earnings with Improving profitability and returns; and ➢ Progress towards ‘Zero Net debt’ objective FY24 Cont
Slide 30: Strong Income Recognition Outlook (FY24-25e)
Strong Income Recognition Outlook (FY24-25e) Sales Volumes (msf) 4-year cumulative sales of 14msf Completed 3.8 msf in FY23 To Hand over ~2,000 units Handover in ~3,000 units in FY24 4.0 FY23 3.8 3.2 3.0 Project Completion Trend (msf) # units handover 2,093 2,885 2,280 2,000+ ~8,000 FY20 FY21 FY22 F
Slide 31: Project Pipeline Update – September'23
Project Pipeline Update – September’23 Project Pipeline (msf) Upcoming – 18 msf # projects Msf 8.6 51.1 Ongoing – 24 msf 5.3 42.5 Pipeline – March’23 53 52.9 2.1 10.6 Less: Projects Completed (4) (1.8) 3.0 13.0 Pipeline – September’23 49 51.1 8.5 Ongoing Ongoing Ongoing Upcoming Upcoming Upcoming Su
Slide 32: Unlocking Potential from Kolkata
Strategies for Unlocking Potential from Kolkata Progressing Well Kolkata Development Strategy Own development of c.10msf over next 3-5 years Monetising remaining land bank c.22msf Development Status Update Monetisation Update ❑ Shriram Grand-1: (2 msf, almost entirely sold) • FSI sale progressing we
Slide 33: Shareholding Pattern as at 30th September 2023
Shareholding Pattern as at 30th September 2023 Category No.of Holders % Share Holding Pattern as at 30 September 23 Promoters 3 28% Private Equity Investors 1 10% Promoters Institutional Investors 23 9% Public 28% 28% Body Corporates 401 25% Public 74,161 28% PE Investors 10% Body Corporates Institu
Slide 34: Investment Summary
Investment Summary 8. Access to Capital 1. Corporate Governance ➢ Strategic relationships with domestic and ➢ Shriram Group DNA and marquee investor international financial investors presence for a decade contribute to strong ➢ Early recipient of FDI in the sector governance and transparency practic
Slide 35: SPL footprints in emerging Micro-Markets
SPL footprints in emerging Micro-Markets Whitefield Micro Market: Sahakarnagar/Kodigehalli Domlur Micro Market: • Shriram Spurthi Started in – 2003 Micro Market: • Shriram Spandhana Started - | Completed in 2005 | Whitefield • Shriram Shreyas Completed 2004 | Completed - 2006 | • Shriram Samskruthi
Slide 36: Thank You
THANK YOU 35
Slide 37: Back-up Slides
Budget Housing Budget Housing Property Awards of Best Gated Visionary Leader Integrated Best Efficient & Lifetime Most Admired Developer Project of the Community of the Sustainable Smart MD of the Year Project of the year – the Year Plotted of the year (1) Township Project of Achievement Upcoming Pr
Slide 38: Annexure-1: Projects Snapshot by Development Models
Annexure-1: Projects Snapshot by Development Models Development Own Developments Joint Developments Joint Ventures Management Execution Track Record Execution Track Record Execution Track Record Execution Track Record Completed Completed Completed Completed ✓ 7 projects ✓ 23 projects ✓ 3 projects ✓
Slide 39: Annexure-2: Development Model Business Dynamics
Annexure-2: Development Model Business Dynamics Land Project Launch & Execution Delivery Financials Developement Ownership Project & Approval Branding Sales & CRM Project Delivery & RERA Maintenance Overall Economics Revenue Construction Costs Marketing Costs Debt & Interest Costs Free Cashflow Shar
Slide 40: Annexure-3: Business Model Dynamics
Annexure-3: Business Model Dynamics Range of Services offered by SPL under DM Model DESIGN APPROVALS SALES MARKETING CONSTRUCTION CRM HANDOVER MAINTENANCE Development Capital Scalability Return Risk Rewards to LO Risk to LO Model Intensivity Own Low High High High Least/NA Least/NA JDA Moderate High
Slide 41: Our Project Presence: Bangalore
Our Project Presence: Bangalore 40
Slide 42: Our Project Presence: Chennai
Our Project Presence: Chennai 41
Slide 43: Our Project Presence: Kolkata
Our Project Presence: Kolkata 42
Slide 44: Back-up Slides: FY23 Performance
Budget Housing Budget Housing Property Awards of Best Gated Visionary Leader Integrated Best Efficient & Lifetime Most Admired Developer Project of the Community of the Sustainable Smart MD of the Year Project of the year – the Year Plotted of the year (1) Township Project of Achievement Upcoming Pr
Slide 45: Key Highlights & Developments: FY23
Key Highlights & Developments: FY23 Operational Performance Project Execution • Sales volumes at 4.0 msf (net) - a new high for SPL • Handed-over 2,000+ units/plots - new record for SPL • Highest-ever sales, both Volume and Value • Completed 7 projects- 3 resi. & 4 plotted; TSA* of 3.8msf • Realisat
Slide 46: Financial Highlights: Profit & Loss | Q4 & 12M FY23
Financial Highlights : Profit & Loss|Q4 & 12M FY23 Particulars (Rs. Mn) 9M FY23 Q4 FY23 FY23 FY22 YoY (%) Total Revenues 6,430 1,710 8,139 5,178 57% Total Revenues Rs. 8,139 Mn Cost of revenue 3,899 633 4,532 1,823 Employee benefit expense 595 193 787 730 57% YoY Other expenses 560 431 991 807 Total
Slide 47: Financial Highlights: Balance Sheet | FY23
Financial Highlights : Balance Sheet|FY23 Particulars (Rs Mn) 31-Mar-23 31-Mar-22 ROCE Trends (%) 11% Fixed Assets 813 823 10% Investments and loans 1,526 1,810 7% Inventories 22,208 21,882 5% 4% Cash and Bank Balances 1,204 1,405 Other Assets 10,679 10,418 FY19 FY20 FY21 FY22 FY23 Total Assets 36,4
Slide 48: Financial Highlights: SPL CFS Cash Flows | Q4FY23
Financial Highlights: SPL CFS Cash Flows | Q4FY23 (Excl. DM & JV cashflows) Gross Collection Trends 9M Q4 (In Rs Mn) FY23 FY22 SPL Own & JDA / JVs / DM FY23 FY23 Collections 3,853 1,390 5,243 5,346 12,631 DM Income 455 117 572 721 11,943 Other Inflows 5 2 7 6 2,506 3,578 8,871 Operating Inflow 4,313
Slide 49: Key Highlights & Developments – Q2 FY24
Key Highlights & Developments – Q2 | FY24 Operational Performance Project Execution • Sales volumes up 14% YoY; Sales Value up 40% YoY in Q2. • Customer handover at 470+ units in Q2, pushing H1 • Successful pre-launch of Shriram Paradiso, Chennai. handover to 830+ units. 2 phase launches done with e
Slide 50: Key Highlights & Developments – Q1FY24
Key Highlights & Developments – Q1FY24 Operational Performance Project Execution • Highest-ever Q1 sales, both in terms of volumes and values • Handed over 350+ units in Q1, despite slowdown in registration since Apr’23 (Election / Kaveri 2.0 issues) • Sales volumes up 17% YoY ; Value up 47% YoY in