Sunteck Realty Limited · NSE:SUNTECK
Sunteck Realty — Q3 FY2022 Earnings Presentation
45 slides from Sunteck Realty's earnings presentation, Feb 10, 2022
Slide 1: Exchange filing cover letter
Sunteck Realty Ltd. Sunteck SRL/SE/61/21-22 Date: 10 th February, 2022 The Manager, Listing Department The Secretary, Listing Department, National Stock Exchange of India Ltd Department of Corporate Services Exchange Plaza, BSE Limited Plot no. C/1, G Block, Phiroze Jeejeebhoy Tower, Bandra-Kurla Co
Slide 2: Sunteck Realty Limited Investor Presentation Q3 & 9M FY2022
Sunteck Realty Limited Investor Presentation Q3 & 9M FY2022 NSE: SUNTECK | BSE: 512179 | Bloomberg: SRIN: IN | Reuters: SUNT.NS / SUNT.BO
Slide 3: Disclaimer
Disclaimer By attending the meeting where this presentation is made and any additional material is provided (“Presentation”) or by reading the Presentation, you (“Recipient”), agree to be bound by the following limitations. This Presentation has been prepared on the basis of the estimates of the man
Slide 4: Agenda
Agenda ▷ Who are we ▷ What have we achieved ▷ What we aspire for ▷ Key Numbers ▷ Risk Factors ▷ Industry Insights ▷ Awards ▷ Summary 3
Slide 5: Who are we
Who are we 4
Slide 6: Executive Summary
Executive Summary ▷ NSE and BSE listed organization with development focus in the Mumbai Metropolitan Region (MMR) market. ▷ One of the largest developer in the Western Suburbs of MMR from Bandra to Virar. ▷ Delivered projects worth > US$ 1 bn (~Rs 8,000 cr) GDV till date. ▷ Presently have ~50* mn s
Slide 7: Mumbai (MMR) presence
Mumbai (MMR) presence One of the largest developer on Western suburbs with ~18.1 mn sq ft of balance development Expanded to Eastern suburbs with ~12.1 mn sq ft of balance development By Project Brands By Location Volume ~5 msf ~12 msf Eastern Western Eastern Suburbs Suburbs Suburbs ~2.6 msf Western
Slide 8: Company Overview
Company Overview Real Estate Developer with 2 Decades of Experience MMR-focus residential play and pivot from high-end luxury segment towards mid-income & affordable segment Luxury Mid-income Affordable Across segments (Aspirational luxury) BKC, Borivali E, ODC, Borivali W, Vasai W, BKC Airoli Goreg
Slide 9: Our Brands
Our Brands Premium positioning by creating different luxury brands across all the segments Presence across the pricing spectrum from uber- luxury to affordable 8
Slide 10: Our Partnerships
Our Partnerships Partnership with Ajay Piramal Group - India REIT private equity invested at Signature Island in 2006 and exited at >20% IRRs within ~3 years - 50:50 JV - Piramal Sunteck Realty Pvt. Ltd. (PSRPL) formed in 2007 to undertaken multiple projects Partnership with Kotak Group - Kotak Real
Slide 11: Board of Directors
Board of Directors 200+ years of combined experience across real estate, banking & finance, law & compliance Kamal Khetan Atul Poopal V P Shetty Mukesh Jain Rachana Hingrajia Chaitanya Dalal Sandhya Malhotra CMD Executive Director Ind. Director Ind. Director Director Ind. Director Ind. Director - 1s
Slide 12: Shareholding Pattern
Shareholding Pattern *Nil shares are pledged ▷ Market Cap - ~Rs. 7,447 crore / ~ US$ 993 million (31st Jan, 2022) US$ 1 = ~Rs 75 11
Slide 13: What have we achieved
What have we achieved 12
Slide 14: Well-timed Capital Allocation
Well-timed Capital Allocation ~36 mn sq ft of projects acquired since 2018 Of which, ~23 mn sq ft acquired since the onset of COVID-19 pandemic Net Debt/Equity @0.16x at the end of H1FY22 highlights fiscal discipline Strong land acquisition track-record, post- Lehmann crisis years (peak recession) 1
Slide 15: Net Debt/Equity discipline
Net Debt/Equity discipline ▷ Despite acquisitions of 36 mn sq ft since 2018, the leverage discipline has been maintained ▷ No compromise on financial prudence and fiscal discipline 2.00x 1.80x 1.60x 1.40x ~36 mn sq ft of projects acquired since 1.20x 1.04x 2018 Of which, ~23 mn sq ft has been ac
Slide 16: Equity fund raising done judiciously
Equity fund raising done judiciously ▷ Sunteck has raised external equity twice through QIP in 2009 (~Rs 150 cr) and 2017 (~Rs 500 cr) ▷ Since 2007, cumulative equity fund raising account for ~28% of FY21 Networth Networth break-up Equity fund raising - QIP & Others 28% Reserves & Surplus 72% 15
Slide 17: Completed Projects
Completed Projects 13 (residential+commercial) projects delivered worth over Rs 8,000 crore (>US$ 1 bn) Signature Island, BKC Signia Isles, BKC Signia Pearl, BKC Signia High, Borivali E Signia Oceans, Airoli Signia Skys, Nagpur Sig. Waterfront, Airoli Gilbird Hill, Andheri W S. City Avenue 1, ODC S.
Slide 18: Completed Commercial Projects
Completed Commercial Projects Sunteck Kanaka, Goa Sunteck Center, Vile Parle E Sunteck Grandeur, Andheri E
Slide 19: Ongoing Projects - Residential
Ongoing Projects - Residential ~6 mn sq ft of execution underway, of which, ~2 mn sq ft nearing completion
Slide 20: Ongoing Projects - Commercial
Ongoing Projects - Commercial ~6 mn sq ft of execution underway, of which, ~2 mn sq ft nearing completion Sunteck BKC 51, BKC Jn. Sunteck Icon, BKC Jn. Sunteck Crest, Andheri E Pinnacle, ODC
Slide 21: Key Performance Highlights (FY18 - FY21)
Key Performance Highlights (FY18 - FY21) Delivering sustainable operational growth and operating margins Average Pre-sales Collections EBITDA CAGR CAGR Margin (18-21) (18-21) (18-21) ~20.25% ~13.68% ~35% *Company follows project completion method of accounting Rs 1 cr = Rs 10 mn 20
Slide 22: Operational Performance Trend
Operational Performance Trend Pre-sales mix & Collections efficiency ▷ Pre-sales mix has pivoted from Luxury to Mid-Income and Affordable segment. ▷ Collections Efficiency has improved to 81% in 9MFY22 against 76% in FY21 Pre-sales mix Collections efficiency (Collections/Pre-sales) 100% 6% 8% 4% 12%
Slide 23: ESG Performance Highlights
ESG Performance Highlights Environmental Social Governance ‘Go Green’ CSR campaign Support for migrant labourers and Philosophy on code of Digital transformation to reduce frontline workers following the governance resource consumption COVID-19 outbreak Policy framework consisting of Rai
Slide 24: What we aspire for
What we aspire for 23
Slide 25: Embarking on Sunteck 3.0
Embarking on Sunteck 3.0 ▷ Sunteck 1.0 journey was initiated as a Business Center Operator in 2000 and after 6 years with the acquisition of the Signature Island, BKC – under Sunteck 2.0 – the company grew into a pure play RE developer with projects in BKC and ODC, Goregaon W. ▷ The salient aspects
Slide 26: Existing Growth Engines of Sunteck 3.0
Existing Growth Engines of Sunteck 3.0 Sunteck’s strategy is to enter markets underpenetrated by organized players and bet big to realize attractive returns 2006 Residences tapped back in 2006-2009, when looked as CBD BKC Took huge bet and developed Uber luxury apartments via Signature Island
Slide 27: Future Growth Engines of Sunteck 3.0
Future Growth Engines of Sunteck 3.0 The launch and execution of these new growth engines will scale up the sales engine of Sunteck 2020 ~50 acres acquired with a development potential of ~5 mn sq ft Vasai W Est. GDV of ~Rs 5,000 crores in the coming 6-7 years Tap big demand potential of hithe
Slide 28: Development Potential & Launch Timelines
Development Potential & Launch Timelines ▷ Est. Gross Sales Visibility of ~Rs. 28,600 (~US$ 3.8 bn) crores from the 6 (six) growth engines Estimated Project Already Balance Beyond Projects Sales Q4 FY22 E FY22-23 E FY23-24 E Size Launched Potential FY24 E Visibility (~ mn sq ft) (~ mn sq ft) (~ mn s
Slide 29: The 'Sunteck' approach to 'Continuous Growth'
The ‘Sunteck’ approach to ‘Continuous Growth’ ~23 msf acquired since the onset of Estimated GDV of acquisitions is ~Rs. the COVID-19 pandemic. 28,600 cr (~US$ 3.8 bn). In the last 3 years, the company has The monetization of these projects will acquired ~36 msf. lead to continuous growth in
Slide 30: ~US$ 3.8 billion, ~36 million sq ft, ~0.16x
~US$ 3.8 billion Est. Gross Development Value (GDV) of upcoming project pipeline ~36 million sq ft Across 6 projects at BKC, ODC, Naigaon, Vasai West, Kalyan- Vasind, and Borivali West in MMR ~0.16x One of the lowest Net Debt/Equity ratio across the sector US$ 1 = Rs 75 29
Slide 31: Pre-sales growth multiple to improve
Pre-sales growth multiple to improve On the back of new project launches ▷ The phase-wise launch of new projects at Vasai West, Kalyan-Vasind, Borivali West and new phases of existing projects such as Sunteck City ODC and Sunteck World Naigaon could be a tailwind for sales growth. 1,800 1,022 588 Rs
Slide 32: Key Numbers
Key Numbers Operational Performance and Financial Statements 31
Slide 33: Operational Snapshot
Operational Snapshot INR 800 cr INR 649 cr 9M FY22 +23% y-o-y +41% y-o-y Pre-sales Collections INR 352 cr INR 270 cr Q3 FY22 +29% q-o-q +30% q-o-q Pre-sales Collections Rs 1 cr = Rs 10 mn
Slide 34: Operational Performance Trend (Quarter-wise)
Operational Performance Trend (Quarter-wise) Both pre-sales and collections are GROWING on a sequential (quarterly) as well as yearly basis Pre-sales (Rs cr) Collections (Rs cr) 1000 800 800 700 649 800 651 600 500 459 600 400 400 349 352 253 270 272 300 207 200 172 176 200 141 200 101 65 100 0 0 Q1
Slide 35: Key Financials
Key Financials ▷ In Q3 FY22, Revenue from operations stood at Rs 128 cr (Rs 1,281 mn) and Rs 357 cr (Rs 3,572 mn) for 9MFY22 ▷ EBITDA for the quarter stood at Rs 35 cr (Rs 346 mn) and Rs 92 cr (Rs 917 mn) for 9MFY22 ▷ EBITDA margin stood at 27% and 26% for Q3 FY22 and 9M FY22 respectively BALANCE SH
Slide 36: Superior Credit Rating
Superior Credit Rating ▷ Sunteck has Top Tier Credit Profile which is a Testimonial for its Strong Fundamentals. AA- / Positive AA- / Stable ▷ Key Rating drivers are – ○ Healthy track record in real estate development in MMR ○ Adequate committed cash flow visibility ○ Prudent Financial Policies; Str
Slide 37: Risk Factors
Risk Factors 36
Slide 38: Risk Factors
Risk Factors ▷ Impact of COVID-19 pandemic on overall economy and real estate sector in particular is still being quantified and uncertain. ▷ Exposure to cyclicality in real estate business – the residential real estate sector have been adversely impacted by liquidity crunch, high inventory and subd
Slide 39: Industry Insights
Industry Insights 38
Slide 40: Improved Affordability
Improved Affordability ▷ Rise in income-levels and favourable demographics (66% of Indian population is less than 35 years of age) has led to best affordability in the last 25 years. ▷ MMR affordability has improved the most in the last 10 years since 2011. (Affordability = EMI/Income) Source: HDFC
Slide 41: MMR Dominates the Residential Real Estate Market in India
MMR Dominates the Residential Real Estate Market in India ▷ MMR both in terms of pricing and units sold is the largest micro-market in India. The average pricing at Rs6,787 per square feet is higher than other cities ▷ Over the past 5 years, the pricing in MMR has remained stable 60,000 MMR 6,787 MM
Slide 42: Home loan rates are benign
Home loan rates are benign ▷ Housing loan rates are at decadal lows, thereby improving affordability and savings on EMI. 11.0% 10.0% 10.0% 10.1% 10.2% 9.9% 9.5% 8.9% 8.7% 8.6% 8.6% 7.0% 6.5% FY12 FY10 FY11 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 9MFY22 41 Source: Bank data
Slide 43: Awards
Awards 42
Slide 44: Awards & Recognitions
Awards & Recognitions the Year - Real Estate v , \ v ) Entrepreneur Awards 2020 é > & 44 Most Trusted Brand “Dy N 2019 v v of the Year - N N bod ET NOW Real Estate Awards - 2019 Vv Vv Sunteck Realty 4 “we x (Zee Business Real ~) v Estate Leadership y v Award for v N v N uv Signia Waterfront bo Zee B
Slide 45: Thank You
Thank You Manoj Agarwal, Prashant Chaubey, CFO SVP-Corporate Finance & IR ir@sunteckindia.com 44