Sunteck Realty (NSE:SUNTECK) Q1 2027 Earnings Call

0:00 Ladies and gentlemen, good day, and welcome to Sunteck Realty Limited q one and FY twenty seven earning conference call. We have with us today, mister Kamal Khetan, the chairman and managing director of the company, mister Prashant Chawbe, the chief financial officer. Please note that this call will will be for thirty minute. And for the duration of the conference call, all participant line will be in the listen only mode. This conference call is being recorded, and the transcript for the same may be put on the company's website. After the management discussion, there will be an opportunity for you to ask question. There will be a q and a session, and we request you to restrict your question to two question only per participant. Should you need assistance during the conference call, please signal an operator by pressing star then 0 on your touch tone phone.

0:48 Before I hand the conference over to the management, I would like to remind you that certain statement made during the course of this call may not be based on historical information or fact and may be forward looking statement, including those related to business statements, plans, and strategies of the company. It is future financial condition and growth prospect. These forward looking statements are based on expectation and projection and may involve a number of risks and uncertainties and other factors that could cause actual results, opportunities, and growth potential to differ materially from those suggested by such statement. I now hand the conference over to Mr. Kamal Khetan from Sunteck Realty Limited. Thank you, and over to you, sir. A very good evening to everyone, and thank you for joining us today for our company's earnings conference call for the first quarter of FY twenty twenty seven.

1:46 I will keep my remarks brief and focused on the key developments of the quarter. We have made a good start to FY 2027. Presales for the quarter grew 20% year on year. Collections grew 17% year on year. And with the strong presales of the last few quarters, we expect collections to accelerate further through the year. The segment mix of our presales remains well balanced. Uber luxury contributed 29%, premium luxury contributed 50% and aspirational luxury contributed 21% of the quarter's pre sales.

2:31 This mix carries a high embedded EBITDA margin. The embedded EBITDA margin on both our FY twenty twenty six and Q1 of FY twenty twenty seven pre sales stands in the range of 35% to 40%, which will flow through to the reported profitability as the project reach revenue recognition. On reported financials, EBITDA grew 40% year on year with the EBITDA margin expanding by 9.5% to 35% and the PAT grew 26% year on year with the PAT margin expanding by 4.2% to 22%.

3:19 On the cash flow front, our net cash flow surplus grew 79% year on year. In spite continuing to invest in business development, our net debt to equity remains negligible at zero seven x, and our ratings a AA long term rating from India ratings of Fitch Group remains among the strongest in Indian real estate. We have consistently maintained that we run the business on cash flow, not accounting revenue. We have been sharing our total GDV numbers in our investor communication. But this year, we have broken down our total GDV into three components launched and to be launched, and the third is upcoming for launch GDV in order to help investors understand our business better.

4:21 Launch GDV indicates the projects that have received the relevant approval and have already launched. To be launched GDV indicates projects that are under the approval process, and the upcoming for launch GDV indicates projects that are in the planning and designing stage. Our existing GDV gives us several years of launch visibility without considering any new acquisitions. Now, at the outset, we would also like to take this opportunity to update you on our Dubai project. As we have shared earlier, we have all the required regulatory approval in place and the project is launch ready.

5:06 Only the timing of the launch has been recalibrated due to the ongoing situation. Finally, on sustainability, our GRESB score of 99 out of 100 with a green five star rating and our S and P Global DJSI ESG score of 78 out of 100 keeps us rated among the best in global real estate, well ahead of the benchmark average of sixty eight and thirty respectively. I shall now hand over the call to Prashant Chobbe to take you through the financial performance of q one f I twenty seven. Over to Prashant.

5:58 Thank you, sir. Good evening, everyone. I trust you have had the opportunity to go through our latest results and the investor presentation which are published on our company website and the stock exchanges. I would like to take this opportunity to share a brief update on the financial and operational performance of the first quarter of FY twenty twenty seven. The key details of operational and financial highlights are as follows. We sold INR $7.87 crores worth of area in quarter one of FY twenty twenty seven, which is a 20% growth over quarter one of FY twenty twenty six presales of INR $6.56...

6:50 INR 57 crores. The segment mix remained well balanced. Collections for quarter one of FY twenty seven stood at Rs. $40.09 crores, a growth of 17% over Rs. $3.51 crores in quarter one of FY twenty six. On the profit and loss front, operating revenue stood at INR191 crores for quarter one of FY27 as against INR188 crores in the same period last financial year. EBITDA stood strong at Rs. 67 crores in Q1 of FY27, 40% growth over Q1 of FY26.

7:40 EBITDA margin stood at 35%. Net profit of Rs. 42 crores which is 26% growth over quarter one FY twenty twenty six and net profit margin stood at 22%. We generated a net cash flow surplus of INR193 crores during the quarter, a growth of 79% over quarter one FY twenty twenty six after deploying INR170 crores towards business development and land related capital expenditure. Thank you. With this, we open the floor for questions. You.

8:26 Ladies and gentlemen, we will now begin with the question and answer session. Participants are request to use handsets while asking a question. Ladies and gentlemen, we'll wait for a moment while the question queue assembles. Our first question comes from the line of Harsh Patak with Motilaloswar. Please go ahead. Yeah. Hi. Thanks for the opportunity. Kamalji, just one question on the Dubai launch. So while while you highlighted that the timeline remains uncertain, is there a possibility this project will get launched in this financial or in FY '28?

9:18 Yeah. Good evening, Harsh. So, Harsh, we are very clear that we are as we shared earlier also, we have required all the required regulatory approvals are in place, and the project today remains launch ready. Only the timing of the launch has to be obviously recalibrated. We all know that's an ongoing situation, and we don't want to launch in such a situation. Just to recap, our land parcel is one of the most prime locations in the prime location, next to Dubai Mall in Burj Khalifa community, Downtown Dubai. So that is one very big advantage. Whenever the markets we are almost launch ready, and whenever the market is there, we will immediately launch. But the market is right, I mean to say.

10:14 And our land cost to GDP is very healthy, and there is no debt on the project. So we maintain that our earlier communication, once again, that project continues to remain highly profitable irrespective of the situation what we are. And just to bring it to your knowledge, our investment in Dubai, as on today on the project, is close to not more than 200 to $2.25 crores. So that is, again, a very and from that kind of investment, we are looking at such a large surplus cash flow which will be coming out. And we are definitely looking at this cash flow whenever it comes to bring bring it to India for the growth of it... Again, the growth of the company overall. Understood, sir. That's clear.

11:02 Coming to your launch pipeline, like you highlighted that you have broken down the GDV in three parts. So your to be launched GDV is close to 16,000 crores. Can you please break down what quantum can be launched in FY twenty seven and FY twenty eight, and which would be the key projects here? So to be launched GDV, if you go, that includes, obviously, INR 9,000 crores coming from Dubai projects. So if you remove that INR 9,000 crore, so to be launched, GDB is close to INR 8,370 crore or INR 7,100 crore, sorry, INR 7,100 crore close to. And which is like ODC, an additional tower in ODC, our Andheri redevelopment project near Western Express Highway.

11:53 Then what we are looking at Sunteck Park where Mira Road 2 Mira Road 1 is already ongoing, so we'll be launching now looking to launch the new project which we have acquired last year. And the Wasei, there will be one tower. We recently launched two towers, and we are targeting to launch one more tower this year. Then Ngaigaum, we are looking to launch again one or two towers. Again, we launched last year. Again, we are planning to launch this year again. So looking at all these things, if you see, this is all put together is close to INR 7,100 crores. Sure. So I believe this entire inventory will come into launch in this financial year. Anything Oh, yeah. Anything additionally that will be added to this launch pipeline, and what can we look for in the... For the next year?

12:44 So uncertainties definitely only related to... We can talk about Dubai because we don't know how long the situation will be there. Otherwise, all the other projects pipeline, what we are looking to launch this year is close to close to INR 7,000 crore, what we are looking to launch. Understood, sir. And so one last question. What is the growth guidance for the presales for this financial area? And maybe even for FY twenty eight also, if you can just throw some light. So looking at the project pipeline, Hajj, we are very confident that we'll maintain... Although this this quarter, we have done 20% growth in presales, but we are confident overall in the full year, we will match our expect what we have given the guidance of 25% to 30% growth in our presales considering the full year of 27%, we'll be at least 25% to 30% higher than the last year.

13:46 With such a strong pipeline, we are really very confident about it. Sure. And any new business there are looking Sorry to interrupt you, mister Patak, but you may please rejoin the queue for more questions. Thank you. Sure. Sure. Thanks. Thank you. Thank you. Our next question comes from the line of Reshet Shah with Axis Capital. Please go ahead. Yes. Thank you for the opportunity and good evening, sir. So couple of questions. So first, on the sales mix. So we... This quarter, we have seen a good increase in the sales coming from affordable segment as well as on the premium side, ODC, SBR, etcetera. So, I mean, on the aspirational luxury specifically, what led to this growth and similarly, some views on the premium luxury segment as well?

14:43 So aspirationally luxury, in fact, obviously, we are seeing the market getting improved because of the reason I feel is aspirational luxury is likely we feel is picking up because of the lower interest rate. And also some sign of recovery somehow we are seeing. And mainly it came basically, we see that coming from and both. Both are now giving, and we are very bullish on now Kalyan picking up more strongly. So obviously, we have a large GDV there, so we want to monetize as early as possible. So we are that two projects, obviously, both are in aspirational luxury only, those two.

15:28 It has come from both the projects. And when it comes to premium luxury, obviously Sunteck City Sunteck City in Gorena and Sunteck Skypark in Mira Road and the Sunteck Beach residences, SBR. All three contributed for this INR391 crores. And with coming quarter, we are again very confident because we'll be launching in this segment Sunteck Skypub two, which is the next acquisition what we have done, and also the Tower 2 in Sunteck City, which will be coming. So due to this, we see the growth picking up. And that's why we are confident that we will be able to achieve 25% to 30% growth in our presales for the FY27.

16:22 Sure. So just a follow-up. So launch that we had this quarter was just the SBR and nothing in the aspirational segment. Right? So... Yeah. So this quarter, we didn't do, any launch. In spite of this, we could do good aspirational luxury sales. Perfect. Perfect. Secondly, I mean, regarding the collections, so how are we looking at the collections overall for this full year? And can you give any guidance? And related to that, anything on the RERA approval for the Napiensi project? So proportionately, obviously, the collection has to grow. And I made the same remark in my speech, also opening speech. And obviously, the bigger collection will start happening once we start the construction of Nepensee Road.

17:14 That will definitely give us a big collection. But if you see trailing if you see, our collections are close to 1,500 crore, which is again stronger than the past twelve months. And this will continue to become stronger and stronger looking at the last few quarters what we have been doing the presales. Sir, would you like to attach some number to it for this year? We'll see a similar growth. I would say 25, 30% growth in the presales also. Yeah. Perfect. Thank you so much. Thank you. Thank you. Thank you, Ashish. Thank you. Ladies and gentlemen, in order to ensure that the management will be able to address all the question from the participant, we kindly request you to limit your question to two question only per participant.

18:10 If you have a follow-up question, please rejoin the queue. Thank you. Our next question comes from the line of Vasudev from Nuvama Wealth Management. Please go ahead. Yeah. Thank you for the opportunity, sir, and congratulations on a good set of numbers. So so my first question is how is our business development pipeline looking like? And in q one, we had a BD spend of about $1.70 crores. So for the full year, what is the amount estimated? So,, would you like to share? Yeah. Hi, Vasudev. For the $1.70 crores that we spent in quarter one is mainly for napi and c, Mirado two, and certain redevelopment projects. So that is where we have spent the 170 crores.

19:01 So with this spend, obviously, some had gone into redevelopment and some we have initially given as a token money. So we are... You will see some good acquisition BD announcements for sure. If you see last year also, it was like our highest spend on BD, what we did more than INR 800 crore in FY 2026. And we are looking to, in fact, surpass this number looking at our strong balance sheet and the markets and what we are already under negotiation or in the advanced stage. We are looking to spend definitely this year also much more than the last year for getting into... I mean, doing BD... More BD.

19:50 Okay. Sure, sir. And secondly, what projects are we looking to deliver in FY '27? What is the delivery pipeline looking at? So we are... This year, we are confident, one, we will be delivering our project SUNTECK one world and maybe some more new floors 4th Avenue. And there are some more new floors which will be done on the 1st Avenue, plus some additional floors even in Pinnacle. So all this will be constructed and delivered within this year. And this will give us additional sales as well from this project. And this will be a strong cash flow because once we launch the project, we'll be like these are the additional flows, so this will be completed in three to six months. So we are looking to monetize the... All this inventory in this current year itself. So this will be substantial, very large delivery.

21:03 Sure. So that's it from my side. I will join back with you. Thank you. Ladies and gentlemen, anyone who wishes to ask a question, press star and 1. Our next question comes from the line of Jaynam Shah with Equity Securities. Please go ahead. Yeah. Hi. Thanks for the opportunity. Sir, the first question is on the resolution that board has approved about the fundraising of around, let's say, two thousand plus year through debt and equity. Is it just the Hello? Sorry. Sorry. Sorry. Yeah. So will it... Is it just enabling resolution, or are we planning for some fundraising in the near term?

21:56 So this is obviously enabling resolution. And if you see every year, we take this enabling resolution. So that is... On today, if you ask me, there is absolutely no planning of any fundraising. Got it, sir. So just for the clarification, one part on the Dubai project, you said that it's ready for the loan. There is no approval or anything which is pending. Right? Yes. Yes. So, sir, just wanted to check on the presentation part. In the presentation, the table that we have given in which it has been included in the to be launched JDV, which is up around 16,100 CR. And when we write the thing... When we read the thing below the same to be launched regularly, it indicates projects which are under approval process. So has there been any... You can say change in the presentation part, or there is some approval which is pending? So both things are actually contracting.

22:47 No. No. I appreciate. Think this is slightly we'll have to edit that. I agree. I appreciate your comment. You're totally right. We should add, like, indicates projects which are to be on in the approval process or approved, which are to be launched. You're correct. I think we will have to edit that. Got it. Got it. On the commercial revenue part, we are seeing this INR79 million going up to INR450 million in the presentation part. So what's the status of the construction for the 5th Avenue ODC as of now and by when it is expected to get delivered? So 5th Avenue construction has already started residential and residential has already started. So we are looking to deliver that in three years from now.

23:36 And you are asking about commercial. So commercial, we are looking to start very soon. And once we start there, we are targeting because it's will be a commercial So we are looking to complete that in twenty four months... Twenty four to thirty months. Got it, sir. Got it. Yeah. That's it from me. Thank you so much. Sir. In you. Thank you. Thank you. Ladies and gentlemen, due to the time constraint, that was the last question for today. I now hand the conference over to the management for the closing remarks. Thank you, and over to you, team. Thank you all for taking the time out of your busy schedule to join us today for the call.

24:30 In case any of your queries have been left unanswered, please feel free to reach out to us. We truly value your continued support and look forward to strengthening this relationship. Thank you. Thank you so much, sir. On behalf of Sunteck Realty Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.