Godrej Properties has reported an exceptional fiscal year 2023, marked by robust business development. According to their annual report, the company has added an impressive 18 new projects, significantly boosting their revenue potential. Pirojsha Godrej, the Executive Chairperson of Godrej Properties, stated that these new projects represent a potential revenue of Rs 32,000 crore, marking a remarkable 250% increase compared to FY22.
Among the notable achievements for the past fiscal year is the company’s highest-ever collections, reaching Rs 8,991 crore, representing a substantial 41% increase. This surge in collections was driven by the successful completion of over 10 million square feet of projects.
Pirojsha Godrej outlined the company’s targets for FY23 in the annual report. Their primary focus for the upcoming year will be to surpass the Rs 14,000 crore mark in booking value while continuing to achieve record cash collections and project deliveries. Launching recently acquired projects in a timely manner will be a significant priority for the company. Godrej Properties aims to maintain its strong performance in sales and project deliveries.
In his statement, Godrej emphasized the continued growth of the residential sector in India, offering opportunities for leading developers to participate in sectoral growth and expand market share. He highlighted that these projects are instrumental in achieving the company’s goal of 20% annual sales growth while also providing opportunities to improve margins, aligning with their target of a 20% return on equity.
A recent report by Motilal Oswal highlighted Godrej Properties as the only developer to achieve a booking value of over Rs 20,000 crore annually in each of the four major markets of NCR, MMR, Bengaluru, and Pune. The NCR market particularly stood out as the top-performing region for Godrej Properties in FY23, driven by strong responses to new launches and consistent sales.
Notably, Godrej Properties’ stock has witnessed significant growth, with a year-to-date increase of over 36%. The report also mentioned the healthy margin profile of recent projects, indicating improved profitability prospects for the company. Projects like Hillside in Pune and Oasis in NCR, completed in FY21, generated impressive adjusted EBITDA margins of 30% and 23%, respectively.
Looking ahead, as the share of such profitable projects in the company’s portfolio increases, it is expected that Godrej Properties will report substantial improvements in profitability. The goal is to achieve a return on equity of nearly 13% by FY25, with the management expecting further improvement as their own projects are launched and completed in the medium term. The company’s business development mix has significantly favored its own projects since FY21, boasting an operating profit margin exceeding 25%. These projects are set to play a pivotal role in pushing the return on equity to the target of 20%.