Ashiana Housing To Launch 4 New Projects In The Next 12 Months: Varun Gupta, Whole Time Director

Ashiana Housing To Launch 4 New Projects In The Next 12 Months Varun Gupta, Whole Time Director

Varun Gupta, Whole Time Director, Ashiana Housing Ltd., talks about Q1FY22 numbers, price hike plans, consumer sentiments, ongoing and upcoming projects, sales trend, revenue potential, pre-operating cash flows, to the geographical presence among others during a candid chat with Mansee Dave, Zee Business.

Q: What are the highlights of the quarter and what is your outlook on it?

A: Our outlook is positive. There has had a reported loss in this quarter but the sales, i.e., the units have been booked stands at 1.50 lakh square foot but during a COVID lockdown, we were happy that we were able to sell at least 1.50 lakh square foot as in the corresponding quarter of the last year, we were able to sell only 80,000 square foot. The cash flows continue to be positive. I believe that the next five is likely to be very good for the company and the real estate industry. From the second quarter onwards, we are increasing the price of the flats and we haven’t faced any problem in increasing the price till date. The price is also getting stabilized in the market and the volumes will be significantly increased in the second quarter. So, we are overall positive, and we will face difficulties in the reported numbers because of profits are reported on delivery and the profits will be reported from the next year. 

Q: You have talked about the price hike. Can you provide some detail about it, i.e., the way the price hike is expected to be done and the areas where the price hike will take place? 

A: We are seeing a price rise in each location and the price rise in the first quarter has been in the range of 2-6%. Averaging around 3% increase in the second quarter is what we are looking at. I think, you may get a chance to see an 8-10% price increase on an annual basis across the projects – maybe it will not happen in one to two projects – but generally, it is likely to be seen everywhere. 

Q: How is the consumer sentiment at present and what kind of footfall is being seen and do you think that the price hike will be accepted well by the consumers? 

A: Consumer sentiment is quite positive, footfalls are positive, our enquiries are very good, site visits are very good, and we see the price rise. For the consumers, the affordability for the middle-class customer to buy a home is good at present. Never before in my career of 14 years, there has been such an opportunity in which the interest rates were these low, the real estate price rise average has not changed in the last six years, people salaries have increased, so to buy the same home the EMI to income ratio is at an all-time low for a particular house. I see, the consumers not only buying houses but buying bigger houses and our average size is increasing. I feel, the consumer sentiment in residential real estate will continue to be positive. 

Q: Can you update us about the increase in your expenditure and raw material cost as the trend of increase in the prices of cement and steel is continuing. How are the expenses for you?

A: We expect that the construction cost will increase by 10-15% on the cost value. That is there and majorly steel and cement prices have a contribution in the input cost increase. But I believe that the way the residential real estate is looking, the increase in the sales price of apartments will be a lot more than the increase in the input cost of construction. 

Q: Let us know about your ongoing projects and also about the upcoming project pipeline?

A: As far as ongoing projects are concerned, as of now, the 41-lakh square foot is under construction, and we want to launch another 15-lakh square foot (approx.) this year in various phases in greenfield projects. Outside of this 41-lakh square foot, we have a very strong pipeline as we have a land bank of around 1 crore square foot including future projects. In this, we are seeing the launch of four big projects in the next 12 months from today of which one is Ashiana Gamma in Bhiwadi, which is a senior living of approximately 13-14 lakh square foot. In sector 93, Gurgaon, we have taken up a new project and have named it Ashiana Hamara, which will be 21 lakh square foot. There are two projects in Pune that we have signed up for, one for senior living and one for regular housing and both will be 21 lakh square foot. So, these four projects together will provide a volume of around 55-60 lakh square foot and we are trying to launch these four projects in the next 12 months. We are in the process, either they are submitted for approval, or we are in the process of preparing documents for approvals going ahead. 

Q: If we will talk about the first and the second wave, then how was the situation during the first wave and how you managed it during the second wave? Also, how are the current sales trends and future revenue potential?

A: As I said earlier, in the first quarter of this financial year we sold 1.50 lakh square foot, while we sold just 80,000 square foot in the first quarter of the last financial year. So, I would like to say that the second wave, which didn’t saw a nationwide lockdown but a state-specific lockdown, did much better for us than the first wave which saw a nationwide lockdown in the first quarter. As I said, the sentiment of the consumers remains good, we see upside in revenues in booking and everything. So, not this year but in the next financial year (FY23), we should report a revenue of Rs 600 crore as per our delivery pipeline, which is more than twice the revenue that was recognized in FY21. As per me, the industry and company’s outlook are positive and strong. 

Q: Your pre-operating cash flows have been positive at 29.6 crores for Q1FY22. If you can throw some light over it and the liquidity position?

A: In this quarter again though it was the lockdown quarter for a lot of states, we were still able to do construction. The construction work done by us helped in raising the demand in the existing customers, which led to a lot of positive operating cash flows. Our cash position, liquidity and net debt position are in a very good situation. The balance sheet is liquid, and we want to use this liquidity as well to acquire more projects and want to create a pipeline to create more growth in the company. 

Q: You have a sound position in Jaipur and Jamshedpur markets. Tell us about your plans to increase your presence geographically going ahead? Also, if you can bifurcate your preference into various housing segments (Comfort home, Senior living, Kid centric). Where do you see the maximum opportunity?

A: Locationally, we will focus on six locations, namely Pune, Chennai, NCR – mainly in Bhiwadi and Gurgaon, Jaipur and Jamshedpur. As a sector, the Senior Living Sector has the largest potential for the company going forward because competition is less in the segment and our expertise is high in it. Also, we create value for the customer and ourselves in that sector. So, a large part of the growth pipeline I see will come from the senior living sector. But we have also worked on comfort homes and kid-centric homes as well as big projects and will continue to do so in the future as well. 

Source : Zee Biz

Related Posts

Realty developer M3M will develop 2 lakh square feet of retail space in Gurgaon, Sushant Lok, Sector 57, Gurugram. M3M...
Wish to buy a lavish home? You need to check these top 5 High Rise Apartments in Gurgaon. Gurgaon is...

About us

We are a real estate consultancy firm working in Gurugram & Delhi/NCR with a global mindset, bringing together exciting real estate developments and investment opportunities under one roof. All our services are delivered with professionalism and politeness.

This website is in the process of being updated. by accessing this website, the viewer confirms that the information including brochures and marketing collaterals on this website are solely for informational purposes only and the viewer has not relied on this information for making any booking/purchase in any project of the company. Nothing on this website, constitutes advertising, marketing, booking, selling or an offer for sale, or invitation to purchase a unit in any project by the company. The company is not liable for any consequence of any action taken by the viewer relying on such material/ information on this website.

All trademarks, logos, and names are properties of their respective owners. All Rights Reserved.Ⓒ Copyright 2020-21  © Property in Gurugram  Blog

ENQUIRE NOW

NO BROKERAGE | BEST DEAL Guaranteed

ENQUIRE NOW