Puravankara Group to launch 11 residential projects across 5 cities in FY21
The company is expecting revenue of over Rs 6,000 crore from these 11 projects with an average realisation of Rs 7,500 per sqft from Purvanakara projects (2.67 million sqft) and Rs 5,500 per sqft from Provident projects (7.56 million sqft).
Bengaluru-based realtor Puravankara Group, plans to launch 11 residential projects with a total saleable area of around 10.23 million sqft this fiscal, even as the Covid-19 pandemic continues to impact the sector.
The company, which already launched two projects in the first quarter of the fiscal, plans to launch a total of six projects under the Purvanakara luxury brand and five under the Provident affordable housing brand.
“Real estate sector has been reeling under stress since the last few years and it has hit all the developers. However, there is demand for projects that offer the right size, right price and right location, and we are seeing a good response for that,” company’s managing director Ashish Puravankara told PTI.
The company is expecting revenue of over Rs 6,000 crore from these 11 projects with an average realisation of Rs 7,500 per sqft from Purvanakara projects (2.67 million sqft) and Rs 5,500 per sqft from Provident projects (7.56 million sqft).
Puravankara launched two projects, one each in Pune and Bengaluru, in the first quarter of the fiscal year through digital platform, and plans to continue with the “new normal” at least for the next few months.
Besides, the company also launched Purvanakara Atmosphere in Bengaluru during the June quarter, which it has not included in plans for FY2021 as the project was planned to be launched in March quarter, but had to be postponed due to the Covid-19 pandemic.
“Last quarter of FY2019 saw some good launches, but the same was insignificant in Q4 of FY2020 due to the Covid situation. Since we couldn’t launch Atmosphere in Q4, we had to push it to the first quarter of this fiscal,” Puravankara said.
“Also, since we received a good response for our digital launch, we plan to continue with the trend at least for next few months,” he added.
A total of four projects would be launched in Bengaluru, two in Mumbai, three in Pune, and one each in Chennai and Cochin.
When asked about the investments the company would make during the year for the proposed projects, Puravankara said, “These projects are coming up on land parcels which we bought in the past, while some are joint developments, and the financial closures have already being done in the past. So for the fiscal we would incur construction cost of around Rs 3,000 crore, which would be funded through a combination of debt and internal accruals.”
When asked if the company had reduced property prices to attract buyers, Puravankara said, “So far we have not resorted to any heavy discounts for any of our projects. However, we have offered price protection to the buyers for six months saying that if the company reduces its prices in future, they would get the benefit of the reduced prices.”
Speaking about the industry, he noted that since the total number of launches in the country have reduced significantly, the supply has also been affected to that extent, and therefore, there won’t be huge pricing pressure on developers.
“At the end of the day, law of economics will prevail. However, when we see from the point of view of cities and the micro markets within these cities, I feel there would be price correction, especially where the prices are unreasonably high,” Puravankara added.
Replying to a question on impact of shortage of migrant labourers on projects, he said, “Even though RERA has granted extension of deadlines for project completion, lack of skilled workers for specific jobs is a serious challenge. We are taking initiatives to bring them back.” “We are not just paying for their fares but also assuring them daily wages during their 14 days quarantine period,” he said.
The company reported a total income of Rs 2,187.26 crore and net profit of Rs 88.35 crore in FY20 as against total income of Rs 2,126.72 crore and profit of Rs 114.35 crore in FY19.
In the last four decades, Puravankara, which has presence in southern and western parts of the country, has completed and delivered more than 40 million sqft area.