August 18th: Macrotech Developers Ltd, presenting as the Lodha brand, reported a 43.5% increase in net debt during the first quarter of the fiscal year 2024-25. According to the company’s investor presentation, net debt rose to ₹4,320 crore as of June 30, 2024, compared to ₹3,010 crore at the end of March 2024. The increase was attributed to higher investments in land acquisition and construction as the company seeks to expand its real estate portfolio.
Despite the significant rise in debt, the company’s debt-to-equity ratio remains at a manageable 0.24 times equity, well below the company’s limit of 0.5 times. Managing Director and CEO Abhishek Lodha emphasized that the business continues to generate strong cash flows, which will accelerate in the second half of the fiscal year as construction activities ramp up.
The company also highlighted a reduction in its average cost of funds by 30 basis points, now standing at 9.1%, which provides some relief from the higher debt levels.
Operational Performance Shows Strong Growth
On the operational front, Macrotech Developers posted a 20% increase in sale bookings during the first quarter, totaling ₹4,030 crore, compared to ₹3,350 crore during the same period last year. The company expects to achieve a 21% annual growth in sales bookings for the current fiscal year, targeting ₹17,500 crore in pre-sales.
Collections from customers also rose by 12%, reaching ₹2,690 crore in Q1 FY25, up from ₹2,400 crore in the same period last year. The company’s strong operational performance is further evidenced by a 2.7-fold increase in consolidated net profit, which reached ₹475.3 crore during the quarter, compared to ₹178.4 crore in the year-ago period.
Total income for the quarter grew by 74%, reaching ₹2,918.3 crore, compared to ₹1,671.8 crore in the corresponding period last year, reflecting strong demand in the housing market, particularly in the Mumbai Metropolitan Region (MMR) and Pune.
Growth Strategy and Future Outlook
Macrotech Developers has set ambitious targets for the coming year. Having delivered around 100 million square feet of real estate to date, the company is currently developing more than 110 million square feet in its ongoing and planned projects. The company has also recently entered the Bengaluru market, further expanding its footprint beyond its strongholds in MMR and Pune.
Lodha highlighted the company’s focus on ramping up construction activities in the second half of the fiscal year, which is expected to boost free cash flow and operational performance. Despite the rising debt levels, Macrotech remains optimistic about its growth trajectory and is confident in meeting its sales targets for FY25.
