New Delhi: Property firm Omaxe Ltd expects to generate revenue of Rs20 billion in the year to March 2011, and hopes to become a debt-free company in two years, a top official said on Thursday.
India’s property market has turned a corner in the last few months, recovering from lows hit earlier this year, as consumer confidence returns and banks offer attractive home loans.
The renewed activity in the housing market was helping the company, which sold Rs1 billion worth of homes in December alone, chairman and managing director Rohtas Goel told Reuters. “From April it (internal accruals per month) must be around 150 crore (Rs1.5 billion ). In FY10/11, we will receive almost 2,000 crore (Rs20 billion ) plus from internal accruals. And 3,000 crore (Rs30 billion ) in FY12,” he said.
Omaxe, which is expected to announce December quarter results later this month, reported net sales of Rs3.43 billion for the first half of the current fiscal and net sales of Rs8 billion for the year ended March 2009. The company’s net sales for three months ended September ‘09 were Rs2.23 billion.
It did not give any guidance for the current fiscal.
New Delhi-based Omaxe has 40 ongoing housing projects in 30 cities including Noida, Lucknow, Allahabad, Indore and Jaipur and plans to launch two 125-acre townships in Indore and near Chandigarh during the current quarter, Goel said.
Omaxe is also building three more mega township projects in the northern state of Uttar Pradesh and expects them to be top revenue-generators for the next 5-7 years.
Its just-launched project at Allahabad has generated sales of Rs1.8 billion and the three townships together will generate revenue of Rs30 billion in three years, Goel said.
“The focus will be on housing. Our aim is to boost sales by keeping prices stable,” he said.
Looking to be Debt Free
Goel said the company’s internal accrual would be sufficient to retire in two years its entire debt of Rs16.50 billion , but it might also look at a qualified institutional placement (QIP).
“If market conditions are favourable and conducive ... if the (stock) price is around 150 rupees, definitely we will go for a QIP,” he said, adding the company could look at raising Rs8 billion via share sales to institutions.
“We are ready (for a significant stake dilution),” Goel, who owns about 90% of the company, said.
Omaxe has no loan repayment due in the current fiscal year that ends in March, but will have to repay Rs3.50 billion during the next fiscal year.
The company, which has a landbank of 4,500 acres, is not thinking of buying fresh land until it becomes debt-free, Goel said.