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Informist, Friday, Apr. 25, 2025

--Macrotech Developers: Target annuity income of INR 1,500 billion by FY31 
--CONTEXT: Macrotech Developers mgmt's comments in post-earnings analyst call 
--Macrotech Developers: Aim to raise annuity income by INR 4 billion in FY26 
--Macrotech Developers: Target INR 210-bln presales in FY26 
--Macrotech Developers: Target EBITDA of INR 65 bln in FY26

By Avishek Rakshit and J. Navya Sruthi

KOLKATA/MUMBAI – Macrotech Developers Ltd. is targeting to grow it presales by 19% to INR 210 billion in the ongoing financial year which will help the company maintain an embedded operating margin of 33% and deliver an earnings before interest, tax, depreciation, and amortisation of INR 65 billion, Managing Director and Chief Executive Officer Abhishek Lodha said Friday.

"We expect to generate over INR 75 billion of operating cash flow, and in terms of net debt, we expect to be very below our ceiling of 0.5 times that of equity," Lodha said in a call with analysts after declaring its financial results for the quarter.

In real estate parlance, pre-sales refer to sales before a project is fully constructed or completed. This involves securing commitments from potential buyers with an initial payment before construction is complete. This helps developers secure funding, gauge market demand, and demonstrate project viability. The EBITDA, which is generated from such pre-sales, is termed as embedded EBITDA, and the margin from such embedded EBITDA is called embedded EBITDA margins. 

The company, which is focusing on the upper mid-income, high-income and luxury housing segments, is targeting to add around INR 250 billion of gross development value in the ongoing financial year. 

If the company maintains the projected embedded operating margin of 33%, it would translate into an embedded EBITDA of INR 69.3 billion in 2025-26 (Apr-Mar), up by 17.5% on year. In FY25, Macrotech Developers reported a presales of INR 176.3 billion. 

Lodha said the company is also aiming to increase its annuity income by INR 4 billion in FY26 from the current level of INR 250 billion. The company is targeting an ambitious INR 1,500 billion from annuity income by FY31, up six times from the level in FY25. "We are continuing to grow our annuity business. This is through our significant focus on the street infrastructure, which is warehousing and industrial space, where we now have a leased area of over 2.1 million square feet with occupiers such as Sketchers, DP World, DHL, Mitsui, Schlumberger, and others," Lodha said. 

Macrotech Developers Chief Sales Officer Prashant Bindal said the company is aspiring to increase its conversion rate to 8.5% from 8% in FY25. "In year 24-25 (FY25), we had 88,000 customers coming to our site, leading to almost 7,000 bookings. And for the first time, we reached a much-desired conversion rate of 8%. Just to give you an idea, three years back, we had a conversion rate of about 6.5%, which we have been increasing significantly from 6.5 to 7 to 7.5 and this year to almost 8%," Bindal said. In the current financial year, Bindal is targeting to increase the sales walk-ins to 93,000 customers.

The company said it has concluded the pilot phase in Bengaluru successfully and is currently in the growth phase. "We are expecting to have five or more projects operational in Bangalore in the course of the current fiscal year, and we expect to start a pilot in one more city, which, of course, will take two to three years before it moves into the growth phase," Lodha said.

The Mulund-Airoli-Palawa freeway is expected to be operational in the current fiscal year, Lodha said. "There has been a delay in its operationalisation on account of certain technical issues of tunnel collapsing, but that has all been resolved now." Friday, shares of Macrotech Developers ended 1.1% lower at INR 1305.10 on the National Stock Exchange. The company had announced its Jan-Mar earnings after market close on Thursday. End

Edited by Saji George Titus

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