Suraj Estate Developers Limited Q1 FY25 Earnings Conference Call Summary
Key Highlights
• Date: August 2, 2024
• Leaders: Rahul Thomas (Whole-Time Director), Shreepal Shah (CFO)
• Performance:
• Pre-sales value increased by 5.2% to Rs. 140 crores
• Revenue growth of 31%
• PAT rose by 107% to Rs. 30 crores
Market Overview
• Mumbai Real Estate:
• Thriving due to infrastructure projects and rising incomes
• Focus on luxury and value luxury segments
Financial Goals and Projects
• Pre-sales Target: Rs. 850 crores for FY25
• New Projects: Launching seven projects with a GDV of Rs. 1,150 crores
• Redevelopment Projects: Active engagement with significant potential in Mumbai
Q1 FY25 Financials
• Pre-sales: 27,431 square feet, Rs. 140 crores (5% increase YoY)
• Total Income: Rs. 134.6 crores (31% increase)
• EBITDA: Rs. 64.2 crores (36% growth)
• Operating Margin: Improved to 47.7%
• Debt Management: Average cost of debt reduced to 13%-13.5%
Business Development and Competition
• Pipeline: 9 lakh square feet ready for launch, targeting Rs. 1,150 crores
• Competition: Limited in the 33(7) project space, with Keystone as a notable competitor
Funding and Financial Strategy
• Funding Sources: Internal accruals, debt, and sales receivables
• Future Plans: Scale up pre-sales beyond Rs. 850 crores, maintain operating margins of 45%-50%
Joint Development Agreements (JDAs)
• Preference: Outright purchases preferred, JDAs considered on a case-by-case basis
• ROE Discussion: Clarified that ROE in JDAs may be higher, but approach varies
Conclusion
• Commercial Property Launch: Estimated GDV of Rs. 475 crores
• Investor Relations: Open for further inquiries post-call

Submission Details
• Date of submission: May 13, 2024
• Transcript of Analyst/Investors conference call held on May 9, 2024
• Submitted to: National Stock Exchange of India and BSE Limited
• Compliance: Required by SEBI regulations
Financial Overview
• Q4 FY24 Finance Costs: Included Rs 11 crores for redemption premium on future NCDs.
• Annualized Interest Cost: Estimated at Rs 60 crores for FY25 with debt levels at Rs 425 crores.
Company Profile
• Established: 1986
• Focus: Residential and commercial real estate in South Central Mumbai.
• Completed Projects: 42 projects totaling over 10 lakh square feet.
• Ongoing Projects: 13 projects with a developable area exceeding 20 lakh square feet, valued at INR 1,350 crores.
Market Performance
• MMR Absorption Rate: 14% annual rate from 2018 to 2023.
• Redevelopment Market: Strong presence, successfully rehoused over 1,011 tenants.
• Recent Developments:
• Favorable litigation resolution with GDV of INR 350 crores.
• New redevelopment project in Mahim with GDV of INR 120 crores.
• Suraj Lumina project expected GDV of INR 100 crores.
Sales and Inventory
• Sales Performance: Sold 489,000 sq ft out of 600,000 sq ft, generating INR 1,171 crores.
• Unsold Inventory: 121,000 sq ft with GDV of INR 631 crores.
• Future Receivables: Expected to reach INR 1,350 crores from FY'25 to FY'29.
• Upcoming Projects: 18 projects totaling over 900,000 sq ft, with plans for seven new launches in FY 24-25 (GDV of INR 1,150 crores).
Financial Highlights (FY Ending March 2024)
• Residential Segment Growth: 10.5% YoY, pre-sales of 107,136 sq ft valued at INR 483 crores.
• Commercial Segment: No pre-sales, total collections down to INR 316 crores from INR 346 crores in FY23.
• Total Income: Grew by 35% to INR 415.7 crores.
• EBITDA: Increased by 54.3% to INR 236.4 crores, operating margins at 56.9%.
• Profit After Tax (PAT): Surged by 111% to INR 67.5 crores.
• Debt Management: Repaid INR 285 crores, net debt reduced to INR 315 crores.
Future Plans
• Sales Target for FY25: INR 850 crores, with INR 200 crores from the commercial segment.
• Project Launches: Seven new projects planned for FY25.
• Project Costs: Estimated at INR 600 crores for ongoing projects.
• Debt Strategy: Maintain current levels, aiming to reduce interest costs from 14% to 12-13% by FY26.
Additional Insights
• Land Reserves: Significant reserves but prioritizing existing projects.
• Sales Receivables: Sufficient to cover completion costs.
• Margin Guidance: Targeting EBITDA margins around 55%.
• Future Financing: Considering raising INR 500 crores for future opportunities.
Conclusion
• Interest Loan: High-interest loan for Mahim land acquisition may be repaid early.
• Call Closure: Rahul Thomas thanked participants and invited further inquiries.