GANESHHOU

Ganesh Housing reported robust Q3 FY25 results, with revenue surging 44% year-on-year to INR264 crores. EBITDA grew 57% to INR218 crores, achieving an impressive 83% margin, while PAT increased 60% to INR160 crores, with a 61% margin. For the nine months ended December 2024, revenues reached INR734 crores (19% growth), EBITDA INR589 crores (23% growth), and PAT INR433 crores (25% growth). This strong performance was primarily attributed to high-margin land sales, which constituted 90-95% of the quarter's revenue.

The company's competitive edge stems from its extensive, historically acquired land bank of 535 acres, which is fully paid for. This low-cost land base enables significantly higher margins when sold at current market prices. Management indicated a mixed strategy of developing and selling land, opting for outright sales when good prices are available. The Godhavi Township project, spanning 450 acres, is a key asset with an estimated sales potential of INR5,000 crores over a 7-10 year plan, with monetization scheduled to begin in Q2 FY26.

The Million Minds SEZ Phase I commercial venture is progressing ahead of schedule, with completion expected by the end of Q4 FY25 and possession for fit-outs by April-May 2025. This project is anticipated to generate annual lease rentals of over INR70 crores starting in FY26, with significant traction already observed. The Malabar Retreat residential project, launched in Q4 FY24, has achieved presales of over INR110 crores and is 22% complete, with a sample apartment expected soon to further boost sales.

Ahmedabad's real estate market is experiencing strong growth, with residential unit sales reaching a 10-year high in 2024, growing 15% year-on-year to 18,400 units. The mid-range segment (INR50 lakhs to INR1 crore) dominated sales, but the premium segment also saw an increase. Commercial office transactions surged 64% in 2024, driven by the city's evolving economic landscape and government support. Management noted a slight slowdown in demand in the last quarter but emphasized that prices continue to increase.

Ganesh Housing is actively scouting for new land acquisition opportunities in high-potential areas, particularly around Ahmedabad Ring Road corridors. While there are no immediate plans for geographic expansion outside Ahmedabad, the company remains focused on leveraging its land bank for high-value developments in residential and commercial segments. The potential to prepone Million Minds Phase 2 is 'almost certainly likely to happen' given the strong demand, indicating further expansion of its commercial portfolio.

The revision of Jantri rates in Ahmedabad is impacting project costs and causing developers to delay new launches, creating uncertainty in the market. Management acknowledged this but stated it's difficult to pinpoint the exact impact currently. Regarding shareholder returns, the company aims to maintain a dividend payout of more than 20-30%, similar to its previous payout. Dividend decisions for the next year will be finalized in the upcoming board meeting in May.