Kolte - Patil Developers Limited — Q3 FY25 earnings call

Call held 12 Feb 2025

Management summary

Kolte-Patil Developers reported strong operational and financial performance for Q3 and 9M FY25, achieving record sales bookings and collections. Revenues and profitability saw significant year-on-year growth, driven by higher deliveries and improved realizations. While the annual pre-sales guidance was marginally impacted by regulatory delays in Mumbai projects, the company remains confident in its long-term targets and robust business development pipeline, focusing on scalable projects and a capital-light model.

Highlights

  • 9M FY25 Sales bookings reached ₹2,161 crore.

  • 9M FY25 Collections stood at ₹1,729 crore, marking a 17% year-on-year growth.

  • Q3 FY25 pre-sales value was ₹680 crore from 0.81 million sq ft.

  • Q3 FY25 average realizations improved by 11% YoY to ₹8,394 per sq. ft.

  • 9M FY25 Revenues were ₹998.7 crore, an 18.18% increase from ₹845.1 crore in 9M FY24.

  • Q3 FY25 EBITDA was ₹25.5 crore, a significant improvement from a loss of ₹36.7 crore in Q3 FY24.

  • 9M FY25 PAT was ₹41.3 crore, a turnaround from a loss of ₹42.3 crore in 9M FY24.

  • Unsold inventory stands at 3.75 million sq ft, valued at approximately ₹2,500 crore.

Key financials

2 periods

Q3 FY25

  • Pre-sales Value
    ₹680 Cr
  • Average Realization
    ₹8,394/sqft
    YoY +11%
  • Revenue
    ₹349.7 Cr
    YoY +361.3%
  • EBITDA
    ₹25.5 Cr
  • PAT
    ₹25.3 Cr

9M

  • FY25 Sales Bookings
    ₹2,161 Cr
  • FY25 Collections
    ₹1,729 Cr
    YoY +17%
  • FY25 Revenue
    ₹998.7 Cr
    YoY +18.2%
  • FY25 EBITDA
    ₹69.5 Cr
    YoY +19.8%
  • FY25 PAT
    ₹41.3 Cr

What they filed

Q1 FY27: revenue up 1475.0%, net profit up 1235.7% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue277 299 462 56 117 −58%249 −17%236 −49%882 +1475%
EBITDA20 25 62 -28 -33 −265%13 −48%-5 −108%189 +775%
Net profit10 29 33 -14 -7 −170%20 −31%-1 −103%159 +1236%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Guidance & targets

Pre-sales

  • Annual Pre-sales Guidance Pre-sales · FY25 · Medium confidence moderate marginally

    Previously about Rs. 3,500 crores → moderate marginally

    in a few of the projects in Mumbai, we see a couple of delays in approval, which may moderately impact our sales guidance.

    — Atul Bohra

  • Three-year Pre-sales Target Pre-sales · next 3 years · High confidence Rs. 13,500 crores
    Three years target, I think we are in line with our long-term horizon because see, these are the temporary delays like maybe a quarter, or two, nothing beyond that.

    — Atul Bohra

Launches

  • GDV of Launches Launches · FY25 · Medium confidence ~Rs. 5,000 crore
    Moving on to the launches – We are hopeful of launching projects with the GDV of ~Rs. 5,000 crore in FY25.

    — Atul Bohra

Business Development

  • Business Development Pipeline Business Development · FY25 · High confidence Rs. 8,000 crores
    we are quite hopeful that the guidance for business development for this financial year of Rs. 8,000 crores, we will achieve.

    — Atul Bohra

  • Geographic Focus (Pune) Business Development · High confidence 70%
    we are guiding like 70% should be Pune, 30% growth has to come from Mumbai and Bangalore.

    — Atul Bohra

  • Geographic Focus (Mumbai & Bangalore) Business Development · High confidence 30%

    — Atul Bohra

Profitability

  • Adjusted EBITDA Margin Profitability · going forward · High confidence early teens

    From 12% - 12.5% today

    in terms of adjusted EBITDA margin, it is 12% - 12.5%. And going forward, this margin will continue to improve. And we see that as we have already discussed, even over our last call, that we see that in early teens.

    — Atul Bohra

  • Project Level Margins (Outright) Profitability · High confidence 25% to 28%
    So the projects which are typically on the outright basis and where we invest on the land, we expect a margin of around 25% to 28%.

    — Atul Bohra

  • Project Level Margins (JV/Redevelopment) Profitability · High confidence 14%, 15%
    even though the margins looks around 14%, 15%, but the IRRs are better in these kind of projects, wherein specifically on joint development and redevelopment sector.

    — Atul Bohra

  • IRR Target (Capital-light model) Profitability · High confidence 20%, 25%
    we target somewhere around 20%, 25% of IRR on those kind of transactions

    — Atul Bohra

Revenue Recognition

  • Annual Revenue Recognition Revenue Recognition · FY25 · High confidence Rs. 1,600 crores to Rs. 1,800 crores
    the guidance of revenue recognitions as well as on the EBITDA side, we have already explained, that's roughly around Rs. 1,600 crores to Rs. 1,800 crores is what we are targeting.

    — Atul Bohra

Finance Cost

  • P&L Charged Finance Cost Finance Cost · by the FY '25 year-end · High confidence Rs. 48 crores to Rs. 50 crores

    From Rs. 36 crores today

    we foresee by the FY '25 year-end, it is as of now already Rs. 36 crores, but somewhere around Rs. 48 crores to Rs. 50 crores should be charged to P&L.

    — Atul Bohra

Risks & concerns

  • Project approval delays in Mumbai

    medium

    Regulatory approval delays, partly due to elections and EC committee, are impacting Mumbai project launches in Q4 FY25.

    Management acknowledged

  • Moderation of FY25 presales guidance

    medium

    Due to Mumbai project delays, the initial FY25 presales target of Rs. 3,500 crores will be marginally impacted.

    Management acknowledged

  • Timing of operational updates

    low

    Analyst noted that results are published post 15-20 days of quarter end, suggesting potential internal MIS challenges, which management committed to improving.

    Analyst acknowledged

Areas of evasion (1)

  • Promoter buyback/valuation

Q&A highlights

2 direct
Presales guidance (annual and 3-year) and EBITDA margins Partial
in a few of the projects in Mumbai, we see a couple of delays in approval, which may moderately impact our sales guidance. ... Three years target, I think we are in line with our long-term horizon because see, these are the temporary delays like maybe a quarter, or two, nothing beyond that.

Reveals short-term challenges to annual presales targets due to regulatory delays, but management's confidence in long-term targets remains, along with clarification on adjusted vs. reported EBITDA.

Asked by Gautam from EverFlow Partners

Presales growth over FY24, Q4 EBITDA performance, and adjusted EBITDA definition Direct
first nine monthly we have already seen a growth of almost 4% and I hope that, that will continue in Q4, as Q4 always has better numbers, we will definitely see the growth in presale number. ... adjusted EBITDA is simply the EBITDA and added back our other income and the share of the profit from the joint venture company.

Confirms expected full-year presales growth and provides a clear, detailed definition of 'adjusted EBITDA,' addressing analyst confusion.

Asked by Rohit from iThought PMS

Strategy on land bank, project design, and customer relationship management Direct
our first strategy is scale, which is scalable projects... Number 2 is on the location. So we always foresee that there has to be a performing and upcoming locations only... And the third one is in terms of our financial closure strategies, like a few deals what we are targeting on the outright as well as in JV in order to maintain a healthy capital-light model... We are implementing quite a few things in the tech-based solutions of interacting with the customer.

Offers comprehensive insight into the company's strategic pillars for future growth, including project selection, financial models, and customer engagement initiatives.

Asked by Himanshu Upadhyay from BugleRock PMS

2 min read 6 chapters

Detailed narrative

Q3 & 9M FY25 Operational Performance

Kolte-Patil Developers reported strong operational performance for Q3 & 9M FY25. Sales bookings for 9M FY25 reached ₹2,161 crore, with collections at ₹1,729 crore, marking a 17% year-on-year growth. Q3 FY25 pre-sales value stood at ₹680 crore from 0.81 million sq ft, with average realizations improving by 11% year-on-year to ₹8,394 per sq. ft. The Life Republic township contributed approximately 1.5 million sq ft to sales volumes in 9M FY25, with realizations improving by 6% YoY.

Financial Highlights and Profitability

The company achieved its highest-ever 9-month revenues of ₹999 crore in FY25, compared to ₹845.1 crore in 9M FY24, an 18.18% increase. Q3 FY25 revenues from operations significantly increased to ₹349.7 crore from ₹75.8 crore in Q3 FY24. EBITDA for Q3 FY25 was ₹25.5 crore (vs a loss of ₹36.7 crore in Q3 FY24), and for 9M FY25, it was ₹69.5 crore (vs ₹58 crore in 9M FY24). Net profit after tax for Q3 FY25 stood at ₹25.3 crore, and for 9M FY25, it was ₹41.3 crore, a significant turnaround from a loss of ₹42.3 crore in 9M FY24. Adjusted EBITDA margin for 9M FY25 was 12%-12.5%.

Business Development and Launch Pipeline

Kolte-Patil is actively building its business development pipeline, having recently signed a ~22-acre joint development project in Pune with an expected GDV of ~₹4,000 crore and a potential saleable area of ~5 million sq ft. The company is confident of achieving its FY25 business development guidance of ₹8,000 crore. While hopeful of launching projects with a GDV of ~₹5,000 crore in FY25, Mumbai launches are experiencing regulatory approval delays, which may moderately impact the annual pre-sales target.

Market Outlook and Strategic Focus

Management noted robust demand in Pune, Mumbai, and Bengaluru, with the residential real estate sector reaching new milestones in 2024. The strategic focus for business development is shifting, with an internal guidance of 70% from Pune and 30% from Mumbai and Bangalore, aiming for scalable projects in performing and upcoming locations. The company is also adopting a capital-light model, focusing on IRR-based transactions, particularly in joint development and redevelopment.

Project Economics and Margins

The company targets project-level margins of 25%-28% for outright land acquisitions and around 14%-15% for joint development and redevelopment projects, where the focus is more on achieving an IRR of 20%-25%. The adjusted EBITDA margin for 9M FY25 was 12%-12.5%, with management expecting it to continue improving towards 'early teens.' The company also clarified that adjusted EBITDA includes other income and share of profit from joint venture companies.

Unsold Inventory and Finance Costs

Kolte-Patil reported a total unsold inventory of approximately 3.75 million sq ft, valued at roughly ₹2,500 crore, with about 40% (₹1,000 crore) located in the Life Republic township. Management indicated that finance costs charged to the P&L are expected to be around ₹48-50 crore by FY25 year-end, up from ₹36 crore in the first nine months, with the remaining costs capitalized to Work-in-Progress.

This is an AI-generated summary of a publicly available earnings call transcript.
View original transcript

More Realty earnings calls