Man Infra — Q4 FY24 earnings call

Call held 15 May 2024

Management summary

Man Infraconstruction Limited reported a strong Q4 and FY24, achieving a lifetime best PAT of ₹300 crores, reflecting 16% YoY growth, driven by robust project deliveries and strategic acquisitions. The company maintained a net cash positive position with significant cash reserves, enabling future growth and project acquisitions. Management outlined an ambitious pipeline of new launches and a total revenue visibility exceeding ₹15,400 crores over the next 5-6 years, emphasizing a focus on high-margin luxury and DM model projects.

Highlights

  • FY24 Profit After Tax (PAT) reached a lifetime best of ₹300 crores, reflecting a 16% growth YoY.

  • FY24 Profit Before Tax (PBT) Margin stood at an impressive 29.2%, with PAT Margin at 22.1%.

  • Consolidated revenue from operations for FY24 amounted to ₹1,263 crores, with total income at ₹1,360 crores.

  • The company achieved FY24 collections of ₹1,197 crores, surpassing ₹1,000 crores for the second consecutive year.

  • Man Infra is Net Cash Positive, holding ₹741 crores in cash and bank balance as of March 2024, with secured debt reduced to ₹23 crores by May 10, 2024.

  • Acquired 27.5 lakh square feet of carpet area in Mumbai in FY24, contributing to a total revenue visibility of over ₹15,400 crores in the next 5-6 years.

  • Targeted launch for FY25 includes 11.5 lakh square feet of carpet area with a sales potential exceeding ₹4,250 crores.

  • The EPC order book stands at ₹823 crores as of March 2024, with 86% from infrastructure projects.

Key financials

2 periods

Headline

  • Total Income
    ₹1,360 Cr
  • Revenue from Operations
    ₹1,263 Cr
  • PAT
    ₹300 Cr
    YoY +16%
  • PBT Margin
    29.2%
  • PAT Margin
    22.1%
  • FY Collections
    ₹1,197 Cr
  • Cash & Bank Balance
    ₹741 Cr
  • Secured Debt (March 2024)
    ₹123 Cr
  • Secured Debt (May 2024)
    ₹23 Cr
  • EPC Order Book
    ₹823 Cr

Q4

  • Collections
    ₹376 Cr

What they filed

Q1 FY27: revenue up 4.0%, net profit down 1.6% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue71 86 131 99 58 −18%64 −26%65 −50%103 +4%
EBITDA14 20 21 27 11 −21%11 −45%13 −38%71 +163%
Net profit30 43 39 61 30 +0%30 −30%33 −15%60 −2%
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.

Segment breakdown

Share of Revenue
₹1,264 Cr Total
  • EPC Business ₹737 Cr 58.3%
  • Real Estate Business ₹527 Cr 41.7%

Guidance & targets

Profitability

  • Projected PBT from Marine Lines DM project Profitability · null · High confidence > ₹400 crores
    With 5.3 lakh square feet of carpet area, MICL is expected to achieve a projected PBT of more than Rs. 400 crores through a Development Management (DM) model in this project.

    — Manan Shah, Managing Director

  • Bottomline growth (average YoY) Profitability · next couple of years · Medium confidence 20-25%
    if you have been seeing the growth journey right, we have been growing on an average between anywhere 20% to 25% of a year-on-year growth in terms of the profitability. And if you want to be probably maintaining those kind of steady levels and probably with these kind of projects where the margins are higher and the market is very supportive in terms of the sales in absorbing growth, we are expecting better growth in the forthcoming couple of years.

    — Manan Shah, Managing Director

  • PAT target Profitability · over 5-6 years · Medium confidence ₹1,000-1,200 crores
    from Rs. 300 crores to go to maybe Rs. 1,000 - 1,200 crores over 5-6 years should not be a problem. That is what I am presuming? We are absolutely positive on that and we are hoping for the best.

    — Manan Shah, Managing Director

Debt

  • Balance preferential issue funds to be received Debt · July 2025 · High confidence ₹407 crores
    As of January 2024, we have received 25% of the allotment money, which is Rs. 136 crores with the balance expected to be received by July 2025.

    — Manan Shah, Managing Director

Revenue

  • Total revenue visibility Revenue · next 5-6 years · High confidence > ₹15,400 crores
    Overall, we have a total revenue visibility of over Rs. 15,400 crores in the next 5 to 6 years.

    — Manan Shah, Managing Director

  • FY25 targeted launch sales potential Revenue · FY25 · High confidence > ₹4,250 crores
    In FY25, we expect to launch another 11.5 lakh square feet of carpet area with sales potential exceeding Rs. 4,250 crores.

    — Manan Shah, Managing Director

  • Yearly pre-sales Revenue · yearly basis · Medium confidence ₹5,000 crore
    So, looking at those kind of stability, yes, we can say, we will be able to do a pre-sales of Rs. 5,000 crore on yearly basis.

    — Manan Shah, Managing Director

Volume

  • FY25 targeted launch carpet area Volume · FY25 · High confidence 11.5 lakh square feet
    In FY25, we expect to launch another 11.5 lakh square feet of carpet area with sales potential exceeding Rs. 4,250 crores.

    — Manan Shah, Managing Director

  • Total construction area to execute Volume · next 6-7 years · High confidence > 2.5 crores square feet
    And the total number if you see in terms of the construction area which we are going to execute in next 6-7 years' time is going to cross more than 2.5 crores square feet.

    — Manan Shah, Managing Director

  • Portfolio increase Volume · by next March · Medium confidence 40%
    There are lot of projects which are under acquisition and we are hoping by next year March we would be like I said increasing the portfolio nearly by 40%

    — Manan Shah, Managing Director

  • Portfolio carpet area target Volume · next 1.5 years · High confidence 10 million square feet
    if you see the portfolio has grown to nearly 6 million square feet of carpet area, hoping to reach 10 million square feet in next 1.5 years' time with the existing money without even needing to leverage any further debt.

    — Manan Shah, Managing Director

Capex

  • Investment in new acquisitions Capex · next 1.5 years · Medium confidence ₹700-900 crores
    I believe with the new acquisition, which we have not yet announced, which is on the final leg, if I include those as well, I think we would be investing around Rs. 700-Rs. 900 crores.

    — Manan Shah, Managing Director

Risks & concerns

  • Land acquisition and regulatory approval delays for SRA projects

    low

    For the Goregaon West SRA project, management noted that 'it takes a little time to do the clearances.'

    Management acknowledged

Q&A highlights

3 direct
FY25 pre-sales target and new project acquisition strategy (DM vs 100% own) Direct
So, for the next upcoming year, the targeted launch is around 11.5 lakhs square feet, which the potential is going to be nearly around Rs. 4,200 crores, which is going to be from multiple projects... Regarding the model which we would like to continue, honestly, we have always kept the modality open because we are considering ourselves as opportunistic for people.

Reveals specific launch targets for FY25 and management's flexible, opportunistic approach to project models (JV/DM vs. own) based on project specifics and cash flow needs.

Asked by Dhananjay Mishra

Sustainability and potential improvement of high PBT (29%) and PAT (22%) margins Direct
So, margins, honestly that you are seeing again were from the past years, which were slightly, I would say on a conservative side. We are definitely seeing an improvisation on these margins even further. Not just by the luxury projects, but the way we are making the new projects, we are creating spaces which does not exist in the local market...

Addresses investor concern about margin sustainability, indicating confidence in further improvement driven by luxury projects and unique community developments, not just market conditions.

Asked by Nalin Shah

Dip in FY24 revenue despite project deliveries and key projects driving FY25 bookings Direct
The drop that you are seeing is basically because this year was actually the year of acquisitions for us. And we have launched only two projects and also all the revenue what you see which was from the Dahisar project or Ghatkopar's earlier project and newer project that had already been contributed in the earlier quarters and the sales had happened in the last year. So, what happened is you saw those recognition already happening and like I said, the Aaradhya Parkwood project and Mira Road and Aaradhya OnePark project that did not reach the revenue recognition stage plus the DM project which also we have signed that revenue also has yet not come.

Explains the revenue dip as a timing issue related to acquisitions and revenue recognition stages of new DM/JV projects, shifting focus to profitability improvement and future booking drivers.

Asked by Dhyey

3 min read 7 chapters

Detailed narrative

Strong Financial Performance and Margin Expansion

Man Infraconstruction Limited achieved a lifetime best Profit After Tax (PAT) of ₹300 crores in FY24, marking a 16% growth over the previous year. The company reported impressive profitability margins with an annual Profit Before Tax (PBT) of 29.2% and a PAT margin of 22.1%, positioning it as a top performer in the industry. Consolidated total income for FY24 stood at ₹1,360 crores, with revenue from operations at ₹1,263 crores.

Robust Business Development and Project Pipeline

In FY24, Man Infra acquired 27.5 lakh square feet of carpet area across prime Mumbai locations, including Marine Lines, Pali Hill, Goregaon West, and Ghatkopar East. The company has a total revenue visibility exceeding ₹15,400 crores over the next 5-6 years. For FY25, it expects to launch another 11.5 lakh square feet of carpet area with a sales potential of over ₹4,250 crores, including ultra-luxury projects and remaining towers of existing developments.

Net Cash Positive Position and Strategic Funding

The company maintained a net cash positive balance of ₹741 crores as of March 2024, with secured debt significantly reduced to just ₹23 crores by May 10, 2024. Man Infra raised ₹543 crores through a preferential issue in December 2023, with ₹136 crores received by January 2024 and the balance ₹407 crores expected by July 2025, further strengthening its financial position for future acquisitions and growth initiatives.

Focus on High-Margin DM and JV Models

Man Infra is increasingly adopting Development Management (DM) and Joint Venture (JV) models for new projects, which contribute directly to profitability rather than consolidated revenue. An iconic ultra-luxury project at Marine Lines East, with 5.3 lakh square feet of carpet area under a DM model, is projected to achieve a PBT of more than ₹400 crores, showcasing the company's strategy to enhance bottom-line growth. This approach allows for reduced initial CAPEX and quicker project starts.

Operational Excellence and Timely Deliveries

The company successfully delivered three large-scale projects spanning 9.5 lakh square feet of carpet area in less than 3.5 to 4 years, often 1 to 1.5 years ahead of schedule. FY24 saw sales volume of approximately 3 lakh square feet, amounting to ₹744 crores, driven by successful launches like Aaradhya OnePark, which achieved record sales of ₹333 crores. Total collections for FY24 reached ₹1,197 crores, surpassing the ₹1,000 crore mark for the second consecutive year, reflecting strong customer trust.

EPC Order Book and Infrastructure Ambitions

The EPC order book stood at ₹823 crores as of March 2024, with 86% comprising infrastructure projects, primarily from the BMCT Port Project. While the company executes its own real estate projects in-house, saving EPC margins, it is actively eyeing new, larger port infrastructure projects. Government announcements are anticipated for projects totaling ₹35,000 to ₹40,000 crores, where Man Infra intends to bid, seeing better margins in this sector.

US Market Expansion and Future Outlook

In its USA division, Man Infra completed its first project of two villas, with one already sold and the other in talks for closure, maintaining a liquidity balance of $11.5 million. The company plans to commence sales for its second luxury housing project, Ritz-Carlton Residences, by Diwali/December. Man Infra is actively pursuing further acquisitions in Miami and other Florida cities, focusing on a shared portfolio of villas, community living, and multifamily projects.

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

More Realty earnings calls