Ajmera Realty & Infra India Ltd Q4 FY2023 Concall Summary

Key Takeaways

• Sales nearly doubled, led by a single project: FY23 sales value jumped 95% YoY to INR 842 crores, with the newly launched Ajmera Manhattan alone contributing INR 572 crores despite being at foundation stage.
• Margins expanded sharply while debt fell: EBITDA margin improved to 30% from 25% and PAT grew 1.6x, supported by a 7% debt reduction (INR 54 crores) on strong collections and UK repatriation.
• A crowded launch pipeline targets INR 1,000 crores: Four FY24 launches carry an estimated revenue potential of INR 2,000 crores, and management expects to "cross around INR 1,000 crores" in sales this year.
• A structure deal with a global PE player is in the works: Management confirmed the previously hinted "positive surprise" is a structure deal, but offered no timeline beyond "sooner."
• What to watch next quarter: Whether Ajmera Eden and the two Bangalore projects begin converting their launch readiness into booked sales, and any concrete update on the PE structure deal.

The Manhattan Effect: What Drove FY23

• One project carried the year: Ajmera Manhattan in Wadala recorded INR 572 crores in sales, roughly 68% of the full-year total, with ~40% of inventory sold while construction was still at foundation level for two towers. Management framed this as buyer confidence in the Ajmera brand and the micro-market.
• Affordable and commercial projects also performed: Greenfinity Wadala, an affordable project started two years ago, reached ~80% inventory sold (INR 155 crores) with work 90–95% complete. Sikova Ghatkopar, a boutique commercial project, sold ~85% and is nearing handover.
• Juhu luxury project is selling slowly by design: Ajmera Prive clocked INR 33 crores in two quarters, selling ~23% of inventory. Management noted that Juhu projects typically sell near or at completion, implying the real sales push lies ahead.
• Collections stayed buoyant: Q4 collections were INR 103 crores, and UK repatriation began in H2 with INR 14 crores received and a further ~INR 55 crores in the pipeline.
• Bangalore mid-luxury is nearly done: Nucleus Bangalore sold 90% of its residential inventory, with the C-Wing 80–90% complete and expected to finish in a few months.

Dhaval Ajmera: "I do not think whoever has been in this particular micro market or if any good entrant players coming in will definitely start seeing success if the product and deliveries has been on time."

FY24 Launch Pipeline & Revenue Visibility

• Four launches identified, all in MMR: The slate includes the newly acquired Vikhroli East land (targeting first-time home buyers, gross value ~INR 550 crores), Ajmera Eden in Ghatkopar (premium, RERA-approved, sales starting Q1 FY24), a Bhandup project, and one undisclosed Central Mumbai project still awaiting final clearances.
• Combined launch revenue potential is large: Management estimates ~INR 2,000 crores in total revenue from these four launches, with ~0.1 crore square feet of carpet area. Total revenue visibility from existing projects plus FY24 launches stands at ~INR 4,000 crores.
• Bangalore projects are financially closed and ready: Ajmera Lugaano and Ajmera Florenza achieved full financial closure with a fund, and sales have been strong over recent months. Management expects numbers to begin reflecting from the coming quarter.
• Sales velocity targets are explicit: Management aims for 10–15% of sales volume during the launch phase, then shifts to sustaining mode with intermittent schemes. New launches are expected to finish selling in 3–4 years on average.
• Kanjurmarg is at least a year away: Backend work is progressing, but management wants full clarity on approvals, infrastructure and project vision before launching, placing the timeline at "maybe in sometime probably a year plus."

Dhaval Ajmera: "We want to bring this up at the right time maybe in sometime probably a year plus and then we ensure that we get a proper clarity and a proper vision for the entire project and not just launch it like that."

Margin & Balance-Sheet Repair

• Profitability improved across the board: EBITDA margin rose to 30% in FY23 from 25% in FY22, while PBT margin moved to 22% from 13%. PAT grew 1.6x year-on-year, with Q4 PAT up 8% YoY and 42% QoQ.
• Debt fell on operating cash flow: Secured debt stood at INR 776 crores with a debt-equity ratio of 1:1, down INR 54 crores (7%) during the year. Corporate-level debt repayment is ahead of schedule, while project-level construction finance will continue as a growth enabler.
• The target is sub-1:1 debt-to-equity: Management reiterated its earlier guidance to bring the ratio below 1, and expects to operate "significantly below" that level in the next 2–3 years.
• Estimated cash flow from the existing portfolio is above INR 870 crores, with completed and advanced-stage projects alone offering INR 300+ crores in revenue visibility over the next 6–12 months.
• EBITDA margins have room to expand further: Currently at 25%+, management expects additional expansion driven by operational efficiency and the debt reduction plan.

The PE Structure Deal & Unanswered Questions

• A structure deal with a global PE player is in progress: When pressed on a previously hinted "positive surprise," CFO Nitin Bavisi confirmed it relates to a structure deal. He called it "still a work in progress because of the nature of the deal" and offered no timeline beyond "sooner."
• One Central Mumbai project remains undisclosed: Management revealed one of the two Central Mumbai projects is in Bhandup but declined to name or detail the second, citing ongoing work on final clearances.
• Market Yard Pune has hit a snag: Issues have arisen at the Pune project, and management is trying to resolve them. Resolution is expected in 1–2 quarters, after which the project may be brought back.
• NCLT demerger is still pending: The process remains at the petition level, the final leg of the regulatory process, and has not yet come up for hearing.

Nitin Bavisi: "That was regarding the one particular structure deal which we are working on and that is something which is still a work in progress because of the nature of the deal is that of the structure deal and a global private equity player involved. So, that particular that deal once it is fructified definitely, we should come back with the positive news."

Portfolio Strategy: Geography, Mix & Run-Rate

• Core geographies are Mumbai, Pune and Bangalore: Mumbai and Bangalore will be the larger contributors, while Ahmedabad is opportunistic. The Bahrain project is under active construction with cash flows from inventory sales expected in 18–24 months.
• Commercial is a deliberate one-third target: Management eventually envisages roughly one-third of the portfolio as commercial, but will launch only when micro-market demand supports value. Sikova commercial is 85% complete and nearing handover; Nucleus commercial in Bangalore (~1 lakh+ sq ft) is complete and in lease/sale negotiations.
• Annual delivery run-rate is taking shape: Management expects to average 500,000–600,000 sq ft of deliveries per year, with an average top line of ~INR 1,000 crores over the next 3–4 years. Four projects are nearing OC in FY24: Greenfinity, Sikova, Nucleus Bangalore and Nucleus commercial, totaling ~4.5–5 lakh sq ft.
• The 5X growth ambition is the stated north star: Management reiterated its strategy to unlock land potential from fully paid and owned land, continue evaluating JV, JD and redevelopment projects, and ultimately grow 5X from current levels.

Dhaval Ajmera: "We continue with our growth strategy which is ultimately to ensure that we grow 5X from where we are and that is where we all are striving towards."

Guidance & Commitments

Key Metrics