Bengaluru-based real estate developer, Shriram Properties Limited (SPL), plans to deliver 2.5 million sq ft (msf) of residential units with a sales value of Rs 1,500 crore within the end of FY24.
"We will be delivering about 2,170 residential units across Bengaluru, Chennai, Kolkata, Coimbatore, and Vizag," Murali M, Chairman and Managing Director (CMD), Shriram Properties Limited told Moneycontrol.
Fifty percent of the total deliveries will be in Bengaluru. The ticket sizes for the units will be in the mid-market segment of Rs 80 lakh to Rs 1 crore and the affordable segment of Rs 30-40 lakh.
For all the deliveries in H2 of FY24, we are looking at 40 percent in the affordable segment, Murali added.
In Bengaluru, the company is looking at locations such as JP Nagar, Electronic City, Old Madras Road, and Sarjapur.
Murali said that the company is looking forward to launching at least 5.3 msf by the end of FY24 comprising about 5,000 units.
The upcoming launches, which will mostly be in the mid-market segment, will come up in Electronic City, Yelahanka, and Jalahalli in Bengaluru.
For FY25, the company will launch about six msf.
"We are also looking at launching a 20-acre plotted development in Chennai and a 15-acre project in Kolkata by the end of this FY. To date, about 2.8 msf of plotted development is ongoing across the cities," Murali said.
Strong demand in affordable segment
Refuting reports of the shrinking affordable housing segment in India, Murali said, "We see the demand growing by at least 20 percent YoY. There was always a demand in all affordable, mid-market and luxury segments. However, over the last few years, the supply in the luxury segment increased rapidly. And thus, it seems like the affordable segment is shrinking even though demand has increased."
However, the land prices in major cities like Bengaluru and Mumbai continue to grow QoQ.
Explaining the price rise, Murali said, there is a constant rising expectation from landowners as the market sentiments continue to remain upbeat. "But it is a concern for developers, especially in the affordable segment, and we are watching it closely," he added.
Reduction in debt
Currently, for SPL the debt value stands at Rs 430 crore. Murali added that the company is looking forward to reducing debt through various means like liquidation and selling more assets.
This year, SPL and ASK Property Fund announced a joint investment of Rs 206 crore to take up 100 percent development rights in an ongoing stressed project in Chennai.
Shriram 122 West is the second joint investment by the co-investment platform set up by ASK and SPL in November 2022, with an aggregate capital commitment of Rs 500 crore.
"To date we have deployed around Rs 230 crore on this platform and we will be deploying the complete balance amount within the end of this FY," Murali said.