Brigade's residential biz poised for solid growth with robust FY24 launches
₹9,960 crore for the June ended quarter (Q1FY24). Pre-sales were, however, fell 33% sequentially in the absence of new project launches during the period. The June quarter saw the rollout of a single commercial project by Brigade, with residential projects taking a backseat.
During an earnings call, the delay in project launches was attributed to prolonged approval processes. So a key takeaway is that this sequential softness in pre-sales is a temporary setback, considering Brigade's robust forthcoming offerings. In FY24, Brigade is eyeing the launch of a whopping 7.5 million square feet in the residential segment, with a gross development value (GDV) potential of ₹6,000 crore.
The management expects the bulk of these launches, particularly 25% from the Mount Road Chennai project, to occur in the latter half of the fiscal year. “While Brigade Enterprises reported lower-than-expected revenue, we retain our P&L estimates for FY24 as overall unit handovers remain on track apart from a minor blip in 1QFY24," said analysts at Motilal Oswal Financial Services Ltd. On the business development front, the company saw a bumper FY23, but Q1FY24 was relatively subdued.
The company added around 8.7msf area with a GDV of Rs5,000 crore in FY23 and spent nearly Rs700 crore on land acquisition, the management said. Analysts expect the company’s business development activities to regain pace in quarters ahead. Its hospitality business saw a sequential moderation in its average room rate owing to seasonality, which according to analysts is in-line with industry trends.
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