Prestige Group, the Bengaluru-based real estate major, has revised upwards its annual sales guidance to ₹20,000 crore based on the continued surge in demand from mid-to-premium homes and plotted development.
The Group, according to its Chairman and Managing Director, Irfan Razack, had set a guidance of ₹16,000 crore; which now stands revised upwards by nearly 25 per cent.
“Going by the current (market) conditions including demand and supply, our launch pipeline, pre-booking for our new launches, I think a ₹20,000 crore plus sales number is achievable and probable this fiscal…. Yes, in a way you can say that we are revising our guidance upwards,” he told businessline on the sidelines of a CREDAI conference.
In a regulatory filing on October 6, the company said it saw a more than two-fold jump in property bookings year-on-year (y-o-y), worth ₹7,092.6 crore. Nearly ₹6,000 crore of sales from its key market of Bengaluru and ₹500 crore each came from Mumbai and Hyderabad.
Sales so far
The April-September month sales are slightly over ₹11,000 crore.
“What makes our achievement noteworthy is that in the first six months of FY24 we have achieved sales of ₹11,007 crore, which is close to entire FY23 number of ₹13,000 crore or so,” Razack said.
According to him, launches in the second half of the fiscal will primarily cover projects in Hyderabad, Mumbai, and Chennai (apart from Bengaluru).
“Bengaluru and Mumbai will give us the numbers. We have three launches planned — Prestige City in Hyderabad, he Ocean Towers (Marine Lines) in Mumbai and the Forest Hills (in Mulund),” he said adding that “this will be the quarter of the outstation cities.”
In Bengaluru, the company is working on a “few plotted development”.
Strong demand, stable price
Razack said, demand continues to be strong across categories spreading between one room (studio apartments) and four-bedroom offerings.
“Price of the market/ micro-market, location, positioning of the project and completion of project (on or before time) makes a difference to demand and sales,” he explained.
Talking about price, the CMD said home prices should reach a point of stability now; and no further significant increases are anticipated in the near future. In fact, Razack said, further price increases could slow down demand.
Incidentally, the average realisation during H1FY24 for Prestige Group was ₹10,338 per sft (up by 25 per cent y-o-y) for apartments and villas; while the average realisation of ₹4,825 per sft (up 17 per cent y-o-y ) for plotted sales.
The average price realisation in Q2 incidentally was ₹10,369 per sft (up 29 per cent y-o-y). But sale of plots saw a 62 per cent rise in price y-o-y to ₹6,753 per sq ft.
“Prices have breached the ₹10,000 per sq ft mark; and should stabilise around this range. Personally, I don’t want it to go up further as it may be counter productive to the traction that the market is witnessing,” he said.
(The writer was in Egypt at the invitation of CREDAI.)