Kolte Patil Developers will hold a meeting of the Board of Directors of the Company on 6 February 2023.

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Sales volume increased by 31% to 1.13 million square feet in Q3 FY23 from 0.86 million square feet in Q3 FY22.

The company's sales value and sales volume are higher by 95% and 102%, respectively, as compared with Q2 FY23.

Realization was Rs 6,339 per square feet, down 2% YoY and down 4% QoQ.

Collections grew by 3% YoY and 8% QoQ during Q3 FY FY23 to Rs. 435 crore.

The company said that it has launched approximately 2 million square feet of inventory across 6 projects in Pune and Mumbai. New launches contributed approximately 57% to the pre-sales value for the quarter. KPDL's flagship project, Life Republic, crossed the half million mark to record volumes of 6.62 lakh square feet, highest ever in any one quarter.

The company, through its wholly owned subsidiary Sampada Realities, has entered into an agreement with Planet Smart City, for strategic land monetization of a portion of its project 'Little Earth' at Kiwale, Pune, for approximately Rs. 78 crore, for joint development of approximately 0.65 million square feet.

It has also entered into an agreement with Marubeni Corporation (Japan) during the quarter. Marubeni will invest Rs 206.5 crore in the company's Pimple Nilakh residential project and will be entitled to approximately 2.85 lakh square feet of saleable area in the project.

During the quarter, CRISIL Ratings re-affirmed the ratings of the company's long-term bank loan facilities at 'A+/Stable', short-term bank loan facilities at 'A1' and rated non-convertible debentures as 'A+/Stable'.

Rahul Talele, Group CEO, Kolte-Patil Developers, said, “Our performance in Q3 was marked by significant contribution from new launches and continued momentum of customer traction in our existing, sustenance phase projects. This keeps us on track to deliver 30% growth in pre-sales for FY23.”

The Kolte-Patil Developers group is one of the largest residential real estate developers in Pune. The company has a healthy project portfolio of affordable and mid-income, and luxury residential segments through its brands, Kolte-Patil and 24K, respectively, and is expanding its presence in Bengaluru and Mumbai. The group has developed around 23 million square feet of projects, and currently has 25 ongoing projects comprising around 13 million square feet.

The company reported a net loss of Rs 8.79 crore in Q2 FY23 as against a net profit of Rs 17.70 crore in Q2 FY22. Net sales declined 59.4% YoY to Rs 123.31 crore in the quarter ended 30 September 2022.

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The agency has reaffirmed its ratings on the bank facilities at 'CRISIL A+/Stable/CRISIL A1'.CRISIL said that the ratings continue to reflect the KPDL group's strong brand and market position, which will continue to support sales and collections, and comfortable financial risk profile. These strengths are partially offset by concentration in revenue and exposure to risks and cyclicality inherent in the real estate sector.

KPDL has achieved sales of 1.17 msf with sales value of Rs 812 crores in first half of fiscal 2023. The performance was constrained due to delays in launches of certain projects. Projects aggregating 1.5 msf were launched in first half as against 6-8 msf expected for full year. However, the approvals for such projects are in advanced stage and projects aggregating 5-6 msf are expected to be launched in second half of fiscal 2023.

Consequently, the scale of KPDL is expected to nearly double over the medium term from the past 3 fiscals. Timely launches alongwith sustained demand in view of headwinds like interest rate and commodity price increase would be key monitorables.

Realizations has also increased to approximately Rs 7000 per square feet (psf) in first half of fiscal 2023 as against Rs 5,000-6,500 psf in the past. Contribution from projects outside Pune was at 27% of Sales Value during H1 FY23, in line with the business diversification goal.

Financial risk profile remains strong with debt-to-total-assets expected to sustain below 15%. Capital structure is comfortable with gearing below 1 time. Bank debt is expected to remained low at Rs 500-600 crore over medium term. KPDL will continue to partner with investors for its projects and has now onboarded Marubeni Corporation.

CRISIL further added that improvement in market position of the company led by significant improvement in scale of operations, with sales crossing Rs 2500 crore per year on a sustained basis; and non-Pune revenue sustaining at more than 30% of overall revenues, while maintaining operating and financial risk profile could lead to a positive rating action.

However, sharp decline in cash flow, triggered by slackened saleability of existing and proposed projects or delays in project execution; and weakening of the financial risk profile due to higher-than-expected borrowing, resulting in net gearing exceeding 0.7 times could lead to a ratings downgrade.

The KPDL group is one of the largest residential real estate developers in Pune. The company has a healthy project portfolio of affordable and mid-income, and luxury residential segments through its brands, Kolte-Patil and 24K, respectively, and is expanding its presence in Bengaluru and Mumbai. The group has developed around 23 million sq ft of projects, and currently has 25 ongoing projects comprising around 13 million sq ft.

The company reported a net loss of Rs 8.79 crore in Q2 FY23 as against a net profit of Rs 17.70 crore in Q2 FY22. Net sales declined 59.4% YoY to Rs 123.31 crore in the quarter ended 30 September 2022.

The scrip rose 2.24% to end at Rs 278.50 on the BSE on Friday.

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Kolte Patil Developers has received credit ratings from CRISIL as follows:

Bank facilities (Rs 800 crore)
Long term rating - CRISIL A+/Stable (reaffirmed)
Short term rating - CRISIL A1 (reaffirmed)

Proposed issue of non convertible debentures - CRISIL A+/ Stable

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