Real estate developer DLF is eyeing sales worth ₹17,000-₹18,000 crore during April-March 2024-25.
Aakash Ohri, Joint MD and Chief Business Officer at DLF Home Developers spoke exclusively with CNBC-TV18 about the latest luxury project--Privana West in Gurugram--which got sold out in just three days, and the upcoming launches.
This is the verbatim transcript.
Q. Was Privana supposed to be launched in FY24 but has been pushed to FY25 because that's what the sales look like right now? What will FY25 bookings look like, given this case of Privana getting pushed to FY25?
A: Privana didn't get pushed by design, there were some regulatory delays in terms of approvals that got pushed out. But you've seen we've done well, we've sold out Privana West as well. The FY25 guidelines will be about ₹17,000 - ₹18,000cr that we will do in sales. As far as Privana is concerned, we've done well, it's an overwhelming response again to a DLF product and I think we're extremely grateful for that.
Q. And when we consider FY24 bookings that were at around ₹14,778 crore vs ₹15,058 crore, how would you expect it to add?
A. See, most of the sales happen post RERA approvals. And you plan for these launches based on the approvals. But there are times when these things don't happen as per plan. But in no way should you consider or even doubt the capabilities of the sales engine or the demand today of a DLF product. And as you see in Q1, we proved it again, there has been a robust sale to Privana West.
Q. You have also spoken about Privana being sold completely. What is the booking value there and will all of the sales be seen in the first quarter itself? Also, how much of the 11.6 million square feet launch is there in the FY25 which is going to come from Privana?
A. Privana, the total launch size has been about ₹5,590 crore and all of it you will see in Q1. It's almost about a 2.68 msqft size. All the other launches as we go along, there is Goa, Mumbai, a super luxury project in DLF5, some independent floors, and some product in Tri-City. So, we've got a good launch pipeline for FY25.
Q. We have also seen the launch area has increased from 10 million square feet in FY24 to 11.6 million square feet in FY25. But at the same time, the launch in FY24 has reduced from 25 million square feet to 24. So, are some of these launches better installed over for the this fiscal?
A. There will be some changes based on demand, some based on approvals and once they are all in, we get ready with the product launch. So there will be that little bit of a variation that you should always look at. But otherwise, most of it will be as per plan.
Q. When we consider the sector 61 as an added project with an opportunity sale of about ₹20,000 crore, by when does this get on the line and what is the capex involved in this?
A. You saw the success of Arbor. I wouldn't say it's the same geography, but it is almost there. So this product is in the golf course extension as you exit the golf course road. We are reasonably excited about the product. It will be a luxury product. I feel there will be a good traction and demand for this, not only here, but I think pan India and of course from the NRI markets as well. So as far as this particular product is concerned, if all goes well, we will bring it in later part of the year, or most probably it will be in FY26.
Q. Talking about the NRIs and the interest that we are seeing, you've got great numbers from both the Privanas. What is the NRI contribution to the total sales? Last time you mentioned that it was 28%. Has there been an increase in this time?
A. Well, last time it was about 22-23%. It's increased to about 27%. What is heartening is that the NRIs are now backing the Indian good real estate developments in a big way. There was a time when most of these investments had dried up, but it's good to see them come back. Most of the NRIs that we are talking about are investing for the future. Should they return in four to five years, they make these investments. That's a market we will continue to develop and explore.
Q. There has been a substantial price increase between Privana South and Privana West. Is the pricing attributed to the dollar exchange rate, the NRIs, and are you converting that in INR for Indian markets?
A. No, the price is the same for everybody, whether it's an NRI sale or a domestic sale. The price has gone up by about ₹1,500 a square foot for the Privana West. There's also a lot of infra work going on on-ground. Privana West and South are part of a very infrastructurally superior land bank. You are connected with good infrastructure. It's the Dwarka Expressway or the Mumbai Expressway or Jaipur. You are very close to almost 10,000 hectares of a green lung. As far as the Privana geography is concerned, it's a place that people would love to live in. And it is a DLF product, so you can say it’s a given. It will be one of the most superior and luxurious products after The Crest. It is the same genre. So Privana, as far as the geography, approachability, lifestyle, the DLF lifestyle, it's a very cohorted mix of everything.
Q. Of the bookings, what percentage of buyers have opted for housing loans? As you said, these are luxury segment houses and a lot of NRIs are also looking at this as an investment so that once they come back, can we get some details on that?
A. The booking amount is ₹50 lakh, which generally come in from the customer themselves. But the banks have been very active and very supportive. So, to start with, there will be about at least 30%, if not more. But those numbers, I'd be able to give you more accurately in three months from now because at this point in time, mostly internal accruals are where the moneys are coming from. But the banks are there. Most of the big banks are doing good business. And I think this particular trend will continue.
Q. When we talk of NCR market, what sort of an expansion plan do you have? You have not entered Noida market for some time, and that's a conscious call that DLF has been taking. Any reason for that, and can we see some future expansion in NCR, especially Noida?
A. Never say never. Whenever and wherever we get a good opportunity, we will definitely be there. But we have always concentrated on margins. We are not in this rat race of just developing projects or for the sake of them. But what is important to understand is that unless it makes good business sense for DLF and what we can create for our customers, we will not just get into a product or a project. Having said that, if we get a good opportunity in Noida, we will be there.
Right now, in NCR, we've got Delhi, with One Midtown with great potential. We've got Gurgaon, which is our hub, both from the super luxury bucket as well as the luxury bucket. We've got independent floors waiting to be launched here. So, we've got our hands full for the next three years at least.
Q. Which projects are you going to launch during the year that will clock sales of ₹36,000 crore? That's the target for the coming fiscal year.
A. No, ₹36,000 crore is the total realisation potential of the development. The launch guidelines as far as the sales guidelines will hover around the ₹ 17,000-₹18,000 crore mark.
Q. How soon is the Mumbai launch happening? Where are we on that project and when can we see openings happening?
A. Mumbai will be sometime in third or fourth quarter this year. We've already set the ground for it. Work, both from the project side as well as the revenue side has begun. We've started to put our people in place. So yes, please look forward to Mumbai in third or fourth quarter this year.
Aakash Ohri, Joint MD and Chief Business Officer at DLF Home Developers spoke exclusively with CNBC-TV18 about the latest luxury project--Privana West in Gurugram--which got sold out in just three days, and the upcoming launches.
This is the verbatim transcript.
Q. Was Privana supposed to be launched in FY24 but has been pushed to FY25 because that's what the sales look like right now? What will FY25 bookings look like, given this case of Privana getting pushed to FY25?
A: Privana didn't get pushed by design, there were some regulatory delays in terms of approvals that got pushed out. But you've seen we've done well, we've sold out Privana West as well. The FY25 guidelines will be about ₹17,000 - ₹18,000cr that we will do in sales. As far as Privana is concerned, we've done well, it's an overwhelming response again to a DLF product and I think we're extremely grateful for that.
Q. And when we consider FY24 bookings that were at around ₹14,778 crore vs ₹15,058 crore, how would you expect it to add?
A. See, most of the sales happen post RERA approvals. And you plan for these launches based on the approvals. But there are times when these things don't happen as per plan. But in no way should you consider or even doubt the capabilities of the sales engine or the demand today of a DLF product. And as you see in Q1, we proved it again, there has been a robust sale to Privana West.
Q. You have also spoken about Privana being sold completely. What is the booking value there and will all of the sales be seen in the first quarter itself? Also, how much of the 11.6 million square feet launch is there in the FY25 which is going to come from Privana?
A. Privana, the total launch size has been about ₹5,590 crore and all of it you will see in Q1. It's almost about a 2.68 msqft size. All the other launches as we go along, there is Goa, Mumbai, a super luxury project in DLF5, some independent floors, and some product in Tri-City. So, we've got a good launch pipeline for FY25.
Q. We have also seen the launch area has increased from 10 million square feet in FY24 to 11.6 million square feet in FY25. But at the same time, the launch in FY24 has reduced from 25 million square feet to 24. So, are some of these launches better installed over for the this fiscal?
A. There will be some changes based on demand, some based on approvals and once they are all in, we get ready with the product launch. So there will be that little bit of a variation that you should always look at. But otherwise, most of it will be as per plan.
Q. When we consider the sector 61 as an added project with an opportunity sale of about ₹20,000 crore, by when does this get on the line and what is the capex involved in this?
A. You saw the success of Arbor. I wouldn't say it's the same geography, but it is almost there. So this product is in the golf course extension as you exit the golf course road. We are reasonably excited about the product. It will be a luxury product. I feel there will be a good traction and demand for this, not only here, but I think pan India and of course from the NRI markets as well. So as far as this particular product is concerned, if all goes well, we will bring it in later part of the year, or most probably it will be in FY26.
Q. Talking about the NRIs and the interest that we are seeing, you've got great numbers from both the Privanas. What is the NRI contribution to the total sales? Last time you mentioned that it was 28%. Has there been an increase in this time?
A. Well, last time it was about 22-23%. It's increased to about 27%. What is heartening is that the NRIs are now backing the Indian good real estate developments in a big way. There was a time when most of these investments had dried up, but it's good to see them come back. Most of the NRIs that we are talking about are investing for the future. Should they return in four to five years, they make these investments. That's a market we will continue to develop and explore.
Q. There has been a substantial price increase between Privana South and Privana West. Is the pricing attributed to the dollar exchange rate, the NRIs, and are you converting that in INR for Indian markets?
A. No, the price is the same for everybody, whether it's an NRI sale or a domestic sale. The price has gone up by about ₹1,500 a square foot for the Privana West. There's also a lot of infra work going on on-ground. Privana West and South are part of a very infrastructurally superior land bank. You are connected with good infrastructure. It's the Dwarka Expressway or the Mumbai Expressway or Jaipur. You are very close to almost 10,000 hectares of a green lung. As far as the Privana geography is concerned, it's a place that people would love to live in. And it is a DLF product, so you can say it’s a given. It will be one of the most superior and luxurious products after The Crest. It is the same genre. So Privana, as far as the geography, approachability, lifestyle, the DLF lifestyle, it's a very cohorted mix of everything.
Q. Of the bookings, what percentage of buyers have opted for housing loans? As you said, these are luxury segment houses and a lot of NRIs are also looking at this as an investment so that once they come back, can we get some details on that?
A. The booking amount is ₹50 lakh, which generally come in from the customer themselves. But the banks have been very active and very supportive. So, to start with, there will be about at least 30%, if not more. But those numbers, I'd be able to give you more accurately in three months from now because at this point in time, mostly internal accruals are where the moneys are coming from. But the banks are there. Most of the big banks are doing good business. And I think this particular trend will continue.
Q. When we talk of NCR market, what sort of an expansion plan do you have? You have not entered Noida market for some time, and that's a conscious call that DLF has been taking. Any reason for that, and can we see some future expansion in NCR, especially Noida?
A. Never say never. Whenever and wherever we get a good opportunity, we will definitely be there. But we have always concentrated on margins. We are not in this rat race of just developing projects or for the sake of them. But what is important to understand is that unless it makes good business sense for DLF and what we can create for our customers, we will not just get into a product or a project. Having said that, if we get a good opportunity in Noida, we will be there.
Right now, in NCR, we've got Delhi, with One Midtown with great potential. We've got Gurgaon, which is our hub, both from the super luxury bucket as well as the luxury bucket. We've got independent floors waiting to be launched here. So, we've got our hands full for the next three years at least.
Q. Which projects are you going to launch during the year that will clock sales of ₹36,000 crore? That's the target for the coming fiscal year.
A. No, ₹36,000 crore is the total realisation potential of the development. The launch guidelines as far as the sales guidelines will hover around the ₹ 17,000-₹18,000 crore mark.
Q. How soon is the Mumbai launch happening? Where are we on that project and when can we see openings happening?
A. Mumbai will be sometime in third or fourth quarter this year. We've already set the ground for it. Work, both from the project side as well as the revenue side has begun. We've started to put our people in place. So yes, please look forward to Mumbai in third or fourth quarter this year.
(Edited by : Shweta Mungre)
First Published: May 15, 2024 11:59 AM IST
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