Lodha Banks aims to be debt free in 2 years

November 11, 2019

MUMBAI: Realty developer Lodha Group is aiming to turn debtfree over the next two years, aided by the brisk sales performance in its recently launched affordable housing vertical, said a top company official.

The company has repaid debt worth Rs. 1,500 crore since the beginning of current financial year and is planning to reduce it further by Rs. 2,500 crore. Currently, the group’s net debt stands at Rs. 17,000 crore. “We will be a zero-debt company over the next two years. In this financial year itself, we aim to reduce overall group debt by at least rs. 4,000 crore,” Abhishek Lodha, MD, Lodha Group, told ET.

The developer is focusing on delivery of projects and debt reduction, halting new investments into acquisitions for the time being. According to Lodha, the company’s sales momentum is improving led by affordable housing, as the company achieved sales of Rs. 750 crore in October alone. “Festive sales have been good. The newly launched affordable housing brand has performed well as out of Rs. 750 crore, over Rs. 240 crore sales were through Crown and over Rs. 100 crore recorded in Palava City,” he said.

The developer has witnessed Rs. 150 crore worth sales in its projects Lodha Park and World Towers at Lower Parel and Rs. 60 crore in New Cuffe Parade in Wadala locality during this month. In the first two quarters since April, Lodha has registered sales worth Rs. 3,300 crore.

Sales from affordable homes contributed more than 50% of overall sales for the company. Last month, the company launched its affordable housing brand ‘Crown’ catering to families with monthly income of Rs. 50,000 onwards. The homes built under this brand will be priced from Rs. 25 to Rs. 50 lakh and select homes up to Rs. 75 lakh.

The first project under the brand Crown was launched in Thane’s Majiwada locality, while two additional affordable projects in Bhiwandi and Taloja near Mumbai are planned during the current financial year.

After delayed plan to go public with its equity listing in the backdrop of volatile market conditions, the company is now looking to build a steady income-yielding commercial portfolio and explore listing a Real Estate Investment Trust over the next 2-3 years.

Source - Economic Times