Mahindra Lifespace Developers Limited ($532313)

Good evening, everyone, and a very warm welcome. Thank you for joining us today for our Q4 and full year FY '26 earning update. We truly appreciate your continued interest and participation. We have with us Mr. Amit Sinha, Managing Director and CEO; Mr. Sriram Kumar, Chief Financial Officer; Mr. Vimalendra Singh, CBO Residential; Mr. Vikram Goel, CBO Industrial. Today's meeting will begin with a brief presentation covering our operation and financial highlights, following which we will open the floor for Q&A session. With that, I am pleased to invite Mr. Amit Sinha, Managing Director and CEO, to take us through the presentation.

So welcome, everybody. I think we'll move through the slides pretty quickly, so that we have as much time for Q&A. By the way, the first picture was that of -- let me go back actually. This was of Bhandup, our recent launch. I think the sales gallery and everything is ready, we just waiting for the EOIs and the CP meet to happen for us to start opening the gallery for customers to take a look at what we have to offer there. And this picture is from Mahindra Blossom in Bangalore, which did really well last quarter, 60% sold within 1 week of its launch. So it's done really well. But obviously, the -- this launch was before the war. So, I think, let's see how the impact of war is on the sentiments and the real estate buying behavior. Right, I think in terms of -- you've seen this slide before, so I will not dwell too much time, but I think we are continuing to execute on a well-defined strategy, you know our aspiration to be a meaningful scale player in the industry, INR 8,000 crores to INR 10,000 crores. GDV addition of INR 45,000 crores, which is in -- looking very good shape. In fact, we have crossed that, and we are thinking ahead in terms of how we build the GDV portfolio for future. The portfolio choices, you're well aware of -- in terms of 3 cities, Premium, Mid-Premium and Exiting Affordable segment. Business development engine which allows us to pick and choose the right set of deals, get us approvals in time to launch, and then make sure we adhere to all the financial guardrails. Customer experience in the last year, we have really pushed the needle on providing superior customer experience to our customers. It has obviously a design element, sustainability elements, some kind of innovations which are more practical. But also a key part of industry challenge has been how do you provide a seamless possession experience, which we have worked really well. Project execution is fundamental, a First Time Right approach to construction, on-time delivery, and I'll share some of the update on OC, and then how do we actually become more industrialize in the project business by having designs and spaces, which can be standardized for repeatability. IC&IC, you'll hear more from us on the business, which has done really well, and across the existing location, and we continue to monetize the asset that we have. And the bedrock for us has been the robust financial discipline, IRR, prudent capital allocation, and then making sure that we have 3D funding to support our growth aspiration. And then you have some of the Future proof Mlife from a talent, performance culture and new technologies. So not deviating from the strategy that we have highlighted 2.5 years back, but I think we are making strong progress on each one of them. Some highlights, just to give you -- you have seen the brief already. But Q4 presales on the Resi side was INR 1,633 crores. Overall, we finished the Resi presales for the financial year at INR 3,400 crores, supported by good, successful launches at Blossom, Marina64, NewHaven, Citadel Tower L, Lakewoods in Chennai. And sustenance sales, which is our continuous effort to actually not depend on the launches, in-year launches, 40% of our sales came from sustenance, and our goal is to continue to improve that. Rainforest, it's the largest project that we have taken, full GDV is more than INR 12,000 crores. We have achieved RERA -- received RERA for Mahindra Rainforest Phase 1, and we will share with you in future months how the response is. Strong launch pipeline heading into FY '27. A lot of GDV that we acquired in the past years is coming up for launches. The approval process are well underway. So we hope to see a significant jump in our presales this year. BD momentum continues, INR 18,000 crores, including Thane this year as well, and total GDV of more than INR 45,000 crores. We have -- our focus on execution continues. We had planned to receive 8 OCs, and I'm glad to share that in the last financial year plus 7 days, we received 2 OCs in -- by April 7, one came on April 1 and one came on April 7. So within -- that's a 372 days, what we achieved was in line with what the expectation were for FY '26. We also have a strategic partnership announced. The first part of infusion of capital has happened. This is a multi-project partnership. It started with Blossom where they have 49% stake, and it's going to be a game-changing partnership from our point of view. Mitsui Fudosan is the largest real estate player in Japan, and they've chosen us to be their partner for the Residential segment. They had partnership in the past on the commercial side, but residential, this is the first partnership. IC&IC continues to be a very strong -- unlike other firms in the space who have Resi plots, we have industrial, which is like industrial plots. So the kind of margin profile, the kind of land bank that's required, we do have in IC business. We have seen leasing activity very strong in Jaipur and Chennai. Realizations have improved quite a lot. And then we are working on Origins Ahmedabad and Origins Pune, Origin Ahmedabad has all the approvals. We are looking for the first set of anchor client. It has been slow in the past, but right now we are -- we receiving healthy inquiries. And then land aggregation in Origins Pune continues to move at good speed. Financial point of view, almost INR 4,120 crores of combined Resi and IC presales. PAT, it is a significant growth for us, and we believe that's going to be a new normal, where we'll see good PAT performance for the next few years, as completions happen, and IC leasing continues. Collections has been strong, more than INR 2,100 crores. Despite not having some of the launches like Bhandup happened in the timeframe we expected, the collections were very healthy. And then given our desire to be very prudent about our balance sheet, I think we have a net debt-to-equity of negative 0.27, which is healthy, right? And especially in the times when there are volatility expected in the market, driven by war, driven by other reasons, having a healthy balance sheet helps build a stronger business. So that's the key highlight. You have known most of these things, but in summary, this page captures the GDV addition. INR 10,500-odd crores is the new acquisition. And the last column is Thane, you had -- you've heard us, and even you probably heard me talk about Thane for some time. But finally, we have gotten the approval from Thane, which is our zone. And given the infrastructure development, metro, and the tunnel, we expect this land will become very valuable to us. We are in advanced stages of design. I think Anshu, our Chief Design Officer, is here. The idea is to develop this into a large mixed-use project, which will have retail, which will have residential, which will have commercial, it will have other amenities, and make it a destination of its kind. So INR 18,000 crores, just to remind you, last year F'25 also was INR 18,000 crores for us. So in -- so we have maintained a very healthy addition to our GDV. And our belief is that we will be able to sustain this kind of GDV activity over the next few years. So please stay tuned for more details and more action on that front. Cumulative GDV, you've seen, it is -- it captures all the latest and the greatest. The color blue is something that has happened in the current financial or past financial year, FY '26. The current inventory on the left most column actually has jumped, because as of 31st March, we had Rainforest that was launched. None of that had sold. We are still collecting EOIs and doing the early stage of marketing, but roughly INR 3,000 crores of inventory has been added to the left most column, making it INR 6,200 crores, right? Launch plan, I think is steady recovery, I would say recovery, but steady growth that we have seen in this year, strong momentum, roughly 20% -- 21% growth over the last financial year. We had planned almost 8 launches, 5 launches happened, and we have in-year impact to that. Rainforest, while the launch has happened, you'll see the impact to that in the current financial year. BeaconHill and Citadel Phase 3 in Pune are at the very last stages of approvals, RERA. And hopefully, we'll have them in this quarter to benefit the sales from multi-month effort. You've seen this slide. I think I will dwell on it. Our trajectory continues. We have an important year in FY '27. In the past, we have given a guidance of INR 4,500 crores to INR 5,000 crores for our presales for FY '27. And this will be an important year, where we'll break out from the 20%, 25% growth that we have seen in the last few years. And we think we are ready for that jump. The reason is the GDV, all the effort that we've put in last 2 years, you're seeing traction, some have -- some launches have already happened. The remaining launches, which we expect to happen, will give us not only the impact in the current year, FY '27, but also give us momentum in the next few years. You'll also note that the extreme right -- your extreme right, yes, the proportion of new launches continues to come down, which is good because in the past, we've always been dependent on one or two marquee launches, they will make or break for us for the year. But as the -- as FY '26 is 60:40, and we hope to reverse that in the next year, right? The sustenance sales will become very important. And then that trend should continue. So, we will gain more from sustenance and past year launches than just depend on the current year launches. IC&IC business, Vikram is here. I think he has done very well in terms of jumping. Obviously, it was really helped by the approval we received in OC2A, Origins Chennai 2A, Part A. We already had OC1 with Sumitomo. OC2A is a partnership we signed with them, they came in, I think, November 2024. And then by end of December 2025, we had received the final approval. And quarter 4 of last financial year received, as you can see, INR 360 crores worth of new lease revenue that came in. And that was already in the pipeline, but receiving the approval allowed us to convert that pipeline into real opportunity. It also tells us that the demand, especially when we have a partner like Sumitomo in our stable, is outstanding. And the largest customer actually that we see there on the page, INR 180.4 crores, is actually Japanese customer, the second largest is also a Japanese customer. The third one is also a Japanese customer. So this has been a tremendously powerful partnership for us, as we're able to bring more land to -- for business. Our partnership allows us to pick the right set of clients from outside India. Even the domestic customers have been quite active in -- especially in Jaipur region. So good, strong performance on the IC side. And just to remind that IC we are only firing, let's say, 3 to 4 out of the 6 locations that we have, right? So OC2A is firing, 2B is under aggregation and approval soon after. Ahmedabad and Pune are not yet ready. Ahmedabad, while technically it's ready, but we are waiting for the right anchor client. And Pune, we are finishing the land aggregation. And the potential is huge, as you can see. And we've always guided that this business will give us INR 500 crores --INR 400 crores to INR 500 crores every year, let's say, INR 500 crores as a midpoint that we -- given what we have seen in the last year. And then this will have a PAT performance of roughly INR 550 crores for us to benefit from. Financial highlights, I think maybe Sriram, I cover that or you are covering it? I cover it, right. So sales, I think you've seen this before, Q4 was great on the Resi side. Financial year had INR 3,400 crores. Obviously, our aspiration is much bigger, and you'll see some of that come through in the coming years. This compares well compared to the last year, as well as last year's final quarter. IC&IC again, very strong growth financial year as well as the quarter 4. GDV we have been cautious, we already have a healthy GDV for the financial year. We didn't want to sign a deal that didn't meet our stringent financial guardrails. So you see 0 in the last quarter of last financial year, but I think we have enough for us to convert from GDV to launches. Resi collection is strong, as we discussed, debt-to-equity very healthy and cost of debt despite some of the challenges in the market, I think it continues to be at a very affordable rate. Let me just invite Sriram to cover some of the segment performance, and then we'll take Q&A.

Thank you, Amit. On the segment performance, I think the point to highlight is the Resi profitability, which we discussed in the last earnings call, that continues to be positive. And with the few more OCs that we received during the quarter, it ends up being a very good year for us with a positive Resi profitability. And IC continues to be extremely important from a PAT contribution perspective. Significant amount of leasing revenues and higher realization really helped us to achieve the PAT for the year compared to the last year. On the cash flow statement, I think we are in a very good position. The operating cash flow for the year FY '26 is about INR 840 crores, compares to INR 832 crores last year. Two things to highlight: one, we did have about the approval costs for Mahindra Rainforest spent in the -- factored in the operating cash flows. So, that's about roughly INR 200 crores, INR 250 crores, which -- basically the INR 840 crores that you see is after accounting for that. And healthy investing and financing cash flows largely due to the transaction, the strategic partnership with Mitsui, and also the rights issue we had at the beginning of the year. The land outflows was around INR 900 crores for the year to get to that GDV of INR 10,560 crores. But this INR 903 crores also includes existing land commitments, which also should be factored in. So overall, the net cash balance at a group level is about INR 11,027 crores against a gross debt of about INR 383 crores. So we are in a very good position from a leverage perspective. This is the cash flow statement, which I think we project out every quarter. So what we have done this quarter is added Thane to our mix. So the cash flow, including Thane, we are looking at roughly about INR 14,000 crores effectively to come from our current projects, the ongoing projects, the remaining cash flows that will come, and also the projects that are in the pipeline, that are yet to be launched. Still Jaipur Residential and Murud is not included in that, but INR 14,510 crores is what we are sort of working towards. And this is the consolidated P&L from a reporting perspective. So, for the quarter, we ended up with INR 90 crores of PAT compared to INR 85 crores last year. And for the full year ended, we had done about INR 298 crores of PAT, compared to INR 61 crores in the prior year, so almost a 5x. On the balance sheet side, as we discussed the -- the balance sheet looks very healthy with a solid equity net worth of about INR 3,600 crores. This has gone up primarily obviously because of the rights issue we had at the beginning of the year, plus the profits that gets consolidated in our numbers. With the rights issue proceeds, we paid the long-term borrowings. And overall, at a net debt-to-equity ratio, we were -- as I said, we were in a very healthy position at negative 0.27. I think we have completed the slides that we wanted to present. I think we can now open up for questions.

This is Parikshit from HDFC Securities. My first question is, I think, Amit, earlier in the call, you said that next year looking at a significant jump in presales. I think last guidance you'd given on the third quarter call was about INR 4,500 crores to INR 5,000 crores. So given that some of the launches got pushed out into FY '27, if I remember at least 2, so how -- do you see any upside to this guidance? I mean -- so what -- if we can quantify the growth, I mean, when you talk about the growth or the guidance, if there is any upside to this guidance?

So we anticipated some part of the launches to give us presales in the -- in FY '27. I think some part was either Q4, or potentially go from Q4 to Q1 of this year. So the -- if we include the value of all the launches that we have planned plus Rainforest, which was technically launched in the last quarter, is roughly INR 10,000 crores. So we would hope to actually really do well on the presales side. But the part that we are seeing in the market, I think we have seen some slowdown in terms of footfalls in our galleries, sales galleries. And obviously, some of them will come back. But I think we want to be cautious in terms of what the impact of war is. So we'll keep you updated from what we think. Our goal is to first meet the expectations or guidance that we have provided. And I think that multiple launches, sizable launches that we have this year should give us the inventory to actually convert. Now external as well as our ability to execute will demonstrate how far we are or how much we can overdeliver on that.

So this INR 4,500 crores to INR 5,000 crores is pure Resi, right? It does not include the Industrial? So Industrial sales will be on top of it?

Yes, exactly. Exactly.

Second question is, if I look at your launch pipeline, so Bangalore is doing so well, but we have very scarce inventory there. And I think if I combine unsold inventory is about INR 3,000 crores. Pune still we have about INR 5,000 crores to INR 6,000 crores. But, so how do you think that how will you supplement business development now, because Bangalore has given good sales for us this year? So in next year, I think beyond one major launch, I think that's about INR 1,000 crores, Navrat. So I don't see any other major launch there. So from the sales point of view and from business development, if you can give us some color, how is Bangaluru looking at?

So I will give, and then I'll ask Vimalendra to jump in. Our -- we have combined Navrat 1 and Navrat 2 together into one project. The combined inventory from that project would be close to INR 2,100 crores to INR 2,200 crores. So it's actually -- and then we'll have the leftover or, so to say, the inventory from Mahindra Blossom. We sold 60%, we had held some of the good quality inventory for subsequent sustenance sales. You'll see maybe INR 2,000 crores, INR 2,200 crores, plus another INR 8,800 crores from Mahindra Blossom that will be there, INR 3,000 crores. We also have a couple of high-profile business development efforts underway. So -- and I think Bangalore has been a great market, both from velocity, pricing, IRR for us. So if we find the right land parcel, we'll pursue it. Maybe I'll request Vimalendra to talk about what kind of deal activity he's seeing in Bangalore, and then we can come back to Pune.

Yes. So Parikshit, rightly said that Bangalore has done very well for us. And there's a significant focus that as a BD function we are putting in Bangalore. And as we have stated in the past, we really don't want to pursue transactions which don't meet the financial guardrails. There are enough and more opportunities, of course. And given how we have scaled up Bangalore over the last 3, 4 years, you must have seen this was just a project -- from one project today, we are 5 projects. And as Amit said, we have the ability to do Navrat 1 and Navrat 2 together actually, and that's how from a design intent approvals perspective, we are moving ahead. So we'll have INR 3,000 crores in terms of overall sales value, which is available. Plus there are a few deals which are in advanced stages. We'll not be able to discuss or disclose it at this point of time. But principally aligned and we are actually working in a direction to supplement Bangalore in a big way. And good thing for us is our portfolio is fairly diversified. We don't run a concentration risk. And I think that's a very big strength for us as a company. We are very well placed across all the 3 key markets that we have said we'll focus on. So we'll continue to focus on all the 3.

And just the last question. So we have INR 11,027 crores of cash. We have a partner in Mitsui, which I think Amit earlier highlighted is one of the largest developer in Japan, so strong funds. So, when I look at the business development, last 2 years have been phenomenal, we have crossed, almost touching INR 18,000 crores, which some of the larger developers do. So from the intent point of view, how do you think business development will play out for FY '27? And -- so what will be your efforts in terms of Pune and Bangalore and Mumbai? So if you can give some sense in terms of how it will be split across these 3 geographies?

Let me take that, and then -- I think when we set out on our journey for scale up, I think we had to do a few things right. The first one was, can we do business development right, right? And I think we made tremendous progress on that. And the big thing is we are not desperate for deals. I think good quality deals come our way, and we can pick and choose based on our risk and reward metrics, right? The second one was, can we actually execute well on the ground? And I think last year was a big year for us as we are able to get approvals, get launches done, get OCs done. I think we've received 8 OCs last year. And Sudharshan will have played a very important role from a project point of view. And that has shown financial returns to our shareholders also. So when you're able to get the deals, when you're able to execute well and you're able to show return, we earn the right to ask for more capital. And some of that has already happened in the rights issue. Some is strategic partnership with Mitsui, and we have, I would say, another 3 discussions underway with different investors who are keen to partner with us. In fact, Mitsui is already committed for another deal, and then they're looking for additional deals beyond that. So our partnership with Mitsui is deeper than what has been publicly announced. It's for multiple deals. So with Mitsui as well as with some of the other discussions underway and support of Mahindra and a very healthy balance sheet, allows us to flex the financial muscle when we need to, right? And that gives us flexibility to pursue larger deals, but more importantly, right deal. We have a healthy portfolio. We -- earlier today, we had the Board meeting, and it was clearly told to us, and supported that, hey you work on building a good business for the long-term, capital is not going to be a constraint. And hopefully, that will play out as we look for all sources of capital for business development, could be Mahindra's capital support, could be strategic partnership capital coming in, or augmenting debt-to-equity in a healthy way. So all sources are available to us.

But from guidance point of view, I mean, what could be the number which one should look at for FY '27 in terms of business development?

And I will say we'll be north of INR 10,000 crores, and that's -- the reason I say that is because if we do more society redevelopments, we can do more, right? And I think for us to continue on the journey of get to INR 10,000 crores, we have to do minimum INR 10,000 crores. Our goal would be to at least do more of that.

And the split between Pune and Bangalore?

It's always be 60%, 20%, 20. 60% would be Mumbai. But if you look at our INR 45,000 crores, we are -- INR 35,000 crores right now is in Mumbai, and INR 5,000 crores each on the other 2 cities. So we will -- we have a lot to do in Mumbai. And a big part of that is society redevelopment. So we'll continue to make sure that we augment the right kind of deals in Mumbai. We can't just do society redevelopment, because they take a lot of time. We can't do only outright in Pune and Bangalore, because they require a lot of capital. So we're looking at balancing the deals in each of the geographies with the other kind of deals. So that's the basket of deals we'll build.

Pritesh from Axis Capital. Continuing from business development, one of the slide I saw, we had a target layout -- laid out for every year that which all projects we need. We are almost there in terms of visibility till FY '30. So from business development perspective, whatever we do now would be for growth, which we will achieve over and above what we have guided for? Or we'll think of it as a cushion that if market slows down, velocity comes off, at least more number of projects will at least ensure that we achieve our target? So what would be the thought process?

I think it's both, Pritesh, and I think both as a cushion. The good and bad part of our portfolio is that a large number are society redevelopments, especially in Mumbai. And they take a long time. And we have been at it for some time, we are reducing. Our first deal took us almost 2 years, second deal took 1.5 years, right? Third will take 400 days. We are measuring the number of days from the time we sign the [ definite ] document. So we're measuring that. So there is likely more slippage on the timelines when you have a society redevelopment. And when you have JDA or greenfield, I think you're able to get to your timelines which are slightly better controlled. So the acquisition that we are doing is for, I would say 2 reasons. One is to have cushion. If you have more projects, it gives you the ability to actually cover your targets better, faster. And the second one is why not think of an accelerated growth plan, right? Some of our peers have really done it. But only difference I want to have is I really want to have profitable portfolio rather than just a portfolio that's growing. And that's why our focus on picking the right deals is very important. And you'll continue to see the cash flows, and hopefully the PAT impact in our financials.

Sure. And just on that, I mean, let's say, if velocity gets impacted, we are not able to sell as much as we are right now. At that point in time, there would also be a thought process that let's first focus on achieving a certain velocity, so that this project gets self-funded and let's push out some of the launches that we are planning. At that point in time, will your balance sheet be more key to carry forward with the new launches or you would really think of first achieving a certain velocity? So would more pipeline be a burden on you that we have the pipeline, but we are not able to launch because of a lower velocity? So what would be the...?

Let me attempt to answer your question. I think -- and if I don't get it right, you correct me. I think we are at a stage where we have earned some stripes from our shareholders, right? They feel comfortable putting more money behind it. We as a team, and most of the team is sitting in this room, feel comfortable and confident that we can continue to scale this platform to deliver higher numbers, right, larger numbers, right? And those are too important, right, because you have the shareholder support, and you have the team committed and hungry to actually deliver more. You will -- we will take calls on deals, right? And sometimes, when things slowdown, those are great opportunity to regain ground for somebody like us who may have lost ground in the past, right, or not benefited from it. If we are -- our balance sheet is healthy and we have a desire, we have shareholder support, why not capitalize on that moment. But I can't say that now till we continue to perform. This year is an important year for us to perform well on the sales side, like we have done INR 20 crores, INR 25 crores, INR 27 crores, INR 28 crores, but can we do a 50% growth here or not, that INR 3,400 crores to INR 4,500 crores to INR 5,000 crores would be a significant jump, right? So why not push and deliver that? Once we do that, it will give confidence to our shareholders that, hey, we continue to perform and address each element of our execution muscle. So at that time, we'll decide which project, should we do this, should we not do that. Bangalore, for example, gives us highest IRR, right? But Mumbai has the highest volume. And then Pune is something which just velocity-wise, very steady, right? So each has its own benefit. So we always want to balance with the right size of deals, right kind of deals in our portfolio.

Sure. And twice you mentioned about the current demand environment. Is it across the board you are seeing that lower walk-ins', conversions? Or is it specific to certain market or certain ticket size? And then what would be your estimate in terms of when should things start getting normal?

I'll let Vimalendra address that from what you're seeing, Vimalendra. And then maybe we'll link it to IC also, because that's also very important for us, right?

So there is -- what is happening is while even the walk-ins have moderated, I think there is this intent to purchase. It's just that given the geopolitical scenario, people are just waiting. They say, let's see what is happening, when is it going to get settled, because the energy is something which impacts everything and everyone. And generally, without talking about other things in India, they're just waiting for the other elections also to get over. And that's the conversation which is coming very clearly, let things settle down, we will know. Honestly, in -- and we are only operating in Mid-Premium and Premium segment, right? We are not operating in the Luxury segment. So to that extent, we have not really seen that great an impact. We have just got the RERA last month for Rainforest. We have started the EOI activity. And I wouldn't say it's been spectacular, but it's not bad. It's very steady. And compared to the history of the micro market, that if you see, we are very well positioned. But we just started that journey, our sales gallery will be up and running, and we still have time to go into the market. So the price segment where we are, we are okay. And if I look at -- the one parameter that I look at is the sustenance sales across Pune and Bangalore. And let me tell you, they continue to do very well. Frankly, without getting into the numbers for this month, it's quite robust, and it's on a very good track. So it will settle down. I think these -- some of these things happened during the course of time. And once the -- there is some kind of finality to that particular situation, it will come back. Fundamentally, the demand is there. It's just that because of certain external factors, people are just deferring it. It will come back in a hurry. So don't worry too much about it.

So just this comment about lower walk-ins is just because of what we are seeing in Rainforest right now, because sustenance, as Vimalendra said that it's doing fine. Is it just because of Rainforest?

Yes. And it is because, obviously, we want to give a superlative experience and -- to all the customers. So we really over-indexed on this year's gallery, and we'll invite you, all of you, probably from next week onwards it will be open, and you can come and experience it. And I'm sure you'll be amazed, you'll be wowed by what we have created, and it's the biggest and the best that we have done as a company in line with the aspirations that we have. So it was an active construction site. We were not really able to do a lot of justice to a lot of the walk-ins. And hence, that was the impact. But it's not as if people are really not coming or not wanting to buy. It will get on track once the sales gallery is fully operational.

And one last on IC&IC. On the Ahmedabad, I think it has been quite some time we are hearing about anchor tenant. Where exactly are we? And -- because for now, I think we are fine with the inventory that we have across other locations. But at some point in time, I think both Ahmedabad and Pune will have to kick in. When would that time be?

So I think Ahmedabad, right now, we're in a position where we cleaned up all the legacy issues. The approvals are in place. We've already started the marketing activities and started talking to the consultants in the local market. And I'm pretty positive that this year, Ahmedabad should kick in, and we'll have the fourth front, which will start. We have 3 projects which are on. My sense is fourth Ahmedabad this year will certainly start. That's the short answer.

And Pune?

Pune, we are going through land aggregation right now. So Pune would be -- Pune would take some more time, but we already acquired about 400-plus acres, touching about 500 acres. We're looking at some continuity and some excess, so which is already there. My sense is it will be more of FY '27, FY '28 when we look for approvals and go forward. The idea is to plan it. We have enough inventory for the next 2 years, including Ahmedabad, and then Pune would be next after that.

Any other questions? There are a few questions online. First one is about the Thane project. So what is the current status of Thane land? And what is the Resi and commercial mix for the Thane land?

So as during the presentation, Amit has already mentioned that the Thane land is now fully a residential zone. So I think that is one big thing that has happened in this financial year. It is -- we are free to develop it the way we want to develop it, residential. We have started the initial design intent with the design team. We are looking at a mixed use. We're looking at a certain amount of commercial, high-street retail, residential. And we want to really do a great job with this project, because the location is amazing. It is basically [indiscernible] Sanjay Gandhi National Park, the metro station, the Gaimukh metro station, the first metro station is bang in front of the land that we have. The good news you must have read that the tunnel work has actually started Thane-Borivali. And that's actually going to be a game changer. Plus, let me also tell you if you might be aware, they're actually constructing a coastal road behind -- towards that creek. So with all this infrastructure which is coming, our belief is that this will significantly enhance value to the company and to the project. But the work has truly started on the ground. The teams are working on it. And hopefully, we'll be able to launch the initial phase of that particular project towards the end of this year or early next year.

Actually, the more we wait, the more value we'll create in a way, right, because the impact of metro infrastructure, tunnel, I think there's the AIIMS -- new AIIMS, I think, coming up, right? All that will start to have a positive impact. So, in terms of the other question was, I think it's roughly INR 7,500 crores by value, but we are thinking of 2 million square foot of office roughly and 4 million -- 2 million square foot of commercial, 4 million square foot of residential. And then there will be some other mixed use like retail and a couple of other things. So somewhere around 6 million, 6.5 million square foot construction.

Next question is on Mahalaxmi, Mahalaxmi project. When the same is going to be launched? And there is one more question related to the Luxury segment, whether the Mahindra Lifespace will play out in the Luxury segment in future?

Maybe I'll answer the last one. I think we are -- our aspiration is to play in Premium, Mid-Premium, Super-Premium, whatever you want to call it. I don't think we want to go into the Luxury segment. And in case of Mumbai, we have put a price point of somewhere around INR 60,000, INR 70,000 per square foot as a definition of what that means. We have seen that the moment ticket price goes beyond INR 10 crores, the demand elasticity is very different. Even between INR 5 crores to INR 10 crores, it starts to be not high velocity. So we want to maintain creating homes for our customers which are in the right ticket size. So we'll continue to play in the Mid-Premium, Premium segment. Maybe I'll request Vimalendra to answer the Mahalaxmi question.

So the question on the approval stage, we are towards the last stages of the approval process. And hopefully, we should be able to launch it soon once we get RERA. But we're targeting this quarter itself.

There is one last question. The question is whether -- are you seeing any demand softening in MMR region or buyers sort of delaying their purchases?

Yes. So I've stated that earlier. Honestly, it's too early. It's too early. The war has just started towards end of March. We didn't see any impact of it in the Q4 numbers or March numbers. You've seen pretty much everybody, the sector has done very well. We have done very well. And for me, the true parameter is the sustenance sales, and we continue to perform well. And from what I've spoken to others, they continue to do well. There are people -- I think we will definitely -- we are seeing an impact at a real high end, which is the Luxury segment, but we don't operate in the Luxury segment. So for the portfolio that we have, I think we are in pretty good shape. Yes, there is a slight delay in terms of decision-making, because of factors beyond anybody's control. And once those factors settle down, inherently, fundamentally the sector is doing very well. It's on a very good wicket and the demand is inherently very strong. So it will bounce back significantly.

Those are only the...

I'll just add, I think because the question is here, a question I think there is -- maybe audience have picked up that we are -- the war is creating a huge impact on the walk-ins and the demand. I think as we reported, it's actually too early for us to say, like whether demand is going away or demand is just deferred by a few weeks. We've also seen that the organic demand doesn't just go away, right? There is a healthy demand that will continue. And when there is little bit of slowness in the market, which may happen, and it's expected because we had 3, 4 years of strong growth in the past post-COVID. So some moderation will happen. And we've seen that even in the last year in terms of units, in terms of apartment size, in terms of the pricing, and that will not continue this year for sure. But when that happens, there is a clear shift towards trusted developers, trusted brand where customers feel that, hey, instead of taking risk with somebody who is, let's say, not as stable, let's try and buy something which is going to be coming from the portfolio, a stronger, well-placed developer with a stronger balance sheet, right? And I think that shift will continue. And whatever you may lose in terms of few points of growth at the industry level, you might be able to gain back in terms of share gain away from smaller developers. So my sense is over the full year or over a longer period of time, the war impact will get neutralized and will be -- we'll go back to what we ought to be seeing in a country where per capita income is increasing, per household income is increasing. Urbanization is significant and then demand for housing continues to be there.

How has been the experience now on the approval side? So if you can help us understand both for the 3 geographies, Pune, Bengaluru and Mumbai? So EC issue was sorted out in Mumbai. I think that helped us accelerate some of the approvals. So -- but if you can give some color how fast or slow now things are there on the approval side?

Vimalendra?

Yes. So I think the system, by and large, remains the same, but we, as a company, have really improved. Let me put it that way. And there are -- and the fact that we have got 8 OCs in a very timely manner, regimented manner, right? The fact that we were able to launch as per what we committed at the beginning of the year, that's kind of a proof that I think we have got better at what we do as a team, as a system. And there are a lot of reasons. Obviously, we have a clear task force. We have a very strong collaboration culture where all the functions come together. There's no -- and in real time, like even the RERA 2.0, now they've upgraded their website, and they've made a lot of the changes and with legal team, the design team, the finance team, they practically sit during the whole day, the projects team. Morning we sit and by evening we're able to file. This is just one example, right? Earlier, it used to take 7 days to file for a RERA application. Today, we are -- and I'm very happy to say that we're so efficient, if we receive a CC today, by tomorrow end of day, the RERA is filed, and then we make sure that our corporate [ efforts ] team actually -- actually -- while it's an online system, but the assessment happens offline. So we actually tell, hey, we have already done, this is our application number. Can you please expedite that? So we have improved at every stage. And so -- and this is across the locations. Just to give you an example, in Bangalore, the Blossom launch, you are aware, suddenly, we got -- I spoke to a few of the investors, they say, "We are surprised that we have got Blossom RERA." We said it's not a miracle, but it's a process that we have as a team, as a company has followed, right? So yes, I mean, the system, by and large, remains the same, but I guess we have become better at it. And that's allowing us to actually be very good at predicting timelines. And that's why when Amit presented those and we have the confidence of saying that what is Q1, Q2, Q3 across -- all the way till FY '30, as a management team, we are putting our neck out and saying that, "Hey, this is what we will deliver", because I think we have really, really streamlined a lot of the things, and we remain confident that we'll be able to deliver it.

And on the annuity portfolio, I don't know what's the strategy now, but you said that in Ghodbunder, we'll do a 2 million square feet of commercial. So if you can help us understand, it is the annuity strategy or strata or -- so how things will move on there?

We are moving towards mixed use where at least 3 locations, Kanjur or Bhandup, Thane and Citadel, all of 3 are land where we have -- 2 of them are outright owned by us and one is a JDA. We will have a portfolio. We will not do a strata sale based on our latest thinking. We feel that we can add more value by owning the asset and creating annuity portfolio. These are great locations. So our current view is that we'll want to develop them as mixed-use locations. And it's also necessary, because you have so many people living, it's good to have work locations there. So that's our current plan. And that will give us a little bit of annuity portfolio that you need. And the yields tend to be better when you develop an asset rather than a buy an asset, right? So hopefully -- and Thane will be a very different price point, Pune sit at a very different price point and Bhandup would be a different price point. But I think that's why we are hoping to build a healthy portfolio.

So in 4, 5 years, we expect to be about INR 300 crores of annuity portfolio in terms of rent generating?

I don't think we'll be able to get to that, because Thane is very low right now relatively. Cost of construction and land prices are relatively -- And Pune is lower than Mumbai. So I think our desire is to first get somewhere between INR 150 crores to INR 200 crores before we put more assets -- more capital to develop more commercial assets.

So this will be about 4 to 5 years, right, out from here?

Yes, yes.

Okay. And just the last one on the deliveries for FY '27. So one million square feet in terms of value. So what kind of revenue recognition we are looking at for FY '27 from the status of the current projects, which will complete in FY '27?

So Parikshit, the numbers I will not be able to share exactly, but I can tell you that the OCs that we are expecting for FY '27 should contribute to a good growth over the prior year FY '26. One thing I would like to highlight is a couple of projects, right, Eden Phase 2, we received the OC on 1st of April. So we didn't -- we couldn't recognize obviously, the revenues on -- by 31st March. So that is already in the bag. So we will recognize that and you will see that numbers coming through in Q1 of FY '27. Similarly, the project Luminare in NCR, that also OC we actually received on 31st of March. But again, we couldn't send the demand letters on time. So again, that will come to be recognized in Q1 of FY '27.

Also, I'll just augment, we have 8 OCs plan for this year, 2 of them have already happened, right, based on what Sriram said. And the 6 remaining will happen. Of the 6, 2 are on the affordable, 4 are -- 6 are -- including the 2 that we have gotten, are in the Premium segment. So 4 Premium, 2 Affordable and 2 already Premium received. So that's our current plan. It should give a healthy growth over the current year portfolio.

Just the last thing. Have we started relooking at the Gurgaon market now? Because next year, if we end close to about -- somewhere in the vicinity of INR 5,000 crores and then again, if you have to plan going back to Gurgaon again, so it will need at least 1 year or 2 years to come back to have a launch in -- again, a market which you are already present for some time, but now you [ vacated ] and then again, you're thinking. So any thoughts there? How are you looking at reentering Gurgaon from time point of view?

Yes, yes. I think -- we are still hoping to go deep in the existing 3 markets before go back to Gurgaon. And to the point that you guys asked earlier in terms of capital allocation, if I have to fund capital for another market, it will take away from, let's say, Pune or Bangalore or even Mumbai. And I think our next maybe 2 years, it's better for us to go deeper. But I think if we feel comfortable that we have a path to 5,000, 6,000, 7,000, we will start to think about another geography. That doesn't mean it has to be Gurgaon. It could even be, let's say, Chennai. I'm just giving a name to you. And the reason it is, because Chennai, we already have Mahindra World City Chennai, so there is a rub-off effect. We have our Research Valley, Mahindra name is popular. We have Origins Chennai in the northern part of Chennai. And we feel that there is a good brand pull from local customer, and we have done 4,000 apartments already in World City Chennai. So there is a reason for us to at least make a case for why not Chennai, why just Delhi, right? Firstly, markets are smaller, but we are not looking to do a high volume. We are trying to do the right volume for each of the market.

Just last two questions. First on, in terms of delivery for this quarter, Q4, which are the projects we delivered? Because I still see gross margins pretty low around 6-odd percent as per my calculation, I might be wrong. But -- so what were the deliveries, if you can highlight? I thought Luminare would be the one, and I was concerned that why Luminare would be such a low-margin project. But if it's Q1, then which were the other projects which got recognized?

So we pretty much got Phase 1 of most of the projects we have, Pritesh. Like, for example, Phase 1 of Eden is there. Phase 1 of Nestalgia is there. Tathawade, which actually is 1 affordable project. Phase 1 was slightly, in fact, lower than -- lower margin compared to the others. So we also had some of the OCs come through on the affordable side. Palghar is also reflected in some of these numbers here. You would see that the Phase 1 of the projects typically tend to be a little lower in margin compared to the remaining phases. So you will see that getting reflected in the coming quarters when we recognize the revenues for Phase 2 for some of the projects.

And what should be the ballpark gross margins that we should be looking at for FY '27 delivery?

So if I were to think about the gross margin, I think I can talk to you about the project level. Around the project level gross margins, these would be upwards of around 30%. For example, some of the projects like Luminare and the premium projects could be around that level. But again, for next year, you will have affordable projects as well in the mix for us. So we have 2 projects that are coming up for OCs next year. So again, I don't want to give a number and, like kind of justify the reasoning for it. But it will be a mixed bag, but you will see as the Phase 2 of the projects getting recognized, the profitability will improve.

Sure. And one last on launches for FY '27. Just a broader cumulative number?

I think Amit said it's about INR 10,000 crores, roughly.

Yes. INR 7,000 crores plus INR 3,000 crores, INR 3,000 crores of Rainforest will be this year. The remaining INR 7,000 crores for the other 7, 8 launches that we have. So the inventory launch should be INR 10,000 crores, and we are hoping to do well on that front, given the earlier part of the discussion, right. We -- I think our affordable portfolio will continue to come down. But in this year, there will be a good number still, right, Tathawade and Palghar, right?

Kalyan.

Kalyan, so you will have a little bit of drag even in this year. But I think from next year onwards, what will happen, the premium portfolio will become dominant. So -- and the moment you have affordable, the volumes are high, the revenues are less, the PAT is less, it affects the financials in the wrong way. So from -- but I think the impact of Mid-Premium, Premium we'll start to see. And maybe in the next meeting, we'll share with you what IRRs are there for our portfolio. So I can verbally tell you it's -- roughly 17% is the portfolio IRR that we are carrying. There are 26 projects that are part of it.

Including affordable?

Including affordable, right. Including affordable. Obviously, the affordable's contribution is small, but they are close to single digits, in some cases, even negative, right? And we are trying to fulfill our RERA commitment, uphold our brand promise. But the current year projects are doing really well or the last year projects are doing very well. The last 3 years, every project that we have launched, it has good margin profile. But we always have to watch out that price gets locked early and then the cost happens later and you have new labor code and all those things because of war, the energy costs are getting in the way. We have healthy accounting practices to make sure you have contingencies and escalations and DLP and everything. But despite that, we need to -- we have a razor sharp eye on our cost, and that's what the -- where the execution is. We just discussed this in our meeting today. Over the last 8 quarters, our projected costs are -- have not changed by more than INR 10 crores for all the projects, over 8 quarters. Obviously, it has a lot of cushion and contingency, et cetera. But we are not changing the cost of -- for last 8 quarters.

I guess we have covered all the questions.

Yes, we have covered all the questions.

Well, I -- thank you, I think for coming over, and this has been a strong year. And my whole team is here. We had our internal town hall, and we are very excited at the prospect of doing even better on the foundation of what has gone in for the past year. So we'll keep you updated on the challenges ahead. And hopefully, we'll meet up and exceed the expectations. Thank you.

Thank you, everyone.