Man Infraconstruction Limited ($533169)

Ladies and gentlemen, good day, and welcome to Man Infraconstruction Limited Q4 FY '26 Earnings Conference Call hosted by Go India Advisors. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Yashesh Parekh from Man Infra. Thank you, and over to you, sir.

Yes. Good evening, everyone and a warm welcome to each one of you attending the earnings call of Man Infraconstruction Limited for the period of Q4 and FY '26. Today, we have with us Mr. Manan Shah, the Managing Director of MICL Group; Mr. [indiscernible] Shah, Director, MICL Global; and Mr. Ashok Mehta, Director and Group CFO. I would request all the participants to keep discussion strategic in nature. If you have any specific data-related questions, I would request you to get in touch with us post the con call. Thank you. Now without taking much time, I would request Mr. Manan Shah to brief you all on the company's performance and business outlook. Over to you, Mr. Shah.

Good afternoon, everyone, and thank you for joining us today for the quarter 4 and FY '26 Earnings Conference Call of Man Infraconstruction Limited. I hope all of you and your families are doing well. FY '26 was an important year in MICL journey, where the company was focused on closing marquee project acquisitions continuing healthy sales momentum and completing the consolidation phase across several ongoing residential developments. FY '27 has also begun on a strong note for the company, and we aim to achieve the best ever sales in the real estate business. We believe we are entering the next chapter of growth with the largest ever launch pipeline in FY '27, a strong sales ambition set over the next 2 years from its ongoing and upcoming developments and improving execution visibility across projects. We would also see a significant part of our development portfolio gradually move into stronger revenue recognition in the upcoming years. In many ways, this year represents an inflection point for the company where years of disciplined execution, capital prudence and strategic groundwork are now beginning to translate into a larger growth phase for the company. Over the next 6 to 18 months, MICL Group expects delivery of over 1 million square foot of carpet area across multiple ongoing developments. At Arabia Parkwood near titer, we are preparing to deliver the first 2 towers of the development, comprising 35 stories with 2 podiums and 1 level basement these towers are expected to be delivered in less than 4 years from the launch. More importantly, the overall project comprising of more than 1,000 units across 4 towers is already nearly 90% sold out. In our flagship project, Aaradhya Avaan at South Mumbai, we have achieved an important milestone by delivering the 38-story members tower in less than 2.5 years of time, which is also one of our new records, which MICL Group has done. Similarly, at Aaradhya One Park, which is situated at [indiscernible] , has witnessed one of the fastest execution time lines within our portfolio. That project is spread across approximately 3.2 acres with 11 hours stores and 2 basement level reach. The project is expected to be completed by March 2027 with approximately 3.2 years of commencement work. In [indiscernible] , our atmosphere O2 project in which Tower G, representing the third phase of atmosphere development is also progressing very and is expected to be completed over the next 18 months. The 47 so tower is already 70% sold out. We expect to generate strong operating cash flows over the next term with the delivery of these developments. Another important highlight I would like to state is in MICL Group, the strongest ever launch pipeline is coming in FY '27. The company expects ongoing and upcoming launches of its multiple projects, approximately of INR 5,600 crores GDV, situated across multiple landmark locations like Marine lines, Tardeo, BKC, Pali Hill. With such a healthy launch pipeline, the company has set an ambition combined sales target over next 2 years, FY '27 and FY '28 of over INR 5,000 crores, supported by both upcoming launches and continued momentum across ongoing developments. Aaradhya Avaan project at Tardeo South Mumbai, the launch of higher floor inventory along with operational sales experience center is completed now, and we expect this to support stronger traction going forward. In addition, multiple projects approaching occupation certificate over the next term are also expected to further support the sales momentum. The company also continues to witness encouraging response of the newly launched project, Tech Park, which is situated in the financial capital of Mumbai at BandraKurla Complex, BKC, following its launch, which happened during FY '26. During FY '26, we also deepened our presence in South Mumbai through a new project addition at a having an estimated GDV of approximately INR 2,000 crores and saleable area carpet of nearly 3 lakh square feet. With this addition, ICL South Puma portfolio now represents a total combined gross development value of over INR 8,000 crores and a development footprint of approximately 5.7 million square feet across Tardeo marine lines together. This position MICL meaningfully with some of the Mumbai most prestigious residential micro markets. Another important strategic initiative for MICL Group is that we shall now introduce MS collection residences a distinct ultra-luxury vertical focused on boutique CV residences, blending neoclassical architectural design with modern luxury and curated living experiences. Every development under MS Collection residences will have limited inventory, long-term legacy appeal and operate with its own identity and positioning separate from the [indiscernible] brand portfolio which shall now be towards community building. So Arada brand shall continue towards community building projects and MS collection shall continue towards building ultra-luxury portfolios and stand-alone projects. I would now like to throw some light at our global residential portfolio established in Florida, United States of America, where we are gradually scaling up. During the year, we acquired a minority stake in a luxury residential property situated at West Avenue with an estimated GDV of over USD 1 billion. The projects shall have over 100 units with Waterfront view located at Miami Beach, Florida in the U.S.A., which is likely to further strengthen MIC brand in the U.S. through MICL Global, the wholly owned subsidy of MICL Group. Today, we have exposure to some high-end residential developments such as the risk carton residences at Lauderdale Beach, Botanic Residences, [indiscernible] , 1250 West Avenue and Shipping Avenue townhomes in Florida. As of today, MICL Global has a portfolio with estimated aggregate GDV of approximately USD 1.4 billion across ongoing and 1 completed development. Moving to our next engine of growth, the EPC business. The current EPC order book stands at about INR 392 crores, which shall be executed over the next 3 to 4 years. Our upcoming development constitute a construction area of about INR 1 crore square feet. About 50% of this will add to the EPC order book once the pipeline is launched in FY '27. This will once again improve the visibility of EPC business for the near future. In addition to our core operations, the company continues to benefit from the interest income arising from capital deployed across various project entities. And cumulatively, MICL Group's investment across these projects stand at around INR 1,461 crores. As of FY '26, our real estate portfolio stands at an estimated gross development value stated as GDV of over INR 17,500 crores across ongoing and upcoming developments. Out of this, we have a balanced sales pipeline of INR 13,300 crores, which shall be sold across the coming years. Our portfolio today is spread across some of Mumbai's most prestigious residential markets, including Tardeo, marine lines, Bandra, BKC, Villeparle, Mulun, CratKopper and Miranda. As a part of our Vision 2031 road map, we now aspire to double our development portfolio to over INR 35,000 crores of through sustained business development and strategic expansion across Mumbai's most distinguished address. We believe MICL is now entering its next phase of growth what's coming ahead will redefine the company and the brand positioning in Mumbai as well as the U.S. micro markets. From operational performance point of view, during FY '26, the company achieved sales of approximately INR 1,800 crores, along with collections of approximately INR 990 crores, while selling over 5 lakh square feet of cafeteria during the year. During the quarter 4 of FY '26, the company reported sales approximately INR 438 crores and collection approximately INR 279 crores with a sale of approximately 1.2 lakhs square feet of carpet area led by a healthy traction across the projects in Tardeo, Valepar, BKC, Mulan and [indiscernible] From a financial standpoint, the company reported consolidated revenue from operations of approximately INR 630 crores for FY 2025 and 2026. As of today, and as mentioned earlier, FY '26 largely represented a consolidation phase across several ongoing developments. As a result, we expect a significantly larger share of revenue recognition to come in the upcoming years. And as many key projects approach advanced stages of completion where we have already achieved significant sales. The company also continued to generate healthy other income during the year. It is important for everyone to note that MICL Group earns interest income on the capital invested in its project entities. This must be understood as one of our business income enhancing corporate level returns and the benefits of our integrated business model. The consolidated PAT after minority interest stood at INR 201 crores. For quarter 4 of FY 2026, consolidated total income stood at approximately INR 187 crores, while PAT after minority interest stood at approximately INR 43 crores. The company continues to build a healthy balance sheet and maintain it. And as of 2026 consolidated net worth stood at approximately... [Technical Difficulty]

I'm sorry sir we can't hear you. Ladies and gentlemen, please stay on your phone while the management [indiscernible] Ladies and gentlemen, thank you for your hold. We have management back. Over to you, sir.

As of March 2026, consolidated net worth stood at approximately INR 2,266 crores while consolidated liquidity stood at approximately INR 686 crores. Consolidated debt remained extremely low at approximately INR 58 crores thereby maintaining MICL net debt reposition. Looking ahead, we remain optimistic about the medium and long-term outlook for the Mumbai residential market. particularly with the premium and luxury segments where demand continues to remain resident. With that, I will now open the floor for question and answers. Thank you.

[Operator Instructions] We will take our first question from the line of Rachna Mehta from SK Advisors.

My first question is the reported revenue was about INR 60 crore. Can you please provide a detailed project-wise reconciliation between cumulative bookings collections, percentage completion and revenue recognize still did across the projects?

Yes, this the revenue recognition aspect, I would request you that we can get over for the details post the con call.

Your second question is that do you see risk that the sharp rise in ultra luxury launches across South Mumbai would create any inventory overhang over the next 3 to 5 years?

So Resha, this is Mr. Shah. Regarding the overall market perspective, Mumbai, a couple of decades back when it was on a cusp of the first time development. There were similar trajectory, things observed that how will Mumbai sustain so much of inventory piling up. We see a similar thing happening where there is a change in the income segment, number one, happened over a couple of years post COVID, especially and this has changed the mindset of consumers to adapt for larger ticket size apartments. Considering specific to MICL, if I would like to state, we are not doing apartments currently, which are INR 100 crore, INR 200 crore ticket size. So the inventory size that we are operating in is a very comfortable ticket size for that micro market which will not create a problem in the sales velocity going down for us, especially.

And what is the targeted presales number for FY '27 alone versus the combined INR 5,000 crore, FY '27 and FY '28 ambition, basically, if you could please throw some light on that?

See, this year is a year full of launches where nearly 1 million square feet is what is targeted to be launched. We are on the words to discuss with a lot of societies where further new products shall also be 1 year in the final negotiation stage. Once the approvals have come in, we will be announcing those soon. But as of today, if we speak, we have a INR 5,000 crore approximate pipeline of launches for this specific year itself and we target nothing less than INR 2,500 crores for this upcoming year. So you can consider more or less, depending on the current situation, like of the total INR 5,000 crores 50-50 is what we are considering without adding on to new projects.

Okay. What level of annual price appreciation assumptions are embedded with this guidance, also which micro markets are currently witnessing the strong pricing power, if you could please highlight?

So when we have always taken projects or done the feasibility [indiscernible] as I scale have a policy where we have never considered the price appreciation. And still, if we can maintain a healthy bottom line, that is when the company takes the project. So we are not honestly bullish on the price hike happening in Mumbai because of the supply, because of this war situation and stuff, but we are confident on the absorption of the inventory that we are going to sell. So regarding price appreciation, I don't see a price appreciation happening. But a flat line on the price does not depict a flat line on bottom line or top line. We'll be having healthy numbers in terms of both and we'll be able to operate in the micro markets like currently where you are asking the price trajectory. We are having a very good sales momentum at our BKC project, which was the recent launch this year. Tardeo is going to come up. The newer phase of Tardeo basically is going to be upcoming in the third or the fourth quarter of this year, maximum. We're trying to postpone the launch but if we receive permissions early, we'll definitely launch the project earlier. So these are the markets where the momentum is strong. Aaradhya, which is one of the flagships launched at South Mumbai, we have now launched the final top floors, and we've also built a brand-new experience center, which is inside the building itself. We have already received more than 200 people's footfall up till now, and they are extremely impressed and the transactions are constantly ongoing, like the weekly run rate is running very, very strong. these are the locations where we see. And of course, Marine lines project will also be launched this year. Again, it's a similar micro market to Tardeo. So where we not consider the price appreciation but we have considered a healthy sales momentum, and we are confident in achieving that.

The next question is from the line of [indiscernible] from Smart in Services.

Sir, I wanted to understand, like you stated to be INR 1,300 crores balance in feasibility. So how much porting to already [indiscernible] inventory awaiting revenue decanting and sold future inventory?

So out of INR 17,000 crores, or approximately is the unsold inventory, which is targeted to be launched in the next few years' time, depending on the project stage. So out of INR 1,000 crores, everything is unsold. But out of INR 17,000 crores, nearly INR 4,000 crores is already sold.

Okay. And also like what is the expected annual revenue recognition in for FY '27, '28 and '29?

. See, in terms of -- compared to this year, we are expecting nearly around 35% to 40% of our growth in terms of revenue recognition because this is the year, like I said, where almost 1 million square feet of projects are going to be launched. So nearly around INR 5,000 to INR 6,000 crores between range the is the GDV value of these launches. So we are seeing a very good upward trend in terms of the top line coming in. A lot of projects are also near completion where OC will be received and that will result in excellent cash flows and the recognition shall happen like our [indiscernible] project is near completion. The [indiscernible] is project is near completion. [indiscernible] project is near completion. These projects will get us a revenue recognition of the unsold inventories soon.

Okay. And as you are entering into this ultra luxury redevelopment project. So should the investor also expect like higher margins of [indiscernible]

Yes, definitely the margins in these and you shall see that in the upcoming years definitely.

And sir, I just wanted to understand like what is your segment on its revenue up of good prices with any variation?

Post this call, you can get in touch with Ashish for the micro detail report analysis, and he shall share all the information that is required.

Next question is from the line of Raj Hauro NBS Brokerage.

Sir, this FY '25 was one of the best years for Man infra. So if we take a slightly longer-term view, say, FY '28. So can we see a repeat of that FY '25 best numbers, which the company produced? Any color on this?

You see, so if you see the growth side of it, this year is a year -- last year was the year when we had a lot of acquisitions coming up. This is the year when all these acquisitions will be fruitful and launches would be coming in. So in the next -- that's why we've given a vision 2031, where we are seeing an excellent growth in terms of top line, bottom line, and we've also expanded our horizon in Mumbai in terms of going to Bandra, BKC in multiple locations. So these high-end projects will definitely yield better margins also. And regarding the indication for the FY '25 number, we are having confidence that we'll be even surpassing that number.

Next question is from the line of Ritwik Ship from Vena Financial Services.

Sir, just one question from me. You mentioned in the presentation that you look to double your GDV over the next 5 years on the current base. So what is the kind of business development that we will require to do in the next 3 to 4 years to achieve this?

We are currently speaking to nearly more than 10-plus housing societies across Mumbai, a lot of which is at the final negotiation stage or the final presentation stage. So we are confident to win multiple out of these negotiations that have been going on. Secondly, the quantum of these projects are much larger than the previous projects, which we are on the words to complete. So for example, if you have seen Tardeo projects, the new Tardeo stand-alone building is a INR 2,000 crore project. So these are the kind of projects which we intend to add on to in the near future, which will result in getting us the INR 35,000 crores GDV by 2031. And we are very confident that 2031 is still very far. We intend to achieve this target much, much prior than that, hopefully.

Okay. And sir, this will be predominantly redevelopment or it will be a mix of redevelopment, JDA, acquiring land parcels. How do you see that shaping up?

It will definitely be a healthy mix of everything because we've always considered ourselves as a flexible company where wherever the best opportunity comes in, we tend to move towards that direction. So it will be a full mix of JDA, JV redevelopment. We are even targeting to add a commercial portfolio soon.

Right. And what would be the annual spend that we could do for the acquiring of the projects?

See, there is no specific number, which I can point it out to, but our cash flows are healthy enough to allow us to acquire these newer projects and the number that we've quoted where we want to double the GDV, we have a healthy run rate of cash flow getting generated from our ongoing projects and the future surplus coming in from the projects which are yet to be launched. So because it has more -- a lot of projects are near completion. -- substantial cash flow shall be getting started to generate, in fact, from this financial year itself onwards.

Next question is from the line of Subu [indiscernible] an individual investor.

Yes. Congratulations to management for the year that just concluded. My question is more around the upcoming launches, specifically the Marine Lines project, if you could add some color around what time we can expect that launch? I know that you have mentioned FY '27. But just wanted to get some idea on that specific project.

So Marine Lines project, the entire land is now vacated. The existing members have been relocated. Construction for the rehab tower and the sale tower has already begun where we have received the IOD and CC for the same. The launch is targeted to be done during the festive season. So the Diwali is when we have targeted with a brand-new experience center sales offers, basically, so we intend to do see, we are waiting right now where the situation globally, which is changing the sentiments of customers, we don't want any implications to drop on the pricing or we don't want any implication whether there's any negative publicity happening for the industry in terms of not specific MICL project or Marine line. But right now, we see consumers at times rethinking. So we're just waiting it through to make it a grand success.

Sure. And is it the same for the Tardeo 2.0 cluster?

The Tardeo 2.0 is just acquired. We have already applied to permissions. But yes, the target for the Tardeo 2.0 is also during the November, December time.

Got it. One more question. I saw a lot of -- in the latest presentation, not so much emphasis on the port part of the business. Is this a conscious decision of you're trying to build the company towards the luxury real estate sector only moving away from the traditional EPC sector?

No, that's not exactly the clear indication that we are deriving away from port. But if you see port segment in India has always been a subjective industry where a couple of years, the port sector is down. So we don't want the company's growth to depend just on the ports, ports will definitely add it's always a healthy margin project. But not every now and then we are seeing many ports getting added in India. So we have been focused more towards the luxury residential segment. And yes, real estate would definitely be the heavy lifter compared to both because of the quantum of the project that we have in real estate is nearly INR 17,000 crores as of today. And you saw the number which we are planning to double. So [indiscernible] is something which will definitely -- as and when we find a good opportunity, we would want to bid. But if you see our current in-house EPC portfolio is nearly INR 1 crore square feet. So that either comes in the form of savings to the company where the company self executes the project or where there are partners, we tend to give the EPC contract to the money. We do have a healthy pipeline of EPC. But the intention is definitely to grow more towards realistic.

We will take our next question from the line of [indiscernible] Mehta from Sky Advisors.

Firs question is, do you think that redevelopment projects in Mumbai are currently at their most profitable stage because the property prices are very strong, while the borrowing costs are still manageable? Or do you believe this cycle is different from past real estate up cycles?

If you're asking this question as a member, how will I be benefited as a member, for instance, if I have to answer, this is the golden years of redevelopment is what I would say, where the existing tenants or members are getting the best benefit out of it. Not just because of the pricing, I would say. Mumbai's pricing has more or less been a flat line apart from a few specific locations, which we see in the press and media getting halted upon. But Mumbai pricing has been more or less stagnant. The thing what has gone up is the SFI. So if you see the policies the way they have been drafted, better benefits have been given by the government, which the industry is definitely thankful for. And that benefit that developers are passing on to the redevelopment existing flat owners. So that is where, I would say, compared to past redevelopment projects, if you would go like 6 years, 7 years back, a lot of policies did not exist. But now they do. So that is where the benefit of predevelopment is going on very, very smoothly. And I see this momentum continuing in the next couple of years because the way the infrastructure is being managed. The way the new connectivity, the Maharashtra government has planned in terms of coastal road connectivity, Metro, Atala, Sarut Mama, bullet train, it's an excellent platform to have people staying outside the city also and contribute to the economy of Mumbai. So that is where approximately you would see that this momentum would continue and create new pockets also.

Okay. That was very helpful. Also, the company is increasing its focus on ultra luxury projects. in Mumbai. So what exactly gives management the confidence that the demand in this segment will remain strong over the next few years. And this is not just like any short-term trend. And also as the portfolio becomes more tilted towards large luxury projects, with longer completion time line, should investors expect more fluctuations in revenue recognition and earnings visibility going forward?

See, why management is confident I'll give you a real-life study example. My luxury project, which is a mid luxury to luxury, more than 50% is sold. My Valepar project which is [indiscernible] is 50% plus some. If you see the Tardeo project, which is a South Mumbai, it's 65% plus already sold. The recently launched luxury project at BKC, our [indiscernible] Park, almost in less than 3 months, more than 20% is already sold. And we are continuously seeing that pipeline of customers turning to our experience centers. Now that is the reason we have, as management have decided to continue our growth in acquiring these type of projects. And Mumbai is on the verge where 3 BHK in 2012, '13, [indiscernible] if you see, there was a trend of 1,000 to 1,100 square feet. Post that the economic crisis happened, 3 BHK sizes, average in Mumbai started dropping down to 800 to 950 square feet. Now again, we see in Mumbai going almost up to 1,500 square feet. So that means the buyer's mindset has changed where everybody wants a slightly larger space to occupy, and this mindset has changed mainly after COVID situation, where people realize the importance of a house where they realize the importance of having like their own space, and this is something which has become very, very common across all of our projects, wherever we are doing a smaller 3 bed. People are now demanding a larger bed size also. And in fact, the larger 3 bed sizes are getting sold out first compared to the smaller bed sizes. And a similar situation is happening in the formed and 5 bed spaces also. So these are the reasons where the company feels that we should definitely move in the near future, and we are not making any exceptionally large apartments, which we feel can become a bottleneck for the company to sell and which can have a hindrance on the cash flow in the near future. So we are operating in the space, which has been a healthy demand and supply continues game.

Thank you. As there are no further questions from the [indiscernible] I would now like to hand the conference over to the management.

Thank you, everyone, for joining the conference call of Man infra. If you have any questions, you can reach out to us post the con call. Thank you.

Thank you very much. On behalf of Go India Advisors, that concludes this conference. Thank you all for joining us today, and you may now disconnect your lines.