Suraj Estate Developers Limited (SURAJEST) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the Suraj Estate Developers Limited Q4 FY '25 Earnings Conference Call. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Rahul Thomas, Whole Time Director of the company. Thank you, and over to you, sir.

Good afternoon, and welcome to our Q4 FY '25 earnings conference call. Along with me, we have our CFO, Mr. Shreepal Shah; Mr. Ashish Samal, our Internal IR; and SGA, our Investor Relation advisers. I hope all of you have gone through our investor presentation uploaded on the exchange and our company website. FY '25 was a remarkable year for us. While the strategic reconfiguration and consolidation of selected land parcels led to some delays in project launches, these steps have significantly enhanced the efficiency and long-term value of our project layouts. We saw strong, broad-based momentum across our portfolio, spanning luxury, value-luxury and commercial segments. We are optimistic that the deferred commercial project, along with few residential projects delayed due to regulatory approvals, will be launched in H1 FY '26. During the year, we raised INR 343 crores, which was fully utilized towards acquiring commercial land, working capital and paying for additional FSI. We recently acquired a 390 square meter land parcel at Shivaji Park, where we plan to develop a luxury project with an estimated GDV of INR 80 crores, offering scenic sea views alongside excellent metro connectivity. As we look ahead to FY '26, we're excited about a strong and diverse launch pipeline that reinforces our leadership in South-Central Mumbai market. This includes the marquee commercial development in Mahim, along with multiple value-luxury residential projects in Mahim, Shivaji Park and Dadar. Our deep expertise in redevelopment under DCR 33(7) continues to be a key differentiator, enabling us to unlock complex projects and deliver high-value outcome. In FY '26, we plan to launch a mix of residential and commercial developments with a combined GDV of INR 2,000 crores. This includes contribution from pre-projects in the residential space such as Parkview 1, which is in Shivaji Park; Lobo Villa in Mahim; JRU project in Byculla; Lucky Chawl in Mahim, Shivaji Park project, which was recently acquired. Further our commercial development on Tulsi Pipe Road alone accounts for INR 1,200 crores of the GDV. Additionally, we're happy to announce that we have in-principle approvals of 2 lakh square feet of additional carpet area under the metro FSI for our Marinagar project in Mahim. This expects to generate an incremental GDV of INR 800 crores only in this project for -- on account of the metro FSI, further strengthening our growth prospects. With regards to new launches, our project Parkview 1 in Shivaji Park and Kowliwadi in Prabhadevi is on track. All our tenants have been relocated. The existing buildings have been fully demolished, and the site is now fully vacant. We have applied for commencement certificate, post which we will obtain RERA registrations for both these projects. The combined GDV of these 2 projects alone is INR 370 crores. With regards to the commercial launch, we have received fire approvals for the amalgamated plot of 426-A and 426-B. We have submitted concession approvals and expect the same shortly. With the fire approval already in place, we are on course for a high-impact launch in H1 of FY '26. With a calibrated strategy, a robust pipeline and supporting market fundamentals, we are well positioned to drive sustained growth and deliver long-term value to our stakeholders. With this, I would like to hand over our call to our CFO, Shreepal Shah, who will run you through the financial highlights.

A very good afternoon to everybody. I will now run you through the financial highlights for the quarter ended -- quarter and year ended March 2025. Starting with the performance for FY '25, the total income grew 33% year-over-year to INR 553 crores versus INR 416 crores in FY '24. This growth was primarily driven by increased sales of units, supported by strong brand recognition in the South-Central Mumbai micro-market. EBITDA degrew 13% year-on-year to INR 207 crores in FY '25 versus INR 236 crores in FY '24. Operating margins were impacted by higher operating costs, including a INR 30 crore charge in FY '25 for settling litigation with a JDA partner. The settlement cost was split equally between INR 15 crores booked in quarter 3 FY '25 and INR 15 crores in quarter 4 FY '25. PAT increased significantly by 48... [Technical Difficulty]

Sorry, ladies and gentlemen, we have the line from management disconnected. [Operator Instructions] Ladies and gentlemen, thank you for patiently waiting. We have the management back with us online. Over to you, Shreepal sir.

So I'll just repeat, I think we got disconnected in between. So just to -- starting with the performance for FY 2025, the total income grew 33% year-over-year INR 553 crores versus INR 416 crores in FY 2024. This growth was primarily driven by the increased unit sales, supported by strong brand recognition in the South-Central Mumbai micro-market. EBITDA degrew 13% year-over-year to INR 207 crores in FY '25 versus INR 236 crores in FY '24. Operating margins were impacted by higher operating costs, including a INR 30 crores charge FY '25 for settling litigation with the JDA partner. The settlement cost was split equally between INR 15 crores booked in quarter 3 FY '25 and INR 15 crores in quarter 4 FY '25. PAT increased significantly by 48.5% year-over-year from INR 67.5 crores in FY '24 to INR 100.2 crores in FY '25. The increase was attributed to better price realization and savings in finance costs during the financial year. PAT margin improved from 16.4% to 18.3%, reflecting a more efficient cost structure and value-accretive sales. On a quarterly basis, the total income grew 33% to 133 -- INR 137 crores in quarter 4 FY 2025 from INR 103 crores in quarter 4 FY 2024. EBITDA degrew 45% to INR 31 crores in quarter 4 versus INR 56 crores in quarter 4 FY '24. PAT degrew 6% to INR 18 crores versus INR 20 crores in quarter 4 FY 2024. Coming to the operational performance. For FY 2025, presales in value terms grew to INR 501 crores, which was in line with our revised guideline, which was issued during the quarter 3 FY 2025 versus INR 483 crores in FY 2024. This is a notable achievement despite no new launches during the particular financial year. Collections grew 22% on a year-over-year basis to INR 386 crores from INR 316 crores in the FY 2024. Collections for FY '25 improved due to strong execution focus and the steady stage-wise progress of the ongoing projects along with the good sales in terms of balanced mix of portfolio of projects. Realizations grew 21% year-over-year to INR 54,353 per square feet from INR 45,074 per square feet in FY '24. For quarter 4 FY '25, presales grew 14% year-over-year and stood at 25,848 square feet in terms of area, up from 22,713 square feet in quarter 4 FY 2024. This strong growth was driven primarily by robustness in luxury projects as such as Palette and Ocean Star along with successful absorption of existing inventory in the value-luxury segment. In value terms, presales grew 20% year-over-year and stood at INR 146 crores, for which -- from which INR 122 crores was in quarter 4 FY 2024. Collections for quarter 4 FY 2025 stood at INR 103 crores, and realizations grew 5% to INR 56,508 per square feet in quarter 4 FY 2025 versus INR 53,651 in quarter 4 FY 2024. Realizations were high supported by strong contribution from luxury project sales. Our net debt rose from INR 360 crores in December 2024 to INR 414 crores in March 2025, driven by fund requirements for the launches of our upcoming portfolio of projects, which include a commercial project at Mahim Parkview 1, which is -- and Kowliwadi & Kripasiddhi project at Prabhadevi and a project at Marinagar for which we have obtained in-principle NOC from Metro and land acquisition at Shivaji Park. With this, I would like to open the floor for questions. Thank you.

[Operator Instructions] We have our first question from the line of Utkarsh Jain from D Street Broking.

So sir, I had one query. Like what's your guidance for this financial year in terms of like revenue growth and for EBITDA margin? And sir, also, like can you guide an EBITDA margin, like a figure so that we can assume -- like it fluctuates every quarter, our margin fluctuates every quarter. So is there a number like we can assume?

So we'll start with the presales. We're waiting for the launch of these 3 of our new projects. So we will be giving the guidance very shortly. You can be part of the call for that. With regards to the margins, I think Shreepal will explain it.

See, EBITDA margins are typically in the range of 40% to 45% annually. Quarterly, it will differ because of the product mix in value segment and luxury and commercial, and also depends on the progress of the projects on quarter-on-quarter. And as a result of which, we have to see annually -- so annually, we feel 40% to 45% is the EBITDA margin is sustainable.

Sir, we have the participant disconnected. We'll move on to the next participant from the line of Bhavin Modi from Anand Rathi.

Sir, my first question is regarding the INR 30 crore litigation, right? So INR 15 crores is charged in Q3 and INR 15 crores in Q4. So can you just help us with what is the litigation about? And are there any further ongoing litigations for which there will be financial implications?

Bhavin, so this litigation was with Runwal, our partner in our project called Nirvana. So that's already part of our DRHP and already mentioned in the litigation section of our DRHP. We have now settled that matter amicably. And in fact, just to say that we've also got OC for that project and hand it over to our customers. So as part of our settlement deal, we want to -- we had to pay. So this is 2 amounts, INR 15 crores last quarter and this quarter, which will be the amount which will be charged to the P&L. This is again a onetime matter to settle the matter with the JDA partner.

Okay. So there are no further litigations, right, right now, which are going? I think everything is settled, right?

Absolutely.

Yes. The second question is with respect to the presales that you have done in Q4. So what is the implied EBITDA margin for the presales done in Q4 and in the entire financial year '25?

So it will be close to 40% to 45%, in that range.

Okay. And can we safely assume the same thing for the presales going forward for FY '26, FY '27?

So till FY '26, you can assume. But going forward, we will find out on the basis of the new launches because our existing projects are nearing completion.

Right. Okay. Yes. My third question is with respect to the Suraj Vibe. So we are -- I think it's mentioned it will be launched in the quarter 1, right? So first question is with respect to, have we received any like interest or something from the prospects with respect to the space and what type of space they are looking for? So are they looking for small offices, larger floor plates? And are you also looking for like an option of handing over the space to someone who -- some private equity who are running co-office space or coworking space?

So Bhavin, just on the approval standpoint, as I updated on the call, we've already got our fire clearance, and we've submitted for the concession for the amalgamated land. As you are aware that we had earlier had one land, we amalgamated with the one on the side. So with the amalgamated portion, the concession are yet to be received. We expect that to come very shortly. For the concession, we have to apply for CC for the amalgamated land and, of course, RERA. So we expect the launch, of course, before H1. We are targeting if we could do it before in this quarter, but I see, due to regulatory approvals, we would be very comfortable on our launch time line, and we can take it safely out of H1 of this year. With regards to the clientele and the requirement coming in, we see a very buoyant commercial space and demand. We're getting demand from all the kind of -- whether it is equity people, whether it is actual users who are looking for larger spaces and corporates, we already are in the process of identifying a couple of clients. They have already done visits. We will update you shortly on that. We are -- our target is to sell it ideally to a larger corporate. That is our wish list. But we also see a demand for very small offices. So depending on the demand, we have the plan aligned for even making smaller offices or larger floor plates, both will be aligned in this current plan.

Right. And sir, last question, just with respect to the time line of the launch, right? So now it's like rainy season, the monsoon season, where the launch is generally being deferred. And second, there is the optics going on with respect to the corona again [ resurging ]. So are we planning to have a -- delay the launch? That is the one point. And the second point is if we are doing the launch, so what is the presales that we are looking for on the day of a launch or in the month of the launch? Like what will be the upfront presales? If you can even give in terms of percentage, that will be helpful.

Bhavin, regarding the launch, we will not be waiting whether it's monsoon. We will not be waiting. As soon as we get the IOD and the CC, we will be starting the site. RERA formalities, of course, can continue. So physically, as soon as we get the CC, we will be starting the work at the site. We already have a financial tie-up for that particular project from a wealthy institution. So that is already -- financially, we're already ready to start that project. With regards to your question about delaying the launch for any other festive season or any other rain season, we will not be delaying that for that. I hope that...

And just a second question was with respect to the what are -- what is the percentage of the presales that we are looking on the -- during the time of launch?

See, we are very optimistic on the demand in the commercial segment. So it will be very nascent to tell you what percentage can be sold. We are discussing with clients for either the whole piece, it could be a couple of floors. So these are the conversations going on right now. So it has to see how everything pans out. Our wish list...

But sir, if you can even give a tentative range or something like that, that will be like -- since this is one of the big launches like INR 1,200 crores. So like if during the launch, we are expecting something around, suppose, 10% or 15%, between INR 120 crores to INR 180 crores or something like that. So can we look at those range?

See, as I said, commercial is in demand today. So we would want to do a larger floor plate and larger deal today. That's the conversation going on. I can only tell you that as of now. But we are very buoyant that something major will happen, and I think let's keep it to that. Let us just focus on the launch, and then we'll update you.

[Operator Instructions] We have our next question from the line of [ Krishnam ], an individual investor.

So the first question is on the EBITDA margin, you've guided for a sustainable 40% to 45%. And if I look at Q4, it's around 22.4%. Even if I adjust the onetime litigation settlement, it comes to around 33%. So the balance 12%-odd is due to the increase in operating costs. Now can you throw some more light on what is the nature of these costs? And are they likely to be inflated going forward as well?

So [ Krishnamji ], just to answer your question, too, I would suggest we look at the annual numbers because quarterly, there may be variations in the EBITDA numbers depending on the product mix and other things. But on a -- if you adjust the onetime cost, so our EBITDA margin actually comes out to 40% to 43%, which is in the range of 40% to 45%, which we have already guided in the last quarter as well. So going forward also, we will want to maintain the same 40% to 45% range of EBITDA on an annual basis.

Got it. Got it. Okay. Can you just throw some light on the operating cost, like what is the nature of this increase? And how are we looking at it going forward?

See, it's all development cost, construction approval and other costs, which is pertaining to [ the body ].

Got it. Okay. The next question is on the other current assets. So if I look at 31st March of last year versus this year, it has jumped from INR 266 crores to INR 669 crores, and I think that has also impacted the operating cash flow. So can you throw some light on this as to what is the nature of this?

It's more of the WIP has increased substantially. If you see, inventories have gone up substantially. Last year, it was -- this year, we have done a few BDs like INR 110 crores, we invested in the land at Mahim. And also we have acquired one plot of land at Mahim at the residential Lobo Villa for INR 38 crores and a plot of land at Shivaji Park, so close to INR 150 crores of BD has been done. So because of this, there is an increase in the assets, which is not yet started. But this year, we plan to launch all these sites. So these are all sites will come into operation this particular financial year.

Got it. But these BDs would be reported under inventories, right? I'm asking about the other current assets. So there's a INR 400 crore increase in the other current assets.

We'll revert to you on that, sir.

Got it. Got it. And the last question is on the new launches. So in FY '25, since there were no launches as such, so in FY '26, can we expect like 2 years' worth of launches? Or is that too optimistic?

So as I informed earlier on the call, we are very optimistic to have a INR 2,000 crore GDV of launches for this year. So as I updated on the 3 big launches, we're already in advanced stages. So we are very optimistic that these launches will definitely happen, and it will happen very soon.

Okay. Got it. And those would mostly be in H1 itself, right?

So roughly about INR 1,500 crores to INR 1,600 crores will be in H1, and it will -- the balance would follow in H2.

Got it. Got it. Okay. All the best. Do let me know about the other current assets.

Yes, we'll get on the call.

[Operator Instructions] We have our next question from the line of Anant Mundra from Mytemple Capital.

Sir, our interest cost for this quarter is just INR 4 crores. So could you just explain why is it so low?

You have to average it out. Overall, the financial year FY '25 is INR 65 crores, which is in line with our estimate, which we have guided during this third quarter conference.

So we have to look at that number on an annualized basis?

Annualized basis, yes.

So -- and -- okay, got it. Got it. And sir, so if I see, we've also raised some 313...

So also we had raised equity. So we had repaid some high-cost debt. Like ICICI Ventures, we had repaid last quarter, which was there close to INR 45 crores, we repaid ICICI, which was at 17%. And with the pref money and operating cash flows, we have repaid them. And during this quarter, there was -- the impact was less. And also, we had made some provisions for finance costs. So accordingly, the cost has come down. Overall, our weighted average cost of capital is close to 13%.

Okay. Okay. So -- and our debt right now is around INR 400 crores -- net debt is around INR 400 crores, INR 410 crores. So for next year, we can expect that to be around INR 50 crores, INR 55 crores, the interest expense?

It could be in the range of INR 60 crores or close because we will need some debt for the growth capital as well. For launching the new sites, we need to have those resources into place. So our debt might increase a little bit in that interim. But at the end of the day, it will throw a lot of cash flows in the upcoming projects, which is estimated presales of INR 2,000 crores of launch.

Okay. Okay. And sir, you highlighted that we raised around INR 343 crores in September last year. And then we've made a PAT of around INR 40 crores in H2. So the total cash that we've generated is about INR 380 crores, INR 390 crores in H2. So I mean -- and our debt has not gone down. So where has all this cash been utilized for? Because we've only acquired INR 110 crores worth of one land. So out of -- so balance money has been utilized for what purpose?

So we have also tied up for the Metro Park FSI and other approval costs for the commercial project. So a lot of these money is going into upcoming portfolio of projects where which we are ready to launch in this particular financial year.

So could you broadly give some breakup because -- so out of INR 380 crores, around INR 110 crores has been utilized for the acquisition. So around INR 270 crores is balance. So that INR 270 crores, could you broadly highlight, yes?

So out of INR 343 crores, we have received only INR 293 crores. INR 50 crore share warrant is not yet received. So the number is INR 293 crores.

Okay, okay. So INR 293 crores minus INR 110 crores, so that is about INR 180 crores. So INR 180 crores breakup, could you just give roughly?

INR 180 crores, a lot of operating level we have utilized for the ongoing projects. We wanted to expedite the construction and deliver the projects because a lot of our sites are coming in the next year -- 1 year for delivery. So we have put in approval costs for our project Palette, Ocean Star and Eterna and other projects, which required the kind of capital to expedite the construction and development.

So this is mainly used for projects which are ongoing or it is mainly used for projects which are going to be launched next year?

So it's a mix of both the projects. Close to INR 80 crores, we have infused in upcoming portfolio and balance in the ongoing portfolio of projects.

Okay. So ongoing portfolio, our understanding or at least my understanding was that the current receivables, the sold receivables are enough to take care of the construction of the ongoing projects. But however, from the fundraise also, we've used some money there. So...

So certain approvals costs were required to be paid to get the further approvals of the projects, Palette and Ocean Star and Eterna. That's why we had to use those money to get the approvals because earlier, Palette was just, you see, for 41 storeys. It has gone to 50. So a lot of payments were required to be made at this point in time. So that was tied up. And now the construction is going on. We are on the 49th floor of the project. [indiscernible] will come in the following years. So it was a working capital gap which we bridged by way of pref money also.

Okay. Okay. So I mean, so for whatever upcoming projects that we have currently, are we further anticipating any capital raise or any kind of dilution in future to fund these projects?

Presently, we are not looking for any further capital raise. We will manage with our sold receivables. And with the upcoming projects, we will take debt, which is at low cost for the CF part only. And that will be for a shorter period of time so that we -- till the time cash flows come in.

And what kind of peak debt numbers do you see to execute whatever upcoming projects that we have in hand?

Close to INR 500 crores, we feel it should be there.

Okay. Got it. Got it. And sir, did you all give any kind of guidance on the presales and revenue? I'm sorry, I joined slightly late, and I might have missed out on that. So if you could just repeat?

We will give it in the next quarter. Once a few launches are there, we will be prudent to give you at that point in time.

Okay. Okay. And what launches are we expecting this year? Any guidance on launches, if you've given?

INR 2,000 crores of launches there this year, out of which INR 1,200 crores is from the commercial project at Mahim, balance INR 800 crores is from the residential projects, close to 7 projects we are planning to launch.

We have our next question from the line of [ Tanya Desai ] from [ Elevate Research ].

Sir, I had a couple of questions. My first question was that with the upcoming 19 projects and 10.2 lakh square feet of carpet area in the pipeline, how do you prioritize these launches based on the market conditions that we have?

Sorry, I didn't follow you, prioritize -- I didn't understand the last one.

So we have around 19 upcoming projects in the pipeline with a 10.2 lakh square feet of carpet area, am I correct?

Correct.

So I was just trying to understand that how are we prioritizing these launches?

So in terms of our category, so first and foremost, we look at the projects which are in advanced stage, either in approvals or in terms of if the land is vacant. So as I said earlier on the call, 2 of our projects, we've already vacated the tenants, the plans are approved, the site is vacant, we have applied for CC. So we would prioritize something which is in advanced stages where people have already shifted out on rent. Those would be obviously our priority because rents are also running. Secondly, most of our upcoming projects are in the segment of value luxury. The new launches in Prabhadevi, the ones which we plan to launch across the year, the INR 800 crores which are residential projects will be in the 1 and 2 BHK range. So we're very mindful that our new launches will be in that range of 1 and 2 BHK starting from INR 1.4 crores to INR 1.5 crores for the 1 BHK, and it goes up approximately around INR 2.5 crores to INR 3 crores in the 2 BHK. So all new launches for the INR 800 crores for this year will be in that category. While the commercial, as I said earlier, would be -- we're talking to clients for both larger office spaces and compact offices. So the plan is quite versatile. We have planned for both the eventualities that if we get a larger client, we'll go for the larger floor plates or for the smaller offices. So the strategy for this year is value luxury and commercial, if I were just to kind of just do a brief synopsis of the strategy for this year.

Okay. All right. Sir, but can you just help me with the names of those projects and what will be the GDV of those projects?

Sure. So Parkview 1, which is at Shivaji Park, roughly the GDV is about INR 250 crores. We have another project called Kowliwadi, which is at Prabhadevi, that's about INR 120 crores. We have a project -- a commercial project between Mahim and Matunga, which has a GDV of INR 1,200 crores. And we have Shivaji Park, which is a GDV of INR 80 crores. We have Lobo Villa with a GDV of approximately INR 120 crores. We have JRU with a GDV of approximately around INR 90 crores. And we have Lucky Chawl with a GDV of approximately about INR 65 crores.

Okay, sir. And what is the expected phase rollout?

Sorry? Expected -- I couldn't hear you.

Yes. I was asking what is the expected phase rollout?

Sorry, we did not get your...

Expect, you mean the launch?

Yes, yes.

So as I said, 3 of these projects I expect in H1, which I said Shivaji Park, Parkview 1; Kowliwadi, which is in Prabhadevi; and the Mahim commercial, we're expecting that in H1, while the balance will be in H2.

We have our next question from the line of Himanshu Dugar from Stylus Holdings.

Sir, my first question is around the interest expense. I find it pretty low this quarter. Can you just highlighted if there's some anomaly this time? And how can we expect the interest cost to go for FY '26?

I would suggest to look at the interest expense on an annual basis as compared to this.

So we did around INR 66 crores for the year.

Yes. So going forward, we estimate the weighted average cost of capital is close to 13%. So assuming that, you can take the assumptions going forward.

Got it. Got it. The other question I had was around the projects that have now gone into OC awaited. So we have, I think, 3 projects now, right, where we are just waiting for the OC. So roughly in terms of receivables, around like what could be the time lines on the receivables? And how do we expect the cash flow? Because you have new launches and kind of activities going ahead. Would you have to raise further funds? Or these receivables, you are expecting a demand because everything else is done, so probably it comes in a few quarters and that should take care of the construction expenses?

So we have only 2 projects where -- and I think most of them are paid except the 5%, which is left for OC. I think most of the 95% has already been received by us. So it is only the 5% which is balance in these 2 projects. And going forward, of course, the ongoing projects will be self-sufficient to take care of its construction cost.

Sir, just to clarify this, say, INR 170 crores, which is expected from Louisandra and Ave Maria, and around INR 180 crores from Nirvana, you're expecting this to come in, in this financial year. Is that right?

No, no, no, it's not INR 180 crores. I think there is a mistake from your -- just look into that.

I'm on your Slide 42 -- 41, which says Louisandra, 80 -- okay, sorry, that's correction received. I mean the realized price is what -- right, sorry. So that's around INR 20 crores here and INR 40 crores there in Nirvana. INR 30 crores in Nirvana, right? So INR 50 crores roughly. So this should be expected in the coming quarter, like coming half year kind of, right, that...

Yes, yes. Yes.

Understood. The other question was in terms of this Lumina project. So have you already started the construction? Or like what is the time line on how you start the construction and the actual -- I mean I see the RERA deadline, but generally, what is the typical time line that you've been seeing in these projects and especially the Mahim region?

So Lumina, we've already reached the print stage. We're actually expecting the CC -- for the further CC very soon. BMC has already inspected the site. We're expecting the CC soon so that we can get the balance CC for the entire project. We expect the construction to be completed within 2 years. That is before our RERA deadline. But we always keep a buffer for unforeseen delays. But as of now, we estimate within 2 years, we'll be able to complete the Lumina project.

Got it. My final question is on the Marinagar. So I think Phase 2 is something that would be up for launch in this financial year, is it, or it is FY '27 kind of a story?

So this year, it will not come in for launch this year. It will be for next year. We already have a lot of launches planned for this year. So we just want to bring that on the table.

Okay. So other than the commercial, the Suraj Vibe, which is INR 1,200 crores, which would be the other projects that we would be looking to launch? I mean, just numbers from 3, 4 projects, the top 5 projects on this pipeline or how is it?

Yes. So we have Parkview 1, as I said earlier. Parkview 1 is INR 250 crores. We have a project called Kowliwadi, which is yet to be named at Prabhadevi near Siddhivinayak Temple at INR 120 crores. We have another project, Lucky Chawl, which is approximately around INR 60-odd crores. We have a project in Byculla, which is...

INR 90 crores.

INR 90 crores. So we have a project in Shivaji Park, INR 80 crores top line. So all these -- that's why I said the combined GDV of all this would be approximately around INR 2,000 crores is what we're planning to launch.

[Operator Instructions] We have our next question from the line of [ Rajinder Bassi ], an individual investor.

So mainly, I wanted to ask that have we had the plan to raise INR 500 crores and you weren't able to do that as our issue was kind of undersubscribed? So what kind of impact can we basically foresee that we weren't able to raise the capital that we wanted to?

So your question is were you earlier planning to raise INR 500 crores, we raised INR 343 crores, for the shortfall, what impact would it have? Am I correct?

Correct. And INR 50 crores -- sorry, INR 50 crores is under warrants as of now, right? So ideally, we have only gotten INR 293 crores. So for the rest, like what kind of an impact can we have on that project in our future?

So we wanted to invest those proceeds for our upcoming project in Bandra as well to hasten that launch. So that maybe we will wait for the cash flows of our ongoing projects to be invested because that is a very big launch coming up. So for that, we wanted to raise that capital. But now we can do that with our ongoing cash flow as well for this year. It is just that we will push back the launch a little because we needed a lot of equity to be pumped in before we launch Bandra. So I think that would be the only impact on the time line of the Bandra launch, nothing else.

But the rest will be on like on time line, there would be no impact on the others, the other projects basically, like Mahim and whatever we are planning to launch.

Yes, not -- we have -- it has no impact on the launches planned for this year, the INR 2,000 crores of GDV.

Okay. And how we are going to fund these, basically the new launches? Like I've seen the balance sheet and I don't think that there is a lot of cash that is left as of now in our hand, right? So how we are planning to manage the working capital?

We already have financial tie-ups with -- especially for the new projects, we already have -- let's talk about the larger project because that's what is substantial, which we require. The commercial project is already tied up with the financial institution. So that is -- we already have a sanction from -- for approximately around INR 250 crores, which gives us a closure on the financial requirement for that particular project.

Okay. And that will mainly be debt, the INR 250 crores? Or is it like buying...

Correct, it's debt.

Okay. So going forward, like can we expect that debt to -- like as of now, it is INR 400 crores. So can we expect it to jump to almost INR 650 crores for this year or like it will be kind of a short-term debt that will be paid within the same year itself?

See, temporarily, there will be an increase because there will be -- let's understand, approval cost needs to be funded upfront before the project starts, before RERA comes in. If there's no equity to be put in, there's only debt option, which is available. So we already have a sanction from a very large institution who is giving us the funding. So temporary debt will be required because if you have to bring in INR 2,000 crores of inventory and approval cost has to be funded by default upfront, the only way to fund it would be debt. So debt would go up temporarily. But once the projects' cash flows kick in, we expect that from a yearly basis, maybe going up, but finally, it will taper down again once the project cash flows kick in.

And can we like expect to go down within the same year or like we are expecting to grow it in next year as well?

We are optimistic that it may go down the same year as well because we are looking at a couple of large deals. So if that happens and translates, we can look at it going down the same year itself.

Okay. And do we have any plans to go for the fundraising again? Like we got -- of course, we had a [ surplus ] of INR 200 crores or like we are not doing it for now?

Not as of now, not as of now.

We have our next question from the line of [ Anj ] from [ Anj Partners ].

And as you mentioned earlier, I could not hear it, could you tell me where -- like from the INR 300 crores or INR 343 crores that you've raised, INR 50 crores is yet to come. Could you tell me where that amount is stuck?

It's under share warrants.

Under share warrants.

We have our next question from the line of [ Pawan Khurana ], an individual investor.

I have a -- first question that I have is about the employee cost, which is shown in the sheet. It's fluctuating a lot, actually. I saw it in Q3, it was around 3.3% and has gone up to 5.6% in this quarter. And if I compare it year-on-year also, it has gone up tremendously. So from a 3.5% last year, it is 4.4% now. Any specific reason? Is it expected to stay high? Or will it come down?

So we have done a lot of hiring for our new launches. We need to build the team to cater to such kind of new launches coming up. We have almost about 7 new residential sites over and above what we're doing in sustenance mode today and the commercial. So we've already ramped up our team to deal with that, whether it's execution, whether it is administratively, whether it's engineers, we ramped up the team. So employee cost, you can take it from an annual basis, will remain the same. We don't see it going up further, but this would be -- would remain for the next 2 years.

Yes. Sorry, just a follow-up on that. Year 2024, it was 3.5%. And as of now closing this year, it's 4.4%. Could you give a guidance of the percentage of expected to be next year? Because that's like a substantial difference between '24 to '25.

I'd say in absolute terms, we don't see a great increase. Whatever hiring had to be done for this year and the next year, we've already factored in that. It will be a very small variance if it has to, but it will pretty much you can take this as the employee cost going forward.

And a follow-up of this, how much percentage is the management overheads in that?

I have to come back to you on the percentage. Maybe we can give it after the call...

I could -- I mean even if it could come in an e-mail, that will be absolutely appreciated. You've been mentioning about the approvals and the expenses on approvals. So sorry, I don't really have an idea about the real estate sector, but let me tell you this, this happens to be one of my largest investments, and I have a very, very strong hope of recovery from here on. And in fact, I would be adding more. But I just want to know from my perspective, how much is a typical approval cost that you've been mentioning about as a percentage of GDV of a project or maybe as a percentage of the overall cost of a project?

Correct. So I'll just give you a ballpark. If you're selling a value-luxury project, which is about INR 40,000 per square foot, which is the sale price per square foot of carpet area, we roughly estimate at least about INR 12,000 to INR 13,000 would be the cost only for approvals. Another -- that is we're talking about a vacant land. If it is a 33(7) project, it will be around the INR 9,000 mark.

Wow, that is huge. Okay. So one last question before I get back in the queue. I understand we didn't have any launches in the last year, and that kind of led to a low presales. And also the last quarter also, the revenue dipped a little bit. I don't know if this question is something which is supposed to be for this conversation, but what would you have done differently if you had to go back and do things that -- to shore up either of the 2?

So I think just ramping up, like you said, launches would be very -- it's very evident that the new launches have to be brought to a RERA stage where we can launch. And I think that's where we are focusing this year, where we're bringing in all the projects. You can see the number of projects compared to last year and the new launches which are planned this year. And I thought in this call, it is very imperative to mention the status of each project which is going to be launched so that there is obviously a confidence built up with our shareholders that these are already coming and it's in the annual, and it's going to come in H1 very clearly.

And before I go, I'm so sorry, but this is just one more question which I had, which is with respect to -- you mentioned about that around INR 50 crores which have not come in from that share warrants. If I understand correctly, usually, these warrants is when people commit approximately and they pay up about 25% up ahead and the remaining they have to pay over a period of time, right?

Correct.

This was your preferential allotment. So I also understand that if the price drops, then the person has the -- maybe a choice to forgo the 25% deposited and then not pay the remaining, right? Is that a possibility? So do we believe that this INR 50 crores will come in or it may not even come in?

No, there are 2 possibilities. The particular individuals have an option of exercising their option within the next 18 months. So since we just raised it, I think we're expecting that call to be taken within -- we have some time for a person to take a call on that.

So the price at which the preferential allotment is given was around 700, 750, if I remember. And now if it is trading around 300 something, so do you have any hope of those people really paying the remaining? Or I mean, if I wasn't that preferential allotment person, I would rather forgo them and buy from...

So what we would focus is bring in the launches, bring in the operational efficiency and bring in the presales. I think that's what is in our hands. I think the price differential is a factor of our performance. So I think as management, we will focus on our launches for this year and bringing cash on the table, and I think the market will do the rest.

We have a follow-up question from the line of Anj from Anj Partners.

I just wanted to know if it's possible to meet the management in person?

Surely, we can have it planned through our external IR, SGA. You can post the call. We'll be happy to have a group meeting with a couple of other investors, whoever is interested in a meeting. We'll be happy to meet.

Ladies and gentlemen, that would be the last question for today, and I now hand the conference over to the management for closing comments.

I take this opportunity to thank everyone for joining the call. I hope we all were able to address all your queries. For any further information, kindly get in touch with us or Strategic Growth Advisors, our Investor Relation advisers. Thank you.

Thank you. On behalf of Suraj Estate Developers Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.