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Sunteck Realty Limited Ideators, Creators & Innovators Corporate Presentation
March 2015
2
Disclaimer By attending the meeting where this presentation and any additional material provided therewith (“Presentation”) is made or by reading the Presentation, you (“Recipient”), agree to be bound by the following limitations: This Presentation has been prepared on the basis of the estimates of the management of Sunteck Realty Limited (the "Company“ or “Sunteck”), for the sole and exclusive purpose of providing information to the Recipient about the Company and its business, and is not and should be construed to be, directly or indirectly, an offer and / or an invitation and / or a recommendation and / or a solicitation of an offer to buy or sell any securities of the Company in any jurisdiction, nor shall part, or all, of this Presentation form the basis of, or be relied on in connection with, any contract or binding commitment or investment decision in relation to any securities of the Company. No Offering of securities of the Company will be made except by means of a statutory offering document containing detailed information about the Company. These materials are not an offer of securities for sale into the United States, Canada or Japan. Securities may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons (as such term is defined in Regulation S under the U.S. Securities Act of 1933, as amended) unless they are registered or exempt from registration. There will be no offer of securities in the United States. The distribution of this document in certain jurisdictions may be restricted by law and persons into whose possession this presentation comes should inform themselves about and observe any such restrictions. This Presentation is strictly confidential and may not be copied, published, distributed or transmitted to any person, in whole or in part, by any medium or in any form for any purpose without the prior written consent of the Company. The information in this Presentation is being provided by the Company solely for the purposes set out herein and is subject to change without notice. Further, this Presentation does not purport to be all-inclusive or necessarily include all the information that the Recipient desires in its evaluation of the Company. The Company relies on information obtained from sources believed to be reliable but does not guarantee its accuracy or completeness. This Presentation contains statements which may pertain to future events and expectations and therefore may constitute forward-looking statements. Any statement in this Presentation that is not a statement of historical fact shall be deemed to be a forward-looking statement, and the Recipient agrees that that same may entail known and unknown risks, uncertainties and other factors which may cause the Company’s actual results, levels of activity, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. There can be no assurance that the results and events contemplated by the forward-looking statements contained herein will in fact occur. None of the future projections, expectations, estimates or prospects in this Presentation should be taken as forecasts or promises nor should they be taken as implying any indication, assurance or guarantee that the assumptions on which such future projections, expectations, estimates or prospects have been prepared are correct or exhaustive or, in the case of the assumptions, fully stated in the Presentation. The Company assumes no obligations to update the forward-looking statements contained herein to reflect actual results, changes in assumptions or changes in factors affecting these statements. The Recipient acknowledges that it shall be solely responsible for its own assessment of the market and the market position of the Company and that it shall conduct its own analysis and be solely responsible for forming its own view of the potential future performance of the business of the Company. This information contained in this Presentation is as of Dec, 2010 except as may be stated otherwise. Neither the delivery of this Presentation nor any further discussions of the Company with any of the Recipients shall, under any circumstances, create any implication that there has been no change in the affairs of the Company since that date. The company is not under any obligation to update the contents of this presentation or inform Recipient of any changes in the affairs of the company. The Company hereby expressly disclaims liability for any errors, inaccuracies, or omissions, and representations and warranties – express or implied, as provided within or in connection with this Presentation. Any clarifications, queries or future communication regarding the matters stated in this Presentation should be addressed to the Company directly.
Business Operations
Construction Updates
Financials
Corporate Overview
3
Strategy
An Insight
4
Mumbai focused developer
City-centric acquisitions
Premium Positioning
Development Potential: ~25 msf spread
across 24 projects and 4 rented assets
6 projects completed in last 4 years
totaling to delivery of ~2 msf
Our Strengths
5
Sunteck Brand
Long Lasting Partnerships
Funding Approach
Execution Capabilities
Corporate Governance
Prudent cash flow management
Capital Efficient Structures: Equity, Debt, Internal Accruals and PE Investments
Completion of ~2 msf in one execution cycle of 5 years
Experienced EPC team with best Contractors, Architects and Consultants on board
Strong Independent Directors on Board with varied years of industry experience
Simple Balance Sheet and Project Structures
Established premium brand
Affluent clientele
Varied level partnerships since inception– India Reit, Kotak REF and Ajay Piramal Group
Successful exits on multiple counts
Acquisition Philosophy
Clean and clear acquisitions; Mix of Govt. Tenders, Outright Purchases and JV/JDAs
22 city-centric acquisitions between 2009 to 2013. Lowest FSI Cost of ~`2,000 psf
Solid Team
6
NAME EXPERIENCE ROLE
President
Exec. Vice President
President
Sr. Vice President
Sr. Vice President
Vice President
Over 18 years; Regulatory Approvals
Over 10 years; corporate finance
Over 18 years
Over 38 years; project management, operations
Over 20 years; architecture
Over 30 years; commercial affairs, procurement & inventory control
Compliance & Regulatory Affairs
Corp Finance, Investor Relations & Luxury Sales
EPC
EPC
Project Planning & Design
Head - Procurement
Vice President Over 20 years; project management
PMO
Vice President Over 8 years; project management & marketing
Sales & Marketing, CRM
7
Business Updates
Sales of worth ~`21,913 mn unrecognized in the P&L Inventory Value: 10 Completed and Ongoing Projects is ~`52 bn
Project Potential
Net Secured Debt of ~`3,499 mn with Networth of ~`14,498 mn Net Debt to Equity ratio is 0.24x with strong cash flow visibility
Leverage
EBITDA Margin of ~51% reported in Q3FY15 (highest in the industry) ROE of ~30% achieved
Margins & ROEs
No. of projects – 8; development potential of ~15msf Of which 3 projects target to launch in H1FY16, 1 already launched
Upcoming Projects
Total 6 projects completed out of 24 projects and 4 rented assets Additional 7 projects to be completed over next 8-10 quarters
Delivery
Awards & Accolades
8
Awards & Accolades (Contd..)
9
Sunteck City, wins ‘Real Estate Marketing Campaign of the Year’ award at Realty Plus Excellence Awards 2013
Sunteck’s flagship project i.e. Signature Island wins Project of the year award - Mumbai by Accommodation Times
Business Operations
Construction Updates
Financials
Corporate Overview
10
Strategy
Project Statistics
Particulars FY05-07 FY08 FY09-10 FY11-12 FY13-15 FY16 (E) FY17 (E) FY18 (E) Beyond
Projects Acquired
No. 7 1 14 1 1 NA NA NA NA
In msf 2.87 0.17 16.77 4.16 0.83 NA NA NA NA
Delivery
In msf 0 0 0.2 0 1.8 1.05 1.4 1.0 19.3
In Value (`mn) 0 0 1,500 0 28,034 29,028 16,911 16,000 204,418
Key Projects Delivered
NA NA Sunteck Centre
NA
Signature Island &
Signia Oceans
Signia Isles & Signia Pearl
Sunteck City Avenue 1 & Signia High
Signia City Avenue 2 &
Signia Gilbert Hill
Sunteck City (16 Acres), Mulund &
Jaipur
11
12
Bandra Kurla Complex – Single Residential Player
BKC – 3 Research based Residential Acquisitions
13
Limited edition apartments targeted
towards the Most Coveted by providing the
Most Premium offering
Prudent funding tie-ups with IndiaReit &
Kotak REF. Exits given within 18-30 months
CAGR of ~20% (over 6 years) achieved in
sale realizations
Projects generating higher operating
margins of ~50%-55%
ROE of ~30%-35% achieved; Target to
increase to ~35%-40%
FSI Cost (`psf) 8,424
Saleable Area (Sq.Ft.) 1,523,146
Area Sold (Sq.Ft.) 849,087
Sales Value Achieved (` mn) 25,823
Average Realisation till date (`psft) 30,413
Last Sale Price (`psft) 52,284
Balance Receivables (` mn) 7,533
Cost to be incurred (` mn) 4,928
Est. Inventory Value (` mn) 28,653
Inventory Exhaustion Timeline 24-30 months
14
BKC – Recent Developments
Well planned CBD of 300 hectares for development – as a ‘City’ within ‘Mumbai City’.
Only ‘slum free and a hawker free’ Zone in the country
Most secure and well connected place with proximity to both Airport & South Mumbai of ~15 mns (via sea link ). Under-pass plan finalized
Some of the biggest Corporates, Financial Institutions, Bourses, Educational Institutions, Multi Specialty Hospitals & Consulates employing over 4 lakh people including top management. More corporates shifting soon
4 main Entry & Exit points - Kalanagar, Kurla/Taxi men colony, Kalina, erstwhile Drive-in theater (Now Maker Max City)
Further 3 new entry and exit points by end 2017
S.No. Particulars Status
1 Santa Cruz Chembur Link Road (SCLR) Operational Since April 2014
2 BKC Reclamation Elevated Corridor Approvals in place; Work to commence soon
3 Sion Bandra Elevated Corrridor Work to commence by Mid 2015
15
BKC – Recent Developments (Contd..)
First Global Convention centre cum RIL headquarters on 18 acres plot in G-Block. Construction started
First High-End mall by Maker Group in E-Block. Construction started
Best 5 star hotels – Trident, Accor Sofitel, Grand Hyatt, Taj Lands End, Sahara Star in and around BKC. 2 more luxury hotels i.e. Bellagio & MGM Grand upcoming in Maker Max City
Best Club, Eateries & Restaurants – MCA Club, Yauatcha, Otto Infinito & several others operational in FIFC
7 Consulates operational – Unites States, British, French, New Zealand, Australian, Belgium and Sweden
7 Best Educational Institutions – American School, Dhirubhai Ambani School, Arya, Vidya Mandir, Ascent & upcoming Zee School
Multi specialty Healthcare – Asian Heart Institute, Lilavati Hospital & Research Center
Goregaon (W) – Largest land aggregator of ~23 acres
16
MIXED USE DEVELOPMENT
Goregaon (W) – 7 acres approx.
17
Acquisition Cost @ `21 crore per acre;
significantly lower than the current
comparable transactions
Target Mid-management levels of Banks /
Corporates & BPOs with a ticket size: Min
`1.5 cr to `3.5 cr
Major Product Mix offering in the 1.5/2/2.5
BHK category
CAGR of ~26% (over 3 years) achieved in sale
realizations
Target EBITDA Margins of 40-45% and ROE of
~30%
FSI Cost (`psf) 2,127
Saleable Area (Sq.Ft.) 1,546,451
Area Sold (Sq.Ft.) 360,582
Sales Value Achieved (` mn) 4,325
Average Realisation till date (`psft) 11,995
Last Sale Price (`psft) 15,889
Balance Receivables (`mn) 2,812
Cost to be incurred (`mn) 4,666
Est. Inventory Value (`mn) 18,304
Inventory Exhaustion Timeline 36-48 months
Goregaon (W) – 16 acres approx.
18
SUNTECK CITY, AVENUE 3, GOREGAON (W), MUMBAI
Approval Stage Developable Area of ~4 msf
19
Goregaon – Secondary CBD of Mumbai after BKC
being developed by MMRDA
Well located and surrounded with premier Business hubs, Shopping malls, Multiplexes and
Educational Institutes; About 10msf office space already operational
Easy accessibility to the Western Express highway and link roads like JVLR, proposed Goregaon -
Mulund Link Road
Infrastructure expected to improve further with the upcoming Oshiwara station, two flyovers - east
west and JVLR flyover going upto infinity mall, thereby resulting further increase in the commercial
activity
Several back offices of prominent banks like Citi, JP Morgan and also by many IT companies leading to
huge employment generation
Best Malls: Infinity 2 & Inorbit in the nearby vicinity of about 3-4 kms
Best Educational Institutes: Vibyor School, Ryan International & Golkuldham school within the
proximity of about 3-5 kms
20
Other Development Potential
Location No. of Sale Area SRL's Share
Projects msf msf
Mumbai
South Mumbai 2 2.9 0.73
Western Suburbs* 6 0.7 0.59
Eastern Suburbs 4 6.13 3.03
Navi Mumbai* 2 0.45 0.22
Total (A) 14 10.18 4.57
Non Mumbai
Goa* 1 0.11 0.05
Nagpur* 2 1.32 0.4
Jaipur 1 8.57 2.68
Total (B) 4 10.00 3.13
Grand Total (A+B) 18 20.18 7.7
Notes:
* 4 Projects completed in the respective locations
21
Notes : Inventory as per last sale price#
Estimated Project cost is excluding land & other cost
Revenue of ~`10,796 mn has been recognized (highlighted) till date
As on Dec’14 Figures in ` Mn
Steady Cash Flow Visibility
Location Particulars Sale Value Achieved
Unrecognized Sale Value
Balance Receivables
Est. Project Cost (B)
Balance CoC to be Incurred
Est. Inventory Value#
BKC, Mumbai
Signature Island 10,513 625 2,360 3,606 112 15,080
Signia Isles 7,868 7,868 2,519 2,055 467 6,387
Signia Pearl 7,443 7,443 2,654 2,048 529 7,186
Goregaon(W),Mumbai Sunteck City Avenue 1 2,914 2,914 1,701 3,008 1,481 7,947
Sunteck City Avenue 2 1,411 1,411 1,111 3,194 3,186 10,357
Airoli, Navi Mumbai Signia Oceans 592 61 110 315 18 25
Signia Orion 433 433 386 432 357 1,488
Borivali, Mumbai Signia High 614 614 413 914 516 2,176
Andheri, Mumbai Sunteck Grandeur 469 92 229 212 1 522
Panjim, Goa Sunteck Kanaka 371 371 169 268 6 199
Sadar Bazar, Nagpur Signia Skys 81 81 27 230 6 1,015
Total 32,708 21,913 11,678 16,283 6,678 52,383
Business Operations
Construction Updates
Financials
Corporate Overview
22
Strategy
Our Project Associates
23
Contractors
Architects
Structural Engineers
Landscape, Interiors, & QS
Brand Partners
Completed 6 projects - 2msf delivered
24
BKC, Mumbai Residential Developed Area – 1.08 msf
Nagpur Residential Developed Area – 0.21 msf
Airoli, Navi Mumbai Residential Developed Area – 0.23 msf
Vile Parle, Mumbai Commercial Developed Area – 0.15 msf
Andheri, Mumbai Commercial Developed Area – 0.08 msf
Goa Commercial Developed Area – 0.18 msf
Completed Projects SIGNATURE ISLAND, BKC
25
Atrium View Water Fountain at Driveway Lobby
Water Fountain at Podium Day View of Landscape Area
Completed Projects (contd..)
SIGNIA OCEANS, AIROLI, NAVI MUMBAI SIGNIA SKYS, NAGPUR
26
Area Developed ~0.23 msf Area Developed ~0.21 msf
Completed Projects (contd…)
SUNTECK CENTRE, VILE PARLE MUMBAI
SUNTECK GRANDEUR ANDHERI MUMBAI
SUNTECK KANAKA PANJIM GOA
Leased Sale Leased
27
Area Developed ~0.15 msf Area Developed ~0.08 msf Area Developed ~0.18 msf
Projects Gearing up for Completion SIGNIA ISLES, BKC, MUMBAI
28
Artistic Impression Developable Area of ~0.43 msf
Actual Site Photograph – Dec’14 19th slab completed with plaster completed for 12 slabs
Projects Gearing up for Completion (contd..)
SIGNIA PEARL, BKC, MUMBAI
29
Artistic Impression Developable Area of ~0.43 msf
Actual Site Photograph – Dec’14 19th slab completed & painting work commenced
Construction Stage SUNTECK CITY, AVENUE 1, GOREGAON (W)
30
Artistic Impression Developable Area of ~0.75 msf
Actual Site Photograph – Dec’14 Tower A – 18th Slab Completed; Tower B – 9th Slab Completed
Construction Stage (Contd..)
SUNTECK CITY, AVENUE 2, GOREGAON (W)
31
Artistic Impression Developable Area of ~0.79 msf
Actual Site Photograph – Dec’14 Ground Preparation work started; Product Mix – 1.5/2/2.5 BHK
Construction Stage (Contd..)
SIGNIA HIGH, BORIVALI, MUMBAI
32
Artistic Impression Developable Area of ~0.24 msf
Actual Site Photograph – Dec’14 Plinth completed; 2nd slab work-in-progress
33
Launching Soon..
Artistic Impression Developable Area of ~0.05 msf
SIGNIA PRIDE, ANDHERI, MUMBAI
Forthcoming Launches (contd..)
SIGNIA ORION, AIROLI, NAVI MUMBAI
Drawing Board Stage
34
Approval Stage Developable Area of ~0.29 msf
SUNTECK CENTRE, BKC, MUMBAI
Approval Stage Developable Area of ~ 0.09 msf
Business Operations
Construction Updates
Financials
Corporate Overview
35
Strategy
36
Financial Statistics
Figures in ` Mn Consolidated Profit & Loss Statement
Particulars 9MFY15 FY14 FY13 FY12
Revenue 1,626 9,256 302 170
Expenditure 927 6,471 248 128
EBITDA 698 2,785 54 42
EBITDA Margin 43% 30% 18% 25%
Other Income 130 127 200 134
Interest 165 170 110 51
Depreciation 16 14 14 15
PBT 647 2,728 107 110
Tax 272 900 62 65
PAT (before MI) 376 1,828 45 45
Minority Interest 92 318 5 14
Adj PAT 284 1,510 40 31
PAT Margin 16% 16% 8% 10%
EPS 4.74 25.18 0.67 0.52
37
Financial Statistics (Contd..)
Figures in ` Mn
Strongest Balance Sheet
Liabilities 9MFY15 H1FY15 Assets 9MFY15 H1FY15
Shareholders Funds 14,498 5,651 Net Block 134 139
Minority Interest 413 379 Loans & Advances 3,027 3,609
Secured Loans 4,005 4,410 Investments 474 1,016
Unsecured Loans 4,059 3,147 Inventories 32,834 20,688
Customer Advances 12,304 11,426 Cash & Bank balances 479 1,166
Others 4,940 5,029 Others 3,272 3,423
Total 40,219 30,041 Total 40,219 30,041
Business Operations
Construction Updates
Financials
Corporate Overview
38
Strategy
Roadmap for Growth
1. BUSINESS EXPANSION
Continue to explore city-centric acquisitions in and around Mumbai. Further, explore opportunistic acquisitions outside Mumbai (JV/JDA model preferably)
Enhancing rental income by exploring opportunities in existing development portfolio
Foray into re-development with a different brand
39
2. STRENGTHEN PROCESSES
Appointment of BIG 4 Consultancies like PWC and KPMG to further strengthen the systems
Improvise customer interaction programs
3. ENHANCE EXECUTION CAPABILITIES
Thrust to add more projects to the completed portfolio in the coming 8-10 quarters
Selectively increase quality EPC team
Working with top contractors, architects, PMCs and employing best talent to ensure quality and timely delivery
40
Annexure
41
Corporate Information
Promoter & Promoter
Group 74%
FIIs / PEs / MFs / FIs /Trusts
18%
Others 8%
Board of Directors
Shareholding Pattern (As on Dec’14)
Stock Price Data (As on Feb 28, 2015)
Name Designation
Mr. Kamal Khetan Chairman & Managing Director
Mr. Jignesh Sanghavi Executive Director
Mr. Kishore Vussonji Independent Director
Mr. Sanjay Dutt Independent Director
Mr. Mahadevan Kalahasthi Independent Director
Mr. Ramakant Nayak Independent Director
Particulars Data
Current Market price (`/share) 284.8
Market Capitalization (` Bn) 17.9
52 Week H/L (`) 379.90 / 205
No of Shares (Mn) 62.9
42
Brand Positioning
Niche Products, Premium Positioning; Vital differentiator in Mumbai residential market as
Sunteck has emerged as the 1st brand recall for unparalleled luxurious living spaces along with
world-class amenities
Credible partnerships and tie-ups
Focus on Segment A customers
Company’s products are designed to cater segment A clients in each micro-market
− The Company’s clientele are the affluent gentry of UHNW individuals, head honchos of global
organizations, business heads of financial institutions, other businessmen and professionals
Channel partners
− Sales through reputed channel partners, wealth managers, institutions and participation in property
exhibitions to attract corporate, HNI and retail customers
Ultra luxury residences
aimed at high-net worth
individuals
Premium & mid-level
residences in select
suburban micro markets
Large formats and mixed
used developments
Commercial developments
43
Construction Management
Appointment of Price Waterhouse Coopers (PWC) for document process, risk & control and
organizational development
Sound Planning, Optimized structural design and construction technology by partnering with
world class architects, best contractors and structural engineers
Strong PMO Team: Planning, budgeting, progress reporting, cost management and project
management processes such as:
- Integrated project schedule - drawing schedule, construction schedule, approvals schedule and
procurement plans
Outsource through EPC contracts with oversight managed by external PMC, QS and QC along with
a strong in-house project monitoring unit
ERP platform to undertake contract management, procurement processes, billing and MIS
Obtainment of requisite certificates for construction and occupation
News Articles on BKC
44
News Articles on BKC
News Articles on Oshiwara
45
Sep 08 2014 : The Times of India (Mumbai)
Oshiwarato
get seven newroads
spanning 3.5K metres
TheMumbai Metropolitan
RegionDevelopment
Authorityannounced on Sunday that it will construct
seven roads in Oshiwara. MMRDA, the special planning
authority for the area, will develop the roads, construct
stormwater drains, a sewage disposal system
and
water connections, making the residents commute to
and fromupcoming Oshiwara
railway station easier
and connectivity to S V Road faster.
“Weste
rnRailway
isstartin
ga
stationbetween
Jogeshwari and Goregaon. Once it is operational, the
region will become a residential and commercial hub.
MMRDA is committed to develop infrastructure in the
region beforethe station begins ope
rations
,“ said
MMRDA joint project director DilipKawathkar.
MMRDA will construct the roads totaling 3,520 metres,
for which Rs 62 crore has been set aside. The authority
may have torehabilita
tesome families under the
project, Kawathkar said.
Coverage on Sunteck
46
Thank You!
Communication Contacts:
Investor Relations
Sumesh Mishra / Chirag Vageria / Abhinav Srivastava
Tel: +91 22 42877800
Email: [email protected]
