Dear Shareholders,
After a year marked by global uncertainties and volatilities, the
global economy achieved greater stability during FY 2024. While uncertainty stemming from
adverse geopolitical developments remained elevated, global economic growth was
surprisingly robust. As per the World Economic Outlook (WEO), April 2024 of the
International Monetary Fund (IMF), the global economy registered a growth of 3.2% in 2023,
though marginally lower than in 2022.
Inflationary pressures have been significantly higher on account of the
persistence of core inflation. Global trade moderated due to rising geopolitical tensions,
cross-border restrictions and slower growth in advanced economies. The muted trade growth
occurred despite the easing of supply chain pressures. Further, geopolitical developments
and monetary policy changes across countries resulted in increased caution among
investors, culminating in moderation in foreign direct investment (FDI) flows.
India's economy carried forward the momentum it built in FY 2023 into
FY 2024 despite a gamut of global and external challenges. The focus on maintaining
macroeconomic stability ensured that these challenges had minimal impact on India's
economy. As a result, India's real GDP grew by 8.2% in FY 2024, posting growth of over 7%
for a third consecutive year, driven by stable consumption demand and steadily improving
investment demand.
Apart from private corporations, households have also been at the
forefront of the capital formation process. The growth in housing sales in cities has been
particularly impressive, indicating that urban households are diversifying the deployment
of their savings. In 2023, residential real estate sales in India were at their highest
since 2013, witnessing a 33% YoY growth, with a total sale of 4.1 lakh units in the top
eight cities. As per real estate research firm Proptiger, new supply witnessed an all-time
high, with 5.2 lakh units launched in 2023, as against 4.3 lakh units in 2022. The
momentum continued in Q1 of 2024, witnessing record breaking sales of 1.2 lakh units,
clocking a robust 41 per cent YoY growth. New supply has consistently exceeded one lakh
units since Q2 of 2022, underscoring persistent demand- supply dynamics in the housing
market.
Real estate and ownership of dwellings have accounted for over 7% of
the overall GVA in the past decade, highlighting their integral role in the economy.
Following two challenging years of pandemic-induced lockdowns and economic instability,
the real estate sector has experienced a robust recovery. The pandemic has shifted
homebuyers' preferences toward larger, sustainable spaces with additional amenities,
driven by remote and hybrid working trends. This shift has also spurred interest in
peripheral areas close to city centres. Factors contributing to the sector's growth
include rapid urbanisation, rising income levels, the emergence of nuclear families, new
entrants in the market, and improved financial options for developers and homebuyers. The
strong desire for home-ownership was reinforced during the pandemic, acting as a catalyst.
The outlook for the real estate sector is encouraging. With increasing
urbanisation, the housing industry is poised for a significant transformation. As per the
United Nations, by 2050, half of India's population is projected to dwell in urban
regions, compared to 31% in 2011. This underscores the need to adapt strategies and
policies to meet the rising demand for housing and offer viable, cost-effective,
sustainable solutions.
Digitisation of land records is poised to improve transparency in land
transactions, diminish property ownership conflicts, and enhance the efficiency of land
management. Implementing a single-window clearance system for construction approvals will
also accelerate construction processes, minimising delays and uncertainties. The
streamlining of approvals is set to consolidate and systematise India's residential real
estate sector further.
Sustainability and technology have emerged as significant disrupters
for the real estate sector. Sustainability will influence green construction practices and
energy-efficient designs, while technology will revolutionise smart homes and data-driven
insights. With more significant environmental concerns, the focus will be on
energy-efficient systems, rainwater harvesting and smart building technologies.
The National Democratic Alliance government led by Prime Shri Minister
Narendra Modi has returned to power with a historic mandate for a third term. His
unprecedented third popular mandate signals political and policy continuity. The
Government has been investing heavily in highways, railways, ports and other
infrastructure projects. We, at Omaxe has been at the forefront of real estate development
i n I ndi a and with a renewed focus, will put our best foot forward to achieve the vision
of Viksit Bharat 2047.
Operational Performance
Continuing our growth trajectory, during FY 2024, Omaxe successfully
completed 3.87 million square feet of handover of real estate properties to its customers.
These deliveries encompassed projects located in various cities such as Delhi, Chandigarh,
Lucknow, Prayagraj, Faridabad, Ludhiana, etc.
With this addition, the Company has delivered 135.87 million square
feet of real estate projects to its customers upto FY 2024.
There is gradual improvement in the financial performance of the
Company during FY 2024, which is demonstrated by:
- The consolidated income grew by 105%, from Rs. 798.01 crore in FY
2023 to Rs. 1,634 crore in FY 2024.
- Cash from operations during FY24 stands at Rs. 986.77 crore against
Rs. 469.00 crore during the previous year.
- Repayment of loan and interest amounted to Rs. 924.14 crore,
resulting into lower financial liabilities in the books at the year end.
Creating Destinations, Building Communities
People want to live in communities, not cities. They want to connect
with other people. As density increases, the walkable neighbourhoods that incorporate
outdoor spaces like gardens, parks, skating rinks, and sports fields become highly sought
after. The developers, that consider these areas, both existing and as additions to their
plans, expand their building's footprint and the project's overall economic viability.
In the fast changing world, the standards are different today.
All sustainable design and business must consider people and the planet
first. Like the great urban spaces that they occupy, high-performance buildings are
shaping the future of cities.
We, at Omaxe, have been pushing for a human-focused approach to
designing communities: clean air and water, efficient transportation, and accessible
outdoor areas. Our project are holistically designed with the surroundings they inhabit,
high-performing structures are thoughtfully designed, mindful of engineering,
environmental, and human impacts. They go beyond standard building standards, striving for
improved energy efficiency, comfort for its occupants (and the public around it), and
long-term resiliency in a changing climate. Careful consideration of these factors is
essential for climate, positive, high-performing buildings, but also to create highly
coveted communities within a city.
We firmly believe that our actions of today will decide the future of
next generation.
Going Forward
Omaxe continues to further its journey of realizing dreams of its
customers an building a valuable company for all its stakeholders. Going forward, we will
continue to emphasize on the critical and already successful cogs in our wheel of success.
We will continue to focus on strategic land acquisition; diversified product mix;
continued emphasis on tier II & III cities; value-selective projects in Tier I cities;
focus on customers and quality in deliveries, on-time. With renewed focus on expanding our
geographies and bringing more new projects in existing cities of presence, we are
confident of developing a diversified portfolio of projects. The more than hundred percent
growth in revenues further encourages us to pursue to the growth path with greater focus
on improving our profitability on a sustainable basis. The newer avenues of
diversification like PPP models, joint developments and asset acquisitions at subsidiary
level is likely to give us ample room for future progress.
A Note of Gratitude
I thank all are shareholders, investors, lenders, employees, customers,
associates and the exchequer for reposing their continued support and trust in us. We
believe that together we can create more milestones of success as we create more
destinations, build more communities.
Best regards,
Rohtas Goel
Chairman