Ajmera bets on acquisitions, JVs to expand m-cap to $5 billion
Ajmera added that to achieve the goal, the company is targeting at least 25-30% growth each year in terms of volumes, sales, and profitability. While he did not specify a timeline, he said it may stretch beyond five years.
The realtor’s current m-cap stands at ₹4,015.61 crore (approximately $472 million).
The family-run real estate firm plans to invest ₹2,300 crore generated from internal cash accruals over the next three to four years in acquisitions, JVs, joint development agreements (JDAs), and society redevelopment opportunities.
Through such projects, the company expects to monetize its 11.1 million square feet land bank in Mumbai and acquire more land in other locations, Ajmera told Mint.
“We are definitely looking at a $5 billion m-cap,” he said. “The plan is to acquire properties or probably get into JVs or transactions at multiple locations rather than probably one location.”
With three generations at work, Ajmera pointed out the company had the capacity to oversee seven to 10 projects simultaneously.
In 2021, the company planned to grow its pre-sales of ₹250-300 crore by 5x. The company is targetting pre-sales worth ₹1,350 crore in 2024-25. If achieved, the realtor will have completed its five-year goal in four years.
To be sure, Ajmera’s 25-30% growth target isn’t farfetched, going by the company’s recent financials. In the fiscal year ended 31 March 2024, its net sales surged 35% to ₹489 crore, and net profit rose 20% to ₹85.33 crore. That wasn’t the case in the year prior when its net sales dropped by 11% even as its profit climbed 75%.
The company’s debt stood at ₹790 crore in the quarter ended 30 September 2024. The realtor aims to bring it down to “almost zero in the next six to eight months” without compromising on “working capital requirements”, Ajmera said.
The prospects
“In a city like Mumbai, having an excellent land bank is a big plus for a developer that can also capitalize on their brand equity to develop it on their own,” said Gautam Saraf, managing director of Mumbai and new business at global property consultant Cushman and Wakefield.
“Also, given the growth momentum in the market with opportunities for society redevelopment, JVs, JDAs that they have been pursuing, it could lead to inorganic growth,” Saraf added.
Mint reported earlier this month that developers from across the country were making a beeline to redevelop Mumbai’s old, dilapidated buildings, housing societies and slums.
Over 25,000 buildings in Mumbai’s metropolitan region (MMR) alone had outlived their useful life and were eligible for redevelopment, Ajmera, who is also secretary of Credai-MCHI, had said at a press conference.
At the same time, Mumbai’s luxury realty sector recorded a cumulative highest-ever half-yearly sales from luxury housing at ₹12,300 crore in the first half of the calendar year 2024, up 7.69% year-on-year, according to an India Sotheby’s International Realty and CRE Matrix report reported by Mint in July.
Ajmera, whose portfolio consists of flats starting from ₹50 lakh to ₹12 crore, has eight projects in the pipeline in Mumbai and Bengaluru. The company intends to follow a 65:35 ratio for new projects, with the majority being residential and the rest being retail and commercial combined.
It also has three society redevelopment projects in the pipeline, including one in Mumbai’s Bandra with Rustomjee Group, Balkrishna Society at Versova, and Ajmera Prive at Juhu. It also has a slum rehabilitation project in the Bhandup area.
In 2024, Ajmera’s stock price more than doubled, growing 148% to ₹1,112.15 as of 18 December from ₹448.15 on 1 January 2024, showed data from the National Stock Exchange (NSE). It hit the 52-week high of ₹1,194.15 on 17 December.
The stock even outpaced the Nifty Realty, which gained 41.4% year to date, beating some of the top listed constituents in the index, such as DLF’s 20.43% growth, Sobha Ltd’s 62.82%, Macrotech Developers Ltd’s 40.57%, and Phoenix Mills Ltd’s 52.16% growth.
