by THO
Boman Irani, chairman and MD of Keystone Realtors (Rustomjee Group), has said that salaried individuals and small business owners make up a strong base of home buyers for them, and there doesn’t seem to be a connection between the stock market and housing demand, at least not right now.
He made this statement while responding to a question during the recent investors’ call for Q3FY25 on February 11 on whether stock market fluctuations would impact housing demand.
Irani also said that the company remains focused on redeveloping old buildings in the Mumbai Metropolitan Region and plans to replicate its success in the Thane real estate market in Dombivli, where it has announced an affordable project.
Link between the stock market and real estate
According to Irani, if one were to look at the FY24 data, Mumbai, Mumbai Metropolitan Region has crossed (+900) apartments in the ₹ 10 crores plus category. “I think even last month, and if I am allowed to say this, January saw data of about 12,000 registrations taking place. So really this slowdown that everybody is there’s some kind of murmur in the market is not really seen from where we are.”
Elaborating on the connection between the stock market and real estate, he said he thinks that “a very strong portion of the Mumbai buyer base while, of course, Mumbai is considered to be the head of the stock markets, etc. I don’t see such a huge connection, at least right now, from the way the data is pointing out. So, we still have a very strong buy base from the salaried class, from the smaller business classes and there’s been a great and strong demand as we have seen the data for all the high-end projects.”
Focus on mix of mid-mass and aspirational housing segments
According to Irani, in the future, the company will focus more on the mid-mass as well as the aspirational segment. The company’s acquisitions over the last two years and nine months of the current financial year have been concentrated in this category. “…more than 73% by value we have acquired in this category. We have been able to balance the portfolio whereby we are present across the price points,” he said.
“We have balanced the portfolio whereby we are present across the price points. The company’s model mix will be about 40% premium, super-premium of the total pipeline size, about 40% into the mid-mass and the aspirational segment 40%-45% and about 10 to 15% coming from the affordable segment. And our pipeline basically has been built and is being built, taking into account this model mix,” Irani said during the call.
Rustomjee planning to foray into the South Mumbai real estate market
According to Chandresh Mehta, Executive Director at Keystone Realtors, the company will soon enter the South Mumbai market.
The company is looking at exploring new micro markets in terms of premium and luxury. “So, we are not currently in the South Mumbai market. We are close to acquiring projects in that micro market very soon,” Mehta said during the call.
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The company has already acquired a project in Prabhadevi and is looking to launch a project in the area. “Mahim, which was an erstwhile, a bit subdued location. We are constantly on the lookout of where the next growth, the next additional revenue will come from and we are extremely conscious in each of these newer markets there is a latent demand which we are looking at exploiting,” he said.
Keystone to focus on redevelopment projects and replicate Thane’s success in Dombivli
During the call, Irani also mentioned that the company remains focused on redeveloping old buildings in the Mumbai Metropolitan Region and has plans for Dombivli near Thane, where it has announced an affordable project.
“Dombivli for us is something where we want to kind of make the most of the current boom in that area. And as I mentioned, the connectivity of Dombivli has seen a tremendous upside with the connectivity to Thane and the entire metro route network going on out there. And over time this entire triangle, which is Bombay (Mumbai)-Dombivli-Thane is going to be a great growth area given that Bhiwandi is continuing to grow as a logistics hub and more and more employment generation is taking place,” Irani said.
He added, “Rustomjee will continue to weave the magic out there with what we have done in Thane. We have seen Thane grow from a Rs. 2,000 market to a Rs. 25,000 market per sq ft. Currently, we see a similar trend happening in Dombivli over the next few years.”
Also Read: Can you buy a property in Mumbai for ₹50 lakh? The answer may surprise you
Q3FY25 results
The company on February 11 reported a net profit of ₹30 crore for the quarter ended December, compared to ₹29.9 crore in the same period last year. The company’s total income for Q3 fell to ₹485.8 crore, down from ₹533.3 crore a year ago. In a regulatory filing, the company said that the pre-sales in Q3 increased 40% to ₹863 crore due to five new launches worth ₹4057 crore.
