Real estate companies are looking to increase the number of project launches and add new cities to boost bookings in the second half of FY25, following a muted first half due to elections and other factors.
Most developers are banking on geographical expansion, while others such as Sobha plan to augment the supply of mid-income housing projects for higher bookings.
Prestige Estates Projects has lined up launches across its key markets such as Bengaluru, Hyderabad, Mumbai, Goa, and Chennai, in addition to a large project in Delhi-NCR, said Irfan Razack, its chairman and managing director. These projects are worth almost Rs 30,000 crore of gross development value (GDV) and these will drive the sales for the next four months, he said.
“The demand remains very strong and all we need to do is get the right product to the market at the right price,” Razack said. Another 4-5 launches are in the works for February and March which will also add to the inventory available for sale in the rest of FY25, he said.
Like Prestige, Puravankara is focused on new launches to the tune of 12.27 million square feet with a potential GDV of around Rs 13,625 crore to drive sales. Of these, Rs 8,000 crore worth of inventory is expected to be opened for sale in the last two quarters of FY25, said Ashish Puravankara, managing director, Puravankara.
These projects, many of which are in the advanced stages of either plan sanction or RERA approval, are concentrated in Bengaluru, Mumbai, Pune, and Kochi.
Puravankara said these projects’ suitable locations and the company’s strong pricing strategy will also support pre-sales.
He said the decline in pre-sales in H1 can be attributed to deferred launches, primarily due to delayed approvals on account of the administration being busy with elections.
Another Bengaluru-based developer, Sobha, is also increasing sales and focusing on geographical diversification.
“We are increasing our launches in H2FY25 as a critical lever to achieve our annual pre-sales guidance of Rs 8,500 crore. Beyond Bengaluru, we are actively pursuing geographical diversification, with key projects planned in Hyderabad, Pune, Greater Noida, and Mumbai in FY26,” Jagadish Nangineni, managing director of Sobha, said in an analyst call recently.
Nangineni said their focus remains on balancing the portfolio across segments and regions to mitigate risks and drive growth sustainably. In the second half of FY25, the company is focusing on the middle-income segment.
Dull H1
In the first half of FY25, Bengaluru-focused Sobha and Puravankara saw a decline of 37% and 13% in bookings, respectively, while Prestige Estates’ bookings declined by 36% to Rs 7,052 crore.
Godrej Properties also posted a muted pre-sales growth of 3% year-on-year. An email sent to Godrej Properties did not elicit any response.
Developers posted lower bookings due to regulatory or approval delays, India Ratings & Research said recently.
“The sector faced challenges maintaining pre-sales on account of lower launches and muted customer sentiments on account of the Shradh period (a period dedicated to honour the ancestors when people usually refrain from certain activities like property deals) as well as the general elections in Q1FY25. As such, sustenance sales largely supported Q2FY25 pre-sales,” India Ratings said.
The firm expects developers to increase supply in H2FY25. It added that a slew of new launches would not lead to oversupply.
Anuj Puri, the chairman of Anarock Property Consultants, said that with robust sales and an all-time low inventory across the top seven cities, most listed developers have a strong pipeline of launches planned for the coming two-to-three years.
While demand remains high, housing sales will mostly depend on the pricing and the product on offer. Developers will need to keep prices in check to maintain robust sales momentum, he said, adding that with prices rising significantly in the past one year, add-on freebies and discounts may attract more buyers.
Sales will vary from market to market, but houses priced anywhere between Rs 80 lakh and Rs 1.5 crore will be in high demand. As of now, most launches are with units priced higher than Rs 1.5 crore, which is unaffordable for many, he said.