Whalesbook
Annuity Income Goal
Lodha Developers is set to significantly boost its recurring revenue. The real estate firm plans to multiply its annuity income tenfold, targeting ₹3,000 crore in the next six years. This expansion focuses on its growing data center business, alongside retail, warehousing, and office developments.
Data Center Expansion
A major part of this expansion involves developing 1 gigawatt (GW) of data center capacity on a built-to-suit basis. Located in Palava near Mumbai on over 100 acres, this project is expected to generate substantial rental income. Lodha Developers plans to invest ₹13,000-₹15,000 crore in its data center projects, not including land costs. The company also plans to monetize Palava land parcels suitable for an additional 2 GW of data center capacity.
Partnerships and Financials
The developer has signed a Memorandum of Understanding with the Maharashtra government to build a Green Data Centre Park in Palava, covering 400 acres. These initiatives are supported by strong financial results. For the fiscal year ending March, Lodha Developers posted a 24% year-on-year increase in net profit, reaching ₹3,431 crore. Total revenue for the year grew 21% to ₹16,680 crore, boosted by record quarterly and annual pre-sales.
Performance and Outlook
In the fourth quarter, net profit rose 9% from the previous year to ₹1,010 crore, with total revenue increasing 12% year-on-year to ₹4,710 crore. Abhishek Lodha, MD & CEO, noted the company's resilience despite geopolitical challenges. He added that despite achieving over ₹20,000 crore in pre-sales, the company's market share remains low, showing significant potential for future growth.
The company cut its net debt by ₹800 crore to ₹5,377 crore through better collections and operational efficiency. Lodha's net margin for the year reached 20.0%, a first for the company. The developer also added 12 new projects valued at ₹60,000 crore GDV across major cities, well exceeding its annual targets. With ₹2,00,000 crore GDV available for sale, Lodha expects to boost free cash flow by cutting business development spending over the next two years.