Over Rs 1 trillion in real estate bookings anticipated

According to analyst projections, the sales bookings of the top listed businesses are expected to surpass Rs 1 trillion in the current fiscal year, which is around three times greater than what they accomplished in FY21.

According to TruBoard Partners, the top 11 listed developers had combined sales bookings of Rs 71,766 crore in the first nine months of FY24. In FY21, these companies had sales bookings of Rs 34,010 crore.

According to our preliminary research, listed developers have exceeded their FY23 full-year sales bookings in the first three quarters of FY24. According to historical data, the last quarter usually represents 30–40% of all sales bookings, according to Sangram Baviskar, TruBoard Partners’ founding member and managing director of real estate. A lot of developers have updated their goals in light of the spike in reservations.

With bookings of Rs 13,315 crore until the December quarter, DLF, the biggest listed developer in the nation, is leading the race. In FY24, a total of Rs 22,363 crore is anticipated. Following DLF is Godrej Properties, which according to TruBoard has sales bookings of Rs 13,008 crore in the most recent quarter and is predicted to reach Rs 18,728 crore in FY24.

DLF exceeded their booking goal for FY24 by Rs 13,000 crore in only the December quarter.

Irfan Razack, chairman and managing director of Prestige Estates Projects, said that although the Bangalore-based company had originally projected to achieve sales bookings of Rs 16,000 crore in FY24, it is optimistic about surpassing this amount.

According to Razack, it is a 50% increase over its sales bookings of Rs 12,931 crore from the previous year.

In a similar vein, Godrej Properties said in its Q3FY,24 investor presentation that, as of the conclusion of the third quarter, it has achieved 93% of its booking value projection for the fiscal year 2024.

During an earnings call with investors last month, GPL’s executive chairman Pirojsha Godrej said, “We will exceed our bookings guidance of Rs 14,000 crore for FY24 and we are confident of also delivering our best-ever year in terms of cash collections and project deliveries.”

The surge in sales bookings is seen by real estate developers and advisors as a shift in consumer preference for branded and listed companies.

Because of earlier worries from buyers about the reliability of the developers in keeping their promises about on-time delivery and product quality, we have seen a movement in the consumer preference towards organized and listed companies, according to Razack of Prestige.

Prestige Estates’ sales bookings have increased at a compound annual growth rate (CAGR) of more than 50% over the past three years, according to Razack. He also noted that a significant portion of this growth can be attributed to the industry’s strong latent and new demand, which is being driven by a stable and expanding economy as well as rising professional salaried class savings, particularly among IT professionals.

“We hope to expand at a reasonable rate during the upcoming years as well, and we plan to aim for a CAGR of 20% in the near future,” he said.

The market is still dominated by Grade A developers, including those who are listed, according to Anuj Puri, chairman of Anarock Property Consultants.

He said, “Demand was mostly focused on projects by Grade A developers, who gained even more market share in 2023. Demand was driven primarily by end-users and followed by investors.”

Approximately sixty percent of the 4.77 lakh units sold in the top seven cities were developed by branded developers, accounting for over sixty percent of the 4.47 lakh units introduced in 2023, as reported by Anarock Research.

“Buyers don’t mind paying a little extra because their desire to avoid construction-related risks also plays a role,” Puri added. “This trend is only continuing this year.”

These developers are now releasing the correct amount of supply at the right price to meet natural end-user demand. He went on to say that this is one of the most remarkable aspects of the reimagined Indian housing market and the outcome of extensive market research prior to clicking the “commit” button.

According to Bhaviskar of TruBoard, the residential real estate industry is unquestionably experiencing a tailwind due to macroeconomic factors including strong economic growth, booming capital markets, and fast urbanization fueling sales momentum.

Furthermore, underlying trends like the rising aspirations of renters to become homeowners and the resurgence of investment interest serve as important drivers for this rise. According to TruBoard Research, this trend is projected to continue, supported by the economy’s ongoing strength and the expectation that interest rates would begin to decline starting in FY25.