Anant Raj Limited (515055) Q4 05/06 earnings summary

Executive summary

• FY2005-06 marked a pivot from ceramic-tile manufacturing toward a consolidated, NCR-focused real-estate platform spanning hospitality, service apartments, IT parks, entertainment and commercial development.

• Revenue rose to Rs 59.2 crore from Rs 23.9 crore and profit after tax to Rs 28.1 crore from Rs 0.3 crore; asset and investment disposals were a major earnings contributor.

• Management’s stated strategy is to acquire land early in NCR, hold it for value creation and develop assets intended to generate rental income and appreciation.

Financial highlights

• FY revenue was Rs 59.19 crore versus Rs 23.89 crore; profit before tax was Rs 36.89 crore versus Rs 0.33 crore, and profit after tax was Rs 28.08 crore versus Rs 0.29 crore.

• Sale of assets and investments contributed Rs 34.47 crore; rental income was Rs 1.71 crore, up from Rs 0.07 crore in FY2004-05.

• Proposed dividend was 25%; Rs 2.81 crore was transferred to general reserve and Rs 19.06 crore carried forward to reserves and surplus.

• Consolidated revenue was Rs 59.20 crore and consolidated PAT Rs 28.09 crore; consolidated prior-year comparisons are affected by subsidiary acquisitions and a subsidiary disposal.

Outlook and guidance

• Six hotels with a combined 750 rooms were planned for development over the following two years, focused on four- and five-star properties; management cited a Delhi room shortage of 12,000–15,000.

• A 10-acre Manesar IT park, planned at 18 lakh sq. ft. with a “Walk to Work” integrated township concept, was targeted for completion within two years.

• Higher tile capacity was expected to bring scale benefits, while real-estate diversification was expected to support future profitability and recurring rental income.