Puravankara (PURVA) Q4 09/10 earnings summary

Executive summary

• FY10 consolidated revenue rose 7.52% YoY to Rs.4,783.62 million; PAT edged up to Rs.1,453.18 million despite recessionary conditions and a higher tax provision.

• Residential development remained the core business; affordable housing expanded through Provident Housing, while management reported improving demand across affordable, mid-market and premium homes.

Financial highlights

• Revenue was Rs.4,783.62 million vs Rs.4,449.04 million; gross profit Rs.2,035.49 million vs Rs.1,810.13 million; operating profit Rs.1,582.53 million vs Rs.1,311.50 million.

• PBT increased to Rs.1,751.26 million from Rs.1,470.16 million; PAT was Rs.1,453.19 million vs Rs.1,444.19 million, with tax provision rising to Rs.298.08 million from Rs.25.97 million.

• Revenue included Rs.1,632.15 million from Kochi land sales; the transaction contributed to higher current tax and land costs.

• Consolidated CFO was Rs.555.33 million vs cash used of Rs.428.02 million in FY09; cash and equivalents rose to Rs.782.15 million from Rs.267.94 million.

Outlook and guidance

• Target to deliver over 60,000 affordable homes over the next six to seven years, following strong response to Provident launches in Chennai and Bangalore.

• Planned launches across Coimbatore, Colombo, Cochin, Bangalore and Mysore; land bank was 125.39 million sq. ft. of developable area, with 19.01 million sq. ft. under development.

• Growth expenditure for land, construction and development expected to be funded through operating cash flows and borrowings; execution and financing plans remain sensitive to interest rates, property prices and market conditions.