Mahindra Lifespace Developers, the real estate division of the Mahindra Group, is on an ambitious path to significantly boost its sales, aiming for an impressive Rs 10,000 crore by fiscal year 2030. With Rs 3,300 crore in sales recorded for FY25, the company is positioning itself for exponential growth.
Strategic Growth Plans
Amit Kumar Sinha, Managing Director and CEO, shared insights during a recent interview, revealing that Mahindra Lifespace holds 70-80% of its land bank for future expansion. While the company is not in a rush to acquire more land, it has notably increased its Gross Development Value (GDV), reflecting its robust development plans.
- FY24 GDV: Rs 4,400 crore
- FY25 GDV: Rs 18,100 crore
- Current GDV: Rs 39,000 crore
These figures include upcoming projects in key areas like Thane, Mulund, and Jaipur, showcasing a strong pipeline of future developments.
Shifting Market Dynamics
In the competitive landscape, larger players like Godrej Properties have also ramped up their residential ventures. Godrej surpassed its sales target of Rs 27,000 crore in FY25 and aims for Rs 32,500 crore in FY26. In this context, Mahindra Lifespace is transitioning from affordable housing projects to focus more on premium segments, aligning with market demand and economic viability.
Sinha emphasized that while the company will continue to deliver ongoing affordable housing projects in locations like Kalyan, Palghar, Pune, and Chennai, the shift in focus is primarily driven by the decreasing pull in budget housing.
Future Project Launches
Looking ahead, Mahindra Lifespace has plans to introduce new developments in several prime locations, including Whitefield in Bengaluru and Malad, Bhandup, and Mahalaxmi in Mumbai. Sinha noted, “We are committed to delivering exceptional designs and products at competitive prices to attract customers.”
The demand for residential properties remains strong, though Sinha predicts that price increases may stabilize to single digits in the upcoming years, contrasting with the 10-20% hikes seen previously. “While volume will remain robust, pricing is expected to be more restrained,” he stated.
Market Shift Towards Quality
A notable trend is the migration of buyers from smaller, less reputable developers to established Grade A developers, driven by a desire for quality and timely project completions. Sinha remarked, “As non-branded players exit the market, Grade A developers are reaping the benefits.”
Integrated Cities and Industrial Cluster Developments
In the realm of integrated cities and industrial clusters, Mahindra Lifespace has successfully leased 85.1 acres valued at Rs 420 crore, up from 119.5 acres worth Rs 370 crore in FY24. The company’s IC&IC portfolio boasts a gross leasable area of approximately 5,737 acres, with around 1,634 acres available for future leasing that could generate revenues of Rs 6,000 crore and a profit after tax (PAT) of Rs 1,500 crore to Rs 2,000 crore over the next 8-10 years.
Focus on Existing Clusters
Sinha noted that the company’s growth strategy centers on enhancing its presence in existing clusters such as Mahindra World City in Chennai and Jaipur, rather than expanding into new locations.
Upcoming Rights Issue
In a move to strengthen its financial position, Mahindra Lifespace is preparing for a rights issue amounting to Rs 1,500 crore. According to Equirus Capital, the successful completion of this rights issue will not only help in reducing debt but also unlock further opportunities for business development.
With a promising outlook and a strategic focus on key areas, Mahindra Lifespace Developers is poised for a dynamic future in the real estate sector.
