Real estate in India has entered a phase of record-breaking growth that is reshaping the sector’s landscape. The demand for homes and offices is increasing due to urbanization and changes in population. People are increasingly moving to cities where they can improve their socio-economic status. Subsequently, the corporate world has contributed significantly towards office space needs and increased residential demands in metropolitan areas. This will make Indian real estate continue to grow at a remarkable pace.
Real Estate Industry in India
The Indian real estate sector is a key driver of the country’s economy, contributing significantly to its GDP and employment generation. The sector is expected to reach a market size of US$ 1 trillion by 2030, up from US$ 200 billion in 2021. The real estate industry in India has been experiencing robust demand across various segments.
The real estate sector shows promise with a projected 9.20% CAGR from 2023 to 2028. In Q1 2024, the Indian residential market has maintained sales growth at 9% YOY, and the Indian commercial real estate market has grown at a rate of 43% YOY.
Company Overview of Anant Raj
Anant Raj is one of the most established & reputed real estate developers in Delhi and the National Capital Region (NCR). Anant Raj Limited was established in 1969 by Shri Ashok Sarin. In 2012, the company changed its name from Anant Raj Industries Limited to Anant Raj Limited. It is actively engaged in the real estate development, construction, and infrastructure development sectors.
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The company has a diverse portfolio of projects, including Integrated Residential Townships, Group Housing, IT Parks, Hotels, Commercial Complexes, Malls, Service Apartments, Warehousing and Data Centers. The company has five decades of experience in the real estate market, leading to strategic growth in revenue and profits. Anant Raj Limited has reduced debt significantly over the past three years.
Segment Analysis
Anant Raj Limited has transformed from a construction company to a diversified real estate firm, with a presence in residential, commercial, hospitality, IT parks, and data centers. The residential segment focuses on high-quality developments in premium locations like Sector 63A, and Golf Course Extension Road in Gurugram. Their flagship project, Anant Raj Estate, features luxury villas, plots, flats, and commercial complexes.
In the data centers segment, Anant Raj is capitalizing on the growing demand for data storage driven by digital transformation and AI/ML advancements. The company has established data centers in Manesar, Rai, and Panchkula. The company plans substantial expansions, leveraging its existing infrastructure for cost efficiency. The hospitality and warehousing segment includes plans for new developments on their extensive land holdings in Delhi and the National Capital Region, aiming to tap into rising market opportunities.
Expansion Footprint in Delhi and NCR
Anant Raj Limited boasts an extensive land bank of around 300 acres spread over several localities. This huge bank of land that has been accumulated over time makes it one of the major players in the regional real estate market. The action consists of land in Gurugram, Najafgarh, and Mehrauli, which is meant for future development.
Anant Raj’s strategic land acquisitions during the early years, when the Delhi Development Authority controlled real estate development in the NCR, have proven to be a valuable asset. Using this land bank, Anant Raj Limited diversified its business into various real estate sectors, including residential, commercial, and hospitality developments. In order to take advantage of the rising demand for high-end properties across Delhi NCR; Anant Raj aims at developing luxury and premium projects only
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Financial Analysis of Anant Raj
We are looking deeply into the financial analysis of Anant Raj Limited, The company’s revenue has increased over the last 4 years. The revenue increased from ₹957 crores in FY23 to ₹1483 crores in FY24 and grew by 54.96%. The company has maintained revenue growth with a CAGR of 52.25% in the last 4 years.
Anant Raj Limited’s net profit has increased massively by 78.52%, from ₹149 crore to 266 crore. It retained a net profit with a CAGR of 78.85% over the last 4 years. Anant Raj Limited’s operating profit margin is flat compared to the previous year. The OPM and NPM are 23.81% and 17.83% in FY24, respectively.
The company’s return on capital employed has increased over the last 4 years. In FY24, the return on equity and return on capital employed were 7.27% and 8.01%, respectively. Anant Raj Limited has reduced debt compared to previous years. It was 0.33x in FY23 to 0.17x in FY24. The company is almost debt-free.
Peers of the Company
Bansal Wire Industries Limited’s revenue growth rate and net profit growth rate of CAGR are higher than their peers like DLF Limited, Godrej Properties Ltd, and Prestige Estates Projects Ltd. The below chart shows a clear comparison of the peers of Bansal Wire Industries Limited.
Future Plans of Anant Raj
- The company is expanding the township to acquire an additional 25 acres in the next 2 years in Gurugram.
- The company has a data center expansion scale of up to 307 MW IT Load Data Center within the next 4 to 5 years. It is expected to generate a rental income of INR 3,300 crores once the 307 MW is fully operational.
- Anant Raj Limited is planning to work towards cloud service adoption to help with the significantly higher rental income.
- Anant Raj Limited has capitalized on almost 100 acres of fully paid freehold land in Delhi NCR for future residential, warehousing, and hospitality projects
- The company has a business partnership with RailTel Corporation of India Ltd. for Data Centres. Anant Raj has a strategic alliance partnership with TCIL for both cloud and colocation services.
- The company’s ongoing projects Ashok Tower will be completed in 2027, and Joy Square (Sector 63A, Gutugram) will be completed in June 2024.
- Anant Raj Limited will become a zero-net debt company by December 2024. It shows the strengthening of the company’s balance sheet.
Conclusion
We are at the end of the article on Bansal Wire Industry Limited, Anant Raj Limited’s strong presence in the Delhi-NCR real estate market, associated with its diversified portfolio and focus on quality, has positioned the company as a leading player in the industry. Anant Raj Limited has strong financial performance, revenue, net profit, and expansion plans. What do you think about Anant Raj Limited? Let us know in the comments below.
Written By Nikhil Naik
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