Tuesday, July 27, 2010


Low inventory for the company: Most of the projects for Omaxe in Noida, Greater Noida, Faridabad and Lucknow have all been sold out the extent of 70-75%. Major portion of the projects are at the completion stage or ready to move in stage which provides them with an edge over their competitors whose projects are still under construction.

Timely execution of the projects: The company has good execution capabilities, as most of its projects were executed in a period of 3 – 3.5 years. Timely execution leads to a higher demand as compared to peers since it provides with ready possession and there is hardly any waiting period for the customers, which aids in increasing the market visibility of the company.

Demand scenario in Delhi and Lucknow: The markets at New Delhi and Lucknow are diverse in terms of the product demand by the customers. There is great demand for luxury and super luxury apartments in Delhi, which have an average realization in the range of Rs. 5,500 – Rs. 6,000 per sq ft. and with the construction cost being Rs. 2,000 per sq ft., the EBITDA margins, are higher as compared to that in Lucknow which has an average realization of Rs. 1,800 per sq ft. and construction cost of Rs. 1,100 per sq ft. where the margins are relatively lower.

Upcoming projects in the pipeline: The company has a large project line up for launch in the coming quarters. For instance the Hi Tech City at Lucknow which is 2,700 acres will be executed in phases, it’s Phase – I of 500 acres is to be launched in November 2010. It has a visibility of 10 - 12 years for the entire development.

To read the full report: OMAXE