Research #15 Ajmera Realty & Infra India Ltd
Building the Nation, brick by brick!
Welcome to the 15th edition of our small-cap coverage. Today, we're diving into an Infrastructure based business, ‘Ajmera Realty & Infra India Ltd’
Let's start! But before we do, here is the link to the 14th edition
LETS GO!
1. Company Share Price chart & comparison with Index:
Ajmera Realty & Infra India Ltd Performace
Ajmera vs Nifty50
Ajmera Ltd. vs Nifty Smallcap
2. About Company:
Ajmera Realty & Infra India Ltd is a Mumbai-based real estate developer with a focus on residential, commercial, and mixed-use projects. The company operates across India, with a strong presence in cities like Mumbai, Pune, Ahmedabad, and Bengaluru. It has also expanded internationally, particularly in Bahrain and London. Known for its large-scale township developments, Ajmera emphasizes delivering quality and innovative designs. The company is listed on Indian stock exchanges and is part of the Ajmera Group, which has over 50 years of experience in the real estate sector.
Key Points About Company:
Domestic Projects
Key projects include Ajmera i-Land (Aeon, Zeon, Treon), Greenfinity, and Sikova in Mumbai.
Lugaano and Nucleus in Bengaluru, and Casa Vyoma and Enigma in Ahmedabad.
Revenue Mix (FY23)
Mumbai: ~90% of total revenue.
Bengaluru: ~10% of total revenue.
Project Updates (FY23)
New Launches: Ajmera Manhattan and Ajmera Prive in Mumbai.
Near Completion: Sikova, Greenfinity, and Nucleus C Wing.
Occupancy Certificate (OC) Received: Nucleus AB Wing and commercial space.
Redevelopment Project
Ajmera Prive is the company's first redevelopment project, offering ~30,000 sq. ft. of saleable carpet area in Juhu, Mumbai.
Land Bank
~118 lakh sq. ft. in Mumbai Metropolitan Region (MMR).
Phased development of Wadala land to begin in 2024.
Upcoming Launches (FY24)
Three projects with a gross development value of ~₹1,800 crore.
Total carpet area of ~9 lakh sq. ft.
Debt Management
₹209 crore paid for cost concessions in FY22, reducing debt by 7% in FY23.
Average cost of debt reduced to ~12% (June 2023) from ~14% (March 2023).
Demerger of Ajmera i-Land
Plan to demerge ~3 million sq. ft. of leasable commercial real estate into Radha Raman Dev Ventures Pvt Ltd.
Aimed at attracting strategic investment partners.
MSF – Million Square Feet on a carpet basis
3. Company’s Journey:
Market Presence:
Portfolio:
4. Management Overview:
KMP's Remuneration:
5. ESOPs:
The Company has not issued any shares with differential voting rights, granted stock options or sweat equity, or through any other permissible mode during FY 2023-24.
If you like the hard work we put in, you can invest in us:
For our Non-Indian audience: You can donate to us through PayPal. Click here.
For our Indian audience, UPI QRs are given below:
6. Revenue Breakdown:
7. Company’s Financial Analysis:
SALES:
The Sales have grown at a CAGR of ~23% in the past 10 years.
EBITDA:
EBITDA has increased at a CAGR of ~22% for the past 10 years.
Net Profit Margin %
Net profits have continuously increased at a CAGR of ~22% for the past 10 years.
BALANCE SHEET:
Borrowings have increased on account of the rise in long-term borrowings.
Cash and Receivables have remained down which is a good sign.
Other investments majorly include Inventory.
Cashflow Statement:
KEY RATIOS:
8. Shareholding Pattern:
Promoters have increased their holdings.
The public has decreased their holdings.
9. MD&A:
Indian Economy:
GDP:
Global GDP is projected to grow at 3.2% in 2024 and 3.3% in 2025. The trades have become firm supported by strong exports from Asia, especially the technology sector. The businesses are majorly on ‘cost-cutting’ projects as the discretionary spendings are still low. Governments are facing fiscal challenges due to higher interest rates, spending on citizen schemes and climate change.
(Source: IMF, World Bank)
(Source: IMF, World Bank)
Inflation:
The economy has stayed remarkably resilient and thus, the inflation is coming back to the target level. Even during the high inflationary environment, consumption was still on rise especially in the emerging economies. The economy, despite facing deflation and recession warnings, has been growing steadily. Forecasts suggest for inflation to come down from 6.8% in 2023 to 5.9% in 2024 and 4.5% in 2025 globally.
(Source: IMF, World Bank)
Mumbai Residential Market
Suburban markets like Sion, Chembur, Kandivali, and Andheri led new launches.
Mid-segment properties dominated, accounting for 61% of quarterly launches, while high-end and luxury segments contributed 19%.
Infrastructure projects like Metro Line 3 and Mumbai Trans Harbour Link are boosting demand in premium submarkets.
Capital values increased by 3-6% across all areas due to redevelopment projects and infrastructure improvements.
Mumbai Office Space Market
Strong leasing activity in Central Suburbs and Lower Parel, driven by fresh demand.
BFSI and professional services sectors contributed 25% and 21% of leasing volumes, respectively.
Limited supply led to declining vacancy rates, creating a supply-constrained office market.
Rental values increased in key submarkets like Worli, Lower Parel, and Malad-Goregaon due to demand for premium-grade assets.
Bengaluru Residential Market
Rapid urbanization and migration of professionals continue to drive demand.
Ongoing metro and road infrastructure projects enhance connectivity.
Proximity to IT hubs like Electronic City, Whitefield, and Manyata Tech Park fuels housing demand.
A mix of reputed developers and emerging mid-sized players is expanding the range of residential offerings.
Bengaluru Office Space Market
Bengaluru’s status as India’s top technology hub ensures steady office space demand.
Multinational corporations are expanding in IT, finance, and engineering sectors.
A strong talent pool from premier educational institutions attracts corporate offices.
Government-backed infrastructure investments support commercial real estate growth in key business districts like Outer Ring Road (ORR) and Central Business District (CBD).
The city’s thriving startup ecosystem fuels demand for coworking and flexible office spaces.
10. Q2 FY25 Concall Analysis
1. Macroeconomic & Business Updates
The real estate sector, especially residential projects, is performing well due to strong buyer sentiment, increasing demand for larger living spaces, and government support.
Technological advancements in sales, customer engagement, and construction are enhancing efficiency.
2. Key Sales & Operational Performance
Total Sales Value (H1 FY25): ₹560 crore (YoY growth of 18%).
Sales Area: 2,44,000+ sq. ft.
Key Performing Projects:
Ajmera Manhattan: 85% sold; next phase to be launched soon.
Ajmera Greenfinity: 59% sold; construction in progress.
Ajmera Eden (Ghatkopar): 69% sold; nearing completion.
Ajmera Prive (Juhu): 69% sold; possession soon.
Ajmera Vihara (Bhandup): 49% sold; excavation ongoing.
Bangalore Projects (Lugano & Florenza): 90% sold; fast-track execution.
3. Financial Highlights (Q2 & H1 FY25)
Revenue: ₹204 crore (YoY growth of 38%).
EBITDA: ₹65 crore (YoY growth of 62%).
PAT: ₹36 crore (YoY growth of 58%).
Debt: Stable at ₹793 crore; improved debt-equity ratio to 0.85x.
Projected Revenue Visibility: ₹6050 crore.
4. Key Strategic Developments
Private Equity Deal: ₹88 crore investment from Motilal Oswal for a Vikhroli project (3 lakh sq. ft., revenue potential ₹650 crore).
Fundraising: Raised ₹225 crore via preferential allotment for debt reduction and business growth.
New Launch Pipeline (FY25): Projects worth ₹4270 crore (17 lakh sq. ft.).
5. Key Future Plans
Kanjurmarg Launch: Expected by March-April 2025.
Wadala & Kanjurmarg Landbank: Total 11.1 million sq. ft. development potential.
Commercial JV with Rustomjee: Launch expected by March 2025.
Repatriation of Overseas Profits: Funds from London expected in the next few quarters; Bahrain repatriation by late FY25/FY26.
6. Investor Q&A Highlights
South Mumbai Land Sale: Negotiations ongoing; evaluating offers.
Debt Strategy: Project-level funding, cash flow from ongoing projects, and potential partnerships.
Margin Expectations:
Own land projects: 35-45% EBITDA.
Redevelopment & JV: 25-30% EBITDA.
Slum redevelopment: 20-25% EBITDA.
11. SWOT ANALYSIS
12. Growth and Opportunity
Growth Drivers for the Company
Ajmera Realty’s growth is driven by a combination of strategic land bank utilisation, premium project development, financial prudence, and leveraging market dynamics. With a clear focus on sustainability, diversification, and infrastructure-linked growth, the company is well-positioned to achieve its goal of a 5x growth trajectory while creating long-term value for stakeholders.
13. Management Guidance
Ajmera Realty's management remains optimistic about the company’s growth trajectory, backed by its robust project pipeline, financial prudence, and strategic focus on premium developments. The guidance underscores the company's commitment to sustained profitability, operational excellence, and value creation for stakeholders.
Management Outlook
Ajmera Realty’s management maintains a positive outlook, with growth underpinned by:
Strategic project launches in prime locations.
Sustained sales momentum supported by market demand.
Continued infrastructure investments enhancing the attractiveness of its developments.
Focus on financial discipline, ensuring stable profitability and value creation for shareholders.
The management remains confident in its ability to navigate market challenges, capitalise on emerging opportunities, and solidify Ajmera Realty's position as a leader in the Indian real estate sector.
14. Competitors in the Market:
1. Godrej Properties – Known for premium residential projects across India.
2. Oberoi Realty – Focused on luxury residential and commercial developments in Mumbai.
3. Lodha Group (Macrotech Developers) – One of India’s largest real estate developers with a strong presence in Mumbai and beyond.
4. Prestige Group – Prominent in Bengaluru and other southern cities with residential, commercial, and retail projects.
5. Brigade Group – Major competitor in Bengaluru with residential and commercial ventures.
6. Sobha Ltd – Known for luxury housing and large-scale residential projects.
7. Puravankara Ltd – Focused on affordable and luxury housing, primarily in South India.
In Mumbai, Ajmera also faces competition from smaller regional developers in specific micro-markets like Wadala and Juhu.
15. Industry Overview:
Market Size:
The Real Estate Industry In India Market size is estimated at USD 563.66 billion in 2025, and is expected to reach USD 855.79 billion by 2030, at a CAGR of 8.71% during the forecast period (2025-2030).
(Source - Mordor intelligence)
India's Real Estate Market 2024 Highlights:
Residential Growth: Sales surged 17% YoY in the first three quarters, driven by buyer confidence and rising demand for premium housing in cities like Mumbai, Bengaluru, and Pune. Property prices increased: Bengaluru (+9%), Mumbai/NCR/Pune (+4-5%).
Commercial Sector: Strong demand for office spaces, especially in IT hubs like Bengaluru and Hyderabad, with rising interest in co-working spaces and Grade A developments.
Urbanization Forecast: By 2047, 50% of India's population will live in urban areas, driving demand for residential, office, and retail spaces. Emerging segments like senior living, co-living, and data centers will see exponential growth (data center demand: +15-18 million sq. ft. by 2025).
Retail Real Estate: Organized retail growing rapidly with a focus on experiential, digital, and sustainable spaces. Retailers are adopting e-commerce, omnichannel strategies, and energy-efficient designs.
PMAY Urban 2.0: Government launched a ₹10 lakh crore initiative to provide affordable housing to 1 crore urban poor and middle-class families, boosting demand for affordable and mid-segment housing.
Tier II and III Cities: Urbanization and infrastructure growth are shifting real estate development to smaller cities and city peripheries, creating new growth centers.
(Source - Mordor intelligence)
Indian Real Estate Market Trends:
In 2024, India's housing market is experiencing robust growth, led by the premium and luxury segments. Cities like Mumbai, Pune, Bengaluru, and Hyderabad are seeing a significant rise in high-end housing launches and sales, driven by urbanization, higher incomes, and evolving buyer preferences.
Home sales in FY23 saw a 48% jump in value and a 36% increase in volume year-on-year, reflecting strong consumer sentiment and favourable market conditions. Post-pandemic shifts have heightened demand for spacious, future-ready homes with premium amenities.
Integrated communities and luxury projects with smart infrastructure and green spaces are in high demand, especially in cities like Mumbai, Delhi NCR, and Bengaluru. Buyers prioritize modern living and sustainable solutions in their property choices.
HNIs and NRIs are driving the luxury real estate boom, viewing these properties as status symbols and investments. Pandemic-era savings and regulations like RERA have further boosted confidence among developers and investors, cementing the sector's growth trajectory.
(Source - Mordor intelligence)
16. Challenges in India's Real Estate Market:
1. Economic Volatility: Market fluctuations and economic instability reduce property demand and increase competition. Solution: Diversify portfolios and focus on high-demand assets like rentals.
2. Regulatory Hurdles: Complex legal frameworks, zoning laws, and environmental regulations create obstacles. Solution: Engage legal experts, ensure due diligence, and maintain transparency.
3. Rising Interest Rates: Higher rates make loans costly, affecting buyers and developers. Solution: Use creative financial instruments to maintain affordability.
4. Political Instability: Policy changes and uncertainty impact market stability. Solution: Build resilient models and adapt to political shifts.
5. Affordability Issues: High urban property prices outpace income growth. Solution: Promote affordable housing, alternative financing, and innovative urban planning.
6. Urbanization Strain: Rapid urbanization outpaces infrastructure, leading to congestion. Solution: Collaborate with authorities to develop sustainable and well-connected spaces.
(Source - Sell.do)
17. Investment Opportunities and Market Outlook:
Residential Sector:
High demand for affordable and middle-income housing in urban areas.
Luxury home sales surged by 75% in 2023, with a 151% YoY growth in early 2023.
Housing sales in the top 7 cities reached 1.14 lakh units in Q1 2023.
Housing prices in top 8 cities rose by 7% YoY.
Under PMAY-U, 119.7 lakh houses sanctioned; 74.75 lakh completed by June 2023.
Commercial Sector:
Strong demand for office spaces driven by IT/BPM and global capability centers.
Office leasing reached 14.8 million sq. ft. in Q2 2023, highest since Q1 2021.
Institutional investment in office spaces grew 2.5x in early 2023 to US $2.7 million.
Delhi-NCR and Bengaluru lead in private equity investments.
Warehousing and Logistics:
Growth fueled by organized retail and supply chain resilience post-COVID.
Private equity investments rose to US $4.2 billion in 2023 (from US $3.4 billion in 2022).
The construction industry attracted US $60.53 billion in FDI (April 2000–March 2024).
Market Growth:
Real estate market projected to reach US $1.04 trillion by 2029, growing at a CAGR of 25.6%.
Key cities with high investment potential: Bengaluru, Delhi-NCR, Hyderabad, and Coimbatore.
Note: While the sector offers promising opportunities, investors should remain mindful of potential challenges.
(Source - Sell.do)
Thank you for reading till the end! We hope you enjoyed this report.
Researched By- Naresh, Mayank and Vaibhav
All information is sourced from the company's annual reports, Screener. in, industry reports and Economy Outlook reports.
Disclaimer- We do not recommend buying or selling any stock. You should consult your financial advisor before buying or selling any financial instrument.