Lodha firm Macrotech Developers swings to Q2 profit even as stock corrects

Macrotech Developers Ltd, part of Mumbai-based Lodha Group, swung to a consolidated net profit for the second quarter as a more than two-fold jump in revenue outpaced the increase in expenses.

The company said it posted a net profit of Rs 223.36 crore for the July-September quarter, compared with a loss of Rs 362.58 crore a year earlier.

Consolidated revenue from operations jumped to almost Rs 2,124 crore from Rs 901 crore in the corresponding quarter last year.

However, the company’s shares ended 1.7% down at Rs 1,030.35 apiece on the BSE in a weak Mumbai market. The stock has fallen 16% over the past five sessions from a peak of Rs 1,225 apiece last week.

Still, Macrotech shares are more than double the price of Rs 486 apiece at which the company floated its initial public offering in April this year.

The company has a market capitalisation of Rs 46,089.44 crore, making it the third-largest listed developer in India after DLF Ltd and Godrej Properties Ltd.

Macrotech Developers Q2: Other highlights

1) The company’s total expenses jumped to Rs 1.906.64 crore from Rs 1,075.30 crore a year earlier.

2) Projects costs soared to Rs 1,432 crore from Rs 650 crore a year earlier.

3) Macrotech’s finance costs halved to Rs 156 crore from Rs 310 crore as it used most of the money raised in the IPO to cut debt.

4) Macrotech had raised net proceeds of Rs 2,407.7 crore in the IPO and used Rs 1,500 crore to pay off loans.

Macrotech Developers commentary

The company said that the outbreak of the COVID-19 pandemic caused a slowdown in economic activity and that its operations slowed due to lockdowns announced by authorities to control the pandemic.

However, its operations as well as economic activities have gradually resumed with requisite precautions.

The company said it continues to monitor the situation but added that the actual impact of Covid-19 on its future operations remains uncertain and will depend on the spread of the pandemic.