Signatureglobal Ltd — Q3 FY26

Signatureglobal (India) Ltd Q3 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=RkrEhyxUImw Published: 2 months ago

0:01 1 second Good morning ladies and gentlemen and welcome to the signature global India limited business update conference call hosted by ICC securities limited. 0:12 12 seconds As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. 0:22 22 seconds Should you need assistance during this conference call, please signal an operator by pressing star pin zero on your touchstone phone. Please note that this conference is being recorded. 0:34 34 seconds I now hand the conference over to Mr. 0:36 36 seconds Abid Chhatapad from ICC Securities Limited. Thank you and over to you sir. 0:43 43 seconds Yeah, on behalf of uh IC securityities I I welcome everyone on the call today. Uh as always from Signage Global India 0:51 51 seconds Management we have with us Mr. Praep Kumar Agarwal the chairman and wholetime director Mr. Lalit Kumar Agarwal the vice chairman and wholetime director Mr. 1:00 1 minute Ravi Agarwal the managing director Mr. 1:03 1 minute, 3 seconds Dendra Agarwal the joint managing director and full-time director Mr. 1:07 1 minute, 7 seconds Rajat Katurya the chief executive officer Mr. Sanjiv Kumar Sharma the chief financial officer and Miss Priika 1:15 1 minute, 15 seconds Singh the head of investor relations and now I'll have to hand over the call to the management to take us through the recent uh announcements uh which they 1:23 1 minute, 23 seconds have done and uh way forward for the company. Over to you sir. Thank you. 1:29 1 minute, 29 seconds Thanks Adid. Good morning everyone. 1:33 1 minute, 33 seconds Welcome to Signature Global's investor call. 1:37 1 minute, 37 seconds RMJ and Signature Global are setting a stage for transforming commercial platform in Delhi NCR. 1:48 1 minute, 48 seconds So a strategic joint venture in Gurugram. This partnership mark the beginning of institutional grade a 1:57 1 minute, 57 seconds commercial ecosystem in one of India's fastest growing business corridor 2:05 2 minutes, 5 seconds by commening signature global deep NCR market expertise expanding land acquisition approvals and 2:15 2 minutes, 15 seconds acquisition with RMJ global capability in design development leasing and asset 2:22 2 minutes, 22 seconds management. We are creating a scalable scalable scalable platform for future ready commercial assets. 2:33 2 minutes, 33 seconds This collaboration is designed to be redefined the guruggram skyline and built enduring commercial destination in DNCR. 2:45 2 minutes, 45 seconds This is a significant milestone in our growth journey. 2:50 2 minutes, 50 seconds India's commercial real estate sector is on a strong structural upcycle. The 2:58 2 minutes, 58 seconds market is projected to expand from approximately $50 billion to 3:07 3 minutes, 7 seconds in 2025 to nearly $250 billion by 2034. Reflecting robust 3:15 3 minutes, 15 seconds long-term growth fundamentals, India continue to be one of the fastest 3:23 3 minutes, 23 seconds growing office market globally with annual leasing of 50 60 million square 3:29 3 minutes, 29 seconds ft in recent years. Demand is being led by global capacity centers, IT, IT, BFSI 3:38 3 minutes, 38 seconds and multinational cooperation. 3:45 3 minutes, 45 seconds Total office stock has surpassed 800 million square ft² with sustain 3:52 3 minutes, 52 seconds additional of greedy supply across leading cities. 3:59 3 minutes, 59 seconds Within this landscape, Dilliancr remains a dominant office market and Gurugram 4:06 4 minutes, 6 seconds stand out with our 100 million square ft office stock, stable rental, healthy 4:15 4 minutes, 15 seconds occupancy level and strong demand for global corporate. 4:21 4 minutes, 21 seconds Southern Ferry Ferry Road is emerging as a next commercial growth corridor 4:28 4 minutes, 28 seconds supported by strong connectivity to Dwara Expressway, NH48 and GF Coast 4:35 4 minutes, 35 seconds extension road along with the ongoing infrastructure upgrades and metro expansion plans at sector 71. This joint 4:45 4 minutes, 45 seconds venture will develop a landmark mixeduse commercial project comprising premium retail gradea office 4:54 4 minutes, 54 seconds space and worldclass hotel designed to meet a global standard of quality and sustainability for signature global. 5:04 5 minutes, 4 seconds This marks a strategic expansion beyond residential development into large scale commercial real estate. grow as institutional partnership model. 5:16 5 minutes, 16 seconds Over the years, we have delivered over 16 million square ft across multiple residential segment with a disciplined 5:25 5 minutes, 25 seconds execution, governance and customer first approach. This foundation positions us 5:32 5 minutes, 32 seconds strongly enter the commercial segment with a confidence and long-term vision. 5:39 5 minutes, 39 seconds Together with RMG, we aim to create a high quality commercial platform that delivers 5:48 5 minutes, 48 seconds sustainable value for our investors and stakeholders. With that, I now invite our CEO Mr. 5:57 5 minutes, 57 seconds Rajat Katurya to share further detail on development. Thank you for your continued trust and support. 6:07 6 minutes, 7 seconds Yeah. Hi, good morning everyone. Thanks for joining the call today morning. 6:13 6 minutes, 13 seconds So, uh you know over the years we've always focused on the housing business. 6:20 6 minutes, 20 seconds uh you know last 10 11 years we've always worked around a build to sell model and we've evolved our way through 6:29 6 minutes, 29 seconds in the housing business to you know achieve a particular sweet spot wherein we've preferred to stick to the NCR region as well as we've preferred to 6:37 6 minutes, 37 seconds stick to the mid-inccome housing market over span of time the definition of you 6:44 6 minutes, 44 seconds know mid-ome housing uh may have uh you know drifted a little with prices have uh you of land and construction have 6:51 6 minutes, 51 seconds gone up. So you know uh mid- income today stands at higher price points than what it used to uh be there about you know in the pre- pandemic era at least. 7:02 7 minutes, 2 seconds But by and large uh you know the housing business has seen very good growth. Uh we understand that business very well 7:08 7 minutes, 8 seconds and we've created a very strong uh brand name positioning and very strong execution capabilities around our 7:16 7 minutes, 16 seconds housing business. And uh for a while we were looking at you know newer growth 7:22 7 minutes, 22 seconds opportunities where you know once we get into uh you know a business we can uh you know scale it to much larger heights. 7:33 7 minutes, 33 seconds Uh we've been good with uh you know in the local market with land acquisitions, approvals, execution capabilities but uh 7:42 7 minutes, 42 seconds there was a missing link with regard to you know project conceptualizing some of these large scale you know heavily capitalized projects and also with 7:50 7 minutes, 50 seconds regard to leasing capabilities and that's where uh you know we've were under a lot of debate internally on you 7:58 7 minutes, 58 seconds know what's the right way to uh you know commence such a journey. 8:04 8 minutes, 4 seconds So uh I think uh after lot of deliberation you know we we uh we kind 8:11 8 minutes, 11 seconds of uh met the folks at RMZ. There was a lot of meeting of minds and uh you know synergy uh with our skill sets. So we 8:20 8 minutes, 20 seconds decided to set up a platform with the RMZ group. I think we saw very complimentary skill sets because exactly 8:27 8 minutes, 27 seconds what we wanted was what we were getting uh in terms of this partnership. 8:32 8 minutes, 32 seconds uh they've executed more than 70 plus million square foot of projects till date and are very actively expanding uh on the back of institutional capital 8:40 8 minutes, 40 seconds across the country have limited presence in NCR region but uh you know see a huge potential right now to expand and do 8:49 8 minutes, 49 seconds much more business uh in the NCR market and uh you know the first choice even at their level is to look at uh you know 8:58 8 minutes, 58 seconds the Gura market which can very safely be called as the CBD market for the entire NCR because bulk of gradea office spaces uh are sitting in Gura right now. 9:11 9 minutes, 11 seconds So with this uh you know broader sort of agendas uh you know taking uh in uh for 9:19 9 minutes, 19 seconds both the groups uh you know we we decided to uh initiate this partnership. 9:25 9 minutes, 25 seconds Uh so if I have to talk specifically around the deal uh we have a 100% subsidiary called Gurugram Commerce City 9:33 9 minutes, 33 seconds Limited. Uh in our investor presentation we've uh detailed our land portfolio in 9:40 9 minutes, 40 seconds uh sector 71 which is on the southern periphery road of about 18.5 million square ft uh which emerges out of some 9:50 9 minutes, 50 seconds 90 plus acres of uh you know land rights ownership. 9:55 9 minutes, 55 seconds Out of this 18 and a half million square foot, we've been uh conservatively calling out about 7 million square foot 10:03 10 minutes, 3 seconds of development within Gurugram Commerce City uh limited. Uh the actual numbers as it is kind of getting closer to 10:11 10 minutes, 11 seconds design is higher than you know our initial estimates. 10:16 10 minutes, 16 seconds But uh in this 7 million which was initially uh you know guesstimated as the development potential there is a component of residential which is about 10:24 10 minutes, 24 seconds 30% of uh the development in this SPV and about 70% pertains to uh you know commercial assets. So that's what's 10:32 10 minutes, 32 seconds permitted within this uh you know as part of the plans for this particular land parcel. 10:40 10 minutes, 40 seconds So what uh we intend to do is to cow out the housing business uh into our parent entity and continue to do housing 10:48 10 minutes, 48 seconds business 100% you know ourselves that's a core business uh you know uh for the 10:55 10 minutes, 55 seconds last decade but on the commercial side you know the uh once we carve out the residential business the the commercial 11:03 11 minutes, 3 seconds development whether it is office space or retail or hotels uh of technically 11:10 11 minutes, 10 seconds okay about we thought initially 5 million but actually it's going to be closer to 5 a.5 million is something 11:17 11 minutes, 17 seconds where you know we're partnering with RMZ group so GCL from currently being a 100% 11:25 11 minutes, 25 seconds subsidiary uh you know we've signed up the transaction we have to do certain set of uh achieve certain conditions prior to closing uh which can't estimate 11:34 11 minutes, 34 seconds an exact time but we are hoping that over the next 45 to 60 days you know these uh conditions will be met. Uh we 11:42 11 minutes, 42 seconds will offer 50% stake to RMZ Group uh in GCL. Uh as of today there is land in 11:49 11 minutes, 49 seconds this company uh and we are at very advanced stage of approvals. uh but as a stage and we intend to design it 11:57 11 minutes, 57 seconds together along with the RMZ group they will invest roughly about 1283 crores uh subject to minor uh adjustments but by 12:05 12 minutes, 5 seconds and large close to 1280 crores uh for a 50% stake in this entity. 12:11 12 minutes, 11 seconds These funds will primarily flow back to signature because we've given a lot of 12:18 12 minutes, 18 seconds loans into uh you know uh this entity right now or there are some third party loans you know so they'll be squared but 12:25 12 minutes, 25 seconds by and large uh you know once the transaction gets done uh both the partners will own about 50% each in this 12:33 12 minutes, 33 seconds particular SPV and hopefully uh by and large this will be a debt-free cash-free venture as as we start it you There 12:41 12 minutes, 41 seconds could be minor debt or cash but by and large the intent is to keep it debt free and cash free. 12:47 12 minutes, 47 seconds Uh the intent is very clear. This is a starting of a long journey. Uh we are starting with about 5 1/2 million square 12:55 12 minutes, 55 seconds foot of development which we intend to do together. Uh this development will be funded through a mix of uh you know 13:04 13 minutes, 4 seconds further equity infusions which may be needed and will be done in equal proportions by both the uh you know companies. But you know we'll also be 13:12 13 minutes, 12 seconds raising construction finance for development of these core assets. 13:17 13 minutes, 17 seconds Uh the plans are yet to be finalized but by and large uh the asset base getting created under GCL will be from a leasing 13:25 13 minutes, 25 seconds purpose. You know the idea is to create a yield play uh in this business and also the intent is to grow this entity. 13:34 13 minutes, 34 seconds Uh since we are very strong in this region, we do keep coming across you know good land parcels, good opportunities and you know we are quite 13:42 13 minutes, 42 seconds hopeful that this is just a beginning we can actually scale up this venture significantly over the coming 4 to 5 years. 13:50 13 minutes, 50 seconds you know with a start of 5 million we see an opportunity here to grow this to let's say 15 to 20 million over the next four to five years in terms of its uh 13:59 13 minutes, 59 seconds portfolio size and uh you know once developed it will be a significantly large business in itself uh the intent 14:07 14 minutes, 7 seconds is to maintain 50% stake by both the parties uh neither do RMZ wants to dilute or nor do we want to dilute and 14:16 14 minutes, 16 seconds uh you know both the parties are fairly confident that uh equity can be infused into this entity at a comfortable pace 14:22 14 minutes, 22 seconds by both of us. Uh talking about ourselves uh see we currently if you look at our portfolio uh of just if you 14:31 14 minutes, 31 seconds just look at part of the portfolio which is like recently launched and forthcoming projects which is roughly 42 million square foot uh you know that is 14:39 14 minutes, 39 seconds expected to create a GDV in excess of 65,000 crores. We've partly achieved some of these sales and you know rest 14:47 14 minutes, 47 seconds are uh you know expected to be achieved over the you know coming let's say you know years uh this leaves us with a 14:55 14 minutes, 55 seconds massive uh you know operating surplus and hence the idea is that we deploy only a portion of it into GCL and start 15:05 15 minutes, 5 seconds creating a yield portfolio alongside RMZ in this entity Uh 15:14 15 minutes, 14 seconds I think by and large that's the thesis and that's the you know background to this uh uh trade. 15:26 15 minutes, 26 seconds Uh just to add on I think uh the residential business which we are carving out of this entity that in 15:32 15 minutes, 32 seconds itself is significant. uh we'll have uh another salailable area uh within that 15:40 15 minutes, 40 seconds uh development of anywhere between 2 to 2.5 million square foot and that in itself uh has you know GDP potential of 15:48 15 minutes, 48 seconds about 5,000 odd crores but uh that's kind of you know coming as part of this overall you know numbers we've we've 15:55 15 minutes, 55 seconds shared with you as part of the invest we were hoping that you know this deal gets closed before our previous call uh 16:01 16 minutes, 1 second we would have managed to do the entire update ated one go but you know the last minute uh you know signing took a week 16:10 16 minutes, 10 seconds longer and hence you know we thought we'll uh we'll set up another call and that's why you know thanks again to all of you for joining this call today but 16:19 16 minutes, 19 seconds uh happy to you know address any uh questions which you have with regard to this trade or uh with the intent of this partnership or anything again with 16:27 16 minutes, 27 seconds regard to our core business happy to address uh each one of those queries. 16:38 16 minutes, 38 seconds Thank you very much. We will now begin with the question and answer session. 16:43 16 minutes, 43 seconds Anyone who wishes to ask a question may press star and one on the touchstone telephone. If you wish to remove 16:51 16 minutes, 51 seconds yourself from the question queue, you may press star and two. Participants, you are requested to use handsets while asking a question. 17:01 17 minutes, 1 second Ladies and gentlemen, we will wait for a moment while the question Q assembles. 17:12 17 minutes, 12 seconds We have the first question from the line of Morta Arrivala from Kotuk Securities. Please go ahead. 17:19 17 minutes, 19 seconds Uh hi sir. Uh just two or three questions. One on the 1283 cr which is uh there. Can you give us a break up on 17:26 17 minutes, 26 seconds you know what is the fresh money that's coming into the entity? What is the stick that is being bought? Any break up 17:33 17 minutes, 33 seconds out there? Uh and um you know you've put in a number of the value being of the entire development being close to 14 to 17:41 17 minutes, 41 seconds 16,000 crores. Uh could you give some building blocks around that? What is the rental expected? What are the timelines that we are looking at in terms of 17:49 17 minutes, 49 seconds completing this project etc. Sure Mortza. So uh Ma this the broad contours 17:57 17 minutes, 57 seconds around uh the stake being offered and the consideration are that see uh we want this entity to have or let's say on 18:07 18 minutes, 7 seconds the closing date the intent is the uh SPV will be able to establish uh you know almost close to 3.9 million square 18:14 18 minutes, 14 seconds foot of FSI and about 5.5 million square foot of tentative you know leasable uh salailable area in that SPB 18:24 18 minutes, 24 seconds uh we also intend to make it debt free and cash free. There are set of existing loans in this entity. There are there is certain payments which are supposed to 18:31 18 minutes, 31 seconds be made to uh you know the revenue department DTCP Hana with regard to this particular development. So we are just 18:39 18 minutes, 39 seconds kind of crystallizing these liabilities and achieving certain other conditions to the extent we have to clear up 18:46 18 minutes, 46 seconds liabilities in this entity which is expected to be upwards of about 1,000 crores. we'll uh seek that much money in 18:55 18 minutes, 55 seconds form of a primary infusion into the company and you know this thousand plus crores then either goes uh you know a small 19:03 19 minutes, 3 seconds portion of it maybe you know goes to DTCP or and bulk of that money comes back to SGI 19:11 19 minutes, 11 seconds uh you know because we've given fair bit of loans into this uh SPV till now so about 1,000 plus crores will be in the form of primary infusion uh the balance 19:20 19 minutes, 20 seconds will be in the form of secondary stake sales of investment by SGI to RMZ both put together will add up to 50% stake 19:28 19 minutes, 28 seconds being offered to RMZ but as of today we can cannot exactly determine the quantum of liability on the closing date and 19:35 19 minutes, 35 seconds hence uh you know that split is will be available once we are closer to closing uh so that's on the deal contours 19:44 19 minutes, 44 seconds as far as uh the project development is concerned see this 5.5 million MA will be anchored around an office space 19:52 19 minutes, 52 seconds development. Uh as of today SPR is emerging like the next uh you know 20:00 20 minutes critical CBDL like area you know after cyber city in Gorgawa. I think this is a spot seeing maximum traction in terms of 20:08 20 minutes, 8 seconds you know commercial developments the the upcoming infrastructure you know the way it has come up whether it is very good 20:16 20 minutes, 16 seconds connectivity to golf course and golf course extension road or to the sonar road or to the you know Dark Expressway market or to the NH8 so you know it's 20:24 20 minutes, 24 seconds kind of probably best position or most sweetly positioned in terms of you know the infrastructure uh of the city as of 20:31 20 minutes, 31 seconds today so uh this will be primarily anchored around office spaces of about let's say 3 and a half to 4 million 20:38 20 minutes, 38 seconds square foot. The balance uh area uh you know will be a split of either retail 20:45 20 minutes, 45 seconds spaces which could be in the form of you know very high-end design district. 20:51 20 minutes, 51 seconds The concept is being worked upon very closely by both the sides and uh there'll be you know maybe one or two 20:58 20 minutes, 58 seconds hotels uh in this SPV. So that's about 5 1.5 million uh square foot of development. Uh the guesstimated rental 21:08 21 minutes, 8 seconds and capital value per square foot post development is in that range of you know uh 26 to 28,000 per square foot you know 21:16 21 minutes, 16 seconds inching closer to 30,000 rupees a foot is what has been uh estimated by by both the parties. 21:26 21 minutes, 26 seconds All right. 21:27 21 minutes, 27 seconds But this 1,000 Koresh has it been paid and there is a loan payable to uh signature global or this is still money payable the DTCP approximately 1,000 K. 21:38 21 minutes, 38 seconds No no no this is a bulk of this is money which so this is uh this is like you know a lot of investment which we 21:46 21 minutes, 46 seconds initially made to acquire the asset and to acquire the approvals. uh DTCP will be a smaller faction in this entire uh you know sum. 21:57 21 minutes, 57 seconds Okay. Okay. 21:59 21 minutes, 59 seconds But effectively motors are we'll have almost like thousand plus crores post 22:06 22 minutes, 6 seconds any sort of DTCP payouts or even taxes which will cleanly acrue to signature global uh or by and large you could say 22:15 22 minutes, 15 seconds that you know the net debt which is sitting at about you know 10 billion today you know should come to a zero level or maybe a negative level by the once we close this trade. 22:26 22 minutes, 26 seconds Okay. Thank you. Yeah, thank you. 22:33 22 minutes, 33 seconds Thank you. We have the next question from the line of Praesh from Access Capital. Please go ahead. 22:41 22 minutes, 41 seconds Uh yeah, thanks for the opportunity and congrats on the transaction. Uh just firstly on this u you know 1,000 cr uh uh you know if I recolct well I think we 22:50 22 minutes, 50 seconds acquired this 93 acre pole of 93 acre at around 1,200 odd crores. Uh so correct me if I'm wrong. Uh so you know in that 22:59 22 minutes, 59 seconds sense will we only get the aortionated uh uh you know payout or uh you know 23:07 23 minutes, 7 seconds this 1,000 cr will completely uh you know be utilized to uh you know pay for whatever liabilities that whole 23:15 23 minutes, 15 seconds 93 acre had. Um second on on the uh retail piece right uh I mean you know 23:23 23 minutes, 23 seconds RMZ have uh developed uh uh the office management capabilities but what's what's the 23:31 23 minutes, 31 seconds uh uh intent on the retail side? Uh will it will those capabilities be jointly developed by both the companies? Uh yeah 23:39 23 minutes, 39 seconds so those are my two questions personally. 23:43 23 minutes, 43 seconds So uh pesh the entire 71 acquisition uh you know yeah happened at at much 23:51 23 minutes, 51 seconds much lower values than what are being discussed right now or you know I don't have the exact numbers right in front of me but yeah I think we've we've overall 24:00 24 minutes acquired so this 18 1.5 million square foot is by and large owned by us there is very uh you know small portion of JDS 24:09 24 minutes, 9 seconds it's bulk of it is owned by us and the balance is in the form of collaboration. 24:14 24 minutes, 14 seconds Uh the acquisition or historical costs are much lower. Uh this particular entity was 24:23 24 minutes, 23 seconds within our acquisition bucket. Uh you know priced relatively higher but much lower than the current values. I don't 24:30 24 minutes, 30 seconds have the exact number but I don't think we've acquired this entire 25 acres uh for more than I think 500 uh odd crores 24:39 24 minutes, 39 seconds would be like a tentative acquisition value but you know we've invested on top of it we've paid uh some amounts for getting approvals we've held this land 24:46 24 minutes, 46 seconds for a little while now but yes I think uh once this transaction consumates we'll a lot of the you know money will 24:53 24 minutes, 53 seconds flow directly into uh you know the you know it will be like an upside for us so definitely the historical cost is much 25:01 25 minutes, 1 second lower as far as the capability set is concerned. Yes, I think uh office spaces office is something where RMZ has 25:08 25 minutes, 8 seconds massive leasing capabilities and we'll we'll get to leverage that cap capability on the retail side. Uh I think um that 25:17 25 minutes, 17 seconds capability at their end is being built up. they are they started doing bit of retail not like a mall format or a box format retail but more in the form of 25:26 25 minutes, 26 seconds you know uh high uh you know high-end retail spaces. So uh you know retail 25:34 25 minutes, 34 seconds capability is something which will get enhanced uh alongside this development as well. Hotels of course you know we we'll try and get some you know top 25:43 25 minutes, 43 seconds brands to run the hotel or hotels within this uh entity. 25:50 25 minutes, 50 seconds Got it. Just a couple of follow-ups. Uh on the rental side, uh you know, while you gave the capital value of 30,000 per 25:57 25 minutes, 57 seconds square ft, if I ballpark calculate, it should translate to around 250 per square ft² uh rental or no, I think 200 26:06 26 minutes, 6 seconds odd square ft per uh per month as the rental assumptions that you would have made and what would be the capeex and the completion timelines for this? 26:17 26 minutes, 17 seconds So on the office side I think the rental expectation 5 years hence is in the range of 125 to 130 rupees. Uh on the 26:25 26 minutes, 25 seconds retail side of course it is uh much higher could be 250 rupees plus uh years hence what we 26:34 26 minutes, 34 seconds uh and timeline wise I think we it should take about 5 years uh from the you know start date to to get the 26:41 26 minutes, 41 seconds project completed. uh we I do not want to give a particular number but yeah hard cost will be in the range you know 26:49 26 minutes, 49 seconds your and my estimate will be not different but you know since that entire design is yet to be frozen uh you know we haven't yet uh come to a detailed you 26:59 26 minutes, 59 seconds know cost budget uh for the development but you know all of us know you know the the range in which you know hard costs 27:06 27 minutes, 6 seconds typically line up for projects like this and five years you said for the entire project 5 and a half million square ft or it will come in phases. 27:19 27 minutes, 19 seconds Mostly see it will be uh singlephase driven. There could be bit of uh uh you 27:26 27 minutes, 26 seconds know there could be some bit of you know stoming towers may come earlier than later but till plinth level and from a 27:33 27 minutes, 33 seconds services perspective everything is single phase then we can always say on uh you know on the commencement date maybe we are starting something earlier 27:41 27 minutes, 41 seconds and you know some other tower a little later but but uh yeah we'll be able to commence bulk of this development within 5 years. 27:50 27 minutes, 50 seconds Sure. Got it. Uh thank you. That's it from Thanks. 27:56 27 minutes, 56 seconds Thank you. We will take the next question from the line of Perves Kazi from Nama Group. Please go ahead. 28:03 28 minutes, 3 seconds Uh hi uh good afternoon and thanks for taking my question. Uh so so first question is I mean when you said that uh 28:12 28 minutes, 12 seconds office 1283 odd crude bulk of it will come to the parent company. uh can we look at this transaction in a way that 28:21 28 minutes, 21 seconds maybe the 1819 odd acres of land which is under this SPV RMZ has kind of valued 28:28 28 minutes, 28 seconds that land at about,200 cr I mean would that be a fair way to look at it 28:37 28 minutes, 37 seconds 50% of that is getting valued at 13 1280 crores right they're taking 50% of Sure. 28:49 28 minutes, 49 seconds Uh and what would be the accounting treatment uh for this entity let's say 5 years down the line? I mean if we 28:56 28 minutes, 56 seconds maintain a 50% stake in this JV uh you will do it as a share of profit from this JV or how will it work? 29:05 29 minutes, 5 seconds I'll I'll ask to answer this. I'm quite bad at accounting. So, so what will happen uh 29:12 29 minutes, 12 seconds prove is that um twofold accounting one for the sale of stake uh on consolidated 29:20 29 minutes, 20 seconds basis it will throw a profit with the book value and this 1283 crores and when it comes to the accounting for the 29:28 29 minutes, 28 seconds consolidation it will be an equity accounting which will be oneliner in the balance sheet as an investment fair 29:35 29 minutes, 35 seconds valued every quarter or or uh profit and loss adjustment every quarter not fair valued and uh on one line in the P&L 29:43 29 minutes, 43 seconds which will be profit from this entity just like a joint venture because no one of us will have a control direct control on this SPV. 29:55 29 minutes, 55 seconds Sure. And lastly, when do we expect to start construction here? 30:00 30 minutes Within this calendar year itself. I think over the next 6 to 9 months is when we intend to break ground. 30:09 30 minutes, 9 seconds So thanks and all the best. Thanks Babies. 30:15 30 minutes, 15 seconds Thank you. We have the next question from the line of Abidv Chhatupad from IC Securities. Please go ahead. 30:23 30 minutes, 23 seconds Yeah, thank you for the opportunity. Uh so just to follow up on the previous question on the accounting. So this will be primarily a joint venture and any 30:32 30 minutes, 32 seconds loans or debt right will be off the books during consolidation. Is that a correct understanding here? 30:39 30 minutes, 39 seconds No, it will not be. Uh what will happen if in future any loan is given because the current loan will get scared of with 30:47 30 minutes, 47 seconds with this around 1,000 cr infusion. Uh but in future if whether we or RMJ gives 30:55 30 minutes, 55 seconds any loan to this SPV that will go as a loan line item only as if it is given to third party. 31:03 31 minutes, 3 seconds Okay. So, so just to again uh just to reclarify here. So, the money which will be coming right now right net of the 31:10 31 minutes, 10 seconds costs right for DTCP and other approvals the money will come to signature global parent right and any incremental capex 31:19 31 minutes, 19 seconds right which which the signature and RMC will do you will have to infuse equity again in this SPV to do the capex or how 31:27 31 minutes, 27 seconds does it work apart from the construction finance you may take at the SPV level. 31:31 31 minutes, 31 seconds Yeah. So uh if that understanding is correct once the transaction gets closed and all money reaches whichever you know 31:39 31 minutes, 39 seconds place it has to reach uh the entity will be sitting with uh you know an approved land with a development potential we've 31:46 31 minutes, 46 seconds talked about uh almost on a debtfree cash basis. Hence going forward any uh the construction will be funded through 31:55 31 minutes, 55 seconds construction finance and the differential will be funded in the form of equity stroke loan from the two uh you know partners. 32:04 32 minutes, 4 seconds Okay. And just to again clarify the residential component which you alluded to right which will be left. So there will be no cash flow which will be 32:12 32 minutes, 12 seconds flowing from that entity to this entity right that is an independent project which will uh work on its own terms right that is the 32:20 32 minutes, 20 seconds yeah residential business as an undertaking will be moved to our parent entity prior to uh this uh unit transaction. 32:29 32 minutes, 29 seconds Okay. Okay. And just a final question. 32:32 32 minutes, 32 seconds So for all these things is there any tax liability which would come to signature global at the parent level or it'll all get settled against the outstanding 32:39 32 minutes, 39 seconds loans and whatever interest carry which was there. So as far as uh tax is concerned to the portion which uh 32:48 32 minutes, 48 seconds signature global India will sell there will be a capital gain because u uh we will be completing very soon 2 years. So 32:56 32 minutes, 56 seconds it will be a long-term capital gain tax uh on that. But as far as 1,000 K or around 1,000 K is concerned, there will 33:04 33 minutes, 4 seconds not be any tax outflow but definitely in the books there will be defer tax liability uh equivalent to the long-term capital gain. 33:14 33 minutes, 14 seconds Okay. So the Okay. So understand okay the cash portion will be for the secondary sale not the primary part right? No not. 33:22 33 minutes, 22 seconds Yeah you are right. uh nothing will be there on the primary uh side because in the tax it will be considered as uh 33:29 33 minutes, 29 seconds infusion of a fresh equity by one party to uh the entity. 33:34 33 minutes, 34 seconds Okay. Okay. Okay. Fine. Okay. Okay. Got that. That is pretty clear. Yeah. Thank you and all the best. Thank you. 33:42 33 minutes, 42 seconds Thank you. A reminder to all the participants you may press star and one to ask a question. 33:54 33 minutes, 54 seconds We have the next question from the line of Sukrit Patil from Eyesight Private Limited. Please go ahead. 34:00 34 minutes Uh good morning to the team. Uh I have two uh questions. My first question to Mr. Rajat is beyond the uh demand 34:08 34 minutes, 8 seconds guidance. How will Signature Global manage risk and uncertainty in customer acquisition and financing? What signals 34:17 34 minutes, 17 seconds will guide your approach to sustaining affordability while protecting the margins? I want to understand your point of view on this. Thank you. That's the first question. I'll ask my second question after this. 34:27 34 minutes, 27 seconds No. Uh uh sorry I didn't fully understand this is this question is regarding the housing business. So how are you what was this question regarding 34:36 34 minutes, 36 seconds I'm uh customer acquisition in the you know commercial business? 34:41 34 minutes, 41 seconds I'm asking about uh how you will handle risk in customer demand and financing uh not just growth plans and what signals 34:49 34 minutes, 49 seconds will guide you will guide affordability and margins. 34:54 34 minutes, 54 seconds Sorry I'm I'm still not clear. I haven't understood what you really want to understand. 35:00 35 minutes Uh no worries. I'll come back in regarding which business you talk. Yeah. Okay. Maybe we can talk offline on this. 35:06 35 minutes, 6 seconds Yeah. What's your second question? 35:12 35 minutes, 12 seconds No stress. Let's let's take this offline. That's okay. 35:17 35 minutes, 17 seconds Thank you very much. As there are no further questions from the participants, I now hand the conference back to the management for closing comments. Thank you and over to you sir. 35:28 35 minutes, 28 seconds Yeah. Uh thank you very much everyone for joining the call today. uh I would just want to reiterate that uh we we're 35:37 35 minutes, 37 seconds feeling fairly good as far as uh you know the performance of the housing business is concerned. We've grown that business significantly over the last 35:45 35 minutes, 45 seconds couple of years and uh we've reached a good situation uh you know in the business where we are now seeing strong collections uh and for the coming 35:54 35 minutes, 54 seconds calendar year you know strong collections happening good pace of completions going on and sales are keeping steady so you know all those uh 36:02 36 minutes, 2 seconds you know three parameters we seeing good performance and uh this seemed like a good uh you know timing for us to uh enter into a new business and nothing 36:11 36 minutes, 11 seconds better than you know partnering with a group like RNG for one of our existing large land parcels. Uh and what it also 36:19 36 minutes, 19 seconds does is that you know it puts into production uh you know a significant portion of our you know uh land stage 36:28 36 minutes, 28 seconds resource. So out of this 21 million square foot of land which was coming as forthcoming uh you know we've mapped out 36:36 36 minutes, 36 seconds another 7 million uh you know square foot of 7 plus million square foot of utilization uh between commercial office spaces and the housing business which uh 36:45 36 minutes, 45 seconds you know is now uh with uh advanced approvals will also come to a launch stage sometime in the calendar year. So 36:53 36 minutes, 53 seconds it's another you know 7 to 8 million which is kind of coming into production. 36:56 36 minutes, 56 seconds So really makes our uh you know cash flow situation very robust uh from a mid-term uh you know medium-term 37:05 37 minutes, 5 seconds perspective. So we are quite you know excited and enthused around this this new business and do intend to you know scale it significantly in the coming years. Thank you very much. 37:15 37 minutes, 15 seconds Thank you. Thanks a lot. Thank you. Thank you. Thanks a lot. Thank you. 37:19 37 minutes, 19 seconds Thank you members of the management. On behalf of ICC Securities Limited, that concludes this conference.