16 , May , 2020
Realty firm Mahindra Lifespace Developers Ltd reported a consolidated net loss of Rs. 223.9 crore for the quarter ended March due to lower income and provisioning of loss in a joint venture project in Delhi-NCR. The company had posted a net profit of Rs. 31.27 crore in the year-ago period, according to a regulatory filing.
Mahindra Lifespace, the real estate arm of the Mahindra group, posted a total income of Rs. 110.78 crore in the fourth quarter of 2019-20 as against Rs. 246.88 crore in the corresponding period of previous year.
For fiscal year 2019-20, the company posted a net loss of Rs. 193.41 crore as against a net profit of Rs 119.71 crore in the previous year. Total income fell marginally to Rs. 645.92 crore in FY20 from Rs. 653.87 crore in 2018-19. The company said it has provided for impairment of its equity value in Mahindra Homes Pvt Ltd (MHPL), a joint venture (JV) firm. MHPL is executing residential projects in National Capital Region (NCR) and Bengaluru.
The residential project in NCR is a joint development with the landowner. The project saw a successful launch in 2015 in a buoyant market.
"The market has thereafter seen muted demand and declining prices. During the year, the company also saw significant cancellations of earlier bookings," Mahindra Lifespace said in a statement.
Consequently, MHPL has valued its balance inventory as per its accounting policies. Similarly, Mahindra Lifespace has in turn, based on estimated net present value of forecasted cash flows, and provided for impairment of its equity value in the JV firm.
"On a consolidated basis, the impact of impairment is Rs. 135 crore, in addition to an impact of Rs. 64 crore as share of loss from MHPL JV. This has been done as a matter of prudence considering uncertain market conditions," Mahindra Lifespace said.
Sangeeta Prasad, Managing Director & Chief Executive Officer, Mahindra Lifespace Developers said, "We are happy with the robust sales in our affordable housing project in Kalyan and the industrial customer acquisition in Chennai and Jaipur in Q4F20."
"We had planned a couple of launches in March-20 but did not go ahead because of the COVID-19 conditions. Being abundantly cautious, we have made a one-time provision in our financials for our project in NCR which was launched in 2015," she added.
