Eldeco Housing & Industries Ltd (NSE:ELDEHSG) Q4 FY23 Earnings Concall dated May. 16, 2023.
Corporate Participants:
Abhishek Bhatt — Investor Relations, Ernst & Young LLP
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
Sanjay Agarwal — Vice President Accounts and Taxation
Analysts:
Gunit Singh — CCIPL — Analyst
Abhishek Agarwal — KR Choksey — Analyst
Faisal Hawa — H.G. Hawa & Co. — Analyst
Harmit Desai — Pendulum Investment Services — Analyst
Niraj Mansingka — White Pine Investment Management Private Limited — Analyst
Monica Arora — Sharegiants Wealth Advisors Private Limited — Analyst
Presentation:
Operator
Ladies and gentlemen, good day, and welcome to the Eldeco Housing & Industries Limited Q4 FY ’23 Earnings Conference Call. [Operator Instructions]
I now hand the conference over to Mr. Abhishek Bhatt from EY Investor Relations. Thank you. And over to you, sir.
Abhishek Bhatt — Investor Relations, Ernst & Young LLP
Thank you. Good afternoon, everyone, and thank you for joining us on the call.
Before we proceed to the call, let me remind you that today’s discussion may contain forward-looking statements that may involve known and unknown risks, uncertainties and other factors. It must be viewed in conjunction with our business risk that could cause future results, performance or achievement to differ significantly from what is expressed and implied by such forward-looking statements. Please note the results and presentation are available on the exchanges and on our company’s website. Should you need any assistance to receive them, you can write to us, and we’ll be happy to send them over.
Today, we have on the call senior management of Eldeco Housing and Industries Limited, which is represented by Mr. Pankaj Bajaj, Chairman and Managing Director; Mr. Manish Jaiswal, Group COO; Mr. Sanjay Agarwal, Group Vice President Accounts and Taxation. We will begin with the highlights of the quarter, followed by Q&A. Over to you, sir.
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
Hello, everybody. This is Pankaj Bajaj. I would like to welcome everyone to Eldeco Housing & Industries Limited’s Q4 and FY ’23 results call. Thank you for participating in the call.
Let me begin with a few comments on the real estate market, after which I will discuss operational and financial results for the fourth quarter and the year ended March 2023. The demand for quality real estate, particularly residential real estate, continued its strong trajectory in FY ’23. Several macro economic factors adversely affected global real estate demand in FY ’23, but there was hardly any impact on the Indian real estate demand.
The size of the industry which has been stagnant for nearly 10 years is predicted to grow in the next three to four years substantially. The fundamental factor of rising salary, good demographics and rapid urbanization have not changed. The customer, particularly in smaller towns, is also unconcerned about interest rate fluctuation. Lucknow real estate market remained robust during the year. Demand was not a concern, but supply was constrained due to absence of new launches.
Moving on to performance. The fiscal 2023 was a flat year for us in terms of growth. Due to the lack of new launches, sales remained flat throughout the year. Despite signing up some new projects, we were unable to move them to the launch stage owing to land assembly issues, approval issues or both. The company has already advanced about INR25 crores in these projects and have significant expression of interest from real estate funds who want to enter the Lucknow market for the balance part of the investment. At this stage, we cannot disclose the location or nature of these projects due to confidentiality issues. However, we expect the issues to get resolved in the first or second quarter of the current financial year. The positive side of this delay is that the prices have toned up in our micro market and the launches will happen at price points higher than our own original underwriting.
Moving on to the operational highlights. During the year, the company handed over 4.15 lakh square feet with the registration of 322 homes. The FY ’23 collections were INR158 crores. The area booked for the financial year was 2.01 lakh square feet. We successfully added land bank of 20.91 acres between April 2022 and March 2023. All our existing projects are developing well in terms of execution, sales and collections. And we are confident that we will complete them all within or before the RERA timeline.
I’d like to spend a minute on new launches. We have received RERA registration for our new residential project Latitude 27 and construction has commenced. We plan to formally launch it by the end of May 2023. We expect strong sales from Imperia Phase II, which we will launch during the second half of the year. Apart from this, we have signed two new projects where land assembly and approvals are under process. We hope to be able to formally announce them next quarter. Furthermore, we are working on building a strong project pipeline for the coming two, three years. To finance all these business development, we will look at an optimum mix of external debt and internal equity. Accordingly, we plan to raise debt this year against existing and new projects. We feel that the time is right to invest at this stage of the real estate cycle.
Now moving on to our financial performance. The consolidated revenue from operations for the quarter stood at INR38.7 crores in Q4 FY ’23 compared to INR28.9 crores in Q4 FY ’22 and INR30 crores in Q3 FY ’23. The revenue from operations in FY ’23 stood at INR129.1 crores compared to INR126.9 crores in FY ’22. The consolidated EBITDA was at INR18.1 crores for the quarter compared with INR15.6 crores in Q4 FY ’22 and INR12.2 crores in the third quarter of this financial year, which is Q3 FY ’23. EBITDA for the entire year was INR51.2 crores. EBITDA margin stood at 46.8% for the quarter against 39.6% in FY ’23. The company’s consolidated profit after-tax stood at INR14.9 crores or this quarter, which is Q4 FY ’23, and INR44.4 crores in FY ’23.
With this, I would like to open the floor for questions, if any. Thanks.
Questions and Answers:
Operator
Thank you. [Operator Instructions] Our first question comes from Gunit Singh with CCIPL. Please go ahead.
Gunit Singh — CCIPL — Analyst
Hi, sir. Thank you for this opportunity. So sir, in the last con call you mentioned that we will have a sales value of INR300 crores to INR400 crores in FY ’24 and about INR500 crores in FY ’25. So I just want to understand — I mean, how much of it will be realized in actual sales for the coming years?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
Yeah. The guidance that we gave remains unchanged. So that will be the sale booking number. So if you look at — we have given the investor presentation also. The area which is available for sale in the existing projects is about 1 million square feet. And similar area is already planned in the forthcoming projects and this is not counting the fresh projects which we have not declared. So 2 million square feet at an average utilization of INR4,500 to INR5,000 a square foot, which is what our latest numbers are. So that is the sale value of INR900 crores to INR1,000 crores and this will all get realized — will get booked in the next two to three years. So our numbers stand, whatever the guidance I gave then, but there are two ways of recognizing the revenue.
The latest accounting standards say that revenues get recognized when you get completion certificate and pass on the title to the customer. So obviously, a lot of that will be get recognized on the back-end, except the running projects which will get recognized during this period. But of course on the tax part, we continue to use the old method of recognizing revenue, which is percentage completion method. But for you, the real number is that the new projects will — revenue will get recognized towards the latter part of this period, three to four years. The existing projects the company is running, the numbers are, as you can see, fairly stable and they will not dip, they will only rise from here.
Gunit Singh — CCIPL — Analyst
Okay. And how much was the sales value for FY ’23?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
Given there. I think it’s — let me recall. Fresh booking number, right?
Gunit Singh — CCIPL — Analyst
Yeah.
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
Fresh booking number is about INR100 crores I think.
Gunit Singh — CCIPL — Analyst
All right. And do we have any projects which will be handed over in FY ’24?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
FY ’24, yes, we’ll be handing over one of our big projects, Imperia — Eldeco Imperia.
Gunit Singh — CCIPL — Analyst
Okay. So sales from that, they could be realized this year itself?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
Yeah, yeah.
Gunit Singh — CCIPL — Analyst
And how much would that be?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
Since it’s a mix of a lot of numbers, there will be Imperia, there will be other projects also. So it’s very difficult to pinpoint — co-relate the completion of one project with the declared numbers because it’s — when you give the completion and handover to the customer. So the number would be slightly — on a consolidated basis, the revenue recognized will be slightly higher than the last year.
Gunit Singh — CCIPL — Analyst
All right. And by — what are the timelines for handover? I mean, in second quarter, third quarter?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
I think by the third quarter.
Gunit Singh — CCIPL — Analyst
All right. And the venues for this would be slightly higher than what we realized last year?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
Yeah, it should be.
Gunit Singh — CCIPL — Analyst
All right. That’s all from my side. Thank you.
Operator
Thank you. [Operator Instructions] Our next question comes from Abhishek Agarwal with KR Choksey. Please go ahead.
Abhishek Agarwal — KR Choksey — Analyst
Hello. Sir, my first question is, you have mentioned about debt raising. So can you throw some number on it for FY ’24 and FY ’25?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
It depends on our new business development. Debt is required mostly for — NTR going — as I mentioned, they are going aggressive on it, but it should be in about INR100 crores range.
Abhishek Agarwal — KR Choksey — Analyst
For FY ’24?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
Yeah.
Abhishek Agarwal — KR Choksey — Analyst
Okay. And are you planning to merge our unlisted entity in the near future, because it’s a much bigger size compared to listed entity?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
Nothing that I can declare right now. It’s complicated issue because there are multiple agencies and all. There is multiple RERAs. As you know that the unlisted company is bigger and is in multiple jurisdictions. So it is also controlled by RERA. So it’s not something that we can — we have a very firm view on right now, but it’s something that one keeps exploring informally.
Abhishek Agarwal — KR Choksey — Analyst
Okay. If something we get approval or everything in line, so we can think one in that?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
Yeah, it makes sense for the two sets of shareholders, of course, it may — we will like to see…
Abhishek Agarwal — KR Choksey — Analyst
Okay. Sir, can you give me the segmental break-up of the new launches? What — how many projects in the residential or commercial cycle?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
These are all residential. And there will be a mix of group housing, which is apartments, multi-storeyed apartments and horizontal plotted townships, which Eldeco has been very traditionally very good at. So it will be a 50-50 split horizontal project development and group housing, which is apartments. All will be in the Lucknow area.
Abhishek Agarwal — KR Choksey — Analyst
Okay, sir. And you have mentioned about the realization of around INR4,500 to INR5,000 for the new project what we’ll launch. So how much growth we are expecting compared to we did in the FY ’23?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
See, because it’s a lumpy business, it’s very to give quarter or yearly kind of forecast. But as I said that, we should be — we have been doing about INR100 crores to INR150 crores of annual fresh bookings for the last many years. But my number for the next three to four years is more than INR1,000 crores. Now which year we will do how much, it depends on the stage of the cycle — stage of the project. But on an average, we should be doubling or tripling somewhere over the next two to three years.
Abhishek Agarwal — KR Choksey — Analyst
Sir, my question was more related to the growth on the realization. So like we are expecting INR4,500…
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
So we have given a chart actually where every year we have been — this year, we have seen the highest realization — improvement in realization in the last many years on a per square foot basis. Last year it was INR3,800 a square foot. This year it is INR4,600 nearly. And going forward, we also expect it to improve. But the last year was an outlier in terms of residential market realization. The prices increase is simply on an average — weighted average by 20%. This year, we think another 10% should rise.
Abhishek Agarwal — KR Choksey — Analyst
So it will more than the normal growth in the real estate, correct?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
Yeah. It’s more than the normal because many years — it has been stagnant for many years. And now there is an upward correction to correct for so many years of stagnation.
Abhishek Agarwal — KR Choksey — Analyst
Okay. Sir, from the last few calls I’m asking the same thing that apart from the Lucknow market which are the markets you are looking to grow because Lucknow market, though we have the potential to grow in the Lucknow market, but there are other markets where we can think on it. So what is in our plan right now on other market?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
So as of now, we are focused on the Lucknow market. And as I mentioned in my opening address, we have already done significant BD. Unfortunately — in the last year, unfortunately, we could not bring it to the launch stage, which it has got delayed by a couple of quarters. Hopefully, we should resolve that. And I don’t think we’ll be constrained for growth because — and I’ve already committed to that. If a time comes that the company is limited for growth because of its geographical presence, then we will go beyond our core market. But as of now, I think that market — there is a strong trend towards consolidation. We can get a bigger market share of a very rapidly growing market. So we are focused on that market. If for some reason we are not able to do it, we will move out. And to begin with, it will be in the other parts of UP only. We did make a investment in Bareilly. Maybe we will do one with — if nothing goes wrong, then Gorakhpur is the market we are looking at.
Abhishek Agarwal — KR Choksey — Analyst
Gorakhpur, okay. Because why I’m asking this question because you are one of the players who are leading this geography. So I think it’s a good time for us to be more aggressive to cater the market.
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
That’s a good point and UP itself is growing very fast now. It’s a 20 crores population and real estate and urbanization is really exploding in this part of the country. So if we are to be at the right place at the right time, which we think we are, and we’ll try to ride this wave with our — how we have been doing in the past.
Abhishek Agarwal — KR Choksey — Analyst
Okay, sir. Done from my side. All the best. Thanks, sir.
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
Thank you.
Operator
Thank you. [Operator Instructions] Our next question comes from Faisal Hawa with H.G. Hawa. Please go ahead.
Faisal Hawa — H.G. Hawa & Co. — Analyst
Sir, what is causing our movement towards Lucknow and UP markets, because we were predominantly an NCR-based player? And are the realizations there for our ROC, ROE calculations for which we have been very conservative over the years? Secondly, sir, now we are almost like more than a 40-years-old company. So to really give a good shareholder return or to enhance shareholder returns, are we looking at any kind of buybacks or kind of giving some large dividends to really reward the shareholders? And thirdly, sir, what is the kind of movement we are seeing in the affordable housing market? Is it still profitable for most real estate companies like ours or it’s getting to be little difficult now?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
Okay. First question, why did we moved from NCR to Lucknow. So let me correct it, not at all. This company has always been in Lucknow, has only been in Lucknow and has never ventured outside. So it is not that we have moved from NCR to Lucknow. So Eldeco is a group from Lucknow. In fact, this company has operated only here. It’s a separate — because it was operating only here, the separate company was formed some years ago to look at other markets in unlisted entity of the promoters. So it’s not that it has moved from Lucknow to — from NCR to Lucknow, it’s the other way around.
Faisal Hawa — H.G. Hawa & Co. — Analyst
My apologies for being wrongly informed. I was confuse in the unlisted company.
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
Yeah, yeah. So it’s not that we moved from there. It has historically only been in Lucknow.
The second — your question was that because maybe Lucknow does not give us the kind of ROE or ROCE that other markets might. Again, I would like to correct you. If you look at the number, I think that our company in Lucknow gave the highest ROE and ROCE of all listed companies in the entire country. It is the highest. And if you look at our margins there, our consolidated revenue this year is about INR150 crores and our PAT is about INR45 crores. On those margins, any other real estate company in the country to give that kind of profit after-tax would have to do a turnover at least 4 or 5 times of that. So our margins are very good, our ROEs have been very good, our ROCEs have been very good. I think we are market leaders amongst all listed or unlisted real estate companies that I know of.
Third point — second point was on, it’s been a old company with a track record and should we not give buybacks and increase the dividend. So we did do a stock split last year because the stock — just to increase the liquidity. I know it’s not a value-wise, it’s a neutral impact. For whatever it is worth, we did a stock split 1:5. Dividend, if you have been noticing, we have not only been increasing our dividend ratio. So this year, I think we have recorded 400% dividend. So historically, it was quite low. It has now come down to 400%.
We have also been increasing our dividend payout ratio. It used to be 2% to 3% or 5% of our profit. This year, it is I think almost 17% to 18% of our profit. And our intention in the long run is to take it about 25% of our profit. Why we don’t give more dividends or more buybacks is because as I answered for one of the earlier questions, we see a great opportunity to invest this money on behalf of our shareholders and at the stage of the real estate pipeline.
I think we are in a long-term secular uptrend. We are well placed. So it will be a good thing to put this money to work on something which the company is good at, which is doing real estate development. If the market is stagnant, of course, we are going to give back the money to the shareholders, either by way of dividend or buybacks or whatever.
Your third question was on affordable housing. We have never been an affordable housing player. We never believed that it was a sustainable kind of model. The margins are just too [Indecipherable]. And given how RERA has played out in the last four, five years, where as a developer, you are open to inflationary pressures, but you cannot pass that on to your customers, because once you enter into a agreement to sell contract with the customer, your price is fixed. Earlier you could pass that on to your customer by saying that escalations have happened.
So — and this is exactly what has happened after the pandemic. The commodity prices have increased 20% to 30% and in some items even more. And the developers who had done affordable housing had pre-booked their inventory. They could not pass on this price rise and many other projects are unlisted, be a real estate projects in India or long gestation projects, largely they depend on advances from customers, which is good because that reduces our capital requirement. We use customers’ money as capital to finish the project. But what that does is expose us to inflationary pressures. And if the margins are not high enough, sometimes that can be very, very risky for the company.
For that reason, we are largely not in that segment. We would in fact — we have always been a premium player with good insight. We are introducing a couple of projects in the luxury segment also because that’s a segment end of the market which is showing the highest rate at the moment. So affordable housing, my comment is, too risky in the current model. I hope that answers your question.
Faisal Hawa — H.G. Hawa & Co. — Analyst
Okay. Thank you so much, sir.
Operator
Thank you. [Operator Instructions] Our next question comes from Harmit Desai with Pendulum Investment. Please go ahead.
Harmit Desai — Pendulum Investment Services — Analyst
Good afternoon, sir. Thank you for taking my question. Sir, actually this is with reference to our most recent quarterly results. As we can see that the other expenses in this quarter are negative. Could you elaborate a bit on that?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
I can’t I will ask my colleague, Sanjay Agarwal, if he is on the line. Sanjay, are you there?
Sanjay Agarwal — Vice President Accounts and Taxation
Yeah, yeah, I’m here, sir.
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
So can you answer this question, please?
Sanjay Agarwal — Vice President Accounts and Taxation
See, where other expense — you want to know what is the reason of increase in other expenses, right?
Harmit Desai — Pendulum Investment Services — Analyst
They are negative actually, sir, for this quarter. I just wanted to know why.
Sanjay Agarwal — Vice President Accounts and Taxation
Sorry. Please, come again.
Harmit Desai — Pendulum Investment Services — Analyst
Sir, in your most recent quarterly result, I am seeing other expenses are negative, which is value of negative 1.40, 1.86. I just wanted to learn more about it.
Sanjay Agarwal — Vice President Accounts and Taxation
For the last quarter, the figures are always the balancing figure. It is quite possible that in earlier quarters, the provisions for some expenses have been taken on the higher side. And when the year ends, then they need that that provision is not required. So for the — even in our notes to the financial statements, you’re right that the balancing figure is there in the last quarter. So it’s quite possible that some of the provision has been reversed and it is the net impact of those reversals.
Harmit Desai — Pendulum Investment Services — Analyst
Okay. Okay, sir. And I had another question actually. Could you elaborate a bit on your strategy for the next two years?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
I’ve already elaborated, Harmit. We have bolt-on our business development pipeline in the last year. We could not bring them to launch, but this year we hope to. And I did give a guidance in my last call that we would be doing about INR300 crores or INR400 crores of sales this year — fresh bookings, which is what we are on line for that. Hopefully, we should be — for that, it is important that we launch the new projects that we have tied-up. And that number should increase slightly in the year after that. We are looking at substantial increase in our top-line and bottom-line in the next coming years. But frankly, that’s not — there is no [Indecipherable] strategy. We are going for premium end of housing in Lucknow and riding on the infrastructure and growth wave which has happened there. So that’s the strategy. And those are the kind of numbers which we are looking at in the next couple of years.
Harmit Desai — Pendulum Investment Services — Analyst
Okay, sir. And sir, my last question to you is, is Lucknow experiencing or is it receiving any strategic investments for real estate development?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
The city is booming and the GDP of the city is booming, the furniture is — what has happened in the last 10, 15, 20 years is that the top seven metros really grow in India. But now the belief is that the next set on 10 or 15 cities in the country are also seeing a similar kind of boom, and Lucknow is one of those and it is the capital of the most popular state. For that reason itself, we expect the market size in Lucknow and real estate and in other things to improve significantly or increase significantly over the next two, three years or four years or five years. So we are just at the right place at the right time. If you look at the expressways, airport, educational institutes, recreation, so almost everything is falling into place for that city.
Harmit Desai — Pendulum Investment Services — Analyst
Okay, sir. This was it from my side, sir. Thank you for taking my questions.
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
Thank you.
Operator
Thank you. Our next question comes from the line of Niraj Mansingka with White Pine Investment Management Private Limited. Please go ahead. Niraj, your line is unmuted. You could go ahead and ask your question.
Niraj Mansingka — White Pine Investment Management Private Limited — Analyst
Are you able to hear me?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
Go ahead, Niraj.
Niraj Mansingka — White Pine Investment Management Private Limited — Analyst
Yeah, yeah. Just a question on the launches that you’re doing in the future. Will your — how is the margin profile be of those launches? The other way to put it is, will the margins remain at similar 40%, 45% range or would it be slightly lower or higher?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
Slightly lower, but still above industry average. Industry norm for gross profit margins are about 20, 25%, we are at 45%. So the prices at which we will get launched today should be about — the gross profit margins should be about 35%. But as we know that during the life cycle of the project, prices tend to drop, and towards the end, again, the margins should become better. So overall, it will start at about 30%, 35%, but it will go up higher as we go along.
Sanjay Agarwal — Vice President Accounts and Taxation
When you’re saying gross profit, you are talking about the EBITDA margin or talking about the gross profit for the project?
Niraj Mansingka — White Pine Investment Management Private Limited — Analyst
EBITDA margin. Okay. So this is — so just curiosity that the profit in the land purchase price that you’re having — you’re holding right now on those land?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
I couldn’t get your question. It’s not clear.
Niraj Mansingka — White Pine Investment Management Private Limited — Analyst
Was the cost of land much lower than the market price right now on the launching that you’re doing in next two years?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
Not really. These are — the new launches which we are doing are at — we have bought land at market prices, assembled the land, that’s why it’s saving time. And the thing is that what has happened in the real estate market is, for a company like ours, we buy at market price, we used to sell at market price. But now we don’t sell at market price, we sell at market price plus. The market has started giving a premium to credible developers. So that’s why we continue to get higher than market margin. The higher margins are not attributable to lower land prices, they are more attributable to higher realizations that we get as compared to the market.
Niraj Mansingka — White Pine Investment Management Private Limited — Analyst
So is it right to say that similar type of land not a premium developer like you would launch, they would still do 20%, 25% EBITDA margin, but because of your brand…
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
Somebody else could get 20%, 25% margin, we’ll get about 35%, 40% margin.
Niraj Mansingka — White Pine Investment Management Private Limited — Analyst
Okay. Got it. Thank you.
Operator
Thank you. Our next question comes from Monica Arora with Sharegiants Wealth Advisors. Please go ahead.
Monica Arora — Sharegiants Wealth Advisors Private Limited — Analyst
Hi. Thanks for the opportunity. So I just wanted to ask, can you throw some highlights on how the Lucknow market is growing? And how is the trend you’re seeing in the market? What’s your expectation on that?
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
I expect the market size to double in the next three to four years. Had it not been for the supply constraint in Lucknow, it could have already done so. Anyways, Lucknow is at the — right now for whatever reasons, land assembly has become very difficult. But I do expect it to get unlocked in next year, year and a half, because new master plan, new policies are coming. And the inherent demands that we face on the ground is very, very strong. We feel like even if there was — whatever the supply right now is, if it were to get doubled or tripled, it will get absorbed in that market. And the reason for that is inbound population influx on Eastern parts of UP, investment influx from Eastern part of UP, which is organic and the government itself is investing a lot in the infrastructure, then UP itself is growing and Lucknow is the capital. So if you visit Lucknow, it gives you the feeling and characteristics of any growing metropolis in the country. So we feel like — as I’ve mentioned in my opening remarks, demand is not the concern, it’s the supply which is a concern which only gradually gets unlocked in the next year, year and a half on the market side and consequently our company side for the increase significantly.
Monica Arora — Sharegiants Wealth Advisors Private Limited — Analyst
Okay. Thanks so much.
Operator
Thank you. [Operator Instructions] As there are no further questions, I would now like to hand the conference over to Mr. Pankaj Bajaj for closing comments.
Pankaj Bajaj — Managing Director and Chairman of EHIL, Managing Director of EIPL
Thank you all for coming today and for your interest in the company. I’m hopeful that we’ll be able to make the current year count in terms of performance. Bye, everybody. Thanks.
Operator
[Operator Closing Remarks]