Mahindra Lifespace Developers Limited (NSE: MAHLIFE) Q3 2025 Earnings Call dated Feb. 03, 2025
Corporate Participants:
Amit Sinha — Managing Director and Chief Executive Officer
Avinash Bapat — Chief Finance Officer
Analysts:
Aditya Sen — Analyst
Pritesh Sheth — Analyst
Shreyans Mehta — Analyst
Parikshit Kandpal — Analyst
Unidentified Participant
Presentation:
Operator
Ladies and gentlemen, good day and welcome to Mahindra LifeSpace Developers Limited Q3 FY ’25 Earnings Conference Call. 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. Should you need assistance during the conference call, please signal an operator by pressing the star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr Amit Kumar Sina, MD and CEO, Lifespace Developers Limited. Thank you and over to you.
Amit Sinha — Managing Director and Chief Executive Officer
Thank you, Steve. Very much appreciate it. Good morning, good day-to everyone, and welcome to our quarter three FY ’25 earnings call. At the outset, I would like to thank everyone for participating in this conference call. I have the benefit of having our CFO, Avinash, also with me and also have Singh, who is the Chief Business Officer Residential; and Shriram, who is our VP Finance, who looks after all the partnerships, FP&A and Investor Relations. So all four of us there on the call. Along with my colleague Simran, who looks after this specific function with. So let me just cover a few things very quickly. I know all of us are trying to understand what happened on Saturday on the budget side, we’re still evaluating that. But overall, we think that income tax and some of the other benefits will have positive impact on the on the buying power of individuals, but we’ll really understand the final prints over the next few — next few days. But let me just cover four or five things. Let me cover a quick summary of what we see in the market. And that’s one. Number two, business development at Mahind the Life Spaces. Sales, how that has been, launches on our IC business and then I’ll hand over to Avinaj for some of the financial details. So start with, I think on the market side, we see a continued overall buoancy in the market continuing. Our market at a pan-India level continues to see healthy absorption growth at around 6% year-over-year. New launches are a little bit higher, more than 6.2% year-on-year. We look at-the-market in three segment, affordable segment and we have come up with our own definition. It’s not exactly the way government defines INR50 lakhs. It’s less than INR1 crore, we Call-IT affordable. INR1 crores to INR5 crore is our premium, mid-premium segment, which is where we are actively participating. And we call luxury, which is greater than INR5 crores. And in Mumbai context, that could be INR12 crores. So the affordable segment interestingly, over the last nine months has seen a degrowth. It’s 59% of the overall market, but it’s degrown from 64 65 last financial year, similar time-frame. The decline of affordable segment is made-up by premium, mid-premium segment, which used to be 33%, now it’s 37%. And luxury segment, which used to be around 2%, 2.5% now is close to 4%. So we see that some of the more premium and luxury, the top-end of the segments are growing really well. One of the best indicator of how the industry is the inventory overhang. It’s at a healthy level, 14 months. The moment it starts to cross 30 months or 36 months, we see that market is slowing down significantly. So overall, at a pan-India level, it’s a healthy market. In the three markets that we participate, Mumbai, MMR region, the absorption is 8.8% year-on-year to 72,000 — close to 73,000 units and new launches at 5.8% and pricing has now stabilized at 5%. It was very-high for the last few years, but it is stabilizing at 5%. Bangalore, the absorption is close to 4% year-on-year at roughly 42,000 units. It has a little bit of base — higher base effect from the last financial year, similar time-frame. But the new launches have become large, larger this nine months, close to 10% year-on-year. And pricing continues to be very healthy for Bangalore, 10% plus year-on-year growth. Pune is shaping up really well, given focus on GCC, IT, tech sector, even some of the other industrial companies. The absorption is around 40,000 units, 4.2% year-on-year change. New launches, amazing level of activity there, roughly 50% growth and pricing at a healthy clip 6% year-on year-on-year growth. And similarly, other cities NCR, Hyderabad, for example, they were slow in the previous quarter have picked-up in the last quarter. Chennai, much smaller market relatively speaking, it continues to have a good absorption, good set of new launches and healthy price increase. So overall, good market from a volume point-of-view, from a growth point-of-view, from absorption point-of-view and even from a pricing point-of-view. Our competitors have done a good amount of business, some have done better than the others. But the more important thing is that since the market has, most of the players are focusing on GDV acquisitions, making sure their balance sheet is strong enough to absorb the cost, the capital required to pursue these GDV additions. And we’ll talk about our own also. We’ve done a very healthy amount of GDV acquisition in the last nine months this financial year. However, overall, we see — while the GDV acquisition is very good. Parts of the market, especially, let’s say, Mumbai has seen muted launches, I would say, relatively speaking, although it’s the largest market, but approval delays because of NASH elections and state elections and many other things in-between have — have had impact on delay. I’m hoping that things pick-up on approvals in this quarter and we’ll talk more about our business shortly. So that’s a quick summary from my side on the market side. Picking-up from the previous set of business development GDV addition, for us at Mahindra Life Spaces, during the Nine-Month FY ’25, we have completed a GDV addition of roughly INR14,000 crores. And if you include — include the transaction we did 10 days back-in Bangalore, it’s another INR1,000 crores. The last transaction was in the last quarter, but since we are having the call a few days already into this quarter that was in Bangalore 8 acre near the airport. We have added the key highlights of GDV addition, 14,000 till in Nine-Month and 10 month is INR15,000 crores. We have signed-up a major land parcel in joint development 37 acre in Bondu. It’s roughly 4 million net area, 6.4 million of saleable area it target potential is INR12,000 crore, which is going to be a significant one for us in the central — in the heart of central suburbs. In — earlier in the year, we had talked about Saiwa Banagar Borivali, seven societies, INR1,800 crore. And then we have also done a small acquisition of INR250 crores of GDV next to our previous project, Mahindra Zen. So it’s a contiguous — the same common boundary. So four, including the Airport Bangalore acquisition, these are the four major acquisitions that we have done so-far in this financial year. We continue to see attractive opportunities for land parcels in our core market. And as I had explained in the previous discussion, we are very disciplined about the financial returns on these acquisitions. Given the expectation of landowners, partners, we just want to be thoughtful about what kind of financial return it provides for us in future years. Sales, we achieved a pre-sale of 1749 in the Nine-Month FY ’25 versus INR1243 crores in the Nine-Month for last financial year and reflects 41% growth. The quarter three has been muted, as I mentioned, not only for us, but for many of the other industry participants. We had a INR334 crore in-quarter three versus INR443 crores in-quarter three FY ’24. And I think we’ll make it up in the next quarters. The reason is we got one approval on 31st of December for RERA, for IV lush, which is the land that we had bought last financial year. And similarly we are expecting a couple of other approvals. In Nine-Month FY ’25, our new launch sales contributed INR1,019 crore, 58% of the INR17 crore INR49 crore overall sales. And then most of the Q3 revenues was driven by sustainable sales across our projects. So that’s our sales summary. I will quickly cover launches now. The Nine-Month FY ’25 sales were primarily driven by launches like Mahindra Ivy Lash, which is the Crown code name, Mahindra Zen Green Estates early in the year and 2 Phase-2 in July 2024 and we come out public announcement on each of them, but Mahindra Zen was quite successful, 96% of inventory is sold already within the six — within the nine months of this financial year when we launched it. Similarly, Lash has 63% of inventory sold, we could have pushed more, but we are holding back given the realization of a specific tower that is a premium tower. We think that it will gain momentum as the project starts to see more construction and comes to show what kind of designs we have brought to the brought to the market. That’s the market. The second plotted development that period this financial year is — has received good response and we have sold more than 50% of that already. Now following the strong response for Phase-1 of IVE Lush, which was earlier in the year, we have preponed the Phase-2 launch. The total GDV of this project across Phase-1 and Phase-2 was INR1,400 crore. More than 50% is — has come up online in Phase-2, IV Phase-2 and we’ll see the impact in this quarter. Overall, overall early — early indications are very healthy for us. Other launches for the year with new tower we had launched, GDV of INR150 crores to INR200 crores, Kalyan to another 225 crores INR250 crores. And in-quarter four FY ’24, ’25, we have planned for three major launches, Vista Phase-2 in Kandivali, we are awaiting the final approvals, Zen 2 in Bangalore, which is contiguous to Zen1. And then in Citadel, we are launching a new tower, which we are — which we have received all the approvals already. So now it will be visible to us in the pipeline. Our Navy in, it’s a redevelopment is expected to be launched in-quarter one. It might slip to first month of quarter two depending on the whole — it’s a large society. We just want to make sure we ensure a smooth transition for the existing members as well as a launch, which is a — which is a very positive launch that we are planning. So that is Navy. And then Project Pink, which was to be launched in this financial year is awaiting final approvals. So that’s been there in our pipeline for some time. We hope to fulfill all the requirements as per the government needs. Our Sumitum of business as part of ICIC so next is ICIC business update. And is a key part of this update as you know. We had a very healthy partnership for Origins Phase-1 Chennai. We signed a an extension of that contract, that relationship for Origins Chennai Phase-2 A and they’ve also signed a MOU for a Phase 2b. So we are going to be a long-term partner with us for all the industrial activity that we see in Chennai on the private industrial part side. So that is INR225 crores, 60% contributed by us, 40% by Sumitomo. So it’s an exciting way to extend our partnership together. Our overall IC and IC business has strong growth levers. As you know, it is an area which allows us to attract all the industrial companies from around the world who find our industrial parts, world cities quite favorable. The China Plus One, domestic consumption, PLI, all these stories are attractive to many of them and we help them with a plug-and-play infrastructure. And during the nine months of this financial year, leasing of 47.3 acres was done around INR209 crores with the Mahindra City Jaipur taking the lead almost 75% coming from that Mahindra World City Chennai was 5.6 acres with roughly INR26 crores and then Origins Chennai with a revenue of INR14.7 crores. Quarter three leasing was around 12.4 acres translating to a revenue of INR47.47 crores. And we also had very healthy pipeline. Some of these closed in the first week of January, otherwise the number would have been slightly higher for quarter three and first-nine months. But eventually they all be coming up in our financial year FY ’25. Very healthy pipeline, lot of interest in India from many industrial clients. So we look-forward to working closely with them to give them a ready to move-in plug-and-play infrastructure. The — from a funding point-of-view, this — the aspiration that we set-out to resolve or to pursue requires a good capital commitment and we are working towards this. We are looking at we have had three very positive developments on the capital side. One, as I mentioned was Sumitomo. The second one was a capital reduction. I’ll ask Avinash to cover that with and the third one was the additional dividend given the performance of City Jaipur interim dividend that came in. So that helps us from upstreaming cash from our subsidiaries to the parent book that is very helpful for us as we plan our growth aspirations. So overall, I think business is good. We have a lot of work to do. Major development is on the GDV side, as I had explained that in the previous call that that’s an area that I really want to pursue so that we are setting ourselves for a very sustainable portfolio of GDP for multi-years rather than chasing every deal or small deals every year. So that’s overall on the business side, I request to take-over on the financial side.
Avinash Bapat — Chief Finance Officer
Thank you. Thank you, Amir. As you all know, we follow the methodology for accounting plus over and above a couple of our key operating entities in the residential business like Mahindra Homes and Mahindra Happiness. And even in the IC business, both Mahindra World City Chennai as well as Jaipur, we do not consolidate them on a line-by-line basis. So we account for the profit share from these entities. Let me talk about the nine months first and then we’ll come to Q3. Our total consolidated income stood at INR408.4 crores in the nine months FY ’25. This is against INR224.5 crores previous — the corresponding nine months of the previous year. The — shows the healthy growth that Amit talked about earlier. The consolidated PAT after the non-controlling interest, that stood at a loss actually of INR23.8 crores in nine months as against a profit of INR26.8 crores in nine months of FY ’24. We’ve been expecting a few OCs. Those have got pushed out. In fact, a few couple of transactions have also gotten pushed out in Q4. So we hope to improve this performance in the coming quarter. Let me talk about cash. The net operating cash-flow, excluding the outflows towards land, this was at INR600 crores in nine months of FY ’25. This is again a healthy growth as compared to INR459 crores in the nine months of FY ’24. So this — this is reflecting the strong collections in residential as well as the IC business. I should mention this and Amit alluded to that earlier is that apart from these operating cash flows, we had a good run-in the financing cash flows as well. All the three things that Amit talked about earlier, which is the more related infusion, the capital reduction as well as the dividend fished at least around INR300 crores during the nine months. So that’s a healthy thing to add to our inflows. Talking about Q3, the consolidated total income stood at INR185.8 crores, thanks to the OC that we received for. This is against INR88.8 crores or INR90 crores in FY ’24 Q3. The consolidated PAT is for the quarter only now after the non-controlling interest that stood at a loss of INR22.5 crores in Q3. This against a profit of INR50 crores previous year Q3. On the debt side, we have gross debt of about INR1,500 crores and cash balance of about INR600 crores. That brings our net-debt to INR920 crores on a fully consolidated basis. We’ve been able to manage or keep our borrowing costs at a healthy level. It has been sub 9%, 8.9% to be precise, is the cost of debt on a consolidated basis as of December ’24. The net-debt to equity and we have been talking about this earlier, this was close to about 0.26 in the previous quarter. There is a slight jump here to 0.5, still at a healthy level, again on a fully consolidated basis. This kind of reflects something which again Amit mentioned earlier, multiple GDV additions that have happened during the quarter as well as nine months. We have been basically maintaining our balance sheet in sheet in such a way that when we need, we can have the flexibility to raise debt as well. So that comes to about 0.5 on a fully consolidated basis. Just to reiterate, just as mentioned by Amit, we are exploring a couple of other funding options and we’ll let you know once we have some decision on that. Thank you. If you have any questions, we can — we can go-ahead with this.
Questions and Answers:
Operator
Thank you much. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2 participants are requested to use handset while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles the first question is from the line of Aditya Sin from RoboCapital. Please go-ahead.
Aditya Sen
For the opportunity. So given that we are the launches of Q3, Q4, sorry, but what are the potential launches for full-year FY ’26?.
Avinash Bapat
Hi, Aditya. Thank you. Great question. Actually, we are gearing up for our F ’26 as well. So I touched upon Navy, for example, which was supposed to be this financial year, but we have — this is our first redevelopment which is close to launch. So it is like three different that we have to get within the same project. So that is one of the — one of the key ones for us. Olympic, we are awaiting some form of approval. There was a new note that had come up about the road width and all. So we’re trying to sort that out. But this is the great location in Whitefield next to the Hope metro station, 1,800 GTV. So Navy 1,000 — close to 1,000 Olympic is close to 1,800. We are awaiting some policy approval for Citadel Phase-3 in Pune on Chinchwar Road. That’s the third one. And then the Saibaba, which is the society redevelopment that’s — that was signed in July. I think given the learning we have from Navy and Westerra, we are trying to catch-up and on the pipeline so that we don’t make the same. We’re able to manage the time delays that are typically associated with society redevelopment. And then obviously Bandup is something we are very excited about and we are tracking that on a — on a weekly basis, how best to launch. Our target is to quarter-four of next financial year. And there are couple of others which are small ones that will also help us in our FY ’26 targets.
Aditya Sen
All right. And one more question, given that we operate in around mid-segment projects, so what is the EBITDA that we internally target for our projects.
Avinash Bapat
What is the EBITDA you said, right?
Aditya Sen
Yeah, that’s the internal target for our projects.
Avinash Bapat
Yeah. So let me answer the question in two-parts. First is, we — I wouldn’t say we are targeting mid-segment alone. I think are targeting mid-premium and premium. As I explained earlier, like some INR1 crore, we would Call-IT affordable, INR1 crore to INR5 crore, we’ll Call-IT, let’s say, say mid-premium and premium. Bangalore and Pune would be let’s say mid-premium by price point but they are like luxury and by luxury or premium in terms of specs and what we provide to the customers. And so that’s the sweet-spot for us. So mid-premium and premium. And beyond five, we Call-IT, let’s say, luxury. So that’s the definition we have. And that’s — that’s something we will continue to pursue as part of our let’s say, business strategy. So does that answer your question?
Aditya Sen
So actually, I wanted to understand what is the EBITDA that you target in the in our restructive segment.
Avinash Bapat
So we don’t look at EBITDA per se. We look at — sorry, I missed that question. We look at the IRRs of the business. So the way we look at it is and there is a project IRR. Our goal is to be the project IRR with the right cost assumption, right pricing assumption, velocity assumption. We target 20% plus EBITDA — sorry, IRRs. Business always has surprises given it’s a long-term four, five, six, seven years. When we target something like that, we have a couple of percentage point to dilute if we have to. So 18% is something that we want to deliver to our shareholders, but we target now 20% with the right cost assumption on the IRR side.
Aditya Sen
All right. And just a bookkeeping question. How much revenue are we going to recognize in the next two years, FY ’25, ’26 and FY ’27.
Amit Sinha
So at this point in time, it would be a bit difficult to answer this question. We would rather — when we go into the next financial year, we’ll probably give some guidance about what we are looking at from a pre-sales perspective, but not the exact accounting.
Avinash Bapat
I’m thinking pre-sale or you’re talking is revenue recognition which is linked to OC? Which one are you asking?
Aditya Sen
I’m asking about revenue recognition?
Avinash Bapat
Yeah. So revenue recognition linked to OCs, right? So I think — let me just what we target is be so much constrained by the approval process that typically we control the construction, getting the apartments and the whole landscape and everything ready. But many times just the delay associated with final OC, sometime part OC otherwis and sometimes full OC is a big question mark. So we can explain what we have in the pipeline, but I hate to say something and then backtrack because we don’t have the approval. So that’s something I don’t want to do. The way we look at the business is how much is the pre-sale that we are targeting and I’ve given a long-term guidance on that, right?
Aditya Sen
Okay. All right. So those are my questions as of now. I’ll fall-back in the queue.
Avinash Bapat
Yeah. And yeah. And if you have any further questions, we’ll follow-up offline.
Aditya Sen
Yeah, sure.
Operator
The next question is from the line of Pritesh from Axis Capital. Please go-ahead.
Pritesh Sheth
Yeah, thanks for the opportunity and just a couple of questions. Firstly, on launches for Q4, you mentioned the names. If you can just highlight on what’s the GDV potential of these launches?
Avinash Bapat
Yeah. So for Q4, Vista Phase-2 would be roughly INR400 crores to INR1,400 crores Vista Phase-2. We are not going to launch the retail part, it’s the residential part only. So residential remaining part. So almost all of that would — we may keep some inventory, which is, let’s say, we don’t want to worry about velocity. Price realization is critical for us on that. So that’s Vista Phase-2. You heard my point about we got a IV lush that came on 31st of December. All of that will have an impact in this quarter-four. So that’s roughly INR700 crores to INR750 crores that has been launched in Pune. We are in the last phase of approval process at to Bangalore. It will be close to INR250 crores of inventory. All of that will come. It’s just one tower, I think, 70, 75 units. The only reason we did that because it’s next to Zen or Zen 1 or one use the name interchangeably. And then there is one specific tower of tower I, which we have gotten, we’ve gotten the approval already. So that’s again in Pune. So somewhere around INR150 crore INR175 crores. So that’s our current. There is one more which is we’ve been waiting for some time, I’ll say it, but I’m not I’ll keep my fingers crossed is the project pink, which is another INR200 crore in Jaipur plotted. Everything is ready. We just been waiting a long-time for some of the approvals from the local authorities.
Pritesh Sheth
Got it. That’s pretty helpful. And just on Thanay, I mean FY ’26, you mentioned a whole lot of projects. I think couple of projects we’re missing there. One is Thane and one is Santa Cruz. So status on both and particularly on.
Avinash Bapat
Yeah, yeah. So, you know we had three steps of the process of approval. Step one was getting that out of 631, it happened a few months back. We discussed that on the previous calls. Step two is making it into a hard zone, so as part of DP plan. So that process is going on given the new DP plan, draft DP plan has come out and we had some observations, some objections, suggestions, etc. So that process is going on. Once that gets concluded, hopefully, we’ll have clarity how big of land parcel we can develop over what period of time. And it’s very close-in terms of clarity on whether and how that will happen. So I would have loved to give you in the previous question that we had to include Thani, but I just want to wait before — before saying anything and then staying firm on that. And the third phase of approval,, then going through the regular of IoDC and radar process and EC, all those things. So that third phase hasn’t started. First phase is complete, second is in-progress. We’ll know in the next two, three months. So that’s — that’s. Is relatively slow for us. We had hoped that this will get launched this financial year. We found that there are some issues when two societies want to come together. The amalgamation process has very different expectations by different societies. We are trying to resolve that in a smart, efficient manner, but it’s taking time given the two different parties on two different sides. And hopefully, we’ll have clarity and we’ll keep you updated on that.
Pritesh Sheth
Sure. And you know, just taking this forward, I mean here we have two societies. I think and Agar, we have seven odd societies or I think what are the learnings that you’re taking from Santa Cruz to to ensure that I think timelines are much shortened on that?
Avinash Bapat
No, still this very different. It’s a cluster redevelopment versus when was not so there are three learnings and one learning is choose the right policy for multiple society redevelopment. So and cluster redevelopment very suitable, it’s moving faster than we typically would have had. The second is the documentation process, the DA process of how to actually maneuver which has a design component, the PMC lawyers and lawyers from the other side across all — how do you work with them in a very, very constructive, creative, but transparent manner. That DA process is including the design part, you have to get alignment. Think of it, you have, let’s say, 7800 people who act like landowners right so that’s something we have to manage very tightly. And the third-part is understanding where are the pitfalls of what to do and what not to do. So from Navy, we realized that, hey, like while it was one project, it turned out to be three plots were seen as three different radar. We had to do three CCs, three IoDs, three CCs, three radars and it just made the timeline three times longer and that’s something that we have to — we have learned a lot, I think, and we’re getting better at it. But these are something we didn’t know when we got into it. We assumed a few things and then we were corrected and humbled along the process. Now we know some of those things and we have a whole crew of the team that knows what to do and what not to do.
Pritesh Sheth
Got it, got it. That’s very helpful. And does these delay you know, by any means change your IRR targets? And obviously, I think we did couple of years back realizations there to now has obviously changed. So we might get help from them, but in a stable market with not much price increase, you know-how does these delays you know impact your IRRs or are all these already incorporated when we anyways underwrite.
Amit Sinha
Yeah. See, I think the IRR delays matter if you have put capital upfront, right, in terms of society reasonable, the reason society redevelopments are in are in — are popular because you don’t have to put capital till you vacate you know the residents. So it’s delayed. But if you have two resources, one is the capital resource, the other is a time resource, right. In society redevelopment, your time resource is very heavy. Capital resource is less heavy, right? Both have an impact on IRRs, right? But right now, what we are trying to do is, as I said, the learning that we have from other society redevelopment that we are doing in Borivali, I think we know-how to balance both, right, where to deploy capital and how to — where to deploy time as a resource. A quarter or two — so we have some contingency that we always plan in our timeline, knowing these are society redevelopment. But since we don’t — we haven’t put too much capital upfront, very little capital, it doesn’t hurt us big-time. But for every other project, time is a huge resource. We have to always factor-in that it’s all about momentum. If we have gotten something DA or a LOI, we need to really launch the land to launch or commitment to launch has to be as fast as possible given the nature of the industry. So we’ve gotten that done on the GDA side on the land outright side, but society redevelopment has its own challenges that we are working through it. But to answer your specific question, we track the IRR very specifically. We have some contingency, but in case of society since you don’t put a lot of capital, it doesn’t hurt you that much.
Pritesh Sheth
Got it. That’s very helpful. That’s it from my side and all the best. Thank you.
Operator
Thank you. The next question is from the line of Shriyan Smetha from Equirus. Please go-ahead.
Shreyans Mehta
Yeah, hi. Thanks for the opportunity. My first question is on Bandup again. So can you quantify our share in the GD or the margins which will be making on the project, number-one? Number two, given the size of the project, how do you intend to fund the construction cost? That’s the first question.
Avinash Bapat
Yeah. Thank you,. It’s a very exciting project for us. So very large project. This is like five years of GDV that we did in the — in one project together, right. So it’s very exciting. We followed a similar financial discipline of same IRR base. Given this is a longer duration, not — it can go from anywhere from seven to 10 years given 4 million RNA. We are targeting around 18% IRR from the project. But with some cushions for upside and some cushions for protecting us from downside both the things we have done well and
Operator
Sorry to interrupt. The line for the management has been disconnected please wait while we reconnect them back, ladies and gentlemen, the line for the management has been reconnected. Yes, sir. Please go-ahead.
Avinash Bapat
Yeah. So I think I was answering question that you had raised about Hondu, so you ask a couple of questions. The first one was what kind of margins, etc. So we target against similar financial IRR targets. Given it’s a long gestation, long-duration, we are targeting 18%. And with some cushions and upside that’s there that will hopefully realize. And then we have protection against some of the downside scenarios as well, given during this time you’re likely to hit a long-cycle either way, right? So that’s the first question. The second is the revenue-share arrangement we have is 29.5% bulk of the transaction. So that’s for every INR100 rupees that we collect. The land is — landowner gets 29.5%. So that’s part of joint development. And there are some peaks here and there depending on how the transaction shapes up. So that’s the first — is the second part. The third is your question about how do we — how do we fund the — so right now, I think we are in a healthy position. We have our internal accruals. We have a some more room for expansion on debt-to-equity side, but we want to be very conservative. We want to cross 0.6 is what our aspiration is. We’re also looking to not specific to, look at TAP public market or private markets, both are open for us. So we have enough avenues. And as I’ve said in the past, we have strong support from Mahindra Group given growth aspiration from this business. So we’re likely to have good backing. So it will be a combination of all of these — all of these like our own balance sheet, our own accrual, public market, private market, all of those things are open for us. We’re looking for the best and the most flexible option.
Shreyans Mehta
Sure, sure. Sure. Second. So second question is Thani. So Thani, we put — we are putting disclosure to INR7,800, just be residential right or this still include some commercial?
Avinash Bapat
Yeah. So we want to have — we want to create a flexibility for us. So I think we want it to be our zone and that’s where we are working on the approval process. But if you have to do some commercials, we should — in the past, when we look at ITD policy, we were going to be mandated to do 50% commercial and then OCs have to be linked, so very different kind of requirements and constraints. So we want to have the optionality rather than constraints. So we are looking for the right approval as part of the DP plan process.
Shreyans Mehta
Yeah. Got it. Got it. And last question on the BD pipeline. So largely we are at closer to INR35,500-odd crores. So in terms of the balance spent, how would one look at it? And secondly, in terms of since majority is true, would we now focus on execution? And do you see new projects coming on-stream gradually or how should we look at BD?
Avinash Bapat
Yeah. No, I think Shant, you know you really asked a great question. I think I’ll go back, I think 18 months back when I took over formally and one other thing that we had talked a lot about do we have enough GDV or not? And we have really worked on a good-sized project of clear — clear guardrails on what we want to do. We obtained some tough calls in terms of will not do affordable, we will take a backseat on NCR and Nagpur and Hyderabad where they will focus on a few geographies, we will focus on specific customer segment and so on and so forth. And we’ll be very prudent about our GDV additions. Now, if I look-back where we are, we have — if I include, if I include Thane, if I include Olympic and in Navrath and many others that you know of very well. We have roughly INR30,000 crore of GDV that’s with us already. And our aspiration was INR45,000. So that’s two-third already. And we have a very active pipeline. My sense is we will not — in the short-term, our focus will shift away — not away, but kind of our priority would be execution, as you said. So how do we — how do we accelerate our journey from land to launch, right? And that’s something that we have to really solve. And obviously, part is internal like design and all the value proposition that we want to provide to our customers, but it is external and that’s something we can’t control from a timeline perspective, but we always do the right thing in terms of design, in terms of everything there. So that’s something we are focusing on. But then comes the execution. It’s a long construction cycle, three, four, five years depending on the size and we need to really, really execute and provide a great product, great solution to our customers. So our priority, which was, hey, do we have enough raw-material that seems to be getting resolved? No, we’ll — we’ll go back into stable mode on that. But now we have to focus a lot more on land to launch and execution, which is land to OC and that’s launched to OC, that’s something we’ll focus on. So you said it really well. That’s going to be a bigger priority for us.
Shreyans Mehta
Sure. And I think the variety of the balance what the bid pipeline looking right now, Mumbai, Pune.
Avinash Bapat
Healthy, healthy. I can tell you you’ll hear some good updates from us periodically on that.
Shreyans Mehta
Okay. That’s it from my side. Thank you and all the best. Thank you, sir.
Operator
Thank you. The next question is from the line of Parikshit from HDFC Securities. Please go-ahead.
Parikshit Kandpal
Yeah, hi, Amit. Congratulations on a good quarter on business development. My first question is what was the total land payment in nine months and how much is the pending payments the existing?, Lavi.
Amit Sinha
Yeah. So Parikshit, the total of amounts related to land in terms of outflows was close to about INR600 crores, between INR600 crore to INR650 to be precise. This doesn’t include some of the approval-related cost and all which kind of goes and sits in the project cost, although it is still pre-launch. So that would be another 100 crores to INR150 crores that would have gone in.
Parikshit Kandpal
And what’s the pending amount now on the existing — on these landmarks?
Amit Sinha
On the existing one now not too much. It’s close to about INR250 crores that is pending, but it’s still over a period of time, it’s not immediate.
Parikshit Kandpal
So now there are two things which basically want to delve a little bit deeper here. So one was that the debt is now elevated 920.5 times now you’re looking at 0.6 so some point in time we have become constrained on funding to raise — Q2 business developments. Now do you think that the capital raise becomes more imminent as we grow into next year in terms of new business development?
Avinash Bapat
Yeah, yeah. I think so. I think you’re right. Our — beyond the point, 0.5 is actually comfortable, 0.6c just given the DNA of Mahindra Group, we will have to look at it on a short-term basis only, not for long-term. We want to below 0.5 for sure. And so you have three avenues, maybe four avenues. One is your own operating cash-flow. Second is your balance sheet, which is your debt-to-equity ratio. Third is your private funds, private markets. And the fourth is public markets, right? I’ll — the first and second is healthy for us. We’ll have a great operating cash-flow this year. But these first and second is not going to be sufficient to allow us to meet our aspirations. It will be perfectly fine if we wanted to grow at maybe 10%, 12%, 15%, but not going to be sufficient for, let’s say, 20% 25%, right, even more. So that’s why we need to cat-up into private capital as well as public capital. And each of them has their pros and cons. We are working very closely with our group finance organization, our leadership team there to make sure that we choose the right option and to tell you if we wanted, we could close something yesterday. But given the flexibility we want, given the pros and cons tied with each option, we are evaluating and taking our time to make sure it’s the right choice for Mahindra Life spaces for the long-term.
Parikshit Kandpal
Yeah. So I think this point was debated last call also. So you did highlight that you’re looking at INR3,000 crores of fundraise. So the only contention here was that to have it more flexible — flexible capital than constrained capital, creating more bureaucate lines that we are doing it through private-equity. I think you did highlight last-time that maybe future BD will be entirely through private-equity. So just the feedback. I would like to give it that whatever you tie-up at the end of it should be more flexible in nature and rather than bureaucratic.
Avinash Bapat
Yeah, absolutely, absolutely. Yeah, 100% agree. And that’s why you know even the private-equity has different types, there are some more operationally, let’s say, bureaucratic, I’ll use the word and some are less, depending the type of the investor. So we are — we are — and that’s why I think we have to set-up the business for success. We are going to give a, 18% 20% return to a partner, it should align well with our ways of working on our thinking, our approach to this business. So 100% agree. And as that’s what I said, if I could — if I wanted to close something just on just — oh, we need capital and let’s close the earliest option, we have closed it many days back, many weeks back. But as you said, we will be very careful about the constrained capital part and we’re taking our time to make sure that it does not unnecessarily burden our ways of working, our growth aspiration, our style of — or our operational independence.
Parikshit Kandpal
And any timelines of likely closure and some decision like what timelines do you think and whether the quantum remains at 3,000 or do you think can be lowered or increased?
Amit Sinha
Parikshit, the quantum kind of varies a little bit. As you know, you know, the joint development agreements or society redevelopments may not necessarily need that kind of cash outlays. So the INR3,000 crores is more of a guideline. It does keep changing. So that’s one. In terms of timeline, yes, you’re right, again, we will carefully evaluate that we don’t need to go too much in terms of net-debt to equity ratio and manage the timing in such a way that whenever we need the — whenever we need to match those outflows, we have sufficient funding that is available with us. So we will see something in the coming couple of weeks, something like that.
Parikshit Kandpal
Okay. So within this financial year, something will get crystallized.
Amit Sinha
Yeah, something like that.
Parikshit Kandpal
Okay. Just last thing, Amit, you did he say that there are some more announcements which may happen on business development side. So we’re expecting this to get before March. and these announcements come in before March?
Avinash Bapat
Yeah, yeah product will keep you excited with our pipeline.
Parikshit Kandpal
So and now directionally the sizes have gone up like — I mean, we have been hearing more thousands more 1,800 so kind of deals. So ballpark in that range, we have like some more closures happening.
Avinash Bapat
So we will super size, as I promised our one-on-one also, supersize the deals. So absolutely, like same effort required, so why not do the right-sized deal?
Parikshit Kandpal
Yeah. Thank you so much. Thank you so much and wish you the best. Thank you.
Operator
Thank you. The next question is from the line of Ayush Shabo from Choice Equity Broking. Please go-ahead.
Unidentified Participant
With reference to the fund-raise, I mean, what level do we see our debt closing at in the next one to two years like do we stick to a net to debt if you would be of like 0.7 to-1 range or do we see one blowing?
Amit Sinha
Sorry, your — we are not really able to hear you well. Can you — can you please repeat your question, maybe a bit slower?
Unidentified Participant
What I’m asking is, where do you see your debt levels closing at by the end of this year or by FY ’26?
Amit Sinha
So how we are looking at this is, currently we are at 0.5 we would prefer to not go beyond 0.6 there are a few competitor players who have gone up to 0.7, some people even beyond one. But being conservative, we would want to keep it at about 0.6%. We do have healthy operational cash flows. So we don’t expect the 0.6 to be breached, say, in the next, say, two quarters if that is if that is helpful to you from a question perspective. Okay. Thank you. Ayush, I just want to clarify that we may have our — as to Parikshit’s question and another question before that, our goal is to supplement operating cash-flow, debt-to-equity with some other sources of funds. So there could be ups and downs, which might be a specific — for a specific quarter, but our long-term goal is to keep our debt-to-equity ratio below 0.5. So that should give you a rough guidance in terms of how we are thinking about it.
Unidentified Participant
Okay. Thank you.
Operator
Thank you. The next question is from the line of Aditya from RoboCapital. Please go-ahead.
Aditya Sen
Hi, thanks for the opportunity again. Sir, can you please share the list of projects in which we are expecting OC in FY ’26? I understand there can be delays, of course, but we just want to understand it from the from a ballpark perspective.
Avinash Bapat
Yeah so do you have the projects list yeah so this is a so we have which is the project that we have in Gurgaon there’s one last tower that’s moving along well then we have ALCO actually it has five towers so CDNE is con we have to do it next year as per our commitment, then ANB should also get done if we are able to resolve some of the approval-related issues. Mahindra Eden in Bangalore is — which was our flagship project, which was the sustainability leader is also expected to complete next year. Nostalgia, three out of four towers are expected to get completed next year. Happiness City in Chennai, we Call-IT P21 in our core name, that’s also expected. And then there could be another project or so, if we’re able to launch pink plots this financial year, it will also be expected to complete next financial year. So these are the five, six projects that we have.
Operator
Thank you. Thank you as there are no further questions from the participants, I now hand the conference over to the management for their closing comments.
Avinash Bapat
Thank you, Steve. Thank you to all the participants. Thank you to all the folks who asked questions. I think I just want to highlight three things in summary. We see continued momentum in the business at the industry level, while we — the price and volumes that we saw in the last price growth and the volume growth that we saw in the last three years is getting more measured, more corrected to more realistic levels, we see the demand — End-User demand continue to be there for some time.
Operator
On behalf of Mahindra LifeSpace Developers Limited, that concludes this conference. Thank you for joining us and you may now disconnect your lines.