Unitech Scrip Performed Well In Weaker BSE, Mumbai

Unitech Group is the 3rd largest realtor within the country consistent with market capitalisation, has posted ninety eight per cent drop in net profit, that stands at Rs 2.26 crore for the quarter ended March 2012, as compared to Rs 102.5 crore within the year ago. Overlooking the dwindling profit margins, the company’s money interest ratio has increased considerably. Unitech’s EBIDTA margin stands at a mere 5.4 per cent for this Q4 FY 12. Apart from the dismal performance for the quarter, its project launches for the complete year(2011-12) have conjointly witnessed a big drop. The corporate has launched 7.19 million sq. ft. for FY12, compared to 9.2 million sq. ft. within the corresponding amount last year. In FY10, it had launched 16.6 million sq. ft. As stated by Mr. Ajay Chandra managing director of Unitech Group, they plan to deliver nearly 9 million sq ft of residential development during the current year. Project execution has conjointly been dismal and also the company managed to deliver 3.4 million sq. ft. throughout FY 2011-12. Of the 24.3 million sq. ft. it had launched before March 2009, solely half has been delivered until date. Unitech delivered 0.2 million sq. ft. last year for residential property in Mumbai that had launched since March 2009. The corporate had launched 23.5 million sq. ft. since FY10 and delivered a paltry 0.2 million sq. ft. Thus, of the 47.9 million sq. ft. It's to deliver, thirty five million sq. ft. or nearly seventy three per cent of the deliverable remains pending. Unitech’s operational report for April 2011-March 2012 indicates that the company’s average realisation in residential sales for this Q 4 FY12 has dropped to Rs 3,863 per sq. ft., its lowest within the last one-n-half years. Its average realisation for non-residential operations is Rs 11,788 per sq. ft., however its overall average realisation for the quarter stands at Rs 4,350 per sq. ft., a drop of thirty per cent, compared to the last quarter within the same monetary year. Even once poor financial performance Unitech scrip closed at Rs 21.50, up 7.77 per cent, on the BSE in a very weak market of property in Mumbai on Wednesday. FY 2011-12 was a awfully difficult year, notably in terms of availability similarly as price of funding for real estate residential projects. This has resulted not solely in a rise in financing prices for the corporate however additionally adversely affected the development activity throughout the year. To add to its woes, the company’s auditors have additionally noted that because the 2G license matter is sub-judice, the consequential impact of the investment of Rs 912.86 crore in Unitech Wireless by Unitech can not be ascertained. As a result, the recover ability of Rs 301.38 crore short-term loan cannot be ascertained, that is additionally underneath litigation. As per auditors, advances against projects pending commencement have amounted to Rs 660.47 crore whereas advances for purchase of land have amounted to Rs 961.38 crore beneath short-term loans. It's been cited that a number of the advances are outstanding for a extended amount of time and also the recover ability or subsequent changes of identical can't be ascertained either. Unitech Group has said in its disclosure that these are a part of the traditional business and are thought-about smart for recovery in due course. Auditors have additionally cited that investment aggregating to Rs 61.86 crore and loans & advancements aggregating to Rs 65.09 crore have incurred losses and have negative net worth, though the management has convinced the auditors that within the future, it'll flip positive.