Renews focus on mid-market and mid-market premium segments
Mission to double sales, triple income and quadruple profits in 3 years
New brand identity to transform and elevate brand image
BENGALURU, August 21, 2024: Shriram Properties (SPL), one of South India’s leading real estate developers, has unveiled a brand transformation initiative, as part of its ambitious growth strategy.
New Brand Identity
The Company has entered its 25th year of operations in 2024-25, and as part of the celebration, SPL has embarked on a new brand identity today. The effort is aimed at asserting its own identity as a mature corporate having earned the reputation over 25 years of operations, while benefiting from the visionary oversight of its parent – the “Shriram Group”. This new identity aims to transform the perception of Shriram among customers while elevating its brand and reputation towards better customer delight in the future.
Speaking on the occasion, Mr. Murali Malayappan, Chairman & Managing Director of Shriram Properties Limited, said: “We are embarking on a mission with a brand-new identity, as we enter 25th year of our operations. It will allow us to create our own identity and elevate and re-position the trusted Shriram brand among NextGen buyers.”
Mr. Murali further added “while embracing change, our dedication to customers, quality & design, industry-leading construction standards, and enhancing customer satisfaction will continue. We will leverage technology for enhanced customer delight going forward. We envision SPL as a dominant force, not only in south India but across our key markets.”
SPLNxT: Embracing the New Era
In a simultaneous move, SPL has embarked on a mission – called, SPLNxT – towards accelerating growth, repositioning brand and enhanced focus on the mid-market segments.
Thrust on Mid-Market and Mid-Premium Segments
As part of its mission, the Company aims to enhance its focus on the mid-market and mid-premium segments of the residential real estate markets in Bengaluru, Chennai and Kolkata, as well as Pune that it plans to enter soon. The Company aims to achieve leadership in this segment over the next decade and be one of the most valued, most trusted and most preferred mid-segment real estate brand in India.
The mid-market residential segments have expanded remarkably in recent years. Mid-segments accounted for 59% of housing demand in India in 2023, against 49% during pre-covid. In SPL’s core markets of Bangalore and Chennai, mid-segments accounted for ~75% of demand in 2023, against pre-covid levels of 60% and 52% respectively. In Kolkata, it stood at 64% and 48% respectively.
The Company’s renewed thrust on mid-segments reflects changing the market dynamics and evolving customer needs. The mid-segments have shown strong resilience and accelerated growth in recent years, thus presenting significant opportunities for large-branded players like SHRIRAM. Historically, the Company had strong presence in the mid-segments, that accounted for 67% of its completed and ongoing portfolio, with the rest coming from affordable and other products segments.
Accelerating Growth
Under SPLNxT, the Company aims to double its sales, triple its revenue, and quadruple its profits over the next 3 years. The Company is targeting cumulative sales of over 20 msf[1], predominantly focused on Bengaluru, Chennai and Pune. Kolkata will remain a key contributor. SPL will leverage its time-tested operating platform for accelerated sales and expedited execution. To support such aggressive growth, the Company is targeting to accelerate new project addition in core markets of Bangalore, Chennai and Pune and intends to more than double its new project inventory. Currently, SPL has a project pipeline of 42 projects with 42 msf development potential. Of this, 24 msf is ongoing and the remaining 18 msf of development potential vests in future projects. SPL is targeting to double this future project inventory in 18-24 months.
The Company is confident of success in its mission, on the backdrop of impressive ramp-up of its size, scale and profitability in last 5-7 years. Since the introduction of RERA, in the last 7 years, SPL has achieved a remarkable scale expansion, with its sales volume growing 3.5x to 4.6 msf and sales value growing 5x to Rs. 2,362 crores and annual handovers jumping 4x to over 3,000 units in FY24. The Company’s project execution trends have improved significantly to 3-4 msf now. Also, SPL has successfully scripted a financial turnaround, since the initial public offering. The Company’s ROCE[2] has risen from 3% in FY18 to 11% in FY24, placing SPL in the top quartile of industry returns.
Outlook
SPL remains committed to its growth trajectory, focusing on leveraging its strong operational platform for future profitability. SPL’s project pipeline is robust, and with targeted accelerated new project addition, the Company will be well positioned to reap benefits of the positive industry outlook and attain leadership in the mid-segments, our renewed focus area.
Relentless pursuit of excellence in our operations while ensuring enhanced customer delight will support our journey forward. We are confident of success in our new mission – SPLNxT – and resultant creation of significant value of our stakeholders.
[1] msf – Million Square Feet
[2] ROCE – Return on Capital Employed
