Godrej Construction to pay more emphasis

Godrej Construction to pay more emphasis on Infrastructure Development considering real estate slowdown

The increasing slowdown in demand and liquidity crisis in its mainstream real estate arm over the past 3 to 4 years has led the construction materials unit of Godrej Constructions to focus more on urban infrastructure development, according to a senior company official. Anup Mathew, business head and senior vice-president, Godrej Construction, added that the construction materials arm is the main business unit of Godrej & Boyce Mfg Co and is also looking forward to having 20% rise in revenue this financial year to Rs. 300 Cr. from Rs. 250 Cr last financial year.

He said, “We have spotted one of the most important things during the slowdown of the real estate sector. The government is paying more attention to urban infrastructure
these days. We are going to see more demands for construction materials in the near future with its increasing budget spending.” According to him, Godrej Construction has already got 3 packages from the Metro 4 corridor and order for Metro 3 corridor to supply the products like ready-mix concrete.

Godrej Construction has the widest range of construction materials on offers, such as ready-mix and specially engineered concrete materials, recycled concrete blocks, AAC blocks, and pavers for various applications. Due to uncertain payment terms by real estate developers, as they are also suffering from a liquidity crisis, the company has also controlled its supply run to them. Mathew says, “We were supplying recycled concrete supplies and RMC only to realty sector earlier. By witnessing the tough phase in the real estate sector over the past years, we have changed our strategy and we started to focus more on urban infra.” He explains, “Whether they plan to raise manufacturing capacity, we always want to be asset-light. We always want to have strategic partnerships to scale up whenever needed. We are also capable to set up new plants at project sites.” He further explains that a company prefers to focus on certain markets like Bengaluru, Mumbai, and Pune where it already has its manufacturing units.”

Mathew further explains that their revenue from construction supplies can also rise and take the revenue to a whopping Rs. 500 Cr in the next few years to come with the growth of the real estate sector. The company is also leasing commercial spaces and developing world-class living spaces.