Max Ventures and Industries Limited
Max Ventures and Industries Limited

Max Ventures reports Rs 25 crore net profit in Q1

ANI | Updated: Aug 09, 2019 11:40 IST

Noida (Uttar Pradesh) [India] August 09 (ANI/NewsVoir): Max Ventures and Industries Limited (MaxVIL), a part of the USD 3.2 billion Max Group, operates across two core businesses of Real Estate in NCR and Speciality Packaging Films. MaxVIL has announced its results for the quarter ended 30th June 2019.
Highlights of Q1 FY20 Consolidated Financials

MaxVIL lease income commences in Real Estate and Packaging Films profitability rises as demand revives
* Rental income from flagship office project - Max Towers commenced from Q1 FY20
* Signed a pre-lease deal for Max House, Okhla with 'We Work'
* Successful partial exit in Nykaa (FSN - Ecommerce) at ~4x the invested amount in less than three year
* Speciality Films saw a revival in business as supply stabilizes. Further market improvement expected
"It has been a solid start to FY20 as it marks the commencement of our flagship office project-Max Towers. Our lease rentals are at 40 per cent premium to the immediate micro-market thus validating the superior building specifications and services as well as acceptance of the Max brand in the real estate space. The speed and quality of Max Towers delivery are providing a strong impetus to our growth prospects in the office development space. Our other office development Max House, Okhla which recently begun construction is expected to complete by the first quarter of FY 21", said Sahil Vachani, MD and CEO of MaxVIL.
"Q1 FY20 for speciality films business has seen rising demand, which has reduced oversupply in the industry. This has led to an improvement in realizations and margins for our packaging films business. We also achieved a better product mix which led to a higher contribution from value-added speciality films", he said.
"Our investments subsidiary Max I. partially exited Nykaa successfully, fetching a handsome return on our investment in a short period of time. We believe that FY20 will be a transformational year for MaxVIL with better visibility in all our businesses, stable rental cash flows from Max Towers, new projects in the real estate business and recovery in the speciality films business", he added.
Max Estates
* Rental income commences from Max Towers in Q1 FY20
* Leased about 26,276 sq. ft. in Max Towers in Q1 FY20 taking the total leased area to 1,11,000 sq. ft
* Max Estates entered into a share purchase agreement for acquiring 85.2 per cent stake in Pharmax Corporation Limited - which houses the Okhla development for Rs. 612 million, in addition to payment of preference share capital (Rs 150 Mn) along with accrued dividend (Rs 256 million). The transaction is subject to regulatory approval.
* Signed Letter of Intent with 'We Work' for leasing of entire built-up space of 1.05 lakhs sq. ft in Max House, Okhla.
Max Speciality Films

* Realisations and profitability were under pressure due to excess capacity getting installed in the industry in a short period of time during the last financial year which started to ease from Q4 FY19
* Q1 FY20 has further improved the demand-supply mismatch which has led to better margins as compared to the previous quarter
* In Q1 FY20 the speciality films contribution to volumes stood at 13 per cent. We continue to focus on improving the product mix with higher volumes from speciality film
* Opportunities around sustainability and recyclable structures with large consumer brands.
Max Investments
* Max I. had invested Rs 175 million for 2 per cent stake in FSN E-commerce Pvt Ltd, a multi-brand retailer under the name 'Nykaa'
* In FY18, Max I. sold 1 per cent stake at 100 per cent profit. Half of the residual stake has now been sold for Rs 250 million earning us 4x return on our investment in less than three years
* Going forward we will be the focus on making investments which complement our core businesses of Real Estate and Specialty Films
Max Estates is also in active discussions to acquire land parcels in Delhi NCR to develop office projects. It has signed a non-binding term sheet with Apollo Management Singapore Ltd to partner in the purchase and development of such projects in Delhi NCR. The company is also in active discussion to sell about one-fourth of Max Tower's leasable inventory.
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