West Pioneer Properties Limited Trading Update (9161Z)

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RNS Number : 9161Z

West Pioneer Properties Limited

13 March 2013

 
 Press Release   13 March 2013 
 

West Pioneer Properties Limited

("West Pioneer" or "the Company")

Trading Update

West Pioneer Properties Limited (AIM:WPR), a leading developer and operator of shopping centres and mixed use developments in west and south India, today provides the following update on trading.

Retail

The repositioning of the Kalyan mall (the "Mall") from a value Mall to a leading value and lifestyle destination is progressing well. A key component of this exercise is the opening of a Shoppers Stop Department Store. Shoppers Stop is one of India's leading lifestyle department store operators. The fit-out of the store is nearing completion and is expected to open to customers in April 2013.

The ongoing fit-out process has caused disruption in the Mall and a short term decline in footfalls, both of which have had an impact on revenues. Revenues for the financial year ended 31 March 2013 are now expected to be around 7% below market expectations. Profits are expected to be slightly below market expectations. This is due to lower than expected finance costs. Finance costs have reduced as a result of a delay in the drawdown of debt to finance expenditure on Towers 3 and 4 until after the financial year end. The Company expects uplift in revenues once the Shoppers Stop Department Store is open.

Kalyan - Residential

This sector is growing steadily in terms of both volume and price. In established markets, developers are producing luxury developments with ultra modern amenities. As units are becoming more expensive in established markets, further projects are being launched in extended suburbs to meet the demand in middle and lower segments. The outlook of the residential sector remains positive with ample opportunities in various micro markets catering to different income levels.

Construction of Towers A and B is progressing well. Tower A is expected to be completed by the end of June 2013 whereas completion of Tower B is expected in November 2013. These identical towers with ground plus 23-storey structures were launched as premium apartments with a target segment of middle to higher middle income group in that market. All the apartments are of 2-bedroom-hall-kitchen type, adding up to an area of 375,000 sq. ft and of the total 356 available apartments, around 90% are pre-sold.

Designs and approvals for Towers C and D are at the final stage and the Company expects to ground break in April 2013. Towers C and D will be a larger development than that of Towers A and B and will have advanced features and amenities.

Kalyan - Commercial Plaza

Significant progress has been made in Phase III of the development, a commercial plaza ("Metro Plaza") of 68,000 sq. ft. of office space with the building structure nearing completion. Work is progressing well and the entire development is expected to be completed in the next few months. Metro Plaza will have small commercial units for leasing on the ground floor and units for sale on the first and second floors, with the target market being self-employed professionals such as doctors, lawyers and architects. The response to the development continues to be encouraging with 40% of the space pre-sold at an estimated 50% premium over current residential sale rates. This is in line with the Company's strategy to take advantage of opportunities where the maximum value can be generated.

-Ends-

For further information:

 
 West Pioneer Properties Limited 
 Nitin Dattani, Executive Director   Tel: [phone] 
                                                     0690 
 
 
 Shore Capital & Corporate Limited 
 Anita Ghanekar / Edward Mansfield   Tel: [phone] 
                                                     4090 
 

Media enquiries:

 
 Abchurch Communications 
 Sarah Hollins / Joanne Shears        Tel: [phone] 
                                                      7709 
 [e-mail]   www.abchurch-group.com 
 

Notes to Editors

West Pioneer Properties Limited (AIM:WPR) is a leading developer and operator of retail-led, mixed use developments in west and southern India, primarily in Tier II cities. West Pioneer was established to capitalise on the virtually unpenetrated organised retail environment in India, the rapidly increasing middle class, greater transparency in the property market, and improved infrastructure development which provides access to the market.

The retail side to West Pioneer acquires the land and then develops, leases and manages the shopping malls. The residential development segment develops and sells residential property. West Pioneer currently has three developments in Kalyan, Aurangabad and Nashik.

West Pioneer's first shopping mall, The Metro Centre, in Kalyan, 30 miles north-east of Mumbai is fully operational. Leasing at the mall stands at approximately 74 per cent, and the mall is operationally profitable and generating surplus cash. The residential development at Kalyan currently consists of two towers, which are under construction. Each tower consists of 178 apartments and as of 31 January 2011, a total of 267 apartments have been sold. The Company is nearing completion on the structure of Metro Plaza, the commercial office space development at Kalyan.

This information is provided by RNS

The company news service from the London Stock Exchange

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