NBCC Reports 16% Decline in Q2 Net Profit
New Delhi-based NBCC (India) Ltd witnessed a 16% decrease in its consolidated net profit for the second quarter of the fiscal year 2023-24, amounting to Rs 81.90 crore. This decline can be attributed to provisioning for expected losses in a housing project located in Gurugram. In the corresponding period of the previous fiscal year, NBCC had reported a net profit of Rs 97.72 crore.
Revenue Growth
Despite the decline in net profit, NBCC reported a growth in total income during the July-September period of 2023-24. The total income rose to Rs 2,129.09 crore, up from Rs 2073.89 crore in the same period last year, as stated in the regulatory filing by the company.
Business Segments and Revenue Sources
NBCC primarily derives its revenue from the Project Management Consultancy (PMC) segment and redevelopment works, which accounted for 93.22% of its business revenue on a consolidated basis. Additionally, the company is engaged in real estate development activities.
Provisioning and Exception Items
The decline in NBCC’s profit during the September quarter can be attributed to an exceptional item related to provisioning for losses amounting to Rs 65.39 crore. This provisioning was made against the expected loss arising from the sale of flats/units in the residential real estate project ‘NBCC Green View’, Sector – 37 D, Gurugram.
Remedial Measures and Settlement Plans
Following structural issues in the project, NBCC evacuated the buildings with the assistance of the District Administration under the Disaster Management Act. Subsequently, the company’s board approved a settlement plan to buy back flats/units from homebuyers/allottees. Despite initial buyback offers, NBCC decided to reconsider the settlement plan in its board meeting held on August 18, 2023.
Commitment to Consumer Redressal
NBCC has demonstrated its commitment to consumer redressal by submitting its willingness to refund the entire amount received from complainants, along with simple interest, to the National Consumer Disputes Redressal Commission (NCRDC) on October 6, 2023. This reflects the company’s efforts to address the concerns of homebuyers and ensure a fair resolution to the ongoing issue.
