The agency has reaffirmed the company’s short-term rating at '[ICRA] A1+’.

ICRA stated that the rating upgrade factors in the steady increase in MDL’s pre-sales and collections, which is expected to sustain in the coming years, thereby translating into an improvement in cash flow from operations (CFO) and comfortable leverage metrics.

ICRA notes that over the medium to long term, the share of the warehousing and retail segments in cash flows is likely to improve, providing stability to the overall cash flows from operations.

The ratings positively factor in the management’s guidance to maintain healthy cash surplus/liquidity cushion, which, along with the expected increase in the share of rental inflows from the warehouse and retail segments, will mitigate some impact of the cyclicality in the residential segment.

The ratings note MDL’s strong leadership position in the Mumbai and Thane residential real estate markets as well as the Group’s established track record of over four decades, underpinned by more than 100-plus million square feet of deliveries till March 2025.

The ratings factor in the execution and market risks resulting from the large expansion plans with a pipeline of over 85 million square feet for future project launches including offices, retail and warehousing as of March 2025. The timely launch of these projects, along with healthy sales and collection momentum, would be critical for improving the operational cash flow generation.

Nonetheless, ICRA takes comfort from MDL’s established track record of project execution and strong brand presence, which aid sales velocity.

While the company is making conscious steps towards diversifying its geographical footprint, the share of Mumbai Metropolitan Region (MMR) is likely to remain high (60-70%) in the medium term. The company is also exposed to the cyclicality in the residential real estate market.

Macrotech Developers is one of the largest real estate developers in India with a market leader position in Mumbai and Thane. MDL is focused on residential development in the MMR, with presence in Pune and Bengaluru. As of March 2025, it developed 100-plus million square feet of space with nearly 35 million square feet of ongoing developable area and approximately 85 million square feet of planned launches. The company has one of the largest land banks in the country, totalling over 4,080 acres as of March 2025.