India- Unitech...

Unitech Ltd., India's most valuable listed real-estate firm, said on
Monday its quarterly profit rose more than 10 fold as it sold more
properties and expanded to new markets.

Unitech is diversifying from residential projects into hotels and
malls, and said it would invest $2 billion in building 28 new hotels
and 7 malls.

Managing Director Sanjay Chandra told reporters the company, which had
an EBITDA margin of 62 percent in 2006/07, was hopeful of maintaining
margin growth in the financial year that began on April 1.

"Margins will be sustainable. They could expand a little," Chandra said.

Indian property developers have had robust growth as an economy
growing at over 9 percent a year fuels demand for shopping centres,
offices and homes.

"We were selling seven or eight projects rather than one or two
projects in our earlier days," Chandra said.

Unitech, which has a market value of almost $11 billion, said net
profit for the January-March quarter rose to 3.57 billion rupees from
0.35 billion a year ago.

Unitech shares closed 8.9 percent higher at 595.90 rupees in a Mumbai
market that rose 0.4 percent.

Net sales quadrupled to 8.49 billion rupees from 2.08 billion in the
corresponding quarter last year.

For the full year 2006/07, the company reported a net profit of 13.05
billion rupees on sales of 33.88 billion.

The company's board also approved an issue of one bonus share for each
share held.

Unitech competes with DLF Ltd. and a host of other real estate
developers. DLF is planning a public issue that could raise up to $2.4
billion, and would surpass Unitech as India's largest listed real
estate firm.

After a boom that saw prices double in major cities over the past two
years, many analysts think a combination of higher interest rates and
oversupply in some centres could lead to a price slide of as much as
40 percent.

"India's real estate market is in pain," Citigroup said in a report this month.

"Transaction volumes are drying up, higher interest rates and prices
have damaged affordability, developers are suffering regulatory and
capital markets squeeze, supply is impending."

Citigroup has "sell" recommendations on a number of real estate firms,
including Unitech and Parsvnath Developers Ltd.

But Chandra said the company expected growth in demand, mainly driven
by new markets like Chennai, Hyderabad and Kolkata.

"We will do well," he said. "The end user demand is huge."