EFC (I) — Q2 FY26 earnings call

Call held 12 Nov 2025

Management summary

EFC (I) Limited reported robust financial performance for Q2 and H1 FY26, driven by strong growth across all its integrated business verticals. Consolidated revenue and EBITDA saw significant year-on-year increases, with the Design & Build and Leasing segments leading the charge. The company continues to expand its managed office footprint, grow its order book in Design & Build, and leverage synergies from its Furniture segment, while also venturing into retail leasing.

Highlights

  • Consolidated revenue from operations reached ₹254.6 crores in Q2 FY26.

  • EBITDA for Q2 FY26 stood at ₹110.8 crores, marking a 40% year-on-year jump.

  • H1 FY26 revenue from operations grew by 76.6% year-over-year.

  • H1 FY26 EBITDA jumped by 69.4% year-over-year.

  • The Managed Offices (Leasing) segment's rental revenue grew by 61% year-over-year in H1 FY26.

  • The Design & Build segment achieved a turnover of ₹196 crores in H1 FY26, growing 74% year-on-year.

  • Total seats managed reached over 68,000, including 5,900 under development, across 3.23 million square feet.

  • The Furniture segment's H1 FY26 turnover crossed ₹26 crores.

Key financials

2 periods

Headline

  • Revenue from Operations
    ₹254.6 Cr
  • EBITDA
    ₹110.8 Cr
    YoY +40%

H1

  • FY26 Revenue Growth
    76.6%
  • FY26 EBITDA Growth
    69.4%

What they filed

Q1 FY27: revenue up 28.6%, net profit up 51.1% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue166 177 211 220 255 +54%270 +53%293 +39%283 +29%
EBITDA79 93 109 102 111 +41%112 +20%144 +32%123 +21%
Net profit37 40 48 47 57 +54%62 +55%69 +44%71 +51%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

  • Managed Offices (Leasing)
    68,241 seats Total Seats (Q2 FY26 end)5,900 seats Seats Under Development3.23 million sq ft Managed Area61% H1 FY26 Rental Growth9% Owned Properties (of AUM)
  • Design & Build
    ₹196 Cr H1 FY26 Turnover74% H1 FY26 Growth₹145 Cr New Order Book (Q2 FY26)₹450 Cr Total Order Book (FY26 YTD)
  • Furniture Manufacturing
    ₹26 Cr H1 FY26 Turnover

Guidance & targets

Capacity

  • Annual Seat Addition (Leasing) Capacity · annually · High confidence 20,000+ seats
    we are trying to add on an annual basis, about 20,000 seats plus to our portfolio.

    — Nikhil Bhuta, Whole-Time Director

  • Furniture Capacity Utilization Capacity · current financial year · Medium confidence 40-45%
    we are doing capacity utilization target is that this financial year, we should end at about achieving around 40%.

    — Nikhil Bhuta, Whole-Time Director

  • Furniture Capacity Utilization Capacity · next financial years · High confidence 70-80%
    we should achieve capacity utilization certainly of 70% to 80% in the next financial years.

    — Nikhil Bhuta, Whole-Time Director

Utilization

  • Occupancy Level (Leasing) Utilization · ongoing · High confidence 90%+
    what is important is that we kind of sustainably deploy them and get them occupied with 90% plus occupancy.

    — Nikhil Bhuta, Whole-Time Director

Revenue

  • Design & Build Growth Rate Revenue · next 2 years · High confidence 50-60%
    if we are able to achieve a growth rate of anything around 50% to 60%, that's what our target year-on-year is for next 2 years.

    — Nikhil Bhuta, Whole-Time Director

Profitability

  • Design & Build Sustainable Margins Profitability · ongoing · High confidence 25-26%
    So the sustainable margins are 25%, 26% in this business? Absolutely.

    — Nikhil Bhuta, Whole-Time Director

  • Furniture Margin at Optimal Capacity Profitability · at optimal capacity · High confidence 30%+
    we are confident that even at the current situation, we are we believe that we should be able to achieve anything around 30%-plus kind of margin in this business, sir, at an optimal capacity.

    — Nikhil Bhuta, Whole-Time Director

Market Share

  • Owned Property Portfolio (of AUM) Market Share · future · High confidence 20%

    Previously 9% → 20%

    one of the critical reasons for kind of better margin sustaining ability for us is that about right now, about 9% of my portfolio is under ownership, and that is what we are trying to achieve it to up to 20%.

    — Nikhil Bhuta, Whole-Time Director

Risks & concerns

  • Working capital stress in fast-growth phase for D&B and Furniture segments

    medium

    Design & Build and Furniture verticals are working capital-heavy, and the company is in the process of planning for working capital facilities to improve the cycle.

    Management acknowledged

Areas of evasion (3)

  • Specific H1 net profit number
  • Detailed cash flow reconciliation
  • Specific targets for new retail leasing venture

Q&A highlights

2 direct
Strategy for new retail leasing venture Direct
What we are getting into is basically tying up and partnering with large corporates who have kind of retail chains across India... helping them to kind of expand rapidly with our ability to not just lease, identify the right property for them because you understand for retail businesses, opening the right stores at the right location is very critical.

Clarifies that the company will partner with large retail chains, leveraging its integrated model, rather than managing malls or individual shops, which is crucial for understanding the business model and risk profile.

Asked by Sahil Sharma

Update on REIT structure Direct
We are really actively pursuing it, and we really see a lot of value in those structures. Yes, it has taken a little time. But why it has taken time is, as you know that as a company, we are very cognizant of the fact that we only get into opportunities where there is a substantial profitable and sustainable business is available.

Indicates that the REIT is still a strategic priority, but the company is taking a cautious, value-driven approach, suggesting it's not a rushed initiative.

Asked by Sahil Sharma

Cash flow and working capital management Partial
all my three of my businesses are very capex-light businesses in that sense... both Design & Build and the Furniture vertical, which now today, if you see, roughly contributes 50% of my total revenue, they are quite working capital-heavy businesses. And in the current circumstances, we don't have any working capital significant leverages, which we are already in process of planning.

Highlights a potential working capital strain in the fast-growing D&B and Furniture segments, which could impact operating cash flow, and indicates management is addressing it.

Asked by Vandit

3 min read 7 chapters

Detailed narrative

Strong Q2 & H1 FY26 Financial Performance

EFC (I) Limited delivered a robust performance in Q2 and H1 FY26. Consolidated revenue from operations for Q2 FY26 reached ₹254.6 crores, with EBITDA jumping 40% year-on-year to ₹110.8 crores. For the first half of FY26, revenue grew by an impressive 76.6% year-over-year, and EBITDA increased by 69.4% year-over-year. The company also reported that its net profit nearly doubled during H1 FY26, underscoring strong operational leverage.

Expansion in Managed Offices (Leasing) Segment

The Managed Offices segment continued its growth trajectory, with the total number of seats, including 5,900 under development, exceeding 68,000 by the end of Q2 FY26. The company currently manages 3.23 million square feet across 86 sites in 10 cities. Management aims to add over 20,000 seats annually and maintain a high occupancy rate of 90%+. Rental revenue for this segment grew by 61% year-over-year in H1 FY26, reflecting strong demand.

Momentum in Design & Build Vertical

The Design & Build segment demonstrated significant momentum, achieving a turnover of ₹196 crores in H1 FY26, representing a 74% year-on-year growth. The company secured new orders worth ₹145 crores in Q2, contributing to a total order book of over ₹450 crores for FY26 year-to-date. Management is confident in sustaining a 50-60% year-on-year growth rate for this vertical over the next two years, with sustainable margins targeted at 25-26%.

Furniture Manufacturing and Pepperfry Synergy

The Furniture manufacturing segment recorded a turnover exceeding ₹26 crores in H1 FY26. The company targets a capacity utilization of 40-45% for the current fiscal year, with plans to increase it to 70-80% in the next financial years, aiming for margins of over 30% at optimal capacity. The acquisition of Pepperfry is viewed as a strategic move to leverage its technology platform, providing EFC with pan-India access for its Ek Design products and enhancing cross-selling opportunities.

Strategic OpCo-PropCo Model and REIT Pursuit

EFC is actively implementing an OpCo-PropCo model to enhance its margin profile and asset base. Currently, 9% of its total AUM, approximately 270,000 square feet, is under direct ownership. The strategic goal is to increase this ownership to 20% of the AUM, which will reduce rental expenses and allow the company to benefit from property appreciation. The company is actively pursuing a REIT structure to further facilitate asset ownership and create a stable, profitable business model.

New Foray into Retail Leasing

In November 2025, EFC announced its entry into retail leasing, focusing on premium showroom and shop spaces in key commercial hubs across India. This new venture aims to partner with large corporates and retail chains, offering them capex-light solutions by leveraging EFC's integrated capabilities in property identification, design & build, and furniture provision. While specific financial targets for this segment are yet to be disclosed, the company expects to provide more details in the upcoming quarter.

Working Capital Management Focus

Management acknowledged that while the leasing vertical generates stable cash flow, the Design & Build and Furniture manufacturing segments are working capital-heavy. The company is actively planning to secure substantial working capital facilities from banks. This initiative aims to improve the working capital cycle and enhance overall operating cash flow, supporting the rapid growth across these verticals.

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