Arkade Developers Limited — Q2 FY26 earnings call

Call held 16 Oct 2025

Management summary

Arkade Developers reported a strong Q2 FY26 with revenue growing 30.54% YoY to ₹265 crores and PAT increasing 58.62% QoQ to ₹46 crores. The company achieved pre-sales of ₹331 crores and collections of ₹320 crores. Strategic land acquisitions, including a ₹148 crore deal for 14,363 sq m, are bolstering future growth, though no new project launches are planned for FY26, and H1 FY26 operating cash flow was negative ₹483 crores due to land acquisitions.

Highlights

  • Revenue grew 30.54% YoY to ₹265 crores in Q2 FY26.

  • EBITDA grew 85.29% QoQ to ₹63 crores in Q2 FY26, with margin expanding to 24%.

  • PAT grew 58.62% QoQ to ₹46 crores in Q2 FY26, achieving a 17.3% PAT margin.

  • Achieved pre-sales of ₹331 crores and collections of ₹320 crores in Q2 FY26.

  • Acquired 100% shareholding in Woolen and Textile Industries Limited for ₹148 crores, adding 14,363 sq m land with potential GDV of ₹1,000 crores.

  • Ready-to-move-in OC-received projects (Arkade Aspire, Crown, Prime, Aura) are completely sold out.

Concerns

  • H1 FY26 EBITDA declined 2.97% YoY to ₹98 crores.

  • H1 FY26 PAT grew only 1.35% YoY to ₹75 crores.

  • No new project launches expected in FY26.

  • Operating cash flow for H1 FY26 was negative ₹483 crores, primarily due to land acquisitions.

Key financials

  1. Revenue ₹265 Cr +30.5%YoY
  2. EBITDA ₹63 Cr +6.8%YoY
  3. EBITDA Margin 24%
  4. PAT ₹46 Cr +7%YoY
  5. PAT Margin 17.3%
  6. Pre-sales ₹331 Cr
  7. Collections ₹320 Cr +7%YoY

What they filed

Q1 FY27: revenue down 7.5%, net profit down 34.5% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue202 225 131 159 264 +31%197 −12%197 +50%147 −8%
EBITDA59 61 44 34 63 +7%54 −11%38 −14%28 −18%
Net profit43 50 33 29 46 +7%40 −20%-110 −433%19 −34%
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.

Order book

high confidence

Total value

₹331 Cr

as of 2025-09-30 quantified

Inflow this quarter

₹331 Cr

Pipeline

other

6-7 project launches in FY27 with potential sale of Rs. 8,000 crores plus.

Pre-sales for Q2 FY26 were ₹331 crores, with 1.1 lakh square feet sold, up 4% YoY. Collections were ₹320 crores, up 7% YoY. The company has a strong launch pipeline for FY27 with potential sales exceeding ₹8,000 crores.

Source: Prepared remarks

Capital allocation

high confidence
  • Debt Debt disclosed
    So on operational front, our operating cash flow for first half is about, which as per the financial statement what we have submitted is negative Rs. 483 crores. But it includes the land bought by us during last 6 months. So you can say Rs. 550 crores of land we have bought during last 6 months. So this is about positive Rs. 50 crores, operational cash flow.
  • M&A Woolen and Textile Industries Limited Acquisition · Signed · Consideration ₹[object Object] (undisclosed)

    Strengthening footprint in MMR's central corridors, value-driven development in prime micro-markets, unlocking full potential of key land parcels.

    Includes a land parcel of 14,363 sq m, with a potential GDV of Rs. 1,000 crores.

    Further strengthening our footprint in MMR's central corridors, we recently entered into a share purchase agreement to acquire 100% shareholding in Woolen and Textile Industries Limited, Bhandup West. This transaction valued at Rs. 148 crores, includes a land parcel of 14,363 sq m, with a potential GDV of Rs. 1,000 crores, and marks our second acquisition in Bhandup.
  • Liquidity Liquidity disclosed Operating cash flow for H1 FY26 was negative ₹483 crores, but positive ₹50 crores excluding land acquisitions of ₹550 crores.
    So on operational front, our operating cash flow for first half is about, which as per the financial statement what we have submitted is negative Rs. 483 crores. But it includes the land bought by us during last 6 months. So you can say Rs. 550 crores of land we have bought during last 6 months. So this is about positive Rs. 50 crores, operational cash flow.

Guidance & targets

Revenue

  • Revenue Growth Revenue · year-on-year · Medium confidence 20%
    Darshil, so we don't give the guidance for the pre-sales as such, but we believe in growing by 20% year-on-year.

    — Samshet Shetye

Profitability

  • PAT Margin Profitability · full year · Medium confidence 20%
    So we are optimistic about it. We are hopeful to reach the target.

    — Samshet Shetye

Launches

  • Number of Project Launches Launches · FY27 · High confidence 6-7
    And all our launches are scheduled for the next financial year that is 2026-27, we are looking at 6-7 launches.

    — Amit Jain

  • Potential Sale Value from Launches Launches · FY27 · High confidence ₹8,000 crores plus
    7 project launches combined having a potential sale of Rs. 8,000 crores plus.

    — Amit Jain

Project Mix

  • Greenfield vs. Redevelopment Topline Distribution Project Mix · long term · Medium confidence 50%
    But in the long term, the pipeline that we have is having a fine balance of around 50% topline for Greenfield and redevelopment.

    — Amit Jain

What to watch in Q3 FY26

H2 FY26 Profitability Improvement

next quarter (Q3 FY26 results)
Current H1 FY26 EBITDA ₹98 cr (-2.97% YoY), PAT ₹75 cr (+1.35% YoY)
Target Improved YoY growth in H2 FY26 EBITDA and PAT

Why it matters

To confirm management's expectation of improved profitability and cash flows driven by festive season and construction progress.

We should see a better second half of this year. The figures already make the second half. What we have started seeing in October, the festive season, are much better than what it was in the first half. And also, all our ongoing projects are now at visible stage of construction because of which the interest of the buyer has increased and the sales velocity has gone up. And effectively, the cash flows also have improved. So by the end of the year, when we consolidate and we look at the annual figures, they should be better on a year-on-year basis.

Risks & concerns

  • Negative operating cash flow due to land acquisitions

    medium

    H1 FY26 operating cash flow was negative ₹483 crores, but management clarified it was due to ₹550 crores in land acquisitions, with operational cash flow being positive ₹50 crores excluding these.

    Analyst acknowledged

  • Flat profitability (EBITDA/PAT) in H1 despite topline growth

    medium

    H1 FY26 EBITDA declined 2.97% YoY and PAT grew only 1.35% YoY; management expects better H2 performance due to festive season and increased sales velocity from visible construction.

    Analyst acknowledged

  • No new project launches in FY26

    low

    No new launches are planned for FY26, with sales expected to come from ongoing projects, but a strong pipeline of 6-7 launches is scheduled for FY27.

    Analyst acknowledged

Q&A highlights

8 direct
Launch pipeline for balance FY26 and H1 FY27 Direct
So this year, we are going to complete 2 projects, 2 of the ongoing projects in this financial year are going to see completion. One is Arkade Pearl at Vile Parle and second is Arkade Eden at Malad. And all our launches are scheduled for the next financial year that is 2026-27, we are looking at 6-7 launches. In the first half of the next year, we are launching a project in Santacruz, one project in Bangurnagar and one project in Malad West Liberty Gardens. Three projects are certain to be launched in the first half of the next year. Remaining 3-4 projects should be launched in the second half of the next financial year.

Clarifies the company's near-term launch strategy and provides specific details on the upcoming project pipeline for FY27.

Asked by Dhananjay Mishra

Source of sales for FY26 given no new launches Direct
This year, we are looking at targeting to complete ongoing projects.

Explains how the company plans to generate sales and revenue in the current fiscal year without new project launches.

Asked by Dhananjay Mishra

Operating cash flow and total investment for H1 FY26 Direct
So on operational front, our operating cash flow for first half is about, which as per the financial statement what we have submitted is negative Rs. 483 crores. But it includes the land bought by us during last 6 months. So you can say Rs. 550 crores of land we have bought during last 6 months. So this is about positive Rs. 50 crores, operational cash flow.

Provides critical details on the company's cash flow position, explaining the impact of significant land acquisitions on the reported negative operating cash flow.

Asked by Dhananjay Mishra

Outlook for FY27 and achieving 20% PAT margin target Direct
So we don't give the guidance for the pre-sales as such, but we believe in growing by 20% year-on-year. ... So we are optimistic about it. We are hopeful to reach the target.

Confirms the company's revenue growth target of 20% YoY and expresses confidence in achieving the 20% PAT margin target for the full year.

Asked by Darshil Jhaveri

Cumulative value of FY27 project launches Direct
7 project launches combined having a potential sale of Rs. 8,000 crores plus.

Quantifies the significant potential sales value from the upcoming 6-7 project launches in the next fiscal year, providing visibility into future revenue.

Asked by Darshil Jhaveri

Concerns about market glut in MMR due to redevelopment projects Direct
So the location of all our projects is very premium and in mature markets where the demand is always more than the supply options available. Also, one of the biggest project launches next year that we have is of a land parcel project and not redevelopment project, which is a very rarest of rare projects available in terms of land parcel projects. So that cannot be compared with the other ongoing redevelopment projects. And it will have its own demand because of being a land project.

Addresses concerns about market saturation by highlighting the premium nature and unique positioning of Arkade's projects, particularly a rare land parcel development.

Asked by Darshil Jhaveri

Inventory and debt rising, signaling liquidity stress Direct
So Jayshree, I can see that there is no increase in inventory as such because as of 31st March, my inventory was Rs. 906 crores and as of September also it is Rs. 906 crores. The second question what you are asking about this rise in the borrowing, we have acquired about Rs. 550 crores of land in last 6 months. We have paid about Rs. 360 crores for the Goregaon land and for Thane land we paid Rs. 175 crores. With that Rs. 550 crores of acquisition, our debt has risen by hardly Rs. 50 crores compared to last year, compared to March, 2025. So there is not much increase as such.

Clarifies the company's stable inventory levels and minimal increase in debt despite significant land acquisitions, refuting concerns about liquidity stress.

Asked by Jayshree Bajaj

Flat profitability (EBITDA, PAT) in H1 despite topline growth Direct
We should see a better second half of this year. The figures already make the second half. What we have started seeing in October, the festive season, are much better than what it was in the first half. And also, all our ongoing projects are now at visible stage of construction because of which the interest of the buyer has increased and the sales velocity has gone up. And effectively, the cash flows also have improved. So by the end of the year, when we consolidate and we look at the annual figures, they should be better on a year-on-year basis.

Addresses analyst concerns regarding flat profitability in H1 by outlining factors expected to drive improved performance in H2, including festive season demand and construction progress.

Asked by Harshit Sachdeva

2 min read 6 chapters

Detailed narrative

Q2 FY26 Financial Performance Overview

Arkade Developers reported a robust Q2 FY26, with revenue reaching ₹265 crores, marking a 30.54% year-on-year growth from ₹203 crores in Q2 FY25, and a 60.6% quarter-on-quarter increase. EBITDA for the quarter stood at ₹63 crores, an 85.29% QoQ rise, with the EBITDA margin expanding to 24%. Profit after tax (PAT) also saw significant growth, reaching ₹46 crores, up 58.62% QoQ, and achieving a PAT margin of 17.3%.

H1 FY26 Financial Performance and Outlook

For the first half of FY26, the company recorded a revenue of ₹430 crores, a 30.69% YoY increase. However, H1 EBITDA experienced a slight decline of 2.97% YoY to ₹98 crores, and PAT grew modestly by 1.35% YoY to ₹75 crores. Management expressed optimism for a stronger second half, anticipating improved profitability and cash flows driven by the festive season and increased sales velocity from ongoing projects reaching visible construction stages.

Operational Highlights and Sales Performance

In Q2 FY26, Arkade achieved pre-sales of ₹331 crores, with 1.1 lakh square feet of area sold, representing a 4% year-on-year increase. Collections for the quarter amounted to ₹320 crores, growing 7% YoY. The company highlighted that its ready-to-move-in OC-received projects, including Arkade Aspire, Crown, Prime, and Aura, are completely sold out, underscoring strong market confidence and delivery track record.

Strategic Land Acquisitions and Future Pipeline

Arkade Developers significantly bolstered its pipeline in H1 FY26 by adding ₹6,300 crores in Gross Development Value (GDV). This includes the acquisition of 100% shareholding in Woolen and Textile Industries Limited for ₹148 crores, which brings a 14,363 sq m land parcel in Bhandup West with a potential GDV of ₹1,000 crores. The company plans 6-7 new project launches in FY27, with a combined potential sale value exceeding ₹8,000 crores, including a rare land parcel project.

Debt and Liquidity Management

Despite deploying ₹550 crores on land acquisitions in the last six months (₹360 crores for Goregaon and ₹175 crores for Thane), the company's debt increased by only ₹50 crores compared to March 2025, with inventory remaining stable at ₹906 crores. While H1 FY26 operating cash flow was negative ₹483 crores, management clarified that this was primarily due to the land purchases, and operational cash flow, excluding these acquisitions, was positive ₹50 crores.

Market Outlook and Project Strategy

The company adheres to an 'execution-first' philosophy, focusing on timely project delivery and efficient revenue recognition. Management addressed concerns about potential market glut in the MMR region by emphasizing the premium locations of its projects and the unique nature of upcoming land parcel developments. They believe these factors ensure sustained demand, differentiating Arkade's offerings from other redevelopment projects in mature micro-markets.

This is an AI-generated summary of a publicly available earnings call transcript.
View original transcript

More Realty earnings calls