Arvind SmartSpaces Limited — Q3 FY26 earnings call

Call held 11 Feb 2026

Management summary

Arvind SmartSpaces reported a quarter of strong bookings, collections, and operating cash flows, with 9M bookings and collections reaching all-time highs. While reported revenue and profitability metrics saw YoY declines, the company emphasized its robust business development pipeline, conservative leverage, and focus on sales velocity. Management also addressed leadership transition and acknowledged slower approvals in Bangalore, which impacted Q4 launch plans.

Highlights

  • 9M FY26 bookings reached highest ever at ₹938 crores, up 5% YoY, demonstrating strong sales momentum.

  • Q3 FY26 bookings grew significantly by 48% YoY to ₹331 crores, driven by continued traction in sustenance sales.

  • Collections remained robust, with 9M FY26 collections at a record ₹744 crores (up 2% YoY) and Q3 FY26 collections up 38% YoY to ₹317 crores.

  • Operating cash flows were exceptionally strong, with Q3 amounting to ₹169 crores (128% YoY growth) and 9M at ₹321 crores (16% YoY growth).

  • The company maintains a strong balance sheet with net debt of only ₹79 crores as of December 31, 2025, and a debt-to-equity ratio of 0.13.

  • New business development added ~₹2,510 crores in topline potential for 9M FY26, with a robust pipeline for future launches.

Concerns

  • 9M FY26 revenue declined 25.6% YoY to ₹409 crores from ₹550 crores in the prior year.

  • 9M FY26 EBITDA decreased 34.2% YoY to ₹100 crores from ₹152 crores in the prior year.

  • 9M FY26 PAT fell 39.2% YoY to ₹59 crores from ₹97 crores in the prior year.

  • Approvals in Bangalore have been slower than expected, impacting launch timelines for some projects.

Key financials

3 periods

Headline

  • Net Debt
    ₹79 Cr

Q3

  • Revenue
    ₹166 Cr
    YoY -21% QoQ +16%
  • EBITDA
    ₹44 Cr
    YoY -26.7% QoQ +30%
  • PAT
    ₹29 Cr
    YoY -42% QoQ +38%
  • Operating Cash Flow
    ₹169 Cr
    YoY +128%

9M

  • Revenue
    ₹409 Cr
    YoY -25.6%
  • EBITDA
    ₹100 Cr
    YoY -34.2%
  • PAT
    ₹59 Cr
    YoY -39.2%
  • Operating Cash Flow
    ₹321 Cr
    YoY +16%

What they filed

Q1 FY27: revenue up 211.8%, net profit up 708.3% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue266 210 163 102 141 −47%166 −21%155 −5%318 +212%
EBITDA66 59 34 21 30 −55%42 −29%59 +74%156 +643%
Net profit43 50 22 12 18 −58%29 −42%44 +100%97 +708%
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

₹938 Cr

as of 2025-12-31 quantified

5% YoY

Inflow this quarter

₹331 Cr

Execution

Most of the ~Rs. 10,000 crores inventory expected to start coming into the market within 18 months, with monetization over 4-5 years.

Pipeline

other

New business development topline potential for the year stands at ~Rs. 2,510 Cr, including two new projects in Bengaluru, and one each in Ahmedabad and Vadodara. Q4 launches planned for Baroda (Phase 1, ~Rs. 400 Cr), Orchards Phase 2 (~Rs. 100 Cr), Industrial Park (Phase 1, ~Rs. 600-650 Cr), and one Bangalore project.

The company reported strong bookings and collections, with a robust business development pipeline that includes significant launches planned for Q4 FY26 and a large inventory to be monetized over the next few years.

Source: Prepared remarks

Capital allocation

high confidence
  • Debt Net ₹79 Cr
    • New borrowing Loan drawdowns for outright purchases. ₹110 Cr
    Our balance sheet position remains very strong despite expanding operations, with a net debt Rs. 79 crore as on Dec 31, 2025.
  • M&A Vastrapur land Acquisition · Pending regulatory

    Added a residential high-rise project in Vastrapur, Ahmedabad with a top-line potential of ~Rs. 400 Cr and saleable area of 3.6 lakh sq. ft.

    Some payments need to continue for this locked land.

    So, Vastrapur is one land, I think, but we can give you the details offline if you want. So, Vastrapur is a land which we have already locked, some payments that we need to continue to make. So, that is one project. That's the only one.
  • M&A Nallurahalli, Whitefield, Bengaluru land Acquisition · Closed

    Added a premium residential high-rise project with a top-line potential of ~Rs. 550 Cr and saleable area of ~4.6 lakh sq. ft.

    Acquired on an outright basis.

    In Q3, we also added a premium residential high-rise project in Nallurahalli area of Whitefield, Bengaluru with a top-line potential of ~Rs. 550 Cr and saleable area of ~4.6 lakh sq. ft.
  • M&A Sarjapur, Bengaluru land Acquisition · Closed

    Added a premium residential high-rise project with a top-line potential of ~Rs. 860 Cr and saleable area of ~6.8 lakh sq. ft.

    Acquired on an outright basis.

    Very recently in Jan 2026, we added a premium residential high-rise project in Sarjapur, Bengaluru with a top-line potential of ~Rs. 860 Cr and saleable area of ~6.8 lakh sq. ft.
  • Liquidity Liquidity disclosed Operating cash flows were robust, with Q3 at ₹169 crores (128% YoY growth) and 9M at ₹321 crores (16% YoY growth). Unrealized operating cash flow from current pipeline exceeds ₹4,581 crores, expected to realize within 4-5 years.
    Operating cash flows during the quarter and nine-month period remained robust, underscoring the strength of our business model, the quality of our project portfolio and execution. I would like to highlight that quarterly operating cash flows were the highest ever. Operating cash flows in Q3 amounted to Rs. 169 crore, a 128% YoY growth and for 9M it amounted to Rs. 321 crore, a 16% YoY growth. We estimate an unrealized operating cash flow exceeding Rs. 4,581 crore coming from the current pipeline of projects. This is expected to realise within 4-5 years.

Guidance & targets

Sales

  • Annual Sales Sales · FY26 · High confidence ₹1600-1700 crores
    So just on sales, we are maintaining our guidance, which like you said was about Rs. 1600-1700 crores, largely because I said we have different asset classes and we are also getting our industrial project which is going to come in.

    — Priyansh Kapoor

  • Sustenance Sales Run Rate Sales · ongoing · High confidence ₹200 crores
    So, if you see last quarter, we did almost Rs. 280 crores which came from sustenance excluding the Everland spillover of the launch volume. So, we are actually doing quite well on the sustenance number and I think going forward, we have a reasonable chance that we can maintain this Rs. 200 crores kind of guidance on the sustenance number.

    — Priyansh Kapoor

Business Development

  • BD GDV Business Development · FY26 · High confidence ₹3500-4000 crores
    Coming to the BD, so we have done a GDV of about Rs. 2510 crores and last time we mentioned that we are aiming for about close to about Rs. 3500 crores to Rs. 4000 crores in terms of our BD guidance. We remain on track.

    — Priyansh Kapoor

Pre-sales Growth

  • Pre-sales Growth Rate Pre-sales Growth · next 3-4 years · High confidence 25-30%
    So, Dhananjay, like we say, we have guided for the next 3-4 years that this is the kind of run rate we want to maintain over the next 4 years, about at 25%-30%.

    — Priyansh Kapoor

Leverage

  • Debt-to-Equity Ratio Leverage · ongoing · High confidence below 1:1
    We are at 0.13 and when we have internally drawn up our plans, we are quite clear that we want to keep this debt equity below 1:1.

    — Priyansh Kapoor

Profitability

  • EBITDA Margin Profitability · average portfolio · High confidence 22-25%
    So, our average margin that we target EBITDA margin is between the range of 22% to 25% because the project what we have done recently are on outright basis.

    — Priyansh Kapoor

  • IRR Profitability · historical deals · High confidence 25%
    On IRR basis also, we are actually looking at similar returns. So, we continue to clock 25% IRR which is what we were also saying for our historical deals.

    — Priyansh Kapoor

Launches

  • Q4 Launch GDV Launches · Q4 FY26 · High confidence ₹1500-1600 crores
    So, close to about Rs. 1500-1600 crores of GDV, because like I said, we are launching part of the industrial and part of the Baroda project. So, about Rs. 1500-1600 crores from these four projects that we are bringing in.

    — Priyansh Kapoor

Pre-sales

  • Q4 Pre-sales Pre-sales · Q4 FY26 · High confidence ₹700-750 crores
    To be close to our guidance what we need to do close to about Rs. 700 crores to 750 crores odd what we have to do in the current quarter.

    — Priyansh Kapoor

What to watch in Q4 FY26

Bangalore Project Launch

By end of current financial year (FY26)
Current One project expected by FY end, approvals slower than expected.
Target Launch of at least one Bangalore project.

Why it matters

Bangalore is a key growth market, and successful launches indicate overcoming approval hurdles and execution capability.

So, we are hoping one of those will actually come to the market by the end of the current financial year.

Risks & concerns

  • Bangalore Approval Delays

    medium

    Regulatory changes and streamlining processes in Bangalore have slowed approvals, impacting launch timelines for projects in the region.

    Analyst acknowledged

  • Broader Market Slowdown

    medium

    The market is not showing 'euphoric growth' as in the previous financial year, with volumes potentially flat, though values are still growing. Company believes its diversification mitigates this.

    Analyst acknowledged

  • Regulatory Approval Ambiguity for Launches

    medium

    While the company is confident in its project pipeline, the exact launch dates are difficult to pinpoint due to inherent uncertainties in regulatory approval processes.

    Management acknowledged

Q&A highlights

7 direct
Q4 Launch GDV and Sales at Launch Proportion Direct
So, the total inventory that we will be launching in Quarter 4, if I am not wrong, will be around Rs. 1500 crores. Am I right? ... See generally, if you see all our guidance and all our project underwriting, we do that 30%-40% in the launch. That is what we do. Fortunately, we have been selling a lot more than that but today I would say I think we should look at what is the general underwriting norms in the market that is about 40%-50%.

Clarifies the scale of upcoming launches and realistic sales expectations for new projects, contrasting with a recent high-performing launch.

Asked by Eesha

Industry Slowdown and Bangalore Approval Delays Direct
So, on overall slowdown, I think, yes, when we are also looking at, I would say, secondary data, yes, we do believe I think the markets are not showing further euphoric growth from the base of the last financial year. ... Approvals in Bangalore, yes, we have actually been slower than expected. ... So, we expect to start seeing momentum now over the next coming months on the approval front as well.

Acknowledges broader market slowdown and specific regulatory hurdles in a key market (Bangalore), providing context for launch timelines.

Asked by Shreyans Mehta

Reduction in Q4 Launch Guidance Partial
So, we were actually aiming for about Rs. 2500 crore for the year, you are right, actually, and we had done only Rs.500 crore. So, it meant that we should have at least launched about Rs. 2000 crore of inventory in the last quarter. One reason, like I said, is in Bangalore, out of the two projects that we were thinking that we will get in the current year, we are going to probably get one of those, that's our current best estimate on the approval front. Second, we had also mentioned earlier that the industrial project may come in parts, and Baroda also, we are launching in phases.

Explains the reasons for the revised Q4 launch target, primarily due to Bangalore approval delays and phase-wise project launches, impacting the overall annual launch plan.

Asked by Varun Julasaria

EBITDA Margins and Land Cost Structures for New BD Projects Direct
So, our average margin that we target EBITDA margin is between the range of 22% to 25% because the project what we have done recently are on outright basis. So, the margin might be slightly more than 25%. But I would say at the portfolio level still because we have JD projects also in the pipeline. So, I would say considering that average of 22% to 25% will probably be more appropriate... On IRR basis also, we are actually looking at similar returns. So, we continue to clock 25% IRR which is what we were also saying for our historical deals.

Provides specific profitability targets (EBITDA margin and IRR) for new business development, differentiating between outright purchases and JD projects.

Asked by Ronald Siyoni

Execution Improvement and Collections Velocity Direct
That's a good question and like Kamal Bhai also mentioned, we have been focusing a lot on strengthening teams. So, over the last few quarters, and we mentioned in the last call, we had a new COO coming on board. ... Second thing which also helped the collections is also that the proportion of our sustenance sales has been slightly higher and sustenance typically allows you more billing opportunity because as you know, the project would have been launched in the past and billing percentages are higher.

Explains the drivers behind improved collections and construction velocity, attributing it to team strengthening and increased sustenance sales.

Asked by Ronald Siyoni

Leverage Parameters (Net Debt to Equity) Direct
So, Ronald, on the debt equity front while today we are actually still very low. So, we are not seeing any worry or any concern on that front. We are at 0.13 and when we have internally drawn up our plans, we are quite clear that we want to keep this debt equity below 1:1.

Reassures investors about the company's conservative leverage policy and current low debt-to-equity ratio, despite ongoing expansion.

Asked by Ronald Siyoni

Impact of New Labor Codes Direct
So, right now, as you know, the labour codes got implemented from November onwards. So, we have done an assessment on our side, and we have taken a provision of Rs. 2.59 crores in our numbers for quarter ending December. ... And the impact of this on our P&L is about 1.5% for the quarter.

Provides a specific, quantified financial impact of recent regulatory changes (new labor codes) on the company's P&L for the quarter.

Asked by Akshay Shetty

Strategy for Selling During Market Slowdown Direct
We have always, as you know, been a very cash flow focused company. We believe in velocity, our mantra is velocity. We are not the variety to bank land and wait for market and prices to inch up. That has never been the DNA of this company. It has always been IRR and cash flow. So, if you are in any cycle, we will always look to having velocity of cash flow over looking at banking and just protecting value of the land bank. That is not the way we think.

Clarifies the company's core strategy of prioritizing sales velocity and cash flow over holding land for price appreciation, especially relevant during potential market slowdowns.

Asked by Amit Agicha

3 min read 7 chapters

Detailed narrative

Q3 & 9M FY26 Performance Highlights

Arvind SmartSpaces reported its highest ever 9M bookings of ₹938 crores, a 5% YoY increase, and Q3 bookings of ₹331 crores, up 48% YoY. Collections also reached record highs, with 9M collections at ₹744 crores (up 2% YoY) and Q3 collections at ₹317 crores (up 38% YoY). Despite these strong operational metrics, 9M revenue declined 25.6% YoY to ₹409 crores, and 9M PAT fell 39.2% YoY to ₹59 crores. However, Q3 revenue grew 16% QoQ to ₹166 crores, and Q3 PAT increased 38% QoQ to ₹29 crores.

Leadership Transition

Kamal Singal is stepping down as Managing Director to take on a broader Group-level role as Whole-Time Director, Strategy and Investments. Priyansh Kapoor will succeed him as the new Managing Director. This transition is part of the company's strategic initiatives to strengthen the organization and enhance leadership depth, with a focus on scaling the company further.

Business Development & Launch Pipeline

The company added ~₹2,510 crores in new business development topline potential during 9M FY26, including projects in Ahmedabad and Bengaluru. For Q4 FY26, launches are planned for Baroda (Phase 1, ~₹400 crores), Orchards Phase 2 (~₹100 crores), an Industrial Park (Phase 1, ~₹600-650 crores), and one project in Bangalore, totaling ~₹1500-1600 crores GDV. The overall pipeline of upcoming inventory is approximately ₹10,000 crores, with most expected to come to market within 18 months and monetized over 4-5 years.

Financial Position & Cash Flows

Arvind SmartSpaces maintains a strong balance sheet with net debt of only ₹79 crores as of December 31, 2025, and a debt-to-equity ratio of 0.13, well below the internal target of 1:1. Operating cash flows were exceptionally strong, with Q3 reaching ₹169 crores (128% YoY growth) and 9M at ₹321 crores (16% YoY growth). The company estimates an unrealized operating cash flow exceeding ₹4,581 crores from its current project pipeline, expected to be realized within 4-5 years.

Market Outlook & Strategy

Management acknowledges a broader market slowdown with less 'euphoric growth' and potentially flat volumes, but notes that values are still growing. The company's strategy focuses on diversification across three markets (Gujarat, Mumbai, Bangalore) and asset classes (vertical and plotted development). It prioritizes sales velocity and cash flow generation over banking land for price appreciation, aiming for an average EBITDA margin of 22-25% and an IRR of 25% on new projects.

Operational Efficiency & Team Building

The company attributes improved execution momentum and collections velocity to strengthening its teams and focusing on sustenance sales. The addition of new senior members, including a new COO, has brought increased energy and effort into scaling up construction spends and improving project management. Sustenance sales, which allow for higher billing percentages, have become a meaningful contributor to overall bookings and cash flows.

Impact of New Labor Codes

The new labor codes, implemented from November, had a financial impact on the company. A provision of ₹2.59 crores was made in Q3 FY26, representing approximately 1.5% of the P&L for the quarter. The company is monitoring the situation and implementing guidelines as they crystallize further.

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