Ashiana Housing

Ashiana Housing reported a mixed financial performance for Q2 FY26. Revenue stood at INR 176.18 crores, a notable decrease from INR 302.72 crores in Q1 FY26, primarily due to lower deliveries. However, PAT saw a significant increase to INR 27.54 crores in Q2 FY26, up from INR 12.72 crores in Q1 FY26, driven by a favorable mix of higher-margin projects. The company maintained strong financial health, generating INR 122.62 crores in pre-tax operating cash flow during the quarter, supported by robust collections.

The value of area booked in Q2 FY26 was INR 303.43 crores, a sequential decline from INR 430.97 crores in Q1 FY26. Despite this, management reiterated an overall revenue potential visibility of INR 11,000 crores up to FY30, encompassing launched, sold, and unsold projects. Key upcoming launches, Ashiana Amaya (INR 300 crores potential) and Ashiana Aaroham (INR 1,500-1,800 crores potential), are expected to commence bookings in Q4 FY26, with expression of interest starting in Q3.

Ashiana Housing is aggressively prioritizing the senior living segment for capital allocation, viewing it as a significant future growth driver. The company acquired 22.7 acres in Chennai for a new senior living project, which has an estimated sales value potential of INR 1,200 crores. Management highlighted the segment's strong market response, ability to command pricing premiums, and flexibility in land acquisition in less competitive locations, contrasting it with the challenges faced in general housing due to high land prices.

The company projects a significant improvement in profitability, targeting low double-digit net profit margins (10-11%) for FY26. This is expected to further improve to mid-to-high teens by FY28. This margin expansion is anticipated to be driven by a strategic shift towards higher-margin projects, more favorable land cost structures in newer developments, and improved deal terms compared to older projects that had higher revenue share commitments.

The launch of Ashiana Aaroham, a crucial project, experienced delays from FY25 to H2 FY26 due to approval issues related to building bylaws and town planning interpretations, though RERA approval is now imminent. Furthermore, previously announced land acquisitions in Jaipur, Panvel, and Bangalore are still pending as condition precedents have not been met. Management expects these acquisitions to either conclude within the next 2-3 quarters or the company will withdraw from the transactions.

Management described the Gurugram market as no longer a 'secular sales market,' noting increased fragmentation among channel partners and a demand split based on product quality and brand. While sales velocity for Amarah Phase 4 & 5 was slower due to higher pricing, the company sold 47,000 sq ft in Q2 FY26 and expects a positive outlook for the upcoming Aaroham project. The company aims to differentiate its kid-centric projects further, similar to its success in senior living.

Ashiana Housing has set a presales target of INR 2,000 crores for FY26 and plans to deliver 24 lakh square feet of constructed area within the year. Management expressed confidence in the organizational capacity to handle these delivery volumes, citing prior successful experiences and robust internal processes for delivering operationally ready buildings while maintaining high customer satisfaction.

The company successfully settled a long-pending dispute related to a development agreement for Project Maitri in Kolkata, receiving INR 18.5 crores as full and final settlement. This resolution contributed approximately INR 3 crores to the PAT in Q2 FY26. However, Ashiana is also currently contesting a class action suit filed by 226 customers in Ashiana Town, seeking INR50 crores in compensation.