Eldeco Housing And Industries Limited — Q1 FY26 earnings call

Call held 13 Aug 2025

Management summary

Eldeco Housing reported a strong Q1 FY26 with booking value up 274% YoY to Rs.221 crores and collections up 41% YoY to Rs.78 crores, driven by successful new project launches like Hanging Gardens and Skywalk. While construction expenditure and EBITDA margins were lower this quarter due to project mix and front-ended expenses, management expects significant ramp-up and margin recovery in coming quarters, especially with the launch of their flagship Solano Garden project and revenue recognition from Imperia Phase II. The company also addressed issues with the Bareilly project and minor cancellations in other projects.

Highlights

  • Booking value in Q1 FY26 stood at Rs.221 crores, a 274% year-on-year increase, driven by successful new project launches.

  • Collections reached Rs.78 crores in Q1 FY26, marking a 41% growth year-on-year.

  • Eldeco Hanging Gardens and Skywalk received RERA registration and were successfully launched, with Hanging Gardens selling 84% of inventory within a week.

  • The company plans to launch its flagship integrated township, Eldeco Solano Garden, in FY26 with a gross development value over Rs.1,000 crores.

  • Average realizations have increased to Rs.6,500 per square foot, a sustainable rate reflecting a nearly 30-40% increase over the last two years.

Concerns

  • Q1 FY26 construction expenditure of Rs.39.3 crores, while up 10% YoY, was not as strong as prior quarters and needs to ramp up.

  • EBITDA margin for Q1 FY26 was low at 17.6% due to project mix (low-income housing) and front-ending of marketing expenses for new launches.

  • Bookings for Latitude 27 and Imperia Phase II saw some cancellations, leading to a temporary reduction in booked area value.

  • The Bareilly project faced delays and land issues, requiring an 'unwinding' of the transaction in the next couple of quarters.

Key financials

  1. Booking Value ₹221 Cr +274%YoY
  2. Collections ₹78 Cr +41%YoY
  3. Construction Expenditure ₹39.3 Cr +10%YoY
  4. Deliveries (Sq Ft) 85,000 square feet
  5. Deliveries (Homes) 101 homes
  6. Average Realization ₹6,500/sq ft
  7. EBITDA Margin 17.6%

What they filed

Q1 FY27: revenue up 69.0%, net profit up 400.0% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue33 35 37 29 33 +0%43 +23%60 +62%49 +69%
EBITDA5 6 6 3 3 −40%18 +200%7 +17%17 +467%
Net profit5 6 3 3 3 −40%14 +133%5 +67%15 +400%
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

₹221 Cr

as of 2025-06-30 quantified

274% YoY

Inflow this quarter

₹221 Cr

Execution

Bookings for Hanging Gardens, Skywalk, Latitude 27 to be executed in the next three years.

Pipeline

other

Flagship integrated township Eldeco Solano Garden, 50 acres, plots, villas, multi-storied apartments.

Cancellations & deferrals

  • cancelled: Some units in Latitude 27 and Imperia Phase II were cancelled due to defaulters, temporarily reducing booked area value.
Strong sales performance underscoring positive market response to new launches and continued execution strength across projects, with a sharp increase in booking and healthy collections.

Source: Prepared remarks

Capital allocation

medium confidence
  • Capex ₹39.3 Cr
    Construction expenditure stood at Rs.39.3 crores, up 10% year-on-year, reflecting the continued progress across ongoing projects.
  • M&A Land Bank for Forthcoming Projects Acquisition · Pending regulatory

    Land aggregation is time-consuming but historically good for higher EBITDA margins.

    35 acres already under planning across three different locations, under further aggregation.

    There is a disclosure on land aggregation. If you see the slide on forthcoming projects, bottom half of the slide does talk about land bank for forthcoming projects under planning. Aggregate of which is about 35 acres already. And these are in the three different locations and they are under further aggregation.

Guidance & targets

Capex

  • Construction Expenditure Capex · by end of the year · Medium confidence Rs.50-60 crores per quarter
    So, this 30% should be increasing gradually every quarter. So, I think it should stabilize at about Rs.50-60 crores by the end of the year.

    — Pankaj Bajaj

Margin

  • EBITDA Margin Margin · coming quarters · High confidence 30-40%
    Going forward, it should reverse to its mean of about 30% or probably even 40%.

    — Pankaj Bajaj

Launch Pipeline

  • Eldeco Solano Garden GDV Launch Pipeline · FY26 · High confidence over Rs.1,000 crores
    Looking ahead, we plan to launch our flagship integrated township, Eldeco Solano Garden on New Jail road during FY26, which is the current year. Spread over 50 acres, it will offer plots, villas, and multi-storied apartments and it has a gross development value of over Rs.1,000 crores.

    — Pankaj Bajaj

  • Eldeco Solano Garden First Phase GDV Launch Pipeline · within this financial year · High confidence 300-400 crores
    First phase is going to be the plots and Villas. The GDV there will be about 300-400 crores. That we expect to do within this financial year.

    — Pankaj Bajaj

Revenue

  • Revenue Recognition from Imperia Phase II Revenue · Q3 and Q4 FY26 · High confidence significant revenue recognition
    Imperia Phase-II, we are going to be applying for completion certificate in another couple of months... So, all that revenue should get recognized in FY26 itself; so, it is Q3 and Q4 of this year.

    — Pankaj Bajaj

  • Overall Revenue Recognition Revenue · FY27 onwards · Medium confidence looking very good
    FY27 onwards, the numbers should start looking very good.

    — Pankaj Bajaj

What to watch in Q2 FY26

Construction Expenditure Ramp-up

By end of FY26
Current Rs.39.3 crores in Q1 FY26
Target Stabilize at Rs.50-60 crores per quarter

Why it matters

Indicates execution progress on newly launched projects and future revenue recognition, crucial for operational efficiency.

Construction expenditure stood at Rs.39.3 crores, up 10% year-on-year... We expect this number to rise significantly in the coming quarter... it should stabilize at about Rs.50-60 crores by the end of the year.

Risks & concerns

  • Bareilly Project Issues and Unwinding

    medium

    The Bareilly project faced land issues and delays, leading to a decision to unwind the transaction, expected in the next couple of quarters, with a minimum guaranteed return.

    Both acknowledged

  • Temporary EBITDA Margin Compression

    low

    Q1 FY26 EBITDA margin was 17.6% due to revenue recognition from lower-margin projects and front-ending of marketing expenses for new launches, but is expected to recover to 30-40%.

    Both acknowledged

  • Project-Specific Sales Sluggishness/Cancellations

    low

    Trinity sales have been sluggish (relaunch planned), Latitude 27 bookings slowed due to cannibalization by Skywalk, and routine cancellations for defaulters temporarily reduce booked area value.

    Both acknowledged

Q&A highlights

7 direct
Sustainability of average realizations (Rs.6,500/sq ft) Direct
I think this is a sustainable, stable rate kind of realization. You would have seen in the presentation that this is a sharp rise from what it used to be two or three years ago. So, it used to be Rs.3,500 in FY20. By FY23, it went to Rs.4,500 and now it is Rs.6,500. So, the last two years, there has been a nearly 30% to 40% increase in the average realization. So, I think this is the new normal and I would not expect it to be much higher than this in the coming year also.

Clarifies management's confidence in current pricing levels and their sustainability, indicating strong market demand.

Asked by Aryan Singh

Drivers behind strong growth in booking value Direct
So, the demand as we have been saying in all our previous calls, has been quite strong. First, I think for about five years ago, we struggled with adding to our launch pipeline. Then, we took some time getting the approvals. So, we had been quite transparent with our struggles on that front. Luckily, we unlocked all that in the last year or so. And then, the RERA approvals finally came through this quarter. And there was a lot of pent-up demand for Eldeco products and obviously, we have a strong brand recognition in the market and our execution is well-trusted by the market.

Explains the fundamental reasons for recent sales success, highlighting pent-up demand, brand strength, and the resolution of past approval bottlenecks.

Asked by Aryan Singh

Construction progress and guidance for the year Direct
I am glad you asked that question... the last three years, there was a bottleneck in terms of launches, which has now got unlocked. So, you see that in our last year's booking numbers, this year's booking numbers and construction and execution follows with a lag... I expect the construction and execution numbers to ramp up significantly because the projects have got launched and they will have to be now built.

Addresses concerns about the relatively low construction spend, explaining the lag between bookings and execution and forecasting a significant ramp-up.

Asked by Karan P. Gupta

Status of other projects (Trinity, Latitude 27, Bareilly) Partial
So, Trinity definitely, the sales have been sluggish for the last few quarters... we plan to kind of relaunch the project in next quarter or so... Latitude 27 is pretty good actually... it is at sustenance stage. So, we have already sold out 65% or 70%... Bareilly, I believe we will be unwinding that transaction soon.

Provides updates on specific projects, revealing challenges with Trinity, steady progress with Latitude 27, and the decision to exit the Bareilly project.

Asked by Karan P. Gupta

Reduction in booked area value for Latitude 27 and Imperia Phase II Direct
So, some cancellations do happen, if there are some chronic defaulters, you press them for payment. And they do not pay up. So, it is a routine thing that they do. We end up cancelling them and temporarily your value of area booked goes down. But correspondingly, your area left for sale increases.

Clarifies that reductions in booked area value are due to routine cancellations for defaulters, not a broader sales issue, and that the unsold inventory increases accordingly.

Asked by Runit Kapoor

EBITDA margin compression in Q1 FY26 Direct
It was because of the mix of projects which got recognized for revenue. It was largely low income housing and EWS units that we are statutorily required to build. So, some of the revenue recognition is with respect to that. The other thing which happened was that we did two big launches - Skywalk and Hanging Gardens. And the way we do our accounting, we treat the marketing expenses for new launches as period costs. So, they have got booked in this quarter.

Explains the temporary nature of the margin compression, attributing it to the mix of projects recognized and front-loaded marketing expenses for new launches.

Asked by Runit Kapoor

Bareilly project issues and resolution Direct
So, we made some investments there and the project took longer than it was supposed to. And there were also some land issues which erupted later on which we tried to manage along the way... we are protected in terms of a minimum guarantee which Eldeco infrastructure has given that come what may, EHIL is going to have a minimum return of a certain percentage... we are in talks with the company in Bareilly for the unwinding of this transaction. We expect it to happen in the next couple of quarters.

Provides a detailed explanation of the challenges faced with the Bareilly project and the planned resolution, including the expectation of recovering investment with a minimum return.

Asked by Suhash

Land aggregation strategy and its impact on margins Direct
There is a disclosure on land aggregation. If you see the slide on forthcoming projects, bottom half of the slide does talk about land bank for forthcoming projects under planning. Aggregate of which is about 35 acres already. And these are in the three different locations and they are under further aggregation... But it has to be done and we have been historically good at it and that is partly the reason why our EBITDA margins tend to be much higher than the industry.

Highlights the ongoing importance of land aggregation for future project pipeline and its direct contribution to the company's superior EBITDA margins.

Asked by Manan Patel

3 min read 7 chapters

Detailed narrative

Strong Booking Value and Collections Drive Q1 FY26 Performance

Eldeco Housing reported a robust Q1 FY26 with booking value soaring to Rs.221 crores, marking a significant 274% year-on-year increase, driven by successful new project launches. Collections also demonstrated healthy momentum, growing 41% year-on-year to Rs.78 crores, indicating strong cash flow generation from ongoing projects. Deliveries for the quarter comprised 101 homes, totaling 85,000 square feet, primarily EWS and smaller homes.

Successful New Project Launches and Pipeline Expansion

The quarter saw the successful RERA registration and launch of Eldeco Hanging Gardens and Eldeco Skywalk, both receiving strong market responses, with Hanging Gardens selling 84% of its inventory within a week. Looking ahead, the company plans to launch its flagship integrated township, Eldeco Solano Garden, in FY26. This project, spread over 50 acres, is expected to have a gross development value exceeding Rs.1,000 crores, with its first phase (plots and villas) targeting Rs.300-400 crores GDV within the current financial year.

Construction Expenditure and Revenue Recognition Lag

Construction expenditure in Q1 FY26 stood at Rs.39.3 crores, a 10% year-on-year increase, but management acknowledged it was not as strong as prior quarters. They anticipate a significant ramp-up in coming quarters, expecting it to stabilize at Rs.50-60 crores per quarter by year-end, as execution begins on recently launched projects. Revenue recognition, which follows project completion, is expected to see a substantial boost in Q3 and Q4 FY26, particularly from Imperia Phase II, with overall numbers looking 'very good' from FY27 onwards.

EBITDA Margin Compression and Expected Recovery

The EBITDA margin for Q1 FY26 was reported at 17.6%, lower than historical averages. Management attributed this to a mix of revenue recognition from lower-margin EWS and low-income housing units, coupled with the front-ending of marketing expenses for new launches like Hanging Gardens and Skywalk, which are treated as period costs. They expect the EBITDA margin to revert to its mean of 30-40% in subsequent quarters as higher-margin projects contribute to revenue.

Project-Specific Updates and Challenges

Sales for the Trinity project have been sluggish, prompting a planned relaunch in the next quarter. Latitude 27 bookings saw a temporary slowdown due to cannibalization from the newer, slightly lower-priced Skywalk project within Eldeco City, though Latitude 27 is 65-70% sold. The company is in the process of 'unwinding' the Bareilly project transaction in the next couple of quarters due to land issues and delays, but expects to recover its principal with a minimum guaranteed return.

Sustainable Realizations and Lucknow Market Share

Average realizations have stabilized at Rs.6,500 per square foot, a significant increase from Rs.3,500 in FY20, which management considers sustainable and the 'new normal'. In the Lucknow market, Eldeco estimates its market share to be less than 10% of the approximately Rs.5,000 crores annual sales, but sees significant opportunity for expansion as supply constraints ease and their launch pipeline grows, aiming to be among the top two or three players.

Ongoing Land Aggregation Strategy

Eldeco continues its land aggregation efforts, with approximately 35 acres already under planning across three different locations and under further aggregation. This strategy is crucial for maintaining a robust launch pipeline and is cited as a key factor contributing to the company's historically higher EBITDA margins compared to the industry average. Management expects further progress on this front in the coming quarters.

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