Godrej Properties Limited — Q2 FY26 earnings call

Call held 6 Nov 2025

Management summary

Godrej Properties delivered a robust Q2 FY26, reporting its highest ever Q2 net profit of INR405 crores, a 21% YoY increase. Booking value surged 64% YoY to INR8,505 crores, driven by strong demand and new project launches, particularly in Hyderabad and Bangalore. While H1 booking value reached a record INR15,587 crores, collections growth lagged at 2% YoY, with management attributing this to milestone-linked payments and a heavy OC calendar in Q4. The company remains confident in achieving its annual booking and collection guidance, despite acknowledging challenges like NGT issues in NCR and the impact of accounting methods on reported profitability.

Highlights

  • Godrej Properties delivered its highest second quarter net profit of INR405 crores, representing a 21% year-on-year growth.

  • Booking value for Q2 FY26 surged 64% year-on-year and 20% quarter-on-quarter to INR8,505 crores, marking the ninth consecutive quarter of over INR5,000 crores sales.

  • Total income for the quarter grew by 39% to INR1,867 crores, while EBITDA increased by 118% to INR614 crores.

  • The company achieved 48% of its annual guidance for booking value (INR32,500 crores) in H1 FY26, remaining on track to beat the target.

  • Business development additions in H1 FY26 totaled 9 projects with an estimated saleable area of 15 million square feet and expected booking value of INR16,250 crores, achieving 81% of the annual BD guidance.

Concerns

  • Q2 collections grew only 2% year-on-year to INR4,066 crores, lagging booking growth and expected to be skewed towards Q4.

  • Profitability (PAT) is significantly impacted by accounting methods for fast-growing companies using the project completion method, with current reported numbers being 58% (compounded over 3 years) but affected by dislocations.

  • The Ashok Vihar project in NCR continues to face a 'tree cutting issue' with no immediate visibility on timelines for resolution.

Key financials

  1. Net Profit ₹405 Cr +21%YoY
  2. Booking Value ₹8,505 Cr +64%YoY
  3. Collections ₹4,066 Cr +2%YoY
  4. Total Income ₹1,867 Cr +39%YoY
  5. EBITDA ₹614 Cr +118%YoY

What they filed

Q1 FY27: revenue up 14.2%, net profit up 8.9% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue663 185 912 106 92 −86%268 +45%928 +2%121 +14%
EBITDA-40 -181 77 -263 -408 −920%-175 +3%-27 −135%-260 +1%
Net profit206 35 279 56 13 −94%60 +71%219 −22%61 +9%
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

₹8,505 Cr

as of 2025-09-30 quantified

64% YoY 20% QoQ

Inflow this quarter

₹8,505 Cr

Composition

Mix 9 geographies
  • Hyderabad (Godrej Regal Pavilion) ₹1,527 Cr 14.6%
  • Bangalore (Godrej MSR City) ₹1,032 Cr 9.9%
  • Bangalore (Godrej Tiara and another project) ₹877 Cr 8.4%
  • Golf Course Road (Godrej Sora) ₹633 Cr 6%
  • Indore (first project) ₹400 Cr 3.8%
  • Bangalore ₹1,500 Cr 14.3%
  • Mumbai ₹1,500 Cr 14.3%
  • NCR ₹1,500 Cr 14.3%
  • Hyderabad ₹1,500 Cr 14.3%

Share of order book by geography, derived from disclosed amounts

Pipeline

other

12 new projects in phase launch across eight cities with total sales potential over INR10,000 crores during the quarter. H1 FY26 business development additions of 9 projects with 15 MSF and expected booking value of INR16,250 crores.

Godrej Properties has delivered another robust quarter with strong booking value growth, driven by key new project launches. The company is on track to beat its annual booking value guidance and remains confident in its robust launch pipeline and resilient demand.

Source: Prepared remarks

Capital allocation

high confidence
  • Capex Capex disclosed
    • Construction spend
    we've seen good construction progress during Q2 as evidenced by the construction spend increasing rapidly and we're very confident of a strong end to the year for deliveries and collections.
  • Debt Debt disclosed
    • New borrowing Interest payments higher in Q2 due to NCDs, similar to Q2 last financial year.
    Yes. So, you will see increased outflow in Q2 because we have NCDs, the interest payments come around quarter two. If you see quarter two of last financial year, you will see a similar interest outflow happening.
  • M&A Four new projects Acquisition · Announced

    Business development additions to drive future sales.

    Estimated saleable area of 5.8 million square feet with expected booking value of just under INR5,000 crores.

    In terms of business development, we added four new projects with an estimated saleable area of 5.8 million square feet, an expected booking value of just under INR5,000 crores in the second quarter.
  • M&A Nine projects (H1 FY26) Acquisition · Announced

    Business development additions to drive future sales.

    Total estimated saleable area of 15 million square feet and expected booking value of INR16,250 crores.

    Taking our first half business development additions to nine projects with a total estimated saleable area of 15 million square feet and expected booking value of INR16,250 crores, thereby achieving about 81% of our annual guidance.
  • M&A Panipat acquisition Acquisition · Announced

    New project opportunity.

    Then we have Panipat acquisition we've done, that should open up.
  • M&A 7.5 acres of super prime land parcel in Golf Course Road Acquisition · Announced

    Strategic land for future launch.

    And then we have a 7.5 acres of super prime land parcel in Golf Course Road that we may choose to launch as and when we see its right.
  • M&A Plotted development in Doddaballapur Acquisition · Announced

    New launch opportunity in the South.

    Then we have a plotted development which we recently acquired in Doddaballapur in this last quarter, and actually we are aspirationally trying to launch it within this quarter.
  • M&A Land parcel in Baroda Acquisition · Announced

    New launch opportunity.

    We have bought a land parcel in Baroda just last quarter. We are aspirationally trying to push this as a launch within this quarter.
  • M&A Two lands in Upper Karadi Acquisition · Announced

    New launch opportunity.

    We bought two lands in Upper Karadi we should get one in this year.
  • Liquidity Liquidity disclosed Collections in Q2 were INR4,066 crores, and H1 collections were INR7,736 crores. The company is confident of achieving its full-year guidance of INR21,000 crores collections. Operating cash flow grew 62% compounded over three years.
    Collections in the second quarter grew 2% year-on-year and 11% quarter-on-quarter to INR4,066 crores. In the first half of financial year 26, collections grew 10% to INR7,736 crores. GPL achieved 37% of yearly guidance on collections, which does and we recognize sound a little bit low, but we are confident that we are fully on track to achieve our full year guidance of INR21,000 crores collections. operating cash flow is 62%.

Guidance & targets

Booking Value

  • Annual Booking Value Booking Value · FY26 · High confidence INR32,500 crores
    With this, Godrej Properties has now achieved 48% of its annual guidance for booking value and remains on track to beat its guidance of INR32,500 crores for the full financial year.

    — Pirojsha Godrej

Collections

  • Annual Collections Collections · FY26 · High confidence INR21,000 crores
    GPL achieved 37% of yearly guidance on collections, which does and we recognize sound a little bit low, but we are confident that we are fully on track to achieve our full year guidance of INR21,000 crores collections.

    — Pirojsha Godrej

Profitability

  • Return on Equity (ROE) Profitability · FY28 · High confidence 20%
    Which why after a lot of thoughtful consideration is when we put our neck out and gave you a 20% ROE indication for FY28.

    — Gaurav Pandey

  • Net Profit (PAT) Profitability · FY28 · High confidence INR4,000-4,500 crores
    Secondly, you're basically committing yourself to deliver INR4,000 crores, INR4.500 crores of PAT by FY '28.

    — Mohit Agrawal

Growth

  • Medium-term growth rate Growth · medium-term · Medium confidence 20%
    I think we've generally indicated we see a medium-term opportunity of 20% kind of growth rate.

    — Pirojsha Godrej

Business Development

  • Annual BD Additions Booking Value Business Development · FY26 · High confidence INR16,250 crores
    Taking our first half business development additions to nine projects with a total estimated saleable area of 15 million square feet and expected booking value of INR16,250 crores, thereby achieving about 81% of our annual guidance.

    — Pirojsha Godrej

Deliveries

  • Homes delivered in NCR Deliveries · next 6-9 months · High confidence 4,000 homes
    And this is a new strategy to give you a sense, next 6 to 9 months, we'll deliver about 4,000 homes in NCR alone.

    — Gaurav Pandey

Operating Cash Flow

  • Operating Cash Flow Operating Cash Flow · FY26 · Medium confidence INR6,500 to INR8,500 crores
    So, you know, it all, there's a lot of aspiration internally to speed it up. But if I were to give you a sense of min-max range, because I know what's going on in your mind, could be between INR6,500 to INR8,500.

    — Management

What to watch in Q3 FY26

Q4 FY26 Collections

next quarter (Q4 FY26)
Current H1 FY26 collections at INR7,736 crores (37% of annual guidance)
Target Achievement of INR21,000 crores annual collections guidance

Why it matters

Collections are a key cash flow indicator, and management expects a significant portion in Q4.

GPL achieved 37% of yearly guidance on collections, which does and we recognize sound a little bit low, but we are confident that we are fully on track to achieve our full year guidance of INR21,000 crores collections.

Risks & concerns

  • Collections skewed to Q4

    medium

    Collections growth lagged bookings, with a significant portion expected in Q4 due to milestone-linked payments and OC calendar.

    Analyst acknowledged

  • Profitability impacted by accounting methods

    medium

    Reported net profit is affected by the project completion accounting method for fast-growing companies, leading to dislocations.

    Management acknowledged

  • NGT issues in NCR causing construction delays

    medium

    NGT regulations have caused three months out of 12 months of construction delays in NCR.

    Management acknowledged

  • Ashok Vihar project (NCR) tree cutting issue

    medium

    The project faces an ongoing 'tree cutting issue' affecting NCR overall, with no immediate visibility on timelines for resolution.

    Management acknowledged

  • COVID-related project delays

    low

    Some projects launched before COVID lost about 6 months of construction time.

    Management acknowledged

  • High land prices in recent auctions

    low

    Recent auctions in Hyderabad and Navi Mumbai saw land prices exceeding INR2,000 crores, which seemed high.

    Management acknowledged

Q&A highlights

8 direct
Weak gross margin on P&L side Direct
So, Puneet, you know, we did not get too much OCs into this quarter. Whatever OCs we received were of JV project. So, like earlier explained, you know, JV project, we do lot of structuring. So, the reporting of those, you know, income keeps happening in those respective periods.

Analyst questioned the reported gross margin, which seemed unusually low, and management clarified it's due to the nature of JV project revenue recognition upon occupation certificate.

Asked by Puneet from HSBC Bank

Collections lagging despite strong sales, skewed to Q4 Direct
Not really. I mean, just to share with you typically as you would know that you know these are linked to different milestones, some of these are linked to terrace completion. Some of these are linked to slab, and some of it is also linked to OCs. So, what's really happening for us is that the sales that have happened, you know, say later part of the last year would have got into timely collections between then and last itself.

Analyst raised concern about collections not keeping pace with sales, and management explained it's due to milestone-based payments and a heavy OC calendar in Q4, supported by increased labor and construction spend.

Asked by Puneet from HSBC Bank

Discrepancy between construction cost and inventory increase Direct
Yes, Puneet, so in certain of our joint venture project, we have acquired the JV partner stake due to which their inventory, earlier inventory is now start getting consolidated in our consol account. That's why you can see the some jump in the inventory from March to 30th September.

Analyst noted a large gap between construction spend and inventory increase, which management attributed to the consolidation of JV project inventory after acquiring partner stakes.

Asked by Puneet from HSBC Bank

ROE target of 20% by FY28 and potential equity raise Direct
I think as of now, we certainly don't have any plans and I think it's highly unlikely that there would be any equity raise between now and then. So, yes, in that sense.

Analyst sought clarification on the ROE target and whether it assumes a capital raise, with management stating no plans for equity raise, providing confidence in organic growth.

Asked by Mohit Agrawal from IIFL

Worli project launch strategy, pricing, and structure change Direct
And I think in hindsight, there is such a massive upside we've seen from a market re-rating of the location and this entire coastal road is benefiting that micro market in such a big way that our top-line growth is humongous. And some of the area share that we've changed is largely to benefit our interest and get higher economic interest, because we're also trying to control specific units, specific floors, specific inventory, which is always easier to do when you do a sort of area share structure.

Analyst inquired about the highly anticipated Worli project, its pricing strategy (INR80k-1.5L/sqft), and the shift to a 73% area sharing model, which management explained is to maximize profit and control inventory.

Asked by Mohit Agrawal from IIFL

Market growth trajectory across key cities (Bangalore, Mumbai, NCR, Pune, Hyderabad) Direct
I think, the growth opportunity, in fact, we feel is very strong in each of these markets. I think we've hopefully demonstrated through the growth we've been able to deliver across markets in recent years... Bangalore, similarly, off to a very good start in the first half. And our most recent market...., Pune, of course, is another strong performing market where we've been the number one player over the last couple of years.

Analyst asked for management's outlook on growth in key markets, and management provided a positive assessment for all, highlighting Bangalore as best performing and Hyderabad as a strong new entry.

Asked by Parikshit Kandpal from HDFC Securities

Execution and profitability shortfall despite strong sales, potential delays Direct
Well, if you look at it, we have seen rapid growth across all metrics. We put actually a slide in our investor presentation this quarter that kind of shows the booking value collections, operating cash flow, deliveries and profit growth. Booking value, as you rightly said, has been very fast at 55% compounded, but it's not that these other metrics have not been growing fast.

Analyst questioned why collections, deliveries, and profitability were lagging sales, and management explained it's partly accounting-related, partly due to external factors like NGT and COVID, but emphasized significant improvements in execution capacity (labor strength, construction spend).

Asked by Parikshit Kandpal from HDFC Securities

Construction spend in H2 and FY26 Operating Cash Flow outlook Direct
So, you know, it all, there's a lot of aspiration internally to speed it up. But if I were to give you a sense of min-max range, because I know what's going on in your mind, could be between INR6,500 to INR8,500.

Analyst inquired about the expected construction spend in the second half and the full-year operating cash flow, with management providing a range of INR6,500-8,500 crores for OCF, indicating confidence in collections.

Asked by Kunal Lakhan from CLSA

3 min read 6 chapters

Detailed narrative

Robust Q2 FY26 Performance Driven by Strong Bookings

Godrej Properties reported its highest ever Q2 net profit of INR405 crores, a 21% year-on-year increase. The company's booking value for the quarter surged 64% YoY and 20% QoQ to INR8,505 crores, marking the ninth consecutive quarter of sales exceeding INR5,000 crores. Total income for Q2 FY26 grew 39% to INR1,867 crores, while EBITDA saw a significant 118% increase to INR614 crores. For the first half of FY26, booking value reached INR15,587 crores, the highest ever, achieving 48% of the annual guidance of INR32,500 crores.

Key Project Launches Fuel Sales Growth

Sales in Q2 FY26 were primarily driven by strong demand for several new project launches. Godrej Regal Pavilion in Hyderabad achieved INR1,527 crores in booking value, contributing to Hyderabad's total sales of INR2,600 crores for the current calendar year. In Bangalore, Godrej MSR City recorded INR1,032 crores, and Godrej Tiara along with another project contributed INR877 crores. The company's first project in Indore also saw robust returns with over INR400 crores in booking value.

Collections Lag Bookings, Skewed Towards Q4

Despite strong booking growth, collections in Q2 FY26 grew only 2% YoY and 11% QoQ to INR4,066 crores. H1 FY26 collections stood at INR7,736 crores, a 10% YoY increase. Management acknowledged that collections are currently low relative to bookings but expressed confidence in achieving the full-year guidance of INR21,000 crores. This skew is attributed to milestone-linked payments, particularly a heavy Occupation Certificate (OC) calendar expected in Q4, and rapid ramp-up in construction activity.

Strategic Business Development and Market Outlook

In H1 FY26, Godrej Properties added 9 new projects with an estimated saleable area of 15 million square feet and an expected booking value of INR16,250 crores, achieving 81% of its annual BD guidance. Management highlighted strong growth opportunities across all markets, with Bangalore currently being the best-performing. Hyderabad, a new entry, has shown significant potential with INR2,600 crores in sales this calendar year. The company also noted its strategy for the Worli project, aiming for profit maximization through gradual inventory release and pricing between INR80,000 to INR1.5 lakhs per square foot.

Execution and Profitability Challenges Addressed

Management addressed concerns regarding profitability, explaining that reported net profit is affected by accounting dislocations for fast-growing companies using the project completion method. However, execution has seen significant improvements, with labor strength increasing from 21,000 to 32,000 and construction spend growing 82% YoY in Q2. While external challenges like NGT issues in NCR and past COVID-related delays have impacted timelines, the company is confident in delivering 4,000 homes in NCR over the next 6-9 months and achieving its FY28 ROE target of 20% and PAT of INR4,000-4,500 crores.

FY26 Operating Cash Flow Guidance

For FY26, Godrej Properties provided an operating cash flow guidance range of INR6,500 to INR8,500 crores. This projection reflects the company's internal aspirations to speed up construction and capitalize on strong collections. Management emphasized that while there might be minor quarter-to-quarter fluctuations, the overall trend for operating cash flow growth should mirror sales growth in the long term, supported by increased billing milestones.

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