HORIZONIND — Q1 FY27 earnings call

Call held 11 Sep 2026

Management summary

Horizon Industrial Parks reported a robust Q1 FY27 with strong revenue and EBITDA growth, driven by significant leasing activity. The company successfully completed its IPO, substantially deleveraging its balance sheet and positioning itself for accelerated growth across its large format parks, in-city logistics, and value-added services. Despite a reported net loss, underlying cash profitability remains strong, and management expects to turn profitable by Q2/Q3 FY27.

Highlights

  • Strong revenue growth of 23% YoY to ₹200 crores in Q1 FY27.

  • EBITDA grew 36% YoY to ₹161 crores, with a healthy EBITDA margin maintained at 80%.

  • Successful IPO raised ₹4,250 crores, leading to a significant deleveraging with net debt reduced to ₹2,500 crores (12.5% of enterprise value).

  • Leased 1.9 million square feet across 13 transactions, onboarding 9 new customers and adding ₹65 crores to contracted revenue.

  • Contracted revenue run rate reached nearly ₹970 crores as of end June, indicating strong future visibility.

Concerns

  • Reported a net loss of ₹12 crores for the quarter, though management clarified this is due to non-cash depreciation and interest, with proforma cash PAT at ₹116 crores.

  • Ongoing Delhi High Court case challenging the tender for 13 in-city warehouses, which management is confident about but remains sub judice.

Key financials

  1. Revenue ₹200 Cr +23%YoY
  2. EBITDA ₹161 Cr +36%YoY
  3. EBITDA Margin 80%
  4. Net Loss ₹-12 Cr
  5. Proforma Cash PAT ₹116 Cr
  6. Contracted Revenue Run Rate ₹970 Cr

What they filed

₹ Cr · quarterly
Line itemQ1 FY26Q4 FY26Q1 FY27
Revenue31 40 42
EBITDA-1 -1 10
Net profit-12 54 63
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

29.5 million sq ft

as of 2026-06-30 quantified

Inflow this quarter

1.9 million sq ft

Composition

  • Industrial Customers (client type) 1.425 million sq ft 75%

Pipeline

other

Land bank of 30 million sq ft for further development, 2.4 million sq ft pre-leased, 1.6 million sq ft stock-in-trade, 6.5 million sq ft leasing target for FY27, 6 million sq ft completion target for FY27, 6 million sq ft in-city development over 3 years.

Cancellations & deferrals

  • re leased: 300,000 sq ft expired and re-leased in Q1 FY27 at 12% spread. 1.4 million sq ft coming up for expiries in next 9 months. 2.2 million sq ft in next fiscal. Total ~4 million sq ft over next 21 months.
The company has a strong development pipeline across large format parks and in-city assets, supported by a fully-paid land bank and healthy pre-leasing activity, ensuring continued operational growth and revenue expansion.

Source: Prepared remarks

Capital allocation

high confidence
  • Capex Capex disclosed 1/3 internal accruals and 2/3 incremental debt
    Our capex requirements over the next 3 years are more or less in the INR1,500 crores to INR2,000 crores zip code, which we look to roughly manage 1/3 internally and 2/3 with incremental debt.
  • Debt Net ₹2,500 Cr Cost 8.2%
    • Repayment Deployed IPO proceeds for deleveraging ₹3,900 Cr
    Post this deleveraging, we expect our credit ratings to significantly improve, and thereby, we expect to bring the cost down anything between 40 basis points to 50 basis point.
  • Liquidity Liquidity disclosed Raised INR4,250 crores of fresh primary capital through IPO, leading to a substantially stronger balance sheet and ample financial flexibility.
    In August, we successfully completed our IPO and raised INR4,250 crores of fresh primary capital. The proceeds have been deployed for deleveraging, which brings our net debt down to INR2,500 crores, proforma as of end-June or 12.5% of enterprise value. More importantly, the IPO fundamentally changes Horizon's growth profile. Today, we operate with a substantially stronger balance sheet, access to capital markets, and ample financial flexibility to pursue growth opportunities while maintaining financial prudence.

Guidance & targets

Leasing

  • Square feet leasing Leasing · FY27 · High confidence 6.5 million square feet
    On the development side, we are on track to deliver 6.5 million square feet leasing for FY27, which will translate nearly to about a 30% growth compared to the last fiscal.

    — Urvish Rambhia, CEO

Completion

  • Square feet completion Completion · this fiscal (FY27) · High confidence 6 million square feet
    This quarter, we delivered 1 million square feet and are on track to achieve our 6 million square feet completion target for this fiscal.

    — Urvish Rambhia, CEO

Operational Area

  • Total operational area Operational Area · this fiscal (FY27) · High confidence nearly 35 million square feet
    This will enhance our operational area to nearly 35 million square feet.

    — Urvish Rambhia, CEO

In-city Development

  • First delivery location and timing In-city Development · this fiscal (FY27) · High confidence Pune by the fourth quarter
    On the in-city as well, our development is also progressing very, very well, and we are on track to achieve our first delivery in Pune by the fourth quarter of this fiscal.

    — Urvish Rambhia, CEO

  • In-city square feet delivery In-city Development · next 3 years · High confidence 6 million square feet
    3, the rapid expansion that we are seeing in our in-city strategy. This will deliver 6 million square feet over the next 3 years.

    — Urvish Rambhia, CEO

Operational Capacity

  • Big format parks operational capacity Operational Capacity · next 4 to 5 years · High confidence double
    2, the continued development expansion of our big format parks. This will double our operational capacities over the next 4 to 5 years.

    — Urvish Rambhia, CEO

Revenue

  • Value-added services contribution to revenue Revenue · next 5 years · Medium confidence 5% to 10%
    This will deliver nearly 5% to 10% of our revenues in the next 5 years.

    — Urvish Rambhia, CEO

Debt

  • Cost of debt reduction Debt · post deleveraging · High confidence 40 basis points to 50 basis point
    Post this deleveraging, we expect our credit ratings to significantly improve, and thereby, we expect to bring the cost down anything between 40 basis points to 50 basis point.

    — Kunal Shah, CFO

Profitability

  • P&L turning black Profitability · second quarter, third quarter onwards · High confidence turn black
    My guidance would be Q2, Q3, you start seeing even your P&L also turn black.

    — Urvish Rambhia, CEO

What to watch in Q2 FY27

P&L Turnaround to Profitability

Q2/Q3 FY27
Current Net Loss of ₹12 crores in Q1 FY27
Target Net Profit (P&L turns black)

Why it matters

Verifying the company's ability to achieve profitability as guided is crucial for investor confidence and valuation.

My guidance would be Q2, Q3, you start seeing even your P&L also turn black.

Risks & concerns

  • Delhi High Court case challenging tender for 13 in-city warehouses

    medium

    The case is sub judice, but management expressed confidence in their position and is proceeding with their strategy for these assets.

    Analyst acknowledged

Q&A highlights

4 direct, 1 evasive
Blackstone's long-term plans and exit strategy for Horizon Industrial Parks Evasive
So, you know, sorry, but I won't be able to direct -- I won't be able to give you a direct answer for this because, you know, Blackstone will be best placed to answer on how they are thinking about their exit, but this is, you know, directionally, how you know, what I have personally noticed about them in this market.

Analysts are keen to understand the long-term commitment of the PE fund promoter, Blackstone, and potential future dilutions or exits, which management could not directly address.

Asked by Hriday Choksey

Delhi High Court case challenging tender for 13 in-city warehouses Partial
That's sub judice, so I will not be able to comment much more on that. But we remain very confident on our position, and we are spearing ahead with our strategy and plan on those assets.

This question highlights a potential regulatory/legal risk to a significant part of the company's high-growth in-city strategy, though management expressed confidence.

Asked by Naman Bhansali

Growth CAGR and volume growth breakdown across industrial, logistics, and e-commerce segments Direct
So, the way we are thinking of our growth is, as I said earlier in my opening remarks, this is effectively like delivering from 4 engines here. One is the contractual growth that we continue to get on our existing 29.5 million square feet of operational network.

This question sought clarity on the company's multi-year growth trajectory and the contribution of different business segments, which management detailed through its 4-pronged strategy.

Asked by Mohit Agrawal

Capex requirements, leverage, cost of debt reduction, and pre-leasing traction for in-city assets Direct
Our capex requirements over the next 3 years are more or less in the INR1,500 crores to INR2,000 crores zip code, which we look to roughly manage 1/3 internally and 2/3 with incremental debt.

This covers key capital allocation and financing aspects post-IPO, including future investment plans and expected debt cost savings, crucial for financial modeling.

Asked by Pritesh Sheth

Rental differentials and lease tenures between manufacturing/industrial tenants and logistics/e-commerce tenants, and in-city vs. standard parks Direct
And to your second question, if I look at my existing data, today we are sitting on an in-place base rent plus CAM of about INR27.20 per square feet. But if I give you a little bit of guidance and split that, industrial segment in that is almost 20% above the about the standard bare-bone warehousing, which is at about, call it INR24 and industrial buildings today are being leased at a little above INR29.

Provides granular detail on revenue drivers, tenant mix, and the premium commanded by industrial clients and the high-value in-city assets, informing revenue projections.

Asked by Sushil Choksey

Timeline for the company to start reporting net profit Direct
My guidance would be Q2, Q3, you start seeing even your P&L also turn black.

Addresses a key investor concern regarding profitability, especially after reporting a net loss in the current quarter, providing a clear timeline for turnaround.

Asked by Raunak

3 min read 7 chapters

Detailed narrative

Q1 FY27 Performance Highlights

Horizon Industrial Parks delivered its strongest quarter yet in Q1 FY27, reporting a revenue of INR200 crores, marking a 23% year-on-year growth. EBITDA reached INR161 crores, growing 36% year-on-year, with the company maintaining a robust EBITDA margin of 80%. On the operational front, the company leased 1.9 million square feet across 13 transactions, adding INR65 crores to its contracted revenue kitty. The contracted revenue run rate as of end June stood at nearly INR970 crores, providing strong revenue visibility.

Post-IPO Financial Strengthening and Deleveraging

Following a successful IPO in August, Horizon Industrial Parks raised INR4,250 crores of fresh primary capital. These proceeds were primarily deployed for deleveraging, reducing the net debt to INR2,500 crores as of end-June, which represents 12.5% of the enterprise value. This strategic move has significantly strengthened the company's balance sheet, providing enhanced access to capital markets and ample financial flexibility to pursue future growth opportunities while maintaining financial prudence.

Multi-pronged Growth Strategy

The company outlined a comprehensive 4-pronged growth strategy. This includes contractual rent escalations (averaging 5% annually) and embedded mark-to-market opportunities (re-leasing spreads of 12-15%). Secondly, continued development and expansion of big format parks aim to double operational capacities over the next 4-5 years, leveraging a 25 million square feet land bank. Thirdly, rapid expansion of the in-city strategy is projected to deliver 6 million square feet over the next 3 years, attracting 2-3 times higher rentals. Lastly, expansion of value-added services like rooftop solar and worker accommodations is expected to contribute 5-10% of revenues in the next 5 years.

Development Pipeline and Operational Expansion

Horizon is on track to deliver 6.5 million square feet of leasing for FY27, representing a 30% growth over the last fiscal. The company also aims to complete 6 million square feet of new developments this fiscal, which will enhance its operational area to nearly 35 million square feet. The company possesses a fully-paid land bank capable of delivering 30 million square feet of further development, ensuring a robust pipeline for sustained growth over the next 4-5 years.

Focus on In-City Logistics and Premium Rentals

The in-city platform is a key growth vector, currently spanning 17 assets across 7 major cities and providing access to over 20 million consumers. This strategy is expected to deliver 6 million square feet over the next 3 years, with rentals projected to be 2.5 to 3 times higher than those from big format parks. The first in-city project delivery in Pune is anticipated by the fourth quarter of this fiscal year, marking a significant step in this high-yield segment. Construction costs for these premium in-city assets are estimated around INR4,500 per square foot.

Capital Allocation and Debt Management

The company's capex requirements over the next three years are estimated to be in the range of INR1,500 crores to INR2,000 crores, which will be funded approximately one-third through internal accruals and two-thirds through incremental debt. Post-IPO, the company repaid INR3,900 crores of debt, bringing its net debt down to INR2,500 crores. Management expects to further reduce the cost of debt by 40-50 basis points from the current 8.2% due to improved credit ratings post-deleveraging.

Profitability Outlook and Future Guidance

Despite reporting a net loss of INR12 crores in Q1 FY27, management clarified that this was primarily due to non-cash depreciation and interest expenses. The proforma cash PAT for the quarter stood at a healthy INR116 crores. The company anticipates its P&L to turn black from Q2 or Q3 FY27, signaling a return to reported profitability as the benefits of deleveraging and operational scale materialize.

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

More Realty earnings calls