Lodha Developers Limited — Q2 FY26 earnings call

Call held 31 Oct 2025

Management summary

Lodha delivered exceptional Q2 FY26 performance with the best ever second quarter presales of INR 45.7 billion, maintaining strong momentum with 7 consecutive quarters above INR 40 billion. The company's data center opportunity at Palava emerged as a transformational growth driver with land values appreciating to INR 30 crores per acre and potential for massive value creation through powered shell development. Despite higher JDA contribution (50% vs targeted 40%), embedded margins remained robust at 32%. The successful expansion in Pune and Bangalore continues with expected 30%+ contribution to annual presales, while NCR entry is planned for 2026. Infrastructure connectivity at Palava approaches completion, expected to drive significant premium realization starting next fiscal.

Highlights

  • Best ever Q2 presales of INR 45.7 billion, up 7% YoY with 7 consecutive quarters above INR 40 billion

  • H1 presales of INR 90 billion achieving 43% of FY26 guidance, on track for INR 210 billion

  • Strong embedded EBITDA margin of 32% despite 50% JDA contribution vs targeted 40%

  • Pro forma PAT of INR 9.3 billion with 20.3% margin and ~20% ROE

  • Data center opportunity scaling rapidly with land values moving to INR 30 crores per acre

  • Potential INR 2,500 crores annualized PAT from 250 MW powered shell development

  • Strong expansion momentum in Pune and Bangalore, expecting 30%+ contribution this year

Key financials

3 periods

Headline

  • Revenue from Operations
    ₹3,800 Cr
    YoY +45%
  • Adjusted EBITDA
    ₹1,300 Cr
    YoY +37%
  • PAT
    ₹800 Cr
    YoY +87%
  • Pro Forma PAT
    ₹930 Cr
    YoY +20%
  • Operating Cash Flow
    ₹1,470 Cr
    YoY +25%
  • Net Debt
    ₹5,370 Cr
    YoY +8%
  • Embedded EBITDA Margin
    32%
    YoY +3%

Q2

  • Presales
    ₹4,570 Cr
    YoY +7%

H1

  • Presales
    ₹9,000 Cr
    YoY +12%

What they filed

Q1 FY27: revenue up 30.7%, net profit up 63.0% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue2,590 4,016 3,890 3,349 2,983 +15%4,307 +7%3,902 +0%4,378 +31%
EBITDA682 1,271 1,047 958 618 −9%1,328 +4%963 −8%1,525 +59%
Net profit393 832 742 644 336 −15%1,146 +38%794 +7%1,050 +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.

Guidance & targets

Presales

  • FY26 Presales Presales · FY26 · High confidence INR 210 billion
    that keeps us on track to deliver our full year presales guidance of INR210 Billion

    — Abhishek Lodha (MD & CEO)

Profitability

  • ROE Profitability · Ongoing · High confidence 20%
    enabling us to deliver the ROE of 20% or thereabouts

    — Abhishek Lodha (MD & CEO)

Pricing

  • Price Growth Pricing · FY26 · High confidence 5-6%
    puts us on track to deliver about 5% to 6% price growth for the full year

    — Abhishek Lodha (MD & CEO)

Data Center Land Value

  • Land Appreciation Data Center Land Value · Current · High confidence INR 30 crores per acre
    our land values are further moving north to closer to $0.3 billion per acre

    — Abhishek Lodha (MD & CEO)

Data Center Powered Shell

  • Potential Annual PAT Data Center Powered Shell · Long-term potential · Medium confidence INR 2,500 crores from 250 MW
    the annualized PAT from that could be INR2,500 crores or thereabouts

    — Abhishek Lodha (MD & CEO)

Risks & concerns

  • Higher JDA contribution impacting margins

    medium

    JDA projects carry ~27% embedded margins vs 37-38% for owned land but strategy remains flexible

    Still maintaining 32% embedded margins despite higher jda mix

  • Launch concentration in H2 due to regulatory delays

    medium

    INR 120 billion launches planned in H2 vs more balanced approach preferred

    Issue resolved in august, hoping to return to spread-out launches next fiscal

  • Data center capex requirements and execution complexity

    medium

    Management seeking AI industry partners for expertise while evaluating funding strategies

    Exploring partnerships and phased development approach

  • Palava premium positioning dependent on infrastructure completion

    medium

    Premium product launches already in market but full benefit expected next fiscal

    Infrastructure nearly complete with freeway operational next quarter

Q&A highlights

4 direct
Data Center Strategy - Build vs BTS Model Partial
we don't yet have a view on what would be the nature of doing the powered shell, would that only be on a BTS basis or would that be on a speculative basis or perhaps a combination of both

Management still developing comprehensive data center business plan, to be shared next quarter

Asked by Puneet (HSBC)

Data Center vs Residential Returns Comparison Direct
if you were to just do 10%, i.e., 250 megawatts of IT capacity as powered shell, the annualized PAT from that could be INR2,500 crores or thereabouts

Quantifies massive scale of data center opportunity as additive to residential business

Asked by Puneet (HSBC)

Weekly Sales Momentum and Launch Dependency Direct
INR3 billion of non-launch sales... This number was obviously lower at the start of the year. It's trending upwards, and we expect it to further trend upwards

Strong underlying brand strength evidenced by improving non-launch sales velocity

Asked by Pritesh Sheth (Axis Capital)

Real Estate Cycle Longevity and Market Position Direct
We are only in the year 4 or 5 out of that very long cycle... the plane is on the runway. It's not even gotten to its kind of take-off phase

Management's long-term bullish view on Indian housing cycle durability

Asked by Akash Gupta (Nomura)

Margin Differential Between Markets and Own vs JDA Direct
margins in Mumbai are about 10% better... our own land had an embedded EBITDA of about 37%, 38% and the JDA... about 27%

Clear quantification of margin profiles across geographies and development models

Asked by Gaurav Khandelwal (JPMorgan)

2 min read 4 chapters

Detailed narrative

Operational Excellence with Strong Financial Performance

Lodha delivered its best ever Q2 performance with presales of INR 45.7 billion, marking the 7th consecutive quarter above INR 40 billion and achieving 7% YoY growth despite a challenging market environment. The H1 presales of INR 90 billion represent 43% of the full-year guidance, keeping the company well on track for INR 210 billion annual target. Non-launch weekly sales improved to INR 3 billion from lower levels at year-start, demonstrating strong brand momentum and customer walk-ins without promotional activities. The company maintained robust embedded EBITDA margins of 32% despite higher JDA contribution (50% vs targeted 40%), showcasing business model resilience.

Data Center Opportunity - A Transformational Growth Engine

The data center opportunity at Palava emerged as a game-changing value creator with land values appreciating to INR 30 crores per acre (from INR 21 crores previously) following the Maharashtra Green DC Policy MOU. With 400 acres earmarked and 3 GW power capacity available, the total land value potential reaches INR 100 billion. The powered shell opportunity presents massive scale with potential INR 2,500 crores annualized PAT from just 250 MW development. AWS and STT anchor commitments validate the infrastructure quality, while competitive advantages include $6-7 million per MW build costs (vs $10-12 million globally), $0.07-0.08 per kWh power costs, and PUE of 1.2-1.3. Management is developing comprehensive business plans for this opportunity.

Geographic Expansion Success and NCR Entry Strategy

The geographic diversification strategy continues to deliver exceptional results with Pune and Bangalore expected to contribute over 30% of annual presales compared to just 3% at IPO 4.5 years ago. Pune team has scaled meaningfully from INR 200 crores in FY21 to INR 2,500 crores in FY25, with H1 FY26 already at INR 1,400 crores, positioning to become the largest developer in Pune within 2 years. The systematic pilot-then-scale approach proved successful in Bangalore and is now being replicated for NCR entry in 2026, likely starting with Gurugram. This expansion strategy provides a long runway for sustained growth while maintaining the 20% annual growth and 20% ROE targets.

Infrastructure-Led Palava Transformation and Premium Positioning

Palava's transformation from lower mid-income to premium location is progressing with key infrastructure nearing completion. The Palava-Airoli-Mulund freeway will be operational next quarter, providing access to prices less than half of Airoli while connecting to major job hubs within 30-minute driving distance. The bullet train connectivity to BKC (operational 2028-29) will make Palava just 10 minutes from Mumbai's financial district. Premium products including Golf View apartments at ~$1 million each and villa projects are already launched and under construction. Management expects significant sales and margin expansion starting next fiscal as infrastructure benefits materialize, with Palava and Upper Thane targeting 3.5% market share of the INR 235,000 crores Mumbai housing market by end of decade.

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