Oberoi Realty Limited — Q2 FY26 earnings call

Call held 17 Oct 2025

Management summary

Oberoi Realty reported a solid Q2 FY26, characterized by robust sustenance sales and strong demand for its luxury projects like Sky City and Three Sixty West. The company is actively pursuing expansion into the NCR market with a new Gurugram office and is on track for multiple project launches, including the Ritz-Carlton hotel and I-Ven Realty. While residential margins were lower due to project-specific accounting, commercial assets are scaling up well, and management expressed confidence in future price hikes and a strong launch pipeline.

Highlights

  • Robust sustenance sales across all projects, driven by strong sales velocity at Sky City despite recent price hikes.

  • Three Sixty West continues to attract strong inquiries and sales for its uber-luxury offerings.

  • Expansion into NCR market confirmed with the opening of a Gurugram office and project launch plans.

  • Commercial assets, Commerz III and Sky City Mall, are scaling up effectively with strong leasing demand.

  • A robust pipeline of projects, including Ritz-Carlton, I-Ven Realty, Gurugram, Worli, and other residential towers, are on track for launch within the financial year.

  • Contribution from associates increased to Rs. 117 million, marking the highest in the last five quarters.

Concerns

  • Residential margins were lower this quarter, attributed to accounting standards where projects like Jardin have not yet hit margin recognition.

Key financials

  1. Contribution from Associates 117 Mn

What they filed

Q1 FY27: revenue up 33.9%, net profit up 64.4% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue1,010 1,277 912 775 1,545 +53%1,180 −8%1,415 +55%1,038 +34%
EBITDA649 749 452 407 834 +29%654 −13%754 +67%588 +44%
Net profit464 537 309 309 618 +33%472 −12%570 +84%508 +64%
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

low confidence

Composition

Mix 2 projects
  • Thane 16 units 80%
  • Three Sixty West 4 units 20%

Share of order book by project, derived from disclosed amounts

Pipeline

other

Multiple projects including Gurugram, Worli, redevelopment projects, Borivali tower, Thane tower, Goregaon tower, I-Ven Realty (shopping mall, office, hotel), Pedder Road, and Carter Road are queued up for launch.

Management reported robust sustenance sales and strong demand for luxury projects, but did not quantify overall pre-sales value for the quarter.

Source: Inferred

Capital allocation

high confidence
  • Capex ₹125 Cr
    • Construction of Ritz-Carlton, balance completion for Sky City, Commerz III ₹125 Cr
    So, for example, the construction of the Ritz-Carlton or the balance completion for Sky City or Commerz III. So that is close to about Rs. 125 crores. The balance is purely treasury activities. It is investment into mutual funds and stuff like that.
  • Liquidity Liquidity disclosed Company has sufficient funds for construction activities.
    Now, I have enough and more for funding my construction.

Guidance & targets

Project Launch

  • Ritz-Carlton Launch Project Launch · within this financial year · High confidence Launch
    And we are really hoping, fingers crossed, that within this financial year, we are able to launch.

    — Vikas Oberoi

  • I-Ven Realty Groundbreaking Project Launch · within this financial year · High confidence Breaking ground
    So I-Ven Realty, that land parcel, we are doing a shopping mall, an office building and a hotel on top. And we should be breaking ground within this financial year itself.

    — Vikas Oberoi

  • Gurugram Project Launch Project Launch · within this financial year · High confidence Launch
    And we are hoping, we are really, really hoping to launch it within this financial year itself.

    — Vikas Oberoi

Commercial Asset Performance

  • Sky City Mall Stability/Occupancy Commercial Asset Performance · within this financial year · High confidence Achieve huge amount of stability
    I think within this financial year we will achieve huge amount of stability.

    — Vikas Oberoi

Sales Volume

  • Thane Annual Sustenance Sales Sales Volume · every year · Medium confidence ~Rs. 1,000 crores
    Like we are hoping that Thane will probably settle somewhere around Rs. 1,000 crores every year kind of sustenance sales.

    — Vikas Oberoi

Inventory Reduction

  • Three Sixty West Inventory Completion Inventory Reduction · within the next 2 years · Medium confidence Done with inventory
    I feel within the next 2 years, we will be done with the inventory, hopefully, yeah.

    — Vikas Oberoi

What to watch in Q3 FY26

Ritz-Carlton Launch

Within this financial year
Current Nearing completion, 70-80% volume work over.
Target Launched

Why it matters

Launch of this luxury hotel is a significant milestone and revenue driver for the annuity portfolio.

And we are really hoping, fingers crossed, that within this financial year, we are able to launch.

Risks & concerns

  • Lower Residential Margins

    medium

    Residential margins were low this quarter due to accounting standards where projects like Jardin have not yet hit margin recognition, leading to revenue equal to cost.

    So two parts to that, Pritesh. One, as you rightly pointed out, there will always be projects where because you have not yet hit margin recognition, then the accounting standard is revenue equal to cost. So, you see a top line but you do not see the corresponding bottom line coming through.

    Analyst acknowledged

  • RERA Impact on Early Sales and Cash Flow

    low

    RERA regulations require cash from early sales to be locked in project-specific accounts, which can be a disadvantage for developers wanting to utilize cash for other business development activities.

    So this part of how RERA plays out is a disadvantage for us to sell early, and that's what we are really doing.

    Management acknowledged

Q&A highlights

8 direct
Residential Sales Strategy and RERA Impact Direct
So as a strategy what we do is, we actually end up slowing down sales or stopping sales in some of the projects, I am not saying these, to ensure that I am not selling cheap, and I am not even getting the money in my hand. In the sense, when I sell early, I am giving that advantage to the buyer, but I am also getting cash, which actually is getting locked in my RERA account, and I have enough and more to fund that construction.

Management explains their deliberate strategy of slowing down sales in certain projects to optimize pricing and manage RERA-mandated cash lock-up, prioritizing higher realizations over quick sales.

Asked by Gaurav Khandelwal

Launch Pipeline for H2 FY26 Direct
There are so many. They are all literally queued up and raring to go, like we just need to break open, and it will be a flow, plethora of projects. Gurugram will come in, Worli can come in. There are a few other redevelopment projects that we have signed will come in. We have one more tower to be launched in Borivali, that can come in. We can launch a new tower in Thane. So there is so much more.

Management confirms a robust pipeline of multiple projects across various locations (Gurugram, Worli, Borivali, Thane, Goregaon, I-Ven Realty, Pedder Road, Carter Road) are ready for launch, with several targeted for this financial year.

Asked by Akash Gupta

Ritz-Carlton Launch Timeline Direct
And we are really hoping, fingers crossed, that within this financial year, we are able to launch. And yeah, that's it. So, we will be gifting a beautiful hotel to the city.

Provides a specific timeline for the launch of the highly anticipated Ritz-Carlton project, indicating it's nearing completion and expected within the current financial year.

Asked by Puneet Gulati

Sky City Mall Occupancy and Performance Direct
I think within this financial year we will achieve huge amount of stability. And then going forward you will see, in fact, the Sky City Mall has already reached footfalls, almost equal to what the Goregaon Mall had. And we are really surprised with the way it's taken off, very excited about it.

Highlights the strong and better-than-expected performance of Sky City Mall, with a target for significant stability and high occupancy within the current financial year.

Asked by Pritesh Sheth

Demand for Uber-Luxury Projects (Gurugram, Adarsh Nagar) Direct
I want to just tell you if not for RERA, we have not even firstly advertised. If not for RERA, I would have collected cheques for both these projects. The kind of demand I see, people are already approaching us and telling us, whenever you open you, let me know, can I pay you now?

Indicates exceptionally strong pre-launch demand for upcoming uber-luxury projects in Gurugram and Adarsh Nagar, suggesting high potential for future sales.

Asked by Kunal Lakhan

Residential Project Margins (Jardin) Direct
So two parts to that, Pritesh. One, as you rightly pointed out, there will always be projects where because you have not yet hit margin recognition, then the accounting standard is revenue equal to cost. So, you see a top line but you do not see the corresponding bottom line coming through. That will be one.

Explains the reason for lower residential margins in the current quarter, attributing it to the accounting treatment for projects like Jardin where revenue recognition has not yet commenced.

Asked by Pritesh Sheth

Capex Outflow and Treasury Activities Direct
So, for example, the construction of the Ritz-Carlton or the balance completion for Sky City or Commerz III. So that is close to about Rs. 125 crores. The balance is purely treasury activities. It is investment into mutual funds and stuff like that.

Clarifies the nature of the investment outflow, distinguishing between construction-related capital expenditure and treasury investments, providing transparency on cash utilization.

Asked by Murtuza Arsiwalla

Room for Price Hikes Direct
We will wait for a bit, but we do see enough room on price hike because what we have been able to differentiate with our competition is that we are able to deliver quality with this sort of scale now. So, people who really want quality are willing to pay that extra. And I feel that as a company we deserve it, and then we can keep pushing our prices higher.

Management expresses confidence in their ability to implement further price hikes across projects, citing quality differentiation and strong demand for premium offerings.

Asked by Puneet Gulati

2 min read 6 chapters

Detailed narrative

Q2 FY26 Sales Performance and Strategy

Oberoi Realty reported a solid start to the festive season in Q2 FY26, driven by robust sustenance sales across all projects. Sky City demonstrated strong sales velocity despite recent price hikes, indicating healthy demand for luxury real estate. The uber-luxury project Three Sixty West also continued to attract significant inquiries and sales. Management highlighted a strategic approach to sales, sometimes slowing down or stopping sales in projects to optimize pricing and manage RERA-mandated cash lock-up, ensuring higher realizations rather than pushing for early sales at lower prices.

Project Updates and Expansion

The company is making significant progress on key projects. The Ritz-Carlton hotel is 70-80% complete by volume and is targeted for launch within this financial year. The I-Ven Realty mixed-use development (shopping mall, office, hotel) is expected to break ground within the current financial year. Oberoi Realty also opened an office in Gurugram, signaling its expansion into the NCR market, with the Gurugram project itself targeted for launch within this financial year after loading 100% TDR and securing approvals.

Commercial and Retail Asset Performance

Commerz III and Sky City Mall are scaling up effectively, driven by strong leasing demand for office and retail tenants. Sky City Mall, in particular, has exceeded expectations, with footfalls now comparable to the Goregaon Mall. Management anticipates the mall will achieve a 'huge amount of stability' within this financial year, with potential for further rental escalations as the market matures.

Robust Launch Pipeline

Oberoi Realty maintains a strong and diverse launch pipeline for the coming quarters, with multiple projects 'queued up and raring to go.' These include projects in Gurugram, Worli, several redevelopment projects, an additional tower in Borivali, a new tower in Thane, and a tower in Goregaon. The Pedder Road and Carter Road projects also have approvals in place, indicating a continuous flow of new offerings.

Residential Margins and Capital Outflow

Residential margins were noted to be lower this quarter, primarily due to accounting standards where projects like Jardin have not yet reached margin recognition, resulting in revenue being equal to cost. Management clarified that a significant capital outflow of approximately Rs. 125 crores was allocated to construction activities for Ritz-Carlton, Sky City, and Commerz III completion. The remaining outflow was attributed to treasury activities, including investments in mutual funds.

Demand for Uber-Luxury and Pricing Strategy

Management observed exceptionally strong demand for its upcoming uber-luxury projects in Gurugram and Adarsh Nagar, with potential buyers actively approaching the company even before official advertising or RERA registration. This robust demand, coupled with the company's focus on quality, provides confidence for further price increases across projects, as Oberoi Realty believes its offerings justify a premium.

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