Prestige Estates

Prestige Estates achieved its highest ever presales and collections in Q3 and 9M FY26. Q3 FY26 presales grew 39% year-on-year to INR4,184 crores, while 9M FY26 presales surged 122% year-on-year to INR22,327 crores, surpassing previous full-year records. Collections were equally robust, with INR4,548 crores in Q3 and INR13,283 crores in 9M FY26, also marking new highs. This performance was supported by strong sales volumes of 2.99 million square feet in Q3 and 16.95 million square feet in 9M FY26, with average realizations improving 6% year-on-year to INR14,459 per square foot.

The company made significant investments in land acquisition during Q3, deploying INR2,700 crores. This included INR1,000 crores for Knowledge Park in Hyderabad and INR800 crores for a land parcel in Chennai, contributing to a total Business Development (BD) spend of INR4,700 crores in 9M FY26. Management projects total BD spend for FY26 to be INR5,500-6,000 crores and for FY27 to be INR4,500-5,000 crores. The total capex to be spent across all projects is estimated at INR15,000 crores, with a funding mix of 40% debt and 60% internal accruals, and new projects are expected to yield an IRR of 20-30%.

Prestige Estates has a strong launch pipeline, with 5.02 million square feet launched in Q3 and 23.83 million square feet in 9M FY26, representing a residential Gross Development Value (GDV) of over INR19,600 crores. For Q4 FY26, the company plans launches in Bangalore (Evergreen, Eaton Park, Fernvale, Prestige Marigold) and Hyderabad (Rock Cliff, Golden Grove), aiming to achieve INR8,000 crores in sales for the quarter and cross INR30,000 crores for the full FY26. The NCR region also has a significant pipeline, including Sector 150 and two large Gurgaon land parcels with a combined GDV expected to exceed INR10,000 crores, anticipated to launch in FY27.

The commercial office portfolio maintained strong occupancy at over 95%, with exit rentals for FY26 expected to be approximately INR829 crores, projected to scale to INR4,000 crores by FY30. Retail assets also performed well, with Q3 mall footfall at 5.2 million and gross turnover growing 14% year-on-year to INR702 crores, maintaining over 99% occupancy. Retail annuity income is projected to reach INR1,175 crores by FY30, supported by 14 malls in the pipeline, indicating sustained growth in recurring revenue streams.

The Delhi Airport (DIAL) project is progressing, with 0.6 million square feet of office space almost fully leased out. The hotel block is expected to be topped out by July of this year, with a soft launch by the end of the calendar year, and the office component is slated for handover in April upon receiving occupancy certificate. In Mumbai, the Prestige Place (Jijamata) project, a large development comprising 4,000 homes, a hotel, office, and retail mall, is in planning stages, with 2.5 million square feet allocated for residential, signaling future growth in the region.

Management emphasized a conservative approach to pricing and land acquisition, avoiding overpayment and overpricing to mitigate market correction risks. While acknowledging that pricing has 'peaked out' at certain levels, they believe demand is driven by location, product, and affordability rather than speculative price increases, aiming for a stable, end-user driven market. They noted varying market dynamics, with Bangalore being 'pretty busy,' Hyderabad 'fairly decent,' and Chennai 'steady, very steady,' where a 20% sellout in the first 1-2 months is considered a good project, reflecting a tailored market strategy.

The EBITDA margin for Q3 FY26 stood at 22.5%, which was lower than the 9M average of 34.3%. This was primarily attributed to a product mix that included projects with single-digit margins, such as Prestige Siesta, an NCLT takeover. Despite this, the company's unrecognized revenue as of December 31, 2025, was substantial at INR61,922 crores. This significant backlog provides strong revenue recognition visibility and financial stability for the coming years, underpinning future profitability.