Shriram Properties Limited — Q3 FY26 earnings call

Call held 14 Feb 2026

Management summary

Shriram Properties reported a challenging Q3 FY26 with a net loss of INR7 crores, mainly due to external regulatory delays impacting revenue recognition in Bangalore. However, the company achieved a significant breakthrough by resolving the Kolkata land parcel dispute, discharging a INR259 crore liability without cash outflow. Despite Q3's softness, 9M FY26 showed strong operating inflows and cash flow growth, with a robust pipeline addition. Management expressed confidence in a strong Q4 rebound and achieving revised full-year targets.

Highlights

  • Kolkata land parcel dispute resolved, discharging INR259 crores liability without cash outflow, unlocking significant value and accelerating development.

  • 9M FY26 operating inflows grew 27% YoY to INR787 crores, and operating cash flow grew 23% YoY to INR193 crores, demonstrating robust cash generation.

  • Net debt-to-equity ratio remains conservative at 0.3:1, one of the lowest in the sector, providing ample headroom for growth.

  • Added 2.8 million square feet of new pipeline with a GDV of INR2,900 crores in 9M FY26, strengthening future launch visibility.

  • All pending OCs have been resolved, and the situation regarding E-Khata and registration in Bangalore has shown substantial improvement.

Concerns

  • Q3 FY26 reported a net loss of INR7 crores, primarily due to deferred revenue recognition caused by external procedural delays.

  • Sales volume for 9M FY26 was slightly lower at 2.86 million square feet compared to earlier annual targets, attributed to supply-side constraints.

  • EBITDA for 9M FY26 was INR82.9 crores, lower than INR113.7 crores in the prior year, due to deferred revenue recognition rather than margin erosion.

Key financials

2 periods

Q3 FY26

  • Revenue
    ₹203 Cr
    YoY +13%
  • Gross Profit
    ₹41 Cr
    YoY +19%
  • EBITDA
    ₹13.1 Cr
  • PAT
    ₹-7 Cr

9M FY26

  • Total Revenue
    ₹694 Cr
    YoY +27%
  • Gross Profit
    ₹184 Cr
    YoY +40%
  • Gross Margin
    29%
  • PAT
    ₹22.4 Cr

What they filed

Q1 FY27: revenue down 7.4%, net profit down 47.6% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue141 121 408 242 205 +45%179 +48%641 +57%224 −7%
EBITDA-1 -15 49 22 -5 −400%-17 −13%70 +43%-9 −141%
Net profit-1 13 48 21 9 +1000%-7 −154%79 +65%11 −48%
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

₹1,691 Cr

as of 2025-12-31 quantified

5% YoY

Inflow this quarter

₹565 Cr

Execution

Handovers for 9M FY26 were 2,117 units, up 20% YoY. Q3 handovers were 613 units. Pending handover units with OCs are 1,490-1,500 units.

Pipeline

other

Total unlaunched pipeline of 18.5 MSF with GDV of INR11,670 crores. New projects with 5-6 MSF development potential and GDV of INR3,000 crores to be launched over next 5 years.

Customer demand continues to be encouraging, and execution across ongoing projects is progressing as planned. The reduction in sales volume guidance is due to supply-side constraints rather than a demand slowdown.

Source: Prepared remarks

Capital allocation

high confidence
  • Capex ₹100 Cr
    • New business development opportunities ₹100 Cr
    invested over INR100 crores into new business development opportunities.
  • Debt Net ₹418 Cr · 0.3× EBITDA Cost 11.1%
    • Repayment Repaid scheduled debt ₹67 Cr
    Net debt stands at INR418 crores, with a net debt-equity ratio of just 0.3x... Our cost of debt stood at 11.1%
  • Liquidity Cash ₹217 Cr Ample liquidity to support construction launches and new opportunities.
    Our closing cash balance stands at INR217 crores, giving us ample liquidity to support construction launches and new opportunities.

Guidance & targets

Revenue

  • Full-year Revenue Revenue · FY26 · High confidence INR1,300-1,500 crores
    we believe we should be ending the year with full-year revenues in the range of INR 1,300-1,500 crores

    — Gopalakrishnan J.

  • Full-year Revenue Revenue · FY26 · Medium confidence around INR2,600 crores
    revenue of around INR2,600 crores.

    — Ravindra Kumar Pandey

Profitability

  • Full-year Earnings (PAT) Profitability · FY26 · High confidence INR90-100 crores
    earnings in the INR90-100 crores range for the full year.

    — Gopalakrishnan J.

Sales Volume

  • Full-year Sales Volume Sales Volume · FY26 · Medium confidence upwards of 4.5 million square feet

    Previously about 5 million square feet → upwards of 4.5 million square feet

    expect to end the year with upwards of 4.5 million square feet of sales

    — Ravindra Kumar Pandey

Collections

  • Full-year Collections Collections · FY26 · High confidence cross INR1,700 crores
    Collections are expected to cross INR1,700 crores

    — Ravindra Kumar Pandey

Handovers

  • Full-year Handovers Volume Handovers · FY26 · High confidence close to 4 million square feet
    deliver close to 4 million square feet during the year.

    — Ravindra Kumar Pandey

BD Pipeline

  • GDV Addition from Business Development BD Pipeline · FY26 · High confidence INR4,500-5,000 crores
    confident of adding INR4,500-INR5,000 crores of GDV during the year

    — Ravindra Kumar Pandey

Kolkata Land Parcel

  • Cash Flow from Kolkata Site Kolkata Land Parcel · next five years · High confidence in excess of INR1,500 crores
    Kolkata site has the potential to unlock cash flows in excess of INR1,500 crores in the next five years.

    — Gopalakrishnan J.

Debt

  • Net Debt-to-Equity Ratio Debt · High confidence 0.5
    Our most comforting zone is about 0.5, not more than that.

    — Gopalakrishnan J.

IRR

  • IRR for new projects IRR · High confidence >25%
    we will not do projects if it is less than 25% IRR in general.

    — Gopalakrishnan J.

Pricing

  • Annual Price Increase Pricing · next couple of years · Medium confidence 5%-6% max 8%
    you can see anywhere between 5%-6% max 8% kind of annual increase in prices.

    — Gopalakrishnan J.

What to watch in Q4 FY26

FY26 Full Year Revenue

next quarter (Q4 FY26 results)
Current INR694 crores (9M FY26)
Target INR1,300-1,500 crores

Why it matters

Management has provided a specific range for full-year revenue, which will be a key indicator of recovery from Q3 challenges and overall business momentum.

we believe we should be ending the year with full-year revenues in the range of INR 1,300-1,500 crores

Risks & concerns

  • E-Khata and Kaveri registration portal issues in Bangalore

    medium

    Ongoing issues with the E-Khata and Kaveri 2.0 registration portal in Bangalore cause deferral of revenue recognition and slow down handovers, though the situation is improving.

    Management acknowledged

  • Volatility in quarter-to-quarter performance due to external factors

    low

    Real estate is not a manufacturing firm with stable utilization; external factors like regulatory changes can cause fluctuations in quarterly results, but fundamentals remain strong.

    Management acknowledged

Q&A highlights

4 direct, 1 evasive
Recurring delays in revenue recognition due to E-Khata/Kaveri portal issues in Bangalore. Direct
In Bangalore, they have migrated -- it's not a Shriram problem, you would have seen this in all the company presentations, I don't know how much disclosure they have made. So in Bangalore and Karnataka, they have migrated to a concept of E-Khata last year, and they have their own reason of why it is not stabilizing for so long.

Highlights a persistent external regulatory challenge impacting the company's ability to recognize revenue and deliver projects, particularly in a key market.

Asked by Saumil Shah

Kolkata land parcel monetization value and timeline. Partial
Overall the site has a potential of about INR1,500 crores of cash flow, both from our own development as well as the monetization... three to five years is the development timeline... monetization can happen in a three-year period.

Provides clarity on the significant value unlock potential from the resolved Kolkata land, a major event this quarter, but with a broad timeline.

Asked by Saumil Shah

Revised FY26 sales volume guidance (down from 5.2-5.5 MSF to 4.5 MSF) and market slowdown. Direct
We are not seeing a slowdown in the market. Whatever we are launching is getting sold... It is the ability to supply... constrained by some external factors, and that's what is showing lower numbers than market slowdown.

Addresses a key concern about a potential market slowdown and clarifies that the reduction in sales volume guidance is due to supply-side constraints (approvals, e-katha) rather than demand weakness.

Asked by Saumil Shah

Peak debt levels to achieve FY28 targets. Direct
currently at 0.3. Our most comforting zone is about 0.5, not more than that. But towards reaching a peak pipeline addition and towards reaching the revenue, we might intermittently or at a very short-term basis we might go close to 0.7, but we would be very uncomfortable to go beyond that kind of number on a consol basis.

Provides insight into the company's comfort level with leverage and its potential increase during growth phases, which is critical for a capital-intensive sector like real estate.

Asked by Rohit Kumar

Pricing power and annual price increases in Bangalore/Pune. Direct
I would imagine yes for the next couple of years you can see anywhere between 5%-6% max 8% kind of annual increase in prices... Prices what we have achieved I think we've achieved about INR7,350 INR7,400 per square foot average. That is in excess of what we initially thought of.

Confirms continued pricing power and healthy realization trends, indicating a positive demand environment and successful project positioning.

Asked by Karan Mehra

FY28 mission (5000cr sales, 2500-3000cr revenue, 250cr profit) given current performance. Evasive
I would probably reserve this question or reserve my answer for this question till our Q4 results, then you would see with more credibility and confidence as to is there a growth or not.

Management defers a direct answer on long-term targets, suggesting they want to demonstrate Q4 performance first, raising a slight caution flag on the confidence in achieving these ambitious targets given current challenges.

Asked by Sunil Jatakia

Accounting impact of Kolkata liability settlement (INR259 crores). Partial
No, it may have some impact on the reserves eventually, but it's a gross liability and gross assets getting knocked off. But there will be some depending on we are still working with our statutory auditors, on the actual treatment of this and if there are any surpluses it might get eventually flow into reserves and surplus.

Clarifies the accounting treatment of a significant liability resolution, indicating a potential positive impact on reserves and book value, subject to final auditor review.

Asked by Saumil Shah

2 min read 6 chapters

Detailed narrative

Kolkata Land Parcel Resolution and Monetization

Shriram Properties successfully resolved a long-pending commercial matter regarding its Kolkata land parcel, conveying 42.37 acres to the West Bengal government. This settlement discharged an aggregate liability of INR259 crores without any cash outflow. The remaining 90-100 acres of surplus land from the total 314 acres are targeted for monetization within three years, with the entire site development and monetization expected to generate over INR1,500 crores of cash flow over the next five years.

Q3 Performance Impacted by Regulatory Delays

Q3 FY26 saw a net loss of INR7 crores, primarily due to procedural delays in receiving e-khata and intermittent issues with the Kaveri online registration portal in Bangalore. These external factors deferred revenue recognition, despite operational efforts. However, the situation in Bangalore has shown substantial improvement towards the end of Q3, and all pending OCs have now been resolved, paving the way for a stronger Q4.

Strong 9-Month Operating Performance Despite Headwinds

For the nine months ended December 31, 2025, the company reported robust operating inflows of INR787 crores, a 27% YoY growth, and operating cash flow of INR193 crores, up 23% YoY. Sales value grew 5% YoY to INR1,691 crores, and total revenue increased 27% YoY to INR694 crores. Gross profit rose 40% YoY to INR184 crores, maintaining a stable gross margin of around 29%, reflecting the underlying strength of the business.

Robust Pipeline Additions and Future Growth Outlook

Shriram Properties added 2.8 million square feet of new pipeline with a Gross Development Value (GDV) of INR2,900 crores during 9M FY26, with another 3-4 million square feet expected by year-end. The total unlaunched pipeline stands at 18.5 million square feet with a GDV of INR11,670 crores. Management is confident in a strong Q4 rebound, targeting 2-4 new launches across Kolkata, Chennai, and Bangalore, and expects a busy FY27 from a launch perspective.

Conservative Financial Position and Capital Allocation

The company maintains a conservative net debt of INR418 crores, resulting in a net debt-to-equity ratio of 0.3:1, one of the lowest in the sector. The cost of debt is 11.1%. Capital commitments towards new projects doubled to INR246 crores in 9M FY26, with over INR100 crores invested in new business development opportunities in Q3, demonstrating strong investment in pipeline building while maintaining financial discipline.

Revised Full-Year FY26 Guidance

Management revised its full-year FY26 guidance, now expecting sales volume upwards of 4.5 million square feet (from an earlier 5-5.5 MSF target) and revenue around INR2,600 crores (from an earlier INR2,500-3,000 crores target). Collections are projected to exceed INR1,700 crores, and handovers are expected to be close to 4 million square feet. The revision is attributed to supply-side constraints rather than a demand slowdown, with management confident in a strong Q4 performance.

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