Brigade Enterprises Limited
Q2 FY26
Call date · October 30, 2025

1 · Management Commentary

Key Positives

  • Strong performance and steady growth across all business segments.
  • Residential presales of INR2,034 crores (+12% YoY), with volume at 1.90 million sq ft (+13% YoY).
  • Average realization up 13% YoY to INR12,236/sq ft.
  • Zero residential debt for the last 2 years; robust sales and collections.
  • 15 million sq ft pipeline of upcoming launches; 11 million sq ft residential launches planned over next 4 quarters.
  • Leasing portfolio occupancy at 92%; 8.67 million sq ft leased.
  • Hospitality ARR at INR7,106 (+14% YoY); occupancy at 76%.
  • Consolidated revenue at INR1,430 crores (+26% YoY); PAT at INR170 crores (+48% YoY).

Key Negatives

  • Residential EBITDA margin at 12%, below historical run rate, due to project mix, tech adoption costs, and conservative provisioning.
  • Potential shortfall in achieving INR9,000 crores presales guidance for FY26, dependent on timely launches and approvals.
  • Chennai market velocity slower than Bangalore/Hyderabad; capital allocation to Chennai to be more measured.

Forward Guidance

  • Capex: Planned investment of INR8,000 crores in Chennai over next 5–6 years.
  • New launches: 7 million sq ft (GDV INR8,000–8,300 crores) in H2 FY26, including major projects in Hyderabad, North and East Bangalore, and Velachery (Chennai).
  • Commercial: 4.2–6 million sq ft of new office launches in pipeline.
  • Revenue/margin: Margins expected to normalize in next financial year; rental revenue to grow as new commercial assets are leased.
  • Strategic: Focus on Bangalore and Hyderabad for business development; cautious approach to new geographies outside South India.

2 · Q&A Highlights

Q 1 (Composite): What is the outlook for debt reduction and capital raising?
A (Management):
• No immediate plans for rights issue; recent QIP completed.
• 93% of debt is lease rental backed (LRD); not a concern; will review at AGM next year.

Q 2 (Composite): What is the launch pipeline and sales outlook for H2 FY26?
A (Management):
• 7 million sq ft launches planned (GDV INR8,000–8,300 crores); major launches in Hyderabad, Bangalore, and Chennai.
• Sales guidance of INR9,000 crores is dependent on timely launches and approvals; optimistic if launches proceed as planned.

Q 3 (Composite): Are there any special discounts or schemes to drive sales?
A (Management):
• No builder-led subvention schemes; only standard negotiation-based discounts or occasional interiors.
• Demand remains strong; no need for aggressive schemes.

Q 4 (Composite): Any delays in approvals, especially due to BBMP restructuring?
A (Management):
• Minor delays (~1 month) due to restructuring; now approvals are progressing; no major impact expected.

Q 5 (Composite): What is the status and outlook for key projects in Chennai (Velachery, Perambur, Morgan Heights)?
A (Management):
• Velachery launch expected in Q4; approvals in final stages.
• Perambur launch may take a couple more quarters.
• All approvals for Morgan Heights are in place; government has clarified no irregularities; sales traction improved post marketing office opening.

Q 6 (Composite): What is the steady-state rental and EBITDA potential for the commercial portfolio?
A (Management):
• Rental run rate at INR1,400 crores with 92% occupancy; projected INR800–850 crores rental revenue for FY26.
• Portfolio to grow substantially with 4.2–6 million sq ft of new launches.

Q 7 (Composite): How is demand and pricing in residential markets, especially Bangalore and Hyderabad?
A (Management):
• Demand strong, especially in Bangalore mid-segment (INR75 lakh–1.5 crores).
• Hyderabad seeing robust demand in INR5 crores+ category.
• Like-to-like price hikes of 5–7% annually; no slowdown in pricing power.

Q 8 (Composite): What is the competitive landscape in Bangalore and capital allocation strategy?
A (Management):
• Increased competition in Bangalore, but demand and absorption remain strong; confident in market outlook.
• Capital allocation to focus on Bangalore and Hyderabad; Chennai to see measured investment; no immediate plans to enter markets outside South India.

3 · Other Key Numbers

  • Presales Q2 FY26: INR2,034 crores (1.90 million sq ft)
  • Average realization: INR12,236/sq ft
  • Residential launches planned (next 4 quarters): 11 million sq ft
  • Planned investment in Chennai: INR8,000 crores (5–6 years)
  • Leasing portfolio: 8.67 million sq ft leased (92% occupancy out of 9.38 million sq ft)
  • Office space transacted Q2: 4,22,000 sq ft
  • Mall footfalls: +8% YoY; mall consumption: +9% YoY
  • Hospitality ARR: INR7,106 (+14% YoY); occupancy: 76%
  • Consolidated revenue Q2: INR1,430 crores (+26% YoY)
  • EBITDA Q2: INR375 crores (margin 26%)
  • PAT Q2: INR170 crores; PAT after minority interest: INR162 crores (+37% YoY)
  • H1 FY26 consolidated revenue: INR2,763 crores (+23% YoY)
  • H1 FY26 EBITDA: INR750 crores (margin 27%)
  • H1 FY26 PAT: INR328 crores; PAT after minority interest: INR312 crores (+54% YoY)
  • Gross debt: INR4,291 crores; cash & equivalents: INR2,574 crores; net debt: INR1,717 crores (BEL share: INR1,100 crores)
  • Debt-equity ratio: 0.22
  • Average cost of debt: 8.05% (down 20 bps QoQ)
  • H1 business development: 13 million sq ft acquired (GDV INR14,000 crores: INR8,000 crores Bangalore, INR2,000 crores Chennai, INR2,000 crores Hyderabad)
  • Q2 launches: 2 million sq ft (GDV INR2,200 crores); ~50% of Q2 sales from new launches
  • Chennai Velachery launch: ~1 million sq ft (GDV INR2,000–2,250 crores)
  • Commercial launches pipeline: 4.2–6 million sq ft upcoming
  • Residential segment classification: Mid-segment (INR75 lakh–1.5 crores), Premium (INR1.5–3 crores), Luxury/Ultra-luxury (>INR3 crores)
  • Brigade Foundation: 1 lakh trees planted initiative; 39 years in real estate sector celebrated
  • Awards: Forbes India Developers A-List 2025, Construction World Architects and Builders Awards 2025, India's Best Workplaces for Women 2025

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