Brigade Enterprises Limited
Q1 FY26
Call date · August 14, 2025

1 · Management Commentary

Key Positives

  • All four business verticals delivered healthy performance, with consolidated revenue up 20% YoY to Rs. 1,333 crores.
  • Real estate pre-sales grew 3% YoY to Rs. 1,118 crores; average realization rose 24% YoY to Rs. 11,782/sq.ft.
  • Leasing portfolio occupancy at 92% with rental collections at 99%; leasing revenue up 15% YoY to Rs. 300 crores.
  • Hospitality revenue up 19% YoY to Rs. 141 crores; Brigade Hotel Ventures completed successful IPO.
  • ICRA upgraded credit rating to AA (Stable) from AA- (Stable).
  • Zero residential debt across the group for two years.

Key Negatives

  • Significant YoY increase in employee, admin, and marketing expenses (sales & marketing cash outflow Rs. 86 crores vs Rs. 44 crores YoY; employee/admin Rs. 186 crores vs Rs. 100 crores YoY).
  • Slower sales traction in certain Chennai projects (e.g., Brigade Icon in sustenance mode; Morgan Heights awaiting sales office for ramp-up).
  • Some project launches dependent on regulatory approvals, with potential for slippage into Q4 or next year.

Forward Guidance

  • Planned launches of ~13 million sq.ft. in next four quarters; total pipeline of 16 million sq.ft. (residential & commercial) and 1,700 hospitality keys.
  • Capex for hospitality expansion (1,700 keys) to be detailed next quarter; indicative cost: Rs. 1.5–1.75 crores/key (5-star), Rs. 65 lakhs/key (4-star).
  • Focus remains on Tier 1 South Indian markets (Bangalore, Chennai, Hyderabad); no immediate plans to enter new cities.
  • Targeting 15–20% sales growth in FY26 (value terms); commercial launches of 2.5–3 million sq.ft. planned.
  • Business development ongoing; added 10 million sq.ft. to land bank in Q1 with GDV of Rs. 11,200 crores.
  • BuzzWorks (co-working) to double capacity to 10,000 seats by FY26; open to third-party assets.
  • EBITDA margin for new launches expected to be upwards of 30%.

2 · Q&A Highlights

Q 1 (Composite): What is the outlook and pacing for the 13 million sq.ft. launch pipeline, and are there risks of delays?
A (Management):
• Multiple projects with Rs. 4,600 crores GDV already have RERA and are launching in Q2/Q3; remainder dependent on approvals, with some risk of slippage to Q4 or next year.
• Confident of achieving planned launches; ongoing efforts to secure approvals.

Q 2 (Composite): Any plans to expand beyond South India, and how is the company positioned in new markets like Chennai and Hyderabad?
A (Management):
• Focus remains on Bangalore, Chennai, Hyderabad; significant room to grow in these markets.
• No aggressive plans to enter new cities; strategy is to deepen presence and leverage brand strength in current markets.

Q 3 (Composite): What explains the sharp increase in employee/admin and sales/marketing expenses?
A (Management):
• Employee costs are in line with trend; sales/marketing expenses reflect higher launch activity over recent quarters and are activity-based.
• Expenses expected to align with launch pipeline in coming quarters.

Q 4 (Composite): What is the demand outlook in residential and office segments, especially given IT sector slowdown?
A (Management):
• Residential demand remains healthy, especially for premium/luxury; higher ticket sizes mean longer decision cycles.
• Office absorption in Bangalore strong (4.8 million sq.ft. in Q1); IT now 40% of demand, with GCCs and BFSI contributing significantly.
• No on-ground evidence of slowdown; premium positioning provides resilience.

Q 5 (Composite): Details on business development: land cost, pipeline, and nature of new projects?
A (Management):
• Q1 BD added 10 million sq.ft. (Rs. 11,200 crores GDV); 60% in Bangalore, 20% each in Chennai/Hyderabad.
• Land cost to GDV ratio ~20–22%.
• Projects are mostly mid to upper-mid segment, not ultra-premium.

Q 6 (Composite): Updates on BuzzWorks (co-working) business and competitive landscape?
A (Management):
• Current capacity ~5,000 seats, targeting 10,000 by FY26.
• Average seat pricing ~Rs. 14,000; positioned mid-to-premium.
• Open to third-party assets; co-working/flexible space is ~20% of office absorption.

Q 7 (Composite): What is the expected average realization and EBITDA margin for new launches in FY26?
A (Management):
• Average realization expected to remain stable or move up slightly, depending on mix of premium/mid/plotted launches.
• EBITDA margin for new launches expected to be upwards of 30%.

Q 8 (Composite): Capex plans for hospitality expansion and commercial launches?
A (Management):
• Hospitality capex details to be shared next quarter; indicative costs provided.
• Commercial launches of 2.5–3 million sq.ft. planned; key projects include Brigade Padmini Tech Valley, Panorama Chambers, Cauvery, Kochi Infopark Tower 3, Valencia, and Brigade HRC.

3 · Other Key Numbers

  • Real estate pre-sales: Rs. 1,118 crores (Q1 FY26), 0.95 million sq.ft.; average realization Rs. 11,782/sq.ft.
  • Total collections: Rs. 1,728 crores (Q1 FY26); real estate Rs. 1,248 crores, commercial leasing Rs. 311 crores, hospitality Rs. 168 crores.
  • Leasing portfolio: 9.38 million sq.ft.; occupancy 92%; rental collections 99%; leasing revenue Rs. 300 crores.
  • Hospitality revenue: Rs. 141 crores; portfolio occupancy 75%; ARR Rs. 6,761; EBITDA up 24% YoY; F&B up 32% YoY.
  • Consolidated revenue: Rs. 1,333 crores (+20% YoY); EBITDA: Rs. 375 crores (+14% YoY); PBT: Rs. 194 crores (+80% YoY); PAT: Rs. 158 crores (+95% YoY); PAT after MI: Rs. 150 crores (+79% YoY).
  • Gross debt: Rs. 4,745 crores; cash & equivalents: Rs. 2,476 crores (as of June 30, 2025); net debt: Rs. 2,269 crores (Brigade share: Rs. 1,528 crores); net D/E: 0.34:1.
  • Average cost of debt: 8.25% (down 42 bps QoQ).
  • Land bank added in Q1: 10 million sq.ft. (GDV Rs. 11,200 crores).
  • Sales & marketing cash outflow: Rs. 86 crores (Q1 FY26) vs Rs. 44 crores (Q1 FY25).
  • Employee/admin expenses: Rs. 186 crores (Q1 FY26) vs Rs. 100 crores (Q1 FY25).
  • Brigade Twin Towers: 70% of first tower sold; recent sale price Rs. 12,000/sq.ft. plus additional expenses.
  • BuzzWorks: ~5,000 seats; target 10,000 by FY26; average seat price ~Rs. 14,000.
  • Land cost to GDV ratio for Q1 BD: ~20–22%.
  • Outstanding land payment: Rs. 1,380 crores; Rs. 470 crores paid in Q2, balance Rs. 910 crores to be paid over next 18 months.
  • Brigade facility management: ~16 million sq.ft. managed.
  • Upcoming launches: ~13 million sq.ft. in next four quarters; total pipeline 16 million sq.ft. (residential & commercial), 1,700 hospitality keys.
  • Brigade Showcase (Property Expo): 18th edition, 15+ projects, 5 new launches in Bengaluru & Chennai.
  • Brigade Hotel Ventures IPO completed; 9 hotels currently, target 18 hotels in 4–5 years.
  • ICRA credit rating: upgraded to AA (Stable).
  • Brigade Schools named Best CBSE Schools in Bengaluru 2025 by Indianpreneur Magazine.
  • Brigade Enterprises: Great Midsize Workplace (15th year, rank 75th); Brigade Hospitality: 8th place (Great Place to Work Institute).
  • Track2Realty BrandX Report 24–25: Brigade recognized as national brand leader of Indian real estate.
  • Brigade Twin Towers: Iconic Property of the Year Commercial at Global Real Estate Brand Awards.

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