Eldeco Housing & Industries Ltd Q1 FY26 Earnings Analysis

- Targeting Rs.3,000-3,500 crore GDV over the next five to six years from current projects and new launches. - Pre-sales guidance for FY26 expected to be around Rs.500 crore, higher than previous year’s Rs.340 crore. - Launching large projects like Eldeco Solano Garden (Rs.1,000 crore GDV) in phases, with revenue recognition expected starting FY28-FY29. - Focus on continued launches such as Hanging Garden, Skywalk, and Solano Garden to drive sales momentum. - Expecting stable realizations of Rs.6,000-6,500 per sq ft for most projects, with premium projects like Trinity having higher rates. - Gross margins guided around 30%, with Imperia Phase-2 targeted margins upwards of 40%. - Concentrated growth strategy focusing primarily on Lucknow and expansion to Gorakhpur. - Sales velocity expected to improve, with goal to complete inventory sell-out over 2.5-3 years post-launch.

- Eldeco expects a strong growth trajectory driven by ongoing and upcoming projects, including the Rs.1,000 crore Eldeco Solano Garden and other land acquisitions in Lucknow. - Total GDV over the next 5-6 years is projected at Rs.3,000-3,500 crore, implying gross margins of about 30%, translating to Rs.600-800 crore gross margin. - Revenue recognition from large projects like Solano Garden will likely begin from FY28-29, with staggered recognition over 3-4 years. - Pre-sales guidance for FY26 is around Rs.500 crore, exceeding Rs.400 crore prior targets, indicating growing sales momentum. - Operational margins were low in FY25 due to Imperia Phase-1 but expected to improve with Phase-2 commencements and new launches like Hanging Garden and Skywalk. - EBITDA margins guided around 30% gross margin, signalling healthy profitability ahead. - Dividend payouts remain strong, reflecting confidence in earnings growth. - Debt levels may rise due to business development spends, but construction largely funded by customer advances.

- No current need for equity partnership with HDFC Capital; CAPEX can be managed with internal resources and some debt. - Significant land acquisitions planned: 31 acres acquired with a target of reaching 100 acres this year, including the large Solano Garden project. - Major project Solano Garden (50 acres) expected to launch in Q3 FY26 after approvals; no utilization of land yet. - Business development expenses and land acquisition expected to increase with new projects under planning. - Construction financed largely by advances from customers, so lesser need for construction loans. - Increase in company loans anticipated primarily for business development rather than construction finance. - Cash largely stuck in RERA accounts, not immediately available for use. - Focus on growth within Lucknow and expansion planned into Gorakhpur in near future.

- No immediate requirement for equity partnership with HDFC Capital as the company can manage CAPEX through internal resources and some debt. - Expectation of increased debt going forward primarily for business development, despite having cash on the balance sheet, due to RERA escrow account restrictions. - Cash available is largely locked in RERA escrow accounts and not freely usable. - Debt levels expected to rise to support land acquisition and business development, but no granular projections provided. - No plans for high-cost equity fundraising or merger with unlisted entities at this stage.

- Total GDV (Gross Development Value) of ongoing and upcoming projects is approximately Rs. 3,000 to 3,500 crore to be recognized over the next five to six years. - Unsold and sold value for projects where revenue is yet to be recognized is about Rs. 1,600 to 1,700 crore. - New launches have a GDV of around Rs. 1,000 crore. - The company plans to increase its land bank from 31 acres to approximately 100 acres this year, which will support future projects. - Key projects include Eldeco Hanging Garden and Skywalk with GDVs of about Rs. 180-190 crore each and Solano Garden scheduled for launch in Q3. - Pre-sales guidance for the current year is over Rs. 500 crore. - Imperia Phase 2 is expected to contribute with higher margins, revenue recognition anticipated from Q4 FY25 onwards.