Raymond Realty LtdQ2 FY25Realty

Raymond Realty Ltd

Q2 FY25 Earnings Call Analysis

Management growth scorecard

Revenue

Category 2

Margin

Category 3

Fundraise

N/A

Order

N/A

Capex

Yes

1 of 3 growth signals are positive — mixed outlook.

Revenue guidance

Category 2

→Raymond Realty expects a 20% year-on-year growth in revenue for FY26, consistent with previous guidance.
→New project launches are concentrated in Q3 and Q4 of FY26, which should drive sales and margin improvements in the second half of the year.
→Annual signing targets for Joint Development Agreements (JDA) projects are between INR 6,000 to INR 10,000 crores, helping maintain a strong project pipeline.
→The company aims to maintain steady-state operating margins around 20%.
→JDA projects are expected to deliver 20-25% IRR, aligning with overall ROCE guidance of a minimum 20%.
→The business growth is underpinned by a strong focus on timely project launches and delivery, an asset-light JDA model, and continued demand in Maharashtra real estate markets.

Category 3

→FY25 revenue was about INR2,300 crores with an expected 20% growth in FY26.
→Operating EBITDA margins are targeted around 20%, with initial quarters lower due to seasonality and project maturations.
→JDA projects expected to deliver IRRs between 20%-25%, aligning with a minimum 20% ROCE going forward.
→Blended margins (Thane + JDA) anticipated around 20%, with potential slight improvements.
→Q2 FY26 revenues expected to be in line with Q1 (~INR400 crores), with significant launches planned in H2, driving higher revenues and profits.
→Rayzone (maintenance arm) currently breaking even, margins expected to improve beyond 2-3 years but remain modest (10%-11%).
→Growth driven by inventory launches across Thane, Bandra, Pune focused on mid to premium segments in Maharashtra region only.
→Management confident of meeting annual guidance of 20% year-on-year growth in bookings and maintaining strong return ratios.

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→There is no explicit mention of any immediate plans for fundraising through debt or equity in the transcript.
→Management emphasized capital allocation towards launching new JDA projects, aiming to sign INR6,000 to INR10,000 crores worth annually.
→The company prefers reinvesting generated cash into business growth rather than buybacks or financial engineering.
→The focus is on an asset-light model through JDAs and achieving strong operational growth with ROCE targets around 20%-25%.
→No indication of fundraising plans, but capital is prioritized for project launches rather than external equity or debt raising at this stage.

→Raymond Realty's JDA projects have a Gross Development Value (GDV) of approximately INR 14,000 crores.
→Raymond Realty’s share in these JDA projects is about INR 11,500 crores.
→The projected timeline for completion of these projects is between five to six years.
→Inventory launches are scheduled with 3-4 launches by March and 1-2 more in Q1 and Q2 of the next year.
→Two new buildings worth INR 1100 crores (318 units) are being introduced imminently.
→Bandra 2 and Wadala 1 project launches are planned for H2 of the financial year 2025.
→The company follows an asset-light JDA model for future growth, reducing land ownership and focusing on partnerships.

Yes

→Raymond Realty plans significant capital allocation toward launching new projects, targeting to sign JDAs worth INR6,000-10,000 crores annually.
→The company is focused on an asset-light model through Joint Development Agreements (JDAs), minimizing heavy landholding investments.
→Five projects are expected to launch in the next year, requiring capital deployment for project execution.
→Management prefers reinvesting earnings into business growth rather than financial engineering like buybacks.
→Capital expenditure prioritizes project launches with targeted IRRs of 20%-25%, emphasizing profitable growth rather than buybacks or share price engineering.
→No indication of major strategic investments outside core real estate development and maintenance services via their subsidiary Rayzone.
→Focus remains on MMR and Pune regions for geographic expansion without other significant capex announcements.

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