Q1 2027 Embassy Developments Ltd Earnings Call Transcript
Key Points
- Pre-sales surged 338% year-on-year to INR 868 crore in Q1 FY27, with collections up 54% to INR 496 crore.
- Strong demand across portfolio: ~60% of FY26 launched inventory sold, with Bangalore achieving 72% sell-through within six months.
- Robust FY27 launch pipeline of INR 19,400 crore GDV (9 owned + 2 development management projects), with four launches planned in Q2.
- Embassy Citadel in Mumbai secured approval for all 81 floors upfront, a significant differentiator in a market with staged approvals.
- Balance sheet strengthening: Board approved preferential allotment of convertible warrants to promoters to repay shareholder debt, reducing cost of capital.
- Healthy land bank of 3,000+ acres fully paid, providing long-term development potential.
- OC received for Embassy 109 Phase 1 and five towers at Gaurs City, Savroli, with OC portfolio ~98% sold.
- Management confident in FY27 guidance: INR 6,000 crore pre-sales (owned), INR 2,000 crore from DM projects, and INR 3,000 crore collections.
- Net debt-to-equity remains low at 0.35x, with cash and equivalents of INR 1,200 crore.
- Strategic focus on collections and execution, with construction spend at 56% of collections, indicating efficient capital deployment.
- Reported net loss widened to INR 234 crore in Q1 FY27, impacted by timing of project completions under completion accounting.
- Revenue from operations declined sharply to INR 217 crore from INR 681 crore year-on-year, reflecting no project completions in the quarter.
- Negative operating cash flow of INR 285 crore in Q1, though expected to turn positive from Q2.
- High cost of debt at ~14% average, with Blackstone debt accruing at 18%, increasing financial burden.
- Delays in regulatory approvals in Bangalore due to government changes, potentially impacting launch timelines.
- No new project launches in Q1, leading to quarterly variability in pre-sales and collections.
- Legacy India Bulls projects require significant effort and capital to rectify, impacting brand perception and resources.
- Land bank monetization, especially the 1,400-acre Nashik land, faces legal and regulatory hurdles, with no near-term resolution.
- Goodwill of INR 2,500 crore on balance sheet from reverse merger may raise concerns about asset quality.
- Management expects losses to continue for another 5-6 quarters due to accounting standards, which may weigh on investor sentiment.
Ladies and Gentlemen, Good day and welcome to Q1 FY27 Earnings Conference Call hosted by Embassy Developments Limited.
(Operator Instructions)
I now hand the conference over to Mr. Aditya Virwani, Promoter and Managing Director from Embassy Developments Limited.
Thank you and over to you sir.
Good morning everyone and thank you for joining us today.
I'm joined by Sachin Shah, our CEO and Executive Director and Rajesh Kaimal, our CFO and Executive Director.
Our investor presentation has been uploaded to the stock exchanges and is also available on our website.
We have started FY27 with good momentum. The first quarter reflects the progress we have made over the past year, especially as the launches from the second half of FY26 continue to translate into healthy sales and collections.
We entered FY27 with substantial residential portfolio available for sale, comprising approximately 10,500 crores of ongoing
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