Operator: Ladies and gentlemen, good day and welcome to the Sunteck Realty Limited Q2 FY2027 Earnings Conference Call. Today we have with us Mr. Kamal Khetan, the Chairman and Managing Director of the company, and Mr. Prashant Chaubey, the Chief Financial Officer. Please note that this call will be for 30 minutes, and all participants for this duration will be in the listen only mode.
Operator: This conference call is being recorded, and the transcript for the same may be put on the company's website. After the management discussion, there will be an opportunity for you to ask questions during the question and answer session. We request you to restrict questions to two per participant. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone.
Operator: Before I hand the conference over to the management, I would like to remind you that certain statements made during the course of this call may not be based on the historical information or facts and may be forward-looking statements, including those related to business statements, plans, and strategies of the company, its future financial condition, and growth prospect.
Operator: These forward-looking statements are based on the expectations and projections and may involve a number of risks and uncertainties and other factors that could cause actual results, opportunities, and growth potential to differ materially from those suggested by such statements. I now hand the conference over to Mr. Kamal Khetan from Sunteck Realty Limited. Thank you, and over to you, sir.
Kamal Khetan: A very good evening to everyone, and thank you for joining us for our earnings conference call for Q2 and H1 FY27. I will keep my remarks brief and focused on the key developments of the half. I am pleased to share that Sunteck has delivered a strong performance reflecting our continued growth momentum of operational excellence and commitment to creating long-term value for our stakeholders.
Kamal Khetan: We have delivered a strong H1 with growth across pre-sales, collections, cash flows, revenue, and profits, sustaining the CAGR of 25% across all major operational and financial parameters over the last five years. On business development during the quarter, we have acquired a new land parcel of 4.5 acres at Borivali West through an outright purchase.
Kamal Khetan: This takes our assembled land holding at Borivali West from 7 acres to 11.5 acres, and with an estimated GDV value of INR 80 billion. This will further enhance the project scale, development potential, and set the benchmark for Uber luxury living in that micro market. With this addition, our total GDV stands at INR 469 billion, of which INR 260 billion is already launched or to be launched, providing us several years of launch visibility.
Kamal Khetan: We continue to evaluate further business development opportunities, several of which are at advanced stage. Our approach remains focused, disciplined, and capital efficient. Every new acquisition must clear the same filters we have always applied: a high IRR, a high equity multiple, and a minimum project level EBITDA margins of 30% to 35%. We will continue to do our acquisition across all models such as capital-light JDA, JV, redevelopment, and outright purchases.
Kamal Khetan: Now, on Nepean Sea Road, this is one of our most significant project in our Uber luxury portfolio. Approvals are at advanced stage, and once the construction is underway, the project will be a meaningful contributor to both pre-sales and collections. Now we don't see the visibility in terms of Dubai project.
Kamal Khetan: Since we don't see the visibility to launch the Dubai project in next one or two quarters, in spite of we being launch-ready for the Dubai project, to keep the GDV number more realistic, we have moved the Dubai project from to-be-launched GDV to upcoming for launch GDV. This has been explained properly by us in the slide 10 of Q2 and H1 FY27 investor presentation. However, our conviction in the project or its economics continues to remain very bullish.
Kamal Khetan: Our launch pipeline for FY27, excluding Dubai, stands at INR 70 billion, and the H2 is weighted towards launches. The key launches planned for H2 are Sunteck Belvedere Park at Mira Road on the Western Express Highway, which we are confident will be our second successful project at Mira Road after Sunteck SkyPark, and our residential project at Andheri along the Western Express Highway.
Kamal Khetan: Finally, on sustainability, we have retained our GRESB Green Five Star rating for a second consecutive year, with our score improving to 98.8 in 2026 from 98.6 in 2025. Even as GRESB average declined to 86.2 from 88, widening our lead over the benchmark. During the quarter, Fourth Avenue at Sunteck City also achieved the EDGE Advanced certification from Green Business Certification, GBCI, with over 50% saving in energy, water, and embodied carbon, an estimated CO2 saving of 1,100 tons annually.
Kamal Khetan: This recognition reflects our focus on resource efficiency and sustainable construction and keep us rated among the best in the global real estate. I shall now hand over the call to Prashant Chaubey to take you through the financial performance for Q2 and H1 FY27 in greater detail.
Prashant Chaubey: Thank you, sir. Good evening, everyone. Our results and investor presentation are available on our website and the stock exchanges. The CMD has covered the developments of the half. I will focus on what is driving the numbers. The key operational and financial highlights are as follows. Pre-sales stood at INR 824 crores in Q2 of FY27 and INR 1,611 crores in H1 of FY27. The segment mix of our pre-sales remains well-balanced in Q2.
Prashant Chaubey: Uber luxury contributed 25%, premium luxury 51%, and aspirational luxury 25%. This mix carries a high embedded EBITDA margin on both our FY26 and H1 FY27 pre-sales, which will flow through to reported profitability as projects reach revenue recognition. Collections stood at INR 371 crores in Q2 and INR 780 crores in H1 FY27, as recent sales are weighted towards early-stage projects where milestones link collections are backended.
Prashant Chaubey: On reported financials in Q2, revenue grew 27% year-on-year to INR 3.2 billion, EBITDA 13%, and PAT 17%. In H1, revenue grew 16% to INR 5.1 billion, EBITDA 23% to INR 1.6 billion, with an embedded EBITDA margin expanding 160 bps to 30%, and PAT 20% to INR 1 billion. At the halfway mark, EBITDA and PAT already
Prashant Chaubey: Stand at substantial levels of FY2026 numbers. With the second half, typically our strong half, we are well-placed for a strong year. Reported margins will continue to converge towards the embedded EBITDA margin of our pre-sales. On cash flows, our net operating cash flow surplus for H1 grew 27% year-on-year to INR 3.5 billion, which is 63% of FY2026 record full year surplus, and 45% of collections up from 40% a year ago.
Prashant Chaubey: On a trailing 12-month basis, the surplus stands at INR 6.3 billion. This surplus was delivered investing INR 3.9 billion in business development during the half. Finally, annuity income is running at an annualized INR 86 crores against INR 76 crores in FY2026 on FY2026. Thank you. With this, we open the floor for questions.
Operator: Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets when asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Harsh Pathak with Motilal Oswal. Please go ahead.
Harsh Pathak: Yeah. Hi, sir. Good evening. My first question is on the launch pipeline for H2. You highlighted there is INR 7,000 crores of pipeline coming up in H2, and the two projects you have highlighted for Mira Road and Andheri. What will be the respective GDV of these projects and any other phases of existing projects that we are planning to launch?
Kamal Khetan: Good evening, Harsh. Yeah. I will first take you through all the launches from the existing project and the new projects. What we are looking at, Sunteck Belvedere Park, which is in the Mira Road to the next project of Mira Road. This is one launch. Another one, which is on the Andheri Western Express Highway, again, a residential redevelopment project. Third is, we are looking at a new tower at Sunteck City ODC.
Kamal Khetan: The Altavia project, which we launched tower 1, now we are looking in H2, the tower 2. Borivali West, one phase which we have recently acquired and added to the 7 acres existing land parcel. That also we are looking to do it in H2. Plus the new tower at Sunteck Beach Residences, which is our SBR.
Kamal Khetan: One more new phase or new couple of towers in Sunteck World, and couple of new towers in Sunteck Crescent Park. All these put together makes total of INR 7,000 crores. When it comes to the new launch in Mira Road too, you specifically asked what is the GDV. We are looking at close to INR 1,200 to 1,400 crore GDV from there. And Andheri West, the new project, once again, on the Western Express Highway. There we are looking at a GDV again close to similar INR 1,250 crores to 1,500 crores.
Harsh Pathak: Understood. Thanks for those details. My next question is on the sales mix. I think this quarter we have seen some improvement in sales on the affordable housing segment. How are you seeing the traction in the respective segments like the GDV mid-income and the affordable housing, and how do you expect the overall annual pre-sales to be for this year?
Kamal Khetan: Well, we have seen that, obviously, in the last quarter also, we said we are seeing uptick in our aspirational luxury segment. That's what we are seeing that percentage of growth we are seeing in at least both the projects, where it is Naigaon and plus the Kalyan project. When it comes to uber luxury segment, we have been doing obviously sales from whatever we do at BKC and the Nepean Sea Road.
Kamal Khetan: Obviously, the inventory at BKC is now diminishing, so that's where we will see the much bigger run coming from the uber luxury segment from Nepean Sea Road. In the premium luxury segment, obviously, our sales mix has been 50%. Now when it comes to the mix, I would say uber luxury segment did 27%, premium luxury segment did 50%, and aspirational luxury segment did 23%.
Harsh Pathak: Understood, sir. How should we look at the-
Kamal Khetan: Sorry?
Harsh Pathak: Yeah, I was just trying to know what the pre-sales we should be expecting for the entire year, and also if you can give some color on the collections part also.
Kamal Khetan: We are very clear. We have been always maintaining that we are looking at a growth of 25%, which we are again very confident because H1 there was no major launches and still we could achieve a 19% year-on-year growth in H1. And we have a new launch pipeline, as I mentioned earlier INR 7,000 crore, due to which we are very confident that our guidance or our expectation of 25% year-on-year growth in the full year of FY27, we will be able to maintain easily.
Harsh Pathak: Okay, sir. Thank you. Thank you. Got any more questions?
Kamal Khetan: Thank you. Thank you, Harsh.
Operator: A reminder to all participants, you may press star and one to ask a question. The next question comes from the line of Pritesh Sheth with Axis Capital. Please go ahead.
Pritesh Sheth: Yeah. Thanks for the opportunity. Congrats on a steady growth performance. First question is on the Borivali, this new land that we acquired. Is it within the same location where we had earlier land as well? In terms of launch timing, while you mentioned that the new one will get launched this year, any update you want to provide on the older land parcel which we anyways had? Yeah.
Kamal Khetan: No. So what we said is we have added 4.5 acres. That does not mean that new one will be launched first. It will be together, consolidated. So I mentioned in the speech that this will only make us, in fact, this will increase the size of the project, and obviously, it will give us more strength.
Kamal Khetan: It will be one of the largest projects in that micro-market because 11.5 acre land parcel. That will only give us a better project designing and better product in that micro-market. So we're not saying that it will be consolidated land parcel, so it is touching the boundary of this seven acres. So it will be total one project of 11.5 acres.
Pritesh Sheth: Got it. Great to see some progress there. Second on the commercial project, ODC. Any update you want to provide in terms of construction, where we are on design? When can we see some progress on construction, and what would be the delivery timeline there?
Kamal Khetan: In ODC, Fifth Avenue is a part of our residential project, Altavia, and the commercial project. We have already started the execution because it is one contiguous parkland parcel. The commercial building is coming separately. The construction has started, and the residential building is coming separately.
Kamal Khetan: The one tower of residential has already started, and in H2, we are looking to launch another tower of residential, which is Altavia 2, whatever we call it. That also will be launched and the construction for that also we are looking to start in H2 itself. The construction for commercial also would have started. We have started all. The entire Fifth Avenue construction, you can say, have started.
Pritesh Sheth: Interesting. Got it. Okay. Just one last. I think since we now have a very sizable pipeline, pretty diverse as well across different micro markets within MMR. What should we consider as a focus from here on? Would we keep looking at such business development opportunities while we are launching the projects which we have already signed or for now, at least for the next couple of years, the focus would be to bring these projects online and not too much on the business development side?
Kamal Khetan: No. We are very clear. If you see, in fact, looking at our strong cash flows and our strong balance sheet, our net debt is only 0.09. You must have seen in last 2 years, last year, we spent almost close to INR 800 crores in business development. In H1, we have almost spent close to INR 400 crores. Because our balance sheet is so strong and has so strong cash flows, net cash flow surplus, we will continue to aggressively keep looking at more business development opportunities.
Kamal Khetan: To mention, we are already on advanced stage of one or two business development deals, and you will continue to see this momentum in the similar manner without compromising on our filters, not to compromise our EBITDA margin of less than 30% to 35%. All those filters will continue to remain and discipline. That's all.
Pritesh Sheth: Interesting. Thanks for the clarity and all the best.
Kamal Khetan: Thank you, Pritesh. Thank you.
Operator: The next question comes from the line of Abhinav Sinha with Jefferies Group. Please go ahead.
Abhinav Sinha: Hi. Sir, couple of questions. Firstly, on Nepean Sea Road project, can you tell us where we exactly are in terms of approval process, and can we expect a launch with RERA by March 2027?
Kamal Khetan: Well, Abhinav, we are very confident. Obviously, we know that is a very important project of us. Although it represents till now only INR 3,000 crore of GDV. But for us, that is like a crown in our portfolio. We are looking to launch with RERA as early, definitely before end of FY27. On-ground work has commenced.
Kamal Khetan: When we said last quarter that we have already demolished one complete building, the demolition of the second building has also started. I think it will be all finished within next 10 to 15 days. We are looking to start, because there are a couple of buildings, as you know, so we will very soon even start in next few days, the demolition of the third or fourth building also. That is how. We are very clear, definitely with the RERA, we want to launch properly before the end of FY27.
Abhinav Sinha: Okay. Sir, secondly, again, going back to the Borivali project. So now you have two projects or three projects because there used to be one in some no development zone. Can you please help me here?
Kamal Khetan: So already, just to make you know, it already has a resort running there and a club running there. So it is not exactly NDZ zone or something. So, we are very clear that sir, we are confident that we will be able to launch that project. Hence, we have accumulated another 4.5 acre of land parcel, and that we have purchased to make it bigger and better project. Hence, that's why we have taken that. We are looking to launch very soon even that project.
Abhinav Sinha: Okay, so this 4.5 acres acquired this quarter, this sort of is adjoining to the previous.
Kamal Khetan: Yeah
Abhinav Sinha: one.
Kamal Khetan: Previous land parcel.
Abhinav Sinha: Okay.
Kamal Khetan: Which will make the land parcel bigger and better.
Abhinav Sinha: Great. The one which we had announced in the last quarter, that is a separate location altogether?
Kamal Khetan: Last quarter, we didn't announce any Borivali project.
Abhinav Sinha: The quarter before.
Kamal Khetan: Last quarter we announced maybe the Mira Road project. We have moved it in GDV. It was not in the GDV because last quarter itself, we started getting feeler that we are near to the approvals, hence we must have moved that. That is the same project, old project, which we were not showing in GDV till now.
Abhinav Sinha: Okay, sir. Thank you.
Kamal Khetan: Thank you.
Operator: The next question comes from the line of Vasudev with Nuvama Wealth Management. Please go ahead.
Vasudev Ganatra: Yeah, thank you for the opportunity, sir, and congratulations on a great set of numbers. Sir, if I am not wrong, we have done a new phase launch in the Sunteck SkyPark project. So, possible to give details like what is the area in GDV that we have launched here and sold in the same quarter?
Prashant Chaubey: Hi, Vasudev. Prashant this side. So till now in Sunteck SkyPark, we have launched three towers, of which tower 3 was launched just a few months back. It has done pretty well for us. Our total GDV for that tower is close to around INR 750 crores, and we are also going to get some extra area also in that project going forward. So yes, out of that, we have been doing sales in Q1 and Q2, both. In Q2, we have done a sales of almost INR 200 crores.
Kamal Khetan: Just to correct, Vasudev. It is not exactly tower 3. It is higher floors of tower 1, tower 2, and tower 3, which we launched. That launch is equivalent to one new tower. This is the extra FSI, obviously, due to the new policy which we have got.
Kamal Khetan: So we have increased the number of floors on all the towers. So there are total four towers which are supposed to be there, out of which already three towers were launched. Now what we launched, the higher floors of tower 1, tower 2, and tower 3, which total, if you put it together, is equivalent to one new tower. That is what. Okay, Vasudev.
Vasudev Ganatra: Okay. Sure, sir. That was helpful. Secondly, sir, if you can give us the list of projects that we are expecting to complete in FY27, which would contribute to our P&L revenues.
Kamal Khetan: Vasudev, yeah. We will be doing more recognition, obviously, from our Sunteck One World, Naigaon project completion. More revenues coming from there. Sunteck City ODC. Avenue 1, we have got higher floors, which we are constructing. We will complete. Fourth Avenue, we have got very large number of floors.
Kamal Khetan: We were waiting for that height. We have started construction there also. That also we will complete in FY27 itself. ODC, we have this commercial project, Sunteck Pinnacle, which will get completed now recently. All the ready inventories, what we are looking from our BKC and other projects. That will all give us a good revenue, and we are very confident that will give us our H2 good momentum and results numbers from there.
Vasudev Ganatra: Sure, sir. Got it. That is it from my side. Thank you.
Kamal Khetan: Thank you.
Operator: Ladies and gentlemen, that was the last question for today. I would now like to hand the conference over to Mr. Kamal Khetan for the closing remarks.
Kamal Khetan: Thank you all for taking the time out of your busy schedule to join us today. If any of your queries have been left unanswered, please feel free to reach out to us. We truly value your continued support and looking forward to strengthening this relationship. Thank you once again.
Operator: Thank you, sir. Ladies and gentlemen, on behalf of Sunteck Realty Limited, that concludes this conference call. Thank you for joining us, and you may now disconnect your lines.
