NCR breakthrough masks Q1 margin compression and revenue miss

Residential revenue ₹880 Cr, down from ₹1400–1300 Cr prior quarters (–37% QoQ). Residential operating margin 51–52% vs 55% historical.

Q1 delivered ₹1300.9 Cr (~₹13 B quarterly annualized to ~₹52B), down 25.7% QoQ. Margin compressed 300+ bps to 56.4% overall OPM.

₹8,000 Cr gross bookings confirmed in Phase 1; 1.4M sq ft sold of 2.6M total project. Allotments completed, distanced from court ruling.

Commerz I/II/III + Oberoi Mall reported at near 100%. Sky City Mall 82% and managing to steady state—no revenue figures verified.

Capex for NCR ₹200 Cr of ₹786 Cr total. Project margins range 43–44% to 65%; mix-driven claim plausible but Q1 miss suggests underlying pressure.

Prior: ₹60–70 billion annual sales assumption. Now: ₹100–120 billion (FY27–28) based on Three Sixty North Phase 1 success (₹8000 Cr bookings, 1.4M sq ft).

Was Q2–Q3; now targeting Q3 FY27. Management comfortable with one-quarter cushion buffer.

Management now claims 'cracked the code' on volume + quality. 18 towers of 60–65 floors under construction cited as proof; prior calls focused on project-by-project delivery.

Q1 ₹880 Cr residential recognition vs ₹1400–1300 Cr prior quarters (–37% QoQ). Management pins on payment timing, but miss is material vs market expectations of stable high volumes.

Margins depend on product strategy, land buy, and market approach—not sales volume. We've cracked the execution code; contractors solid; ready for volume.

No refunds requested. Customers refuse refunds; want to wait for cancellations. We're pushing them to take money back (no flats offered). Very humbling sentiment.

NCR capex ₹200 Cr of ₹786 Cr. Margin is project mix (43–65% range). No cost inflation; mix-driven only.

2.6M sq ft holds total. Phase 1: 1.4M sold. Phase 2: balance area, will come after RERA approval. IREO customers separate.

Finished units (Three Sixty, Mulund): recognized on payment + possession. Others: % work done. Timing of payments defers recognition to next Q; order book intact.

All done. Completely distanced from court ruling.

BD is everyday job; can't disclose specifics. Mindful on land, location. Thane model: ₹20–25K/sqft. NCR has width and depth; we'll replicate that.

All named projects (Aurelius, Thane, Alibaug, Tardeo) in FY27. Mulund possible Q4 FY27. Phase 2: not decided. Depends on show apartment reaction, then pricing/timing.

Cracked the code: 18 towers 60–65 floors under construction simultaneously. Systems solid; external partners excellent. Sky City Q4 had retailer true-ups; not repeating.

Driven by Three Sixty North Phase 2 (1.2M sq ft, launch timing TBD) + multiple Mumbai launches (Adarsh Nagar, Aurelius, Thane, Alibaug, Tardeo). Phase 2 strategy (staggered vs one-go) still under review.

Management claims margin independent of volume, driven by product strategy. But Q1 showed 51–52% residential margin vs 55% prior—300 bps miss undermines credibility of sustained 50%+ at higher volumes.

Q1 capex ₹786 Cr (₹200 Cr NCR). No forward capex guidance; management focused on using Three Sixty North Phase 1 proceeds to fund Phase 2.

Adarsh Nagar targeting Q3 (IOD pending), Aurelius/Thane/Alibaug/Tardeo undefined timing. Missed approvals or supply-chain delays could push launches into FY28, materially impacting ₹100–120B annual guidance.

Q1 residential margin 51–52% vs 55% historical (-300 bps). Management blames mix (43–65% project margin range), but if inflation or competitive pricing persists, guidance of 50%+ at higher volumes may not hold. NPM 39.9% also soft vs capacity.

Analyst (Puneet Gulati) raised litigation emergence. Management downplayed: no refunds requested, customers want to hold. But this is optimistic framing; if delivery or pricing falters, refund demand could materialize and hit cash/reputation.

Residential revenue ₹880 Cr (Q1) vs ₹1400–1300 Cr (prior 3 Q) driven by payment/possession timing. Management explains as 'order book intact,' but sequential miss suggests demand softness or buyer financing tightness.

Phase 2 (1.2M sq ft) launch timing 'not decided.' Management will launch after show apartment ready and market reaction gauged. This ambiguity creates execution risk; if Phase 2 is delayed or priced conservatively, ₹100–120B annual sales guidance becomes unachievable.