Buy Brigade Enterprises Ltd For Target Rs.750 By Geojit Financial Services Ltd
Soft Quarter, Launches to Drive H2
Brigade Enterprises Ltd. is one of India’s leading property developers, with over three decades of expertise. Since its inception, Brigade has completed 300+ buildings, amounting to over 100msf. of developed space across a diverse real estate portfolio.
* Pre-sales stood at Rs.1,061cr in Q1 FY27, down 5% YoY, as volumes declined 22% YoY to 0.74 msf.
* Realizations increased 21% YoY to a record Rs. 14,256/sq. ft., supported by price hikes in ongoing projects and a richer product mix.
* The launch pipeline stands at 16.39 msf over the next four quarters, of which 12.36 msf is residential, carrying a GDV of ~Rs.13,400cr.
* Revenue from operation declined 13% YoY to Rs.1,115cr on the mix of projects reaching revenue recognition during the quarter.
* EBITDA rose 11% YoY to Rs.361 with margins expanding ~790bps YoY to 32%, while real estate EBITDA margins improved to 21% from 12% a year ago.
* Leasing revenue rose 9% YoY to Rs.328cr at a 70% EBITDA margin, with portfolio occupancy at 88%, gross leasing of 0.22 msf and rental collections at 99%.
* Hospitality revenue stood at Rs.144cr with EBITDA of Rs.45cr, as portfolio ARR rose 7% YoY to Rs.7,241 and occupancy stood at 76%.
Outlook & Valuation
Brigade reported a soft quarter in pre-sales due to the absence of major launches, though stronger realizations and a sharp margin recovery in real estate provided support. A strong launch pipeline in Bengaluru and Hyderabad should lift volumes from Q2. Leasing income continues to benefit from escalations and renewal spreads, even as large-format office demand stays slow. The revocation of environmental clearance for Brigade Morgan Heights, Chennai, is a key risk, but the balance sheet is comfortable with debt largely backed by lease rentals. We maintain our BUY rating with a target price of Rs.750 (based on FY28E NAV/share).
Key Highlights
* Collections for the quarter stood at Rs.1,856cr, up 7% YoY.
* Business development added 2.7 msf in Q1 FY27 at a GDV of Rs.2,400cr, largely in Hyderabad.
* Cost of debt came in at 7.61% as of June 2026, down 64bps YoY, with net debt-equity at 0.26x.
* Brigade Morgan Heights, Chennai, has been dropped from launch guidance after SEIAA revoked its environmental clearance, with home buyers refunded and the matter now in the High Court.
* Management now guides 9.36 msf of FY27 launches against ~11.5 msf earlier, while maintaining the pre-sales guidance.
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SEBI Registration Number: INH200000345
