Buy Brigade Enterprises Ltd for the Target Rs. 1,154 by Geojit Financial Services Ltd
Solid outlook coupled with valuation comfort
Brigade Enterprises Ltd. (BRGD) is one of India’s leading property developers, with over three decades of expertise. Since its inception, Brigade has completed 280+ buildings, amounting to over 90msf. of developed space across a diverse real estate portfolio.
• In Q1FY26, Brigade reported weaker-than-expected residential pre-sales (-55% QoQ / +0.3% YoY), primarily due to minimal launches.
• Sales volume stood at 0.95 msf, while launches totalled ~1.09 msf for the quarter. Realizations grew substantially by 24% YoY to 11,782 Rs./sq. ft.
• The leasing segment posted a strong 15% YoY growth, supported by additional leasing activity, achieving an occupancy rate of 91%.
• The hospitality segment grew by 19% YoY, driven by steady occupancy and an 8% increase in Average Room Rent (ARR).
• Revenue recognition remained robust, marking a 19% YoY growth. However, EBITDA margin contracted by 189 bps YoY due to a higher residential mix.
• Brigade has a launch pipeline of ~13 msf for the next quarter, along with a total inventory of 5.57 msf, which is expected to drive volumes in the coming quarters.
Outlook & Valuation
Despite a muted performance this quarter, we anticipate a strong rebound in bookings in the near term. With a robust launch pipeline rolling out over the next four quarters, both sales volume and realizations are expected to improve, alongside steady performance in the leasing segment. Considering the strong outlook and valuation comfort, we upgrade our rating on the stock to BUY, with a revised target price of Rs.1,154, based on FY27E adj. NAV per share.
Key Highlights
• Collections stood at Rs.1,728 cr during Q1FY26, reflecting a YoY growth of 8%.
• Brigade Hotel Ventures Ltd was successfully listed on both NSE and BSE during the quarter.
• In Q1FY26, Brigade launched Phase 1 of Morgan Heights, spanning 1.09msf.
• BRGD has a pipeline of ~13msf of residential projects, including 7 in Bengaluru, 4 in Chennai, 3 in Hyderabad, and 2 in Mysuru.
For More Geojit Financial Services Ltd Disclaimer https://www.geojit.com/disclaimer SEBI Registration Number: INH200000345
