IGI Logo

Growth visibility remains strong Record pre-sales in 2Q, supported by sustenance inventory

In 2QFY27, Sri Lotus Developers & Realty (LOTUSDEV) recorded its highest ever quarterly presales at INR4.7b (25% beat on our estimate), up 83% YoY, fueled by sustenance inventory from Lotus Trident, Andheri (INR1.8b) and Lotus Celestia, Versova (INR1.0b). In 1HFY27, its presales surged 1.8x YoY to INR8.8b. In 2HFY27, LOTUSDEV has planned four launches – Lotus Sky Plaza, Lotus Portofino, Lotus Odyssey, and Lotus Aurelia, with a combined GDV of INR35- 40b. This plan positions the company well to meet its FY27 guidance of INR18- 20b (up 56-73% YoY).

Added three new projects; upcoming launches to push pre-sales growth

LOTUSDEV added three new projects – Lotus Supremus in Juhu (Commercial), Lotus Empressa (Dadar West) and Lotus Stellar (Versova). It also added additional area in Lotus Insignia, Andheri. Together, these add INR27-28b of GDV, taking its upcoming residential project portfolio’s potential GDV to INR87- 89b and its commercial portfolio to INR66-68b. Collectively, the ongoing and upcoming projects offer a pre-sales potential of ~INR200b, providing comfortable growth visibility over the medium term. Despite the pre-sales beat in 2Q, we maintain our 56% pre-sales CAGR over FY26-28, reaching INR28.0b

Collections growth to catch up in 2H; balance sheet remains sturdy

LOTUSDEV’s collections were lower in 2QFY27 at INR0.6b, down 43% YoY, primarily due to newer projects being at the basement construction stage. In 1HFY27, collections stood at INR2.1b, up 19% YoY. With healthy progress in construction activity and collection milestones getting triggered from ongoing and upcoming launches, we expect collections to post a 93% CAGR, reaching INR14.1b over FY26-28. Despite the strong BD during the quarter, LOTUSDEV has maintained a robust balance sheet, with net cash at INR4.9b as of 2QFY27.

P&L performance

In 2QFY27, LOTUSDEV’s revenue rose 53% YoY to INR2.7b, while EBITDA (a 35% beat) grew 113% YoY to INR1.1b. EBITDA margin stood at 39.9%. PAT jumped 78% YoY to INR0.8b (a 21% beat), with an adj. PAT margin of 30.6%. In 1HFY27, its revenue surged 69% YoY to INR4.0b, while EBITDA jumped 95% YoY to INR1.6b. EBITDA margin stood at 38.8%. PAT increased 78% YoY to INR1.3b, with an adj. PAT margin of 31.8%.

Valuation and view

* LOTUSDEV delivered a 59% pre-sales CAGR over FY22-26. With a healthy project pipeline, pre-sales and collections are expected to remain at elevated levels over the medium term. Further, the company has continued its business development efforts, and we expect more projects to be added in the coming quarters, providing further growth visibility.

* We roll over our valuations to FY28 and maintain a 50% NAV premium to reflect the company’s future growth potential. We reiterate our BUY rating with a TP of INR285, indicating a 16% potential upside.

For More Research Reports : Click Here 

For More Motilal Oswal Securities Ltd Disclaimer
http://www.motilaloswal.com/MOSLdisclaimer/disclaimer.html
SEBI Registration number is INH000000412