Company Update : Brigade Enterprises by Motilal Oswal Financial Services Ltd
In-line operations driven by strong launches
11msf of residential launch pipeline provides near-term growth visibility.
Operating performance
* In 2QFY26, BRGD reported a 12% YoY pre-sales growth, reaching INR20.3b, in line with our estimates. The company recorded volumes of 1.9msf, a 13% YoY increase and 9% above our expectations. In 1HFY26, presales rose 8% YoY to INR32b, while volumes remained flat at 2.9msf.
* BRGD’s consolidated collections rose 3% YoY to INR20b (in line with estimates).
* BRGD launched two residential projects and one plotted project with a TDA of 2.02msf in 2Q across Bengaluru. Overall, in 1HFY26, it launched three residential and one plotted projects with a TDA of 3.11msf across Bengaluru and Chennai.
* BRGD plans to launch ~11msf in the next four quarters across Bangalore, Chennai, Hyderabad, and Mysuru.
* In 1HFY26, Brigade Group acquired a prime land parcel on Velachery Road, Chennai, for a premium residential development with a total potential of 0.8msf and an estimated GDV of INR16b. The land was acquired at a cost of INR4.4b.
* BRGD's gross debt was INR42.9b, while net debt was INR17.7b. Its net debt-to-equity stood at 0.22x by end-2QFY26 (vs 0.34x in 1QFY26); the cost of debt declined to 8.05%.
* Leasing: Leasing revenue grew 16% YoY to INR3.4b, while EBITDA stood at INR1.9b with a margin of 56%. In 1HFY26, leasing revenue grew 15% YoY to INR6.4b, while EBITDA stood at INR3.6b with a margin of 56%.
* Portfolio occupancy stood at 92% with an overall leasing of 8.67msf out of 9.38msf.
* The company launched two commercial projects during the quarter with a TDA of 0.72msf across Bengaluru and Chennai. Overall, in 1HFY26, it launched four commercial projects with a TDA of 1.26msf across Bengaluru, Gujarat, and Chennai.
* 4.21msf of area is expected to be launched in the next four quarters.
* Hospitality: BHVL reported revenue of INR1.4b, which rose 16% YoY, while EBITDA stood at INR420m.
* BHVL currently operates 1,604 keys. Nine hotels totaling 1,700 keys are in the planning stage, of which six hotels comprising 940 keys are under agreement with Marriott International.
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