Company Update : Brigade Enterprises Ltd By Motilal Oswal Financial Services Ltd
Revenue beat offset by elevated RM costs
The 12msf launch pipeline provides near-term growth visibility
Operating performance
* In 4QFY25, BRGD reported pre-sales growth of 9% YoY to INR24.5b (22% below estimates), aided by volumes of 2.0msf, which declined 26% YoY (50% below estimates).
* BRGD’s consolidated collections rose 5% YoY to INR19.3b (33% below estimates).
* For FY25, BRGD achieved pre-sales of INR78.5b, up 31% YoY (8% below estimates). Collections improved 23% YoY to INR72.5b.
* BRGD launched 4msf of projects in 4Q and plans to launch ~12msf in the next four quarters across Bangalore, Chennai, Hyderabad, and Mysuru.
* BRGD's gross debt was INR44.4b, while net debt was INR9.6b. Its net debt to equity stood at 0.14x by end-4QFY25 (vs. 0.18x in 3QFY24); the cost of debt was 8.67%.
* BRGD recommended a final dividend of INR2.5/sh of FV INR10 each.
* In 4QFY25, BRGD signed a JDA for developing a residential project of ~1msf located at West Chennai with a GDV of ~INR8b. The project will be developed as part of a 1.5msf mixed-use development.
* BRGD has signed a definitive agreement for a prime land parcel located on Whitefield-Hoskote Road, Bengaluru, for developing a residential project spanning about 20 acres. The project will have a total saleable area of ~2.5msf with a GDV of about INR27b and a total land cost of about INR6.3b through its subsidiary Ananthay Properties.
* In 2QFY25, BRGD raised INR15b via QIP at INR1,150 per share. INR10.7b has been utilized so far towards land acquisition, reduction of debt, and general corporate expenses.
* Post-4QFY25, BRGD acquired a prime land parcel on Velachery Road, Chennai for premium residential development with a total potential of 0.8msf, resulting in a GDV of INR16b. BRGD acquired this land for INR4.4b
Commercial:
* Leasing revenue grew 40% YoY to INR3.5b, and the hotel business reported a revenue of INR1.5b, which rose 22% YoY.
* BRGD has a balanced capex commitment of INR7.1b out of a total ongoing capex of INR12.5b for commercial assets.
Financial performance
* Revenue declined 14% YoY to INR14.6b (8% above our estimate). For FY25, BRGD achieved revenue of INR50.7b, up 4% YoY, which was in line.
* EBITDA stood at INR4.1b, down 4% YoY (28% below estimates). EBITDA margin came in at 28.5%, up 307bp YoY, while it was 14pp below our estimates. For FY25, the company reported an EBITDA of INR14.1b, up 18% YoY (10% below estimates). Its EBITDA margin stood at 28%.
* For 4QFY25, BRGD’s adj. PAT jumped 20% YoY to INR2.5b (24% below estimates), clocking a margin of 17%. During FY25, it reported an adj. PAT of INR6.9b, up 52% YoY (10% below estimates).
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