Eldeco Housing & Industries Ltd Q4 FY2026 Concall Summary

Key Takeaways

• Record bookings, margin noise: FY26 bookings hit INR 744 cr (+120% YoY) and collections INR 352.1 cr (+39% YoY), but Q4 margins dipped on ~INR 25 cr of one-off write-offs that management calls a one-time cleanse.
• Solano Gardens validates the model: The Lucknow launch sold 343 of 433 units in its first phase, generating INR 384+ cr in bookings and proving deep demand for plotted, villa and group-housing product in the city.
• Imperia 2 revenue is the FY27 story: The project is substantially complete with a completion certificate, and INR 130-150 cr of revenue is expected to flow through FY27 as customers take possession under IndAS 115.
• Pipeline built, launches back-end loaded: Three new land parcels added ~INR 2,000 cr GDV, taking the total pipeline to ~INR 4,000 cr to be sold over 5-7 years, but big launches only come toward FY27-end after approvals.
• What to watch next quarter: The pace of Imperia 2 possession-linked revenue conversion, any new land parcel additions beyond the three already disclosed, and whether the relaunched Eldeco Trinity gains traction at its higher INR 8,000-11,000/sq ft price point.

The Imperia 2 Revenue Bridge

Imperia 2 is the dominant near-term earnings driver: substantially complete, completion certificate in hand, and the largest single contributor to Q4 revenue at INR 47 cr (70-80% of the quarter). The remaining revenue sits behind a customer-behaviour gate, not a construction gate.

• Revenue recognition mechanics: Under IndAS 115, control passes only when the customer completes all instalments and takes possession. The project finished ahead of its promised two-year timeline, so some buyers who planned finances for a later date may defer possession.
• FY27 visibility: Management projects INR 130-150 cr of Imperia 2 revenue in FY27, with Pankaj Bajaj citing INR 140 cr. Roughly INR 100 cr then remains for the year after.
• Margin tailwind: The FY27 EBITDA margin guidance of 30-35% and PAT margin of ~25% rests substantially on this high-margin recognition flowing through, since direct construction costs are already largely incurred.

Pankaj Bajaj: "Somebody booked a house last year in January, and he was told that it's going to take 2 years. So, he's planned his finances for the next 2 years. And now because the company has got completion certificate and offered possession before time, it is not necessary that he will accept that possession."

Solano Gardens & the Lucknow Demand Engine

The Solano Gardens launch was the headline operational event of FY26 and the clearest signal of product-market fit in Lucknow. Management frames the city's market as supply-constrained, not demand-constrained.

• Launch metrics: 343 of 433 units sold in the launch phase across plotted, villas, group housing plots and commercial, generating over INR 384 cr in bookings. The project is an extension of the Imperia model, which itself extended from Eldeco City and Eldeco Regalia.
• Demand-supply imbalance: Land assembly in Lucknow is difficult because parcels are fragmented and often disputed. Eldeco and its peers cannot supply good-quality housing in the volumes the market demands. Plotted and villa products carry higher margins but require 2+ years of land aggregation pain; LDA-auction group-housing sites can launch in 6-8 months.
• Next phases: 75-80% of horizontal development (villas and plots) is already absorbed or launched. The first multi-storied apartment phase launches toward end-FY27 and will be a multiyear project.
• Price stagnation watch: Realizations rose to ~INR 6,500/sq ft on mix, and new city-centric projects like Trinity will push that higher, but Bajaj noted that prices have risen a lot and are now kind of stagnating across the market.

Pankaj Bajaj: "The demand supply gap is so skewed that we don't even worry about demand anymore. We just worry about supply. Can we put this through through a nice project at a reasonable price, of course."

Pipeline & Launch Cadence

The company added nearly INR 2,000 cr GDV through three prime land parcels in key Lucknow growth corridors, two secured via local authority auctions (lower risk, faster monetization). Total pipeline now stands at ~INR 4,000 cr to be recognized over 5-7 years.

• FY27 launch timing: No major launches are expected in Q1 or Q2 FY27. The three new parcels are still in design and approval stages; launches will come toward the end of the financial year, if at all, subject to RERA registration. Small launches are possible in the interim.
• Eldeco Trinity relaunch: The sample flat is ready with minor lobby works ongoing; the project relaunches in about three weeks at a higher INR 8,000-11,000/sq ft price point, testing the market's appetite for city-centric pricing.
• Latitude 27 handover: The official position remains November 2027, but management hopes to deliver before time, possibly within FY27. Four of five towers finish in the first phase; the fifth tower, launched later, lags by 6-9 months. Total project value is INR 270-280 cr.
• Land aggregation pipeline: Organic aggregation continues in 3-4 undisclosed locations; the company is also working actively in Gorakhpur with a couple of term sheets out, though nothing is tied up yet. Management deflected on whether new parcels will be added this year, saying hands are full for the next couple of quarters.

Margin Walk & One-Offs

Q4 margins were depressed by identifiable one-time items that management characterizes as a cleansing exercise and does not expect to recur. The FY27 margin outlook is materially higher.

• Q4 drag: INR 11 cr of GST input write-off plus ~INR 14 cr of earlier project expenses hitting other expenses, which doubled to ~INR 20 cr in the quarter. Management called it a "cleansing bit" and said no more one-offs are expected in coming quarters.
• FY27 margin guidance: EBITDA margin of 30-35% and PAT margin of ~25%, driven by Imperia 2 revenue recognition where direct construction costs are already substantially incurred.
• Cost recognition structure: Direct construction costs are recognized along with revenue. Non-direct costs (salaries, overheads, advertising) are period costs expensed immediately, so operating leverage improves as revenue scales.
• Construction spend trajectory: Construction spend will keep increasing as more projects launch; FY27 is expected about 15-20% higher than FY26, roughly INR 200 cr. Spend follows project timelines organically over 10-13 quarters even when bookings happen upfront.

Regulatory & Competitive Context

Uttar Pradesh's urban development policy has materially improved project economics and predictability, a structural tailwind that management contrasted with conditions a decade ago.

• Approval predictability: The approval process has become easier, predictable and more liberalized. Management can now forecast launch timelines with confidence: a project put into approvals will come through in reasonable time, enabling 3-quarter-forward launch planning that was impossible 10 years ago.
• Interest rate sensitivity is muted: Only 30-40% of collections are disbursed through home loans. The customer base understands floating rates over a 20-year period, so rate cycles do not heavily drive demand.
• National player entry: Management welcomes potential national-player entry into Lucknow, viewing it as a positive for the market and indirectly for Eldeco, and does not expect adverse impact.

Pankaj Bajaj: "If you had asked me 10 years ago, when would you launch this project, I would have been not sure. But now I can say I would launch it in 3 quarters from now, because we know that once you put your application for approvals, it does come around in some reasonable time."

Guidance & Commitments

Key Metrics