Expect growth momentum to sustain in FY27
About the stock: Mahindra Lifespace Developers, identified as a Growth Gem by Mahindra Group, has ~54 million square feet (msf) of residential projects across seven cities and 5,000+ acres of integrated cities / industrial clusters (IC& IC) business
• It eyes residential pre-sales of ~₹ 9500 crore by FY30, at 28% CAGR over FY25- FY30.
• Its IC&IC business is expected to generate revenues of ₹ 5000-6000 crore and PAT of ₹ 1500 crore (company’s share) over long term.
Q4FY26/FY26 Performance: Mahindra Lifespace Developers reported strong residential pre-sales of ₹ 1633 crore (up 55% YoY, up 186% QoQ) and IC&IC sales of ₹ 360 crore (up 71% YoY, up 171% QoQ) for Q4FY26. For FY26, residential pre-sales were up 21% YoY at ₹ 3405 crore while IC&IC sales were up 44% YoY at ₹ 713 crore. Consolidated revenues stood at ₹ 670 crore for Q4FY26 as against ₹ 9 crore/ ₹ 459 crore in Q4FY25/ Q3FY26 led by revenue recognition of Eden phase I, Nestalgia, Tathawade phase I and Palghar projects. However, it reported EBITDA loss of ₹ 44 crore vs EBITDA loss of ₹ 55 crore in Q4FY25 and EBITDA profit of ₹ 30 crore in Q3FY26 owing to lower gross margins of phase I and affordable projects. Consolidated PAT stood at ₹ 90 crore, up 6% YoY led by IC&IC business.
Investment Rationale
• FY27 pre-sales guidance retained on strong launch pipeline: The company retained its pre-sales guidance of ₹ 4500-5000 crore for FY27 while it upped its launch guidance for FY27 to ₹ 10,000 crore (earlier ₹ 5000-7000 crore). It plans to launch Beacon Hill, Mahalaxmi (₹ 1650 crore GDV) and Citadel phase 3 (₹ 970 crore) during Q1FY27. Additionally, it targets to launch Mahalunge, Pune (₹ 3500 crore), Navrat ph I&II, Bengaluru (₹ 2100 crore) and Saibaba ph I, Borivali (ph I out of ₹ 1800 crore GDV) during FY27. Sustenance sales from already launched projects viz. Rainforest ph I (Mulund), Blossom (Bengaluru), Citadel ph II (Pune) and Marina64 is expected to contribute to FY27 pre-sales.
• New business development momentum to continue: The company added ₹ 18060 crore GDV (including Thane of ₹ 7500 crore unlocking) in FY26 in addition to ₹ 18100 crore in FY25. For FY27, it targets to add at least ₹ 10000 crore GDV across MMR/Pune/Bangalore in the ratio 60/20/20. Total GDV currently stands at ₹ 45180 crore providing it multi-year pre-sales visibility. Based on strong business development over trailing two years and expecting the momentum to continue going ahead, it reiterated its long-term guidance of achieving ₹ 10,000 crore pre-sales (₹ 9500 crore residential, ₹ 500 crore IC&IC business) for FY30. Rating and Target Price
• We retain our BUY rating with a revised SOTP based Target Price of ₹ 450/- (assigning nil premium to NAV).
