Arkade Developers Limited — Q4 FY26

Arkade Developers Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=HJAIZgkL29c Published: 3 weeks ago

0:00 Ladies and gentlemen, good day and welcome to the Arcade Developers Limited Q4 FY 2026 earnings conference call. 0:08 8 seconds This conference call may contain forward-looking statements about the company which are based on the belief, opinions, and expectations of the 0:14 14 seconds company as on date of this call. These statements are not a guarantee of future performance and involve risk and uncertainties that are difficult to 0:22 22 seconds predict. As a reminder, all participant lines will be in the listenon mode and there will be an opportunity for you to ask questions after the presentation 0:30 30 seconds concludes. Should you need assistance during this conference call, please signal an operator by pressing star then zero on your touchstone phone. Please 0:39 39 seconds note that this conference is being recorded. I now hand the conference over to Mr. Amit Chen, chairman and managing director of the company. Thank you and over to you. 0:51 51 seconds Good evening everyone. 0:53 53 seconds I would like to extend a warm welcome to all of you for Arcade Developers Limited earning conference call for the fourth 1:02 1 minute, 2 seconds quarter and annual result. I would like to begin by expressing my gratitude to all of you all for taking the time to 1:10 1 minute, 10 seconds join us today. We have on call with us our independent director Mr. Abhishek 1:16 1 minute, 16 seconds Dave, Mr. Samsit Shep CFO Miss Dip Ny head of marketing. We have shared our 1:24 1 minute, 24 seconds earnings presentation. I hope you all must have had the chance to go through it. 1:31 1 minute, 31 seconds FY 2526 has been a defining year for our kid. It was a year where we not only 1:38 1 minute, 38 seconds expanded our business footprint but also strengthened our commitment towards creating valueled development and 1:47 1 minute, 47 seconds building long-standing communities. The Indian real estate sector and Mumbai in particular continued to demonstrate strong resilience and momentum. 1:59 1 minute, 59 seconds Home ownership today has evolved significantly beyond necessity. Today's consumers seek aspirational lifestyle, 2:08 2 minutes, 8 seconds superior experiences, enhanced connectivity, and long-term value creation. We have witnessed a meaningful 2:17 2 minutes, 17 seconds transition in customer preferences towards premium and luxury housing and integrated living experiences. 2:27 2 minutes, 27 seconds At ARAD, we have remained committed to our philosophy of sustainable growth with disciplined execution. 2:35 2 minutes, 35 seconds During the year, we continued strengthening our project pipeline through a balanced mix of redevelopment 2:43 2 minutes, 43 seconds opportunities and strategic land acquisition across key micro markets in MMR region. 2:51 2 minutes, 51 seconds Our focus has always remained on creating projects that offer strong customer appeal while ensuring healthy 2:59 2 minutes, 59 seconds profitability and efficient capital deployment. 3:04 3 minutes, 4 seconds We have added appro 20% manpower in our front pending team of execution and 3:11 3 minutes, 11 seconds sales department in line with our growth plan. 3:15 3 minutes, 15 seconds Furthermore, I wish to draw your attention to an exceptional item. In financial year 26, AR developers 3:23 3 minutes, 23 seconds completed the strategic acquisition of Silistan Private Limited, a marquee and high value property located in the 3:31 3 minutes, 31 seconds premium residential micro market of Gore West of SV Road, Mumbai. The acquisition 3:39 3 minutes, 39 seconds represents a landmark transaction for the company given the property's unique heritage historical significance and prime location advantages. 3:50 3 minutes, 50 seconds The transaction comprised two distinct components outright acquisition of land. 3:58 3 minutes, 58 seconds Arcade developer acquired the underlying land parcel from Eston properties and Kanwala housing for a consideration of 4:07 4 minutes, 7 seconds 165 cr Indian rupees which was fully paid in January 25. Consequently the 4:14 4 minutes, 14 seconds ownership of the land now west directly with arade developers. 4:19 4 minutes, 19 seconds B part acquisition of tenency rights through Pilmistan Private Limited. 4:25 4 minutes, 25 seconds Filmistan Private Limited held tenency and opening rights related to Filmistan studios property which historically had 4:34 4 minutes, 34 seconds been utilized for movie shoots, advertising production and allied entertainment activity. The teny rights 4:43 4 minutes, 43 seconds were valued at approximately 182.6 crores. Pursuant to the transactions, Filmison Private Limited became a wholly owned subsidiary of Arcade Developers. 4:56 4 minutes, 56 seconds Subsequently, to simplify the holding structure and consolidate complete ownership rights directly under arcade 5:04 5 minutes, 4 seconds developers, the tenency rights were merged from Pyramisan Private Limited and transferred directly to ARD developers. 5:14 5 minutes, 14 seconds As a result of this structuring exercise, the tenency rights recorded in Simistan Private Limited have been 5:22 5 minutes, 22 seconds written off adjusted resulting in one-time exceptional accounting impact 5:28 5 minutes, 28 seconds of rupees 182.17 cr in the consolidated financial statements for the period. 5:38 5 minutes, 38 seconds This acquisition was highly competitive due to the rarity and strategic importance of the asset. The company 5:46 5 minutes, 46 seconds intends to develop a landmark Uber luxury residential project. The proposed development is accepted expected to 5:56 5 minutes, 56 seconds significantly strengthen market developers positioning in the residential luxury segment and serve as 6:04 6 minutes, 4 seconds a benchmark for the company's future premium developments. 6:09 6 minutes, 9 seconds Based on current estimates and subject to final approval and design consideration, expected GDV of the project is 3500 cr. 6:21 6 minutes, 21 seconds Estimated cumulative bottom line contribution over next 3 to 5 years rupees 1,00 to,200 cr. This project is 6:31 6 minutes, 31 seconds expected to become one of company's flagship developments and a defining milestone in arade developers long-term growth trajectory. 6:41 6 minutes, 41 seconds Additionally, I'm delighted to share that last evening we signed an MOU for securing the rights for cluster 6:48 6 minutes, 48 seconds redevelopment of nine society at Ashokaga in Kandiburi East having an 6:54 6 minutes, 54 seconds estimated RA carpet area of 3.25 25 lakh square ft with a GDB projected of 1100 7:02 7 minutes, 2 seconds Indian rupees 1100 crores. To summarize, ARID continues to distinguish itself with our execution first mindset. We 7:12 7 minutes, 12 seconds strongly believe that value creation in GSA does not come merely from owning land. It comes from timely execution, 7:20 7 minutes, 20 seconds customer trust and delivering projects with consistency and quality. Beyond numbers and business achievements, this 7:29 7 minutes, 29 seconds year has also been about reinforcing our brand philosophy, creating homes that enrich lives and build stronger 7:38 7 minutes, 38 seconds communities. We remain optimistic about the opportunities ahead and are confident that our state is well 7:45 7 minutes, 45 seconds positioned to participate meaningfully in the next phase of growth. I would now like to invite our head of marketing 7:54 7 minutes, 54 seconds miss to share insights on marketing consumer behavior and our kids brand journey. 8:04 8 minutes, 4 seconds Thank you Mr. and a very good evening everyone. I'm sorry audio is not clear. 8:12 8 minutes, 12 seconds Thank you. Thank you Mr. J and a very good evening everyone. It is my pleasure to address all of you today and I sincerely appreciate your continued 8:21 8 minutes, 21 seconds trust support and association with Arcade. FY 2526 has been a year of significant evolution within the real 8:29 8 minutes, 29 seconds estate residential real estate landscape. Historically, mid-segment launches dominated the MMR market. 8:35 8 minutes, 35 seconds However, luxury segment has now surged in FY25, matching mid-segment activity and trend 8:43 8 minutes, 43 seconds that has strengthened in the 9 month FY26. 8:47 8 minutes, 47 seconds The share of luxury segment payers in MMR has sharply climbed to 44% in the 9th month FY26, up from 31% in FY20 from FY21. 8:59 8 minutes, 59 seconds In terms of area sold, driven by an evolving consumer preference for larger premium homes, the lucky segment is 9:07 9 minutes, 7 seconds expected to account for a dominant share of launches in FY2627 while the mid segment is likely to retain and have meaningful presence. We 9:16 9 minutes, 16 seconds identify a shift to premium housing. So a mass and affordable housing roughly about above 1 cr has steadily shrunk as 9:24 9 minutes, 24 seconds a proportion of total sales. Properties priced between two to five cr now dominate with sales registration and 9:31 9 minutes, 31 seconds accounting for the bulk of recent market momentum. Steady price appreciation is another attribute that we see in the 9:39 9 minutes, 39 seconds current market. Record absorption and low inventory. The years to sell has hit a historic low hovering around 1.2 to 9:47 9 minutes, 47 seconds 1.4 years indicating a robust year-end demand outstripping the pace of new launches. infrastructure as an catalyst. 9:56 9 minutes, 56 seconds The market center of gravity is expanding considerably. Periphery and extended hubs such as Tame, Na'vi, Mumbai, Mira are becoming hot spots. 10:05 10 minutes, 5 seconds Enhanced connectivity through infrastructure especially the Mumbai trans harbor link and extended metro lines has significantly boosted local 10:14 10 minutes, 14 seconds property values. The sector witnessed a strong continuation of premonization trends with customers increasingly 10:22 10 minutes, 22 seconds prioritizing quality of life, lifestyle experiences, wellness, convenience, and community centric living environments. 10:31 10 minutes, 31 seconds At Arcade, our approach has always centered around understanding customer aspirations and translating them into meaningful experiences. I would now like 10:40 10 minutes, 40 seconds to hand over to our chief financial officer, Mr. from Shetty to take you through the financial performance. Thank you. 10:48 10 minutes, 48 seconds Thank you. Good evening everyone. I'll now take you through some of our key operational highlights for the quarter. 10:55 10 minutes, 55 seconds We achieved highest ever quarterly pre-sales of 303 cr for Q4 FY26 a growth of 40% on year-on-year basis. Visa reached 217 crores in Q4 FY25. 11:09 11 minutes, 9 seconds The area sold during the quarter stood at 1 lakh 10,000 square ft² up 57% 11:15 11 minutes, 15 seconds yearonear as compared with 70,000 ft in previous corresponding quarter. 11:21 11 minutes, 21 seconds Collections for Q4 FY26 came in at 195 crores in Q4 FY26. The key operational 11:31 11 minutes, 31 seconds highlight for the full year ended March 26 are as follows. We recorded pre-sale 11:37 11 minutes, 37 seconds of rupes 911 crores for fy26 a growth of 17% on yearonyear basis as against 773 11:46 11 minutes, 46 seconds crores in the previous corresponding year. The area sold during the quarter stood at 35,000 square ft up n up 27% 11:56 11 minutes, 56 seconds yearon year over 29,000 ft sold in the previous year. Collections for FI26 came 12:04 12 minutes, 4 seconds in at 728 crores registering a year-on-year growth of 2% from rupees 776 crores in FY25. 12:15 12 minutes, 15 seconds Now coming to our consolidated financial performance for the fourth quarter and full year ended 31st March 2025. Our 12:23 12 minutes, 23 seconds revenue for Q4 FI26 stood at 199 crores up by 48% compared to 134 crores in Q4 12:32 12 minutes, 32 seconds FI25. IBITA for the quarter stood at 38 crores. The IBITA margin for Q4 FI26 stood at 19.4%. 12:42 12 minutes, 42 seconds Coming to the fullear consolidated financials revenue for FY26 stood at 828 crores 12:49 12 minutes, 49 seconds compared to 695 crores in FY25 reflecting a growth of 19.2% year-on-year basis. IBITA for the period 12:58 12 minutes, 58 seconds stood at 189 crores. The IBITA margin for FY26 stood at 23.2%. 13:04 13 minutes, 4 seconds Profit after time for FI 2526 to rent that rupees 5 K which is after giving the effect of exceptional item which is 13:12 13 minutes, 12 seconds a diminish in value of tenency right of rupees 128 crores 182 crores and income tax provision of rupees 2 crores. 13:21 13 minutes, 21 seconds Operationally we witness strong performance in key business metric including pre-sale and area sold during 13:28 13 minutes, 28 seconds Q4 FI26 as well as full year FI26. Our balance sheet remains healthy providing us with flexibility to pursue growth 13:36 13 minutes, 36 seconds opportunities while maintaining financial discipline. We remain confident in the long run outlook of the business and believe our strong 13:45 13 minutes, 45 seconds fundamentals discipline strategy and execution capabilities position us well for the opportunities ahead. With that I 13:53 13 minutes, 53 seconds conclude my remarks and we may open the floor for question. 13:58 13 minutes, 58 seconds Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the touchstone 14:07 14 minutes, 7 seconds telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. 14:18 14 minutes, 18 seconds Ladies and gentlemen, we will wait for a moment while the question assembles. 14:27 14 minutes, 27 seconds We'll take our first question from the line of Manish, an individual investor. Please go ahead. 14:35 14 minutes, 35 seconds Hi sir, good evening. Hope you Manish, please use your handset mode. 14:39 14 minutes, 39 seconds The audio is not clear. Manish, please use your handset mode. Is it is it clear now? 14:46 14 minutes, 46 seconds Yes, please go ahead. 14:49 14 minutes, 49 seconds Hi. Hi, sir. Hi, sir. Good evening. Hope you're doing good. So I would like to know regarding the filmistan one. So 14:56 14 minutes, 56 seconds what do you when do we expect more clarity on the project sir? 15:04 15 minutes, 4 seconds The project is under approvers currently and we are uh looking at launching it by this year end financial year end. 15:15 15 minutes, 15 seconds Okay. Uh okay. And the second query is regarding the AITA margin. The EIA 15:23 15 minutes, 23 seconds margin the profit margin if you see from the last quarter has reduced. So going forward what is the AIA margin that we are targeting sir? 15:33 15 minutes, 33 seconds Uh we are targeting around 25% margin. 15:38 15 minutes, 38 seconds So I margin yeah I margin is expected to stabilize around 20 27 to 28%. Pat 15:46 15 minutes, 46 seconds margin expected it will stabilize at around 18 to 19%. 15:53 15 minutes, 53 seconds 28% 7 to 28% you're seeing. Yeah. Yeah. 16:00 16 minutes Okay. 16:05 16 minutes, 5 seconds Thank you. Ladies and gentlemen, to ask a question, please press star and one on your phone now. 16:25 16 minutes, 25 seconds ladies and gentlemen to ask a question please press star and one on your phone. 16:30 16 minutes, 30 seconds Now we have a follow-up question from the line of Manish and individual investor. 16:42 16 minutes, 42 seconds Please go ahead. 16:45 16 minutes, 45 seconds Sir, but no one is asking in query. So I have one. What what what is the revenue guidance for the next two three years sir? 16:54 16 minutes, 54 seconds So projects are in pipeline we have a pipeline of about 12,000 crores spread over next five to six years. So um so so 17:05 17 minutes, 5 seconds we we expect about 20 20 25% growth year on year basically. 17:10 17 minutes, 10 seconds So you're saying 20 25% growth in your year basis mean you're targeting 1,000 mean 120 to 3000 next year 200 maybe 17:21 17 minutes, 21 seconds yes next year should be more only because we are launching our tan project this financial year so it should have a good spike in the growth rate. 17:34 17 minutes, 34 seconds Okay sir. And sir, how has the pre-sales been in the month of May? 17:40 17 minutes, 40 seconds Uh sorry the pre consistently uh only they are a little slow because 17:48 17 minutes, 48 seconds of the war impact and the fuel prices impact and uh the global economical situation. 17:58 17 minutes, 58 seconds No. So you're saying that in because in Q4 we did around 40% uh sales growth so pre-sales growth so 18:05 18 minutes, 5 seconds it's lesser than that or more than that no no more than that no 18:14 18 minutes, 14 seconds okay it's not more than that yeah okay and Q4 and Q1 like historically Q4s are 18:23 18 minutes, 23 seconds always showing better sales than the Q1 one in real estate. Okay, sir. Yeah. 18:31 18 minutes, 31 seconds Okay, sir. Sorry, I've been new to Arcade, so apologies for queries. 18:41 18 minutes, 41 seconds Uh Manish, you're through with your questions? Yes, I'm done. Thank you. 18:47 18 minutes, 47 seconds Thank you, ladies and gentlemen. To ask a question, please press star N1 on your phone now. 19:11 19 minutes, 11 seconds We have a question from the line of Vishal Jen from Dvita Investment. Please go ahead. 19:18 19 minutes, 18 seconds Uh, hi. Uh, is my voice clear? Yes, Vishal. Please go ahead. 19:22 19 minutes, 22 seconds Yeah. Hi. Hi. Uh good evening sir. Uh so uh I just had a single question regarding uh this uh dimension uh in 19:31 19 minutes, 31 seconds value of teny rights uh as like 182 kores in this quarter. Uh I just wanted to know if this value is just like a 19:38 19 minutes, 38 seconds one-off or does it have a financial implication on the company or is this an accountancy practice. 19:46 19 minutes, 46 seconds So it's a one-off. See as we have explained in our presentation you know Filmistan acquisition was having two 19:53 19 minutes, 53 seconds legs. One is the land acquisition which was 165 crores and this was the teny rights which was having acquisition cost 20:01 20 minutes, 1 second of 183 crores. You know as we filed for the de merger and we got the de merger order in March 26. The teny rights got 20:12 20 minutes, 12 seconds de merged from film unlimited and got merged to arade. So that 183 crores which was the value of teny right has 20:20 20 minutes, 20 seconds got diminished. So that that's the one of effect in our financials. So whatever we are considered in this year as a cost 20:28 20 minutes, 28 seconds it will reduce the project cost for the film for going forward. 20:33 20 minutes, 33 seconds Uh okay perfect that helps. Uh thank you that was my question. Thank you. 20:41 20 minutes, 41 seconds Thank you. 20:43 20 minutes, 43 seconds Participants who wish to ask a question may please press star and one on their phone. 20:53 20 minutes, 53 seconds We have a question from the line of Heath Sha and individual investor. Please go ahead. Yeah. So am I audible? 21:01 21 minutes, 1 second Yes, please go ahead. 21:03 21 minutes, 3 seconds Okay. So uh I had a question regarding the future revenue growth. So I I wanted 21:09 21 minutes, 9 seconds to know the 12,700 cr revenue that the from the upcoming projects approximately how many years will it take to get all 21:18 21 minutes, 18 seconds the 12,000 or crores to get recognized in the books? 21:25 21 minutes, 25 seconds It should be done in around six years. 21:29 21 minutes, 29 seconds In six years that's what we are targeting it. 21:32 21 minutes, 32 seconds Okay. So one question uh as uh Mr. Assam said that we are targeting a growth of 21:40 21 minutes, 40 seconds approximately 25%. So based on the growth of 25% in six years the total 21:46 21 minutes, 46 seconds revenue recognized hardly as per the financials of this year adding the 25% 21:54 21 minutes, 54 seconds every year hardly the combined revenue of next six years goes to 5 to 6,000 cr. 22:00 22 minutes So are are we seeing any exponential growth in any year coming in next two to three years that the 22:06 22 minutes, 6 seconds yeah anistan projects and uh other to cluster redevelopment projects will make the growth exponential. 22:17 22 minutes, 17 seconds Okay. So and cumulative basis cumulative basis if you do the workings it should be around that figure in six to seven years. 22:27 22 minutes, 27 seconds Okay. cumulative compounding factor if you calculate either. 22:31 22 minutes, 31 seconds Yeah, I I am I am uh asking based on the compound based on my calculation as per compounding factor only. So based on 22:39 22 minutes, 39 seconds compounding factor as we add 25% revenue growth each year in next five to six years the total combined revenue for 22:46 22 minutes, 46 seconds next six years uh reaches almost 5 to 6,000 cr. So that was my question because if we don't see an exponential 22:53 22 minutes, 53 seconds growth then 20 based on 25% growth 25% CR uh the total reaches to almost 5 23:00 23 minutes 6,000 CR. So that was one question. Now this this 25% was someone asked the 23:08 23 minutes, 8 seconds next next year's growth rate you know so forum if you see 27 we we may do 20 25% 23:15 23 minutes, 15 seconds but once this kilm and tan contribute for full year that that will have a exponential growth like fy 28 f 29 23:24 23 minutes, 24 seconds okay okay yeah thank you that's that's it thank you ladies and gentlemen to ask 23:33 23 minutes, 33 seconds question. Please press star and one on your phone. 23:57 23 minutes, 57 seconds As there are no further questions, I now hand the conference over to Mr. Amit Chen for closing comments. over to you. 24:09 24 minutes, 9 seconds Yes. Uh so we thank all the participants for uh joining the conference call. Thanks. 24:17 24 minutes, 17 seconds Thank you. 24:18 24 minutes, 18 seconds Thank you on behalf of Arcade Developers Limited. 24:21 24 minutes, 21 seconds That concludes this conference. Thank you all for joining us.