Oberoi Realty Limited, one of India’s leading premium real estate developers, held its Q1 FY26 earnings conference call on July 22, 2025. Chairman & Managing Director Mr. Vikas Oberoi and Director of Finance Mr. Saumil Daru addressed investors and analysts, providing insights into project launches, sales performance, leasing updates, financial trends, and the broader outlook for the business. This article provides an expanded and detailed summary of the management commentary, followed by a structured question-and-answer section with analysts, and concludes with key investor takeaways.
Residential Segment
Oberoi Realty continues to maintain a dominant position in the Mumbai Metropolitan Region (MMR) and has expanded into NCR with its Gurgaon project. During Q1 FY26, the company witnessed a strong response to the launch of Elysian Tower D at Oberoi Garden City, Goregaon. The success underscores the sustained demand for luxury housing in established Oberoi townships, where residents value integrated living with schools, malls, and open spaces.
Management highlighted that projects such as Sky City, Eternia, and Enigma continue to perform well, though quarterly sales volumes showed natural fluctuations. Typically, launches see a spike in sales which then plateau until handover approaches, after which momentum revives. For instance, at Thane, Oberoi Realty recorded sales of nearly Rs. 1,800 crore soon after launch, a testament to brand pull and consumer trust in a new market.
The upcoming pipeline is significant: new towers in Borivali, Gurgaon, and South Mumbai (Pedder Road, Tardeo) are slated for launch in FY26. Management emphasized a disciplined approach—approvals are secured, titles are clear, and design work is complete before launch, ensuring transparency and execution certainty for buyers.
Commercial & Office Leasing
Oberoi Realty’s annuity assets continue to perform strongly, with Commerz III already achieving over 85% occupancy and expected to reach full leasing within FY26. Both Commerz I and Commerz II are fully leased, highlighting the resilience of premium Grade A office demand in Mumbai. Management noted that leasing traction has been robust across IT, BFSI, and flexible workspace players.
Retail / Malls
The Borivali Mall and the Goregaon retail hub have been witnessing consistent footfall recovery post-COVID, with new stores opening steadily. Borivali Mall, in particular, has become a landmark, driving property price appreciation in its vicinity. Management pointed out that world-class design, connectivity to metro networks, and lifestyle positioning ensure Oberoi’s retail assets command premium rentals and strong occupancies.
Hospitality & Mixed-use Development
The acquisition of Hotel Horizon Private Limited provides Oberoi Realty with a marquee land parcel in Mumbai. The site has multiple development options—luxury hotel, retail, or mixed-use—which management believes will generate superior returns given its strategic location. While detailed plans are yet to be finalized, the management described it as a “marquee project” with optionality across asset classes.
Business Development (BD)
Management reiterated its focus on Mumbai and NCR as the two core markets. Over 1,000 land proposals are evaluated annually, but only a handful qualify under Oberoi Realty’s stringent criteria. The Gurgaon project has moved into execution with demolition work and licenses secured. For Adarsh Nagar in Mumbai, plans are under approval stages, with RERA registration expected soon.
Mr. Oberoi emphasized that land acquisitions are executed prudently, ensuring sustainable margins of 50% EBITDA or higher. The philosophy is clear: profitability over market share. This disciplined approach, the company believes, differentiates it from peers who may compromise margins for scale.
Financial Commentary
On operating cash flows (OCF), Saumil Daru explained that real estate OCF reflects not just collections but also land purchases, development rights, and premiums paid to municipal authorities. While this sometimes creates volatility, the underlying business remains cash-positive. Analysts were reassured that Oberoi Realty has consistently maintained healthy cash flows despite significant investments.
Return ratios (RONW/ROCE) for FY25 stood at ~15% but dipped to ~10% in Q1 FY26 due to timing of revenue recognition. Importantly, revenue at Three Sixty West was not recorded in Q1 due to accounting norms, but management expects recognition in Q2, which should normalize returns.
Macro Environment
Vikas Oberoi highlighted the positive impact of Mumbai’s infrastructure buildout—Metro lines, Coastal Road, and DCPR reforms. Improved connectivity reduces travel time dramatically (e.g., Nariman Point to Bandra in 15 minutes), enhancing the attractiveness of residential micro-markets. Management believes this will accelerate sales velocity and potentially support pricing power across projects.
Q&A Highlights
HSBC (Puneet): What is the timeline for Gurgaon and Adarsh Nagar launches?
Management: Gurgaon has already commenced on-site work with demolition and design finalization. All approvals and titles are clear. Launch is expected within FY26. Adarsh Nagar is progressing through approvals and RERA registration before launch.
HSBC (Puneet): Why no revenue recognition at Three Sixty West?
Management: Recognition is subject to completion of registrations and full consideration receipt. Bookings exist but accounting standards defer recognition. Most of this will flow in from Q2 FY26.
HSBC (Puneet): When will Borivali Mall and Commerz III reach full occupancy?
Management: Both assets are expected to hit 100% occupancy within FY26. Commerz III is already at 85%+.
Morgan Stanley (Praveen Choudhary): How should investors view weaker operating cash flows and sustainability of high margins?
Management: OCF appears weaker due to upfront land/premium payments, but the core business remains positive. On margins, Oberoi Realty’s land acquisitions are highly selective, ensuring projects maintain ~50% EBITDA margins. The company focuses on profitability, not just volumes.
Ambit Capital (Karan Khanna): Sales volumes fell in projects like Forestville and Jardin. Is there a slowdown?
Management: This is part of the natural sales cycle. Strong upfront demand gets absorbed at launch, followed by plateauing, and then another pickup closer to completion. Thane projects already generated Rs. 1,800 crore in sales, reflecting strong demand. Sustenance sales in Borivali will revive with new tower launches.
Ambit Capital (Karan Khanna): Any changes to Thane launch timelines?
Management: Phases will be sequenced with social infrastructure—school, hotel, mall—before new residential. The intent is to replicate the integrated Goregaon model, creating long-term premium value.
Ambit Capital (Karan Khanna): Plans for Hotel Horizon?
Management: It offers flexibility (hotel, residential, mixed-use). Final plans are under evaluation. Described as a “marquee” opportunity.
Ambit Capital (Karan Khanna): Is Gurgaon overcrowded already?
Management: Management remains confident. Entry has been timed prudently; demand for premium product exists. Quality and brand differentiation will ensure absorption.
Nuvama Group (Parvez Qazi): Can we expect Borivali and Gurgaon launches by FY26-end?
Management: Yes. Borivali in Q3, Gurgaon in Q4.
Jefferies (Abhinav Sinha): What’s driving higher realizations in Goregaon and Sky City?
Management: Mainly sales of higher floors with better views. Prices are stable otherwise; management prefers not to push pricing aggressively until targets are achieved.
Jefferies (Abhinav Sinha): Any new land acquisitions?
Management: Evaluating continuously but focusing only on Mumbai & NCR. South Bombay society redevelopments (Tardeo, Pedder Road) likely to launch in FY26.
HDFC Securities (Parikshit Kandpal): What are the upcoming launches?
Management: Q3 – Borivali. Q4 – NCR (Gurgaon) and Pedder Road. Adarsh Nagar depends on approvals.
HDFC Securities (Parikshit Kandpal): Update on Three Sixty West sales pipeline?
Management: Demand is intact; momentum will revive post-holiday season. These are high-ticket transactions with longer gestation.
HDFC Securities (Parikshit Kandpal): Any large land deals this year?
Management: Evaluating multiple parcels; too early to disclose. Business Development is active.
Trinetra Asset Managers (Vishal Dudhwala): Impact of new DCPR norms, FSI, Metro, and Coastal Road?
Management: All positive. Better connectivity boosts absorption and sales velocity. Even if prices remain steady, sales will accelerate.
Trinetra Asset Managers (Vishal Dudhwala): Will product mix tilt toward mid-income?
Management: Oberoi Realty serves all segments—from mid-income (Thane) to luxury (South Mumbai). The versatility ensures resilience.
Closing Remarks
Mr. Vikas Oberoi thanked participants, emphasizing the company’s focus on prudent land acquisition, strong execution, and maintaining profitability across cycles. Saumil Daru reiterated that despite accounting-driven timing mismatches, Oberoi Realty remains financially strong and cash-positive.