Prestige Estates Stages Impressive Comeback with Record Pre-Sales Performance
Prestige Estates and Projects Ltd is poised to conclude FY26 on a remarkably strong note, driven by a combination of strategic new project launches and sustained sales momentum across its existing portfolio. The company's pre-sales, also known as bookings, have witnessed an extraordinary surge, increasing by a staggering 122% year-on-year to reach ₹22,327 crore during the nine-month period ending December (9MFY26). This impressive growth has been fueled by the unveiling of nine new residential and plotted development projects, including the notable Prestige Garden Trails in Mira Road during the third quarter.
Strategic Launches and Revised Guidance Signal Robust Growth Trajectory
The company's launch pipeline remains aggressive, with three new projects planned for Bengaluru in Q4FY26, one of which—Evergreen at Prestige Raintree Park—has already been introduced to the market. Additionally, the quarter will see plotted developments and significant projects in other key cities: Rock Cliff in Banjara Hills and Golden Grove in Tellapur, Hyderabad, along with Palm Court in Chennai. In light of this strong performance, management has upwardly revised its FY26 pre-sales guidance from ₹27,000 crore to ₹30,000 crore.
Analysts at Antique Stock Broking anticipate that Prestige Estates may even surpass this revised target. However, they caution that the exceptionally high base established in FY26 could lead to a moderation in pre-sales growth momentum in the coming periods. The management remains optimistic, citing a robust pipeline of future launches as a key driver for sustaining the pre-sales trajectory. For FY27, the company plans new launches covering approximately 29 million square feet, potentially including landmark developments such as the Jijamata Nagar project in Worli, Mumbai.
Collections Reach Historic Highs Amid Diversification Efforts
Financial collections have maintained a firm footing, with Q3FY26 marking the third consecutive quarter where collections exceeded ₹4,000 crore. Consequently, cumulative collections for 9MFY26 rose by 49% year-on-year to ₹13,283 crore, setting a new record for the period. The company is actively pursuing growth opportunities across various markets, emphasizing geographical diversification. Beyond strengthening its presence in core markets like Bengaluru, Mumbai Metropolitan Region, and Hyderabad, Prestige is expanding into newer territories including the National Capital Region, Chennai, and Pune.
During 9MFY26, the company added projects with a gross development value (GDV) or revenue potential of ₹39,900 crore, achieving 80% of its full-year business development guidance. Management has indicated that 40% of the capital expenditure required for these expansions will be funded through debt, with the remaining 60% coming from internal accruals. This financing strategy underscores the importance of closely monitoring cash flow trends and debt levels moving forward.
Debt Levels Rise, Balancing Growth with Financial Prudence
Net debt has increased sequentially, rising to ₹8,700 crore in Q3FY26 from ₹7,300 crore, primarily due to investments in annuity assets and vigorous business development activities. With approximately ₹15,000 crore in pending capital expenditure for office and retail portfolios, Antique Stock Broking expects debt levels to continue rising in the medium term. This comes at a time when the company's stock has gained 2% over the past year, outperforming the Nifty Realty index, which experienced a significant decline.
The current recovery marks a notable turnaround from FY25, when pre-sales fell by 19% year-on-year to ₹17,000 crore, missing guidance due to delays in project approvals. While the resurgence in pre-sales during FY26 is a positive development, the challenge lies in balancing aggressive growth with manageable leverage. Analysts at HDFC Securities have added a note of caution, suggesting that property prices may have peaked, with only inflation-driven increases likely in the near future.
In summary, Prestige Estates' remarkable pre-sales performance in FY26 demonstrates a strong market recovery and strategic execution. However, the company's ability to manage its growing debt while sustaining expansion across diversified geographies will be critical for long-term stability and investor confidence.
