Arvind Smartspaces' FY27 launches and Goregaon project underpin pre-sales growth outlook

Investment View and Business Profile

In its August 10, 2026 result update, ICICI Securities retained its BUY rating on Arvind Smartspaces Ltd. after what it described as a strong start to FY27E. The broker has a target price of Rs 820, compared with the current market price of Rs 662.

Arvind Smartspaces is the real estate arm of the Lalbhai group, with residential developments in Gujarat, Karnataka and Maharashtra. Its portfolio spans horizontal projects such as plotting and villas, as well as vertical luxury and MIG projects. The residential portfolio comprises 10.3 million square feet completed, 58.6 million square feet ongoing and 31.2 million square feet planned.

Q1 FY27 Operating and Financial Performance

Arvind Smartspaces reported Q1 FY27 pre-sales of Rs 432 crore, up 147 per cent year-on-year but down 29 per cent quarter-on-quarter. The new Aquacity phase accounted for Rs 274 crore, or 63 per cent, of pre-sales, while sustenance sales contributed the remaining 37 per cent.

Collections increased 76 per cent year-on-year to Rs 336 crore, despite declining 5 per cent quarter-on-quarter. Operating cash flow tripled year-on-year to Rs 81 crore. Net debt rose Rs 48 crore quarter-on-quarter to Rs 215 crore, while net debt to equity stood at 0.29 times.

Q1 FY27 consolidated revenue was Rs 318 crore, up 212 per cent year-on-year and 104 per cent quarter-on-quarter, aided by project handovers. EBITDA margin expanded by 2,814 basis points year-on-year and 1,108 basis points quarter-on-quarter to 49.2 per cent, reflecting project mix. Net profit rose 8.9 times year-on-year and 134 per cent quarter-on-quarter to Rs 99 crore.

FY27E Growth Outlook and Launch Pipeline

Management has guided for 35-40 per cent year-on-year pre-sales growth in FY27 and plans six launches with aggregate gross development value of about Rs 3,000-3,500 crore during the first nine months of FY27E.

The pipeline includes Vastrapur in Ahmedabad, three Bengaluru projects, Khopoli Phase I in Mumbai and either Santacruz or Goregaon. Management expects sustenance sales to grow 15 per cent over FY26 to about Rs 640 crore, contributing roughly 30 per cent of FY27E pre-sales guidance of Rs 2,000-2,100 crore.

Business Development and Balance Sheet

Arvind Smartspaces secured Rs 2,580 crore of business development in Q1 FY27, including a Rs 2,400 crore Goregaon high-rise joint venture with a 43.5 per cent profit share and a roughly Rs 180 crore Ahmedabad horizontal project.

Management has guided for Rs 4,000-5,000 crore of FY27E business development through both ownership and JDA models, after investing about Rs 225 crore in Q1 FY27. ICICI Securities views the underlevered balance sheet, operating cash generation and access to the HDFC Capital Platform Fund as supportive of further business development.

Financial Forecasts

Valuation and Target Price

ICICI Securities values Arvind Smartspaces using project NAV for ongoing, completed and upcoming residential projects, plus business development expected over the next two years. Its sum-of-the-parts valuation is set out below:

ICICI Securities believes the stock trades at an undue discount to NAV considering the pre-sales growth trajectory and business-development pipeline.

Key Risks

• Project-execution risk
• Macroeconomic risk
• Regulatory risk