Lodha Developers H1FY27 net profit soars 63%, expects to beat full-year guidance

Lodha Developers reports strong earnings and property sales, raises profit expectations and plans data centre investments to expand recurring annuity income significantly.

The company’s net profit for the quarter ended September rose 28% year-on-year to Rs 1,013 crore, while revenue increased 18% to Rs 4,468 crore. Net profit margin for the quarter stood at 22.1%.

The developer’s pre-sales during the quarter grew 10% to Rs 5,037 crore, taking pre-sales as of the first half of the financial year to Rs 9,670 crore, which is 40% of the company’s full-year guidance of Rs 24,000 crore.

“We have delivered continued strong operating and financial performance in Q2 FY27, building on the momentum we have sustained since our IPO in 2021…Basis the strong performance in the first half, we expect to easily exceed our profit guidance for the year,” said Abhishek Lodha, managing director, Lodha Developers.

The company is continuing its expansion in new markets, with its Bengaluru business gaining traction following another launch in North Bengaluru during the quarter. It is also planning a launch in the National Capital Region during the festive season, alongside further launches across new locations.

The company said the response to its Bengaluru launch reaffirmed demand for established real estate brands, amid concerns about the potential impact of artificial intelligence-led disruption on housing demand, particularly beyond the affordable housing segment.

Alongside its development business, Lodha is looking to scale up its rental and annuity income through investments in data centres, as it seeks to participate in the expansion of AI infrastructure.

The company plans to begin execution of its self-funded data centre annuity strategy over the next six months. It expects annuity income to increase tenfold from Rs 300 crore in the last financial year to Rs 3,000 crore by financial year 2031-32.

Lodha is developing its data centre business as a second source of growth alongside its core real estate development operations, with the proposed expansion in annuity income expected to strengthen its recurring revenue profile.

Lodha’s net debt stood at Rs 5,279 crore as of September end, while its net debt-to-equity ratio remained largely stable at 0.2 times, below its stated ceiling of 0.5 times. Its exit cost of debt for the quarter was 7.8%, which the company said was among the lowest in the industry.

According to the company, the recent increase in interest rates in India is unlikely to have a direct impact on housing demand in the segments it serves, although it would monitor the second-order effects. It is also tracking the geopolitical and macroeconomic implications of the continuing conflict in the Middle East.