Arvind SmartSpaces Stock Plummets After 45% QoQ Net Profit Decline in Q1
Arvind SmartSpaces, a prominent real estate development company, reported a sharp quarter-on-quarter decline in net profit, causing its stock to hover near 52-week lows. Despite strong year-on-year growth, investor sentiment remains cautious.
Real EstateStock MarketArvind SmartspacesFinancial PerformanceInvestor SentimentReal Estate NewsJul 28, 2025
The stock in focus, Arvind SmartSpaces Ltd, has a market capitalization of Rs 2,833.5 crore. It opened at Rs 620 and touched a low of Rs 613.90, down 1.8 percent from its previous close of Rs 624.95. The current price is less than 2.2 percent above its 52-week low of Rs 601.
### What’s the News?
Quarter-on-Quarter (Q1FY26 vs Q4FY25): Arvind SmartSpaces reported a consolidated revenue of Rs 102 crore in Q1FY26, a 37.4 percent decline from Rs 163 crore in Q4FY25. Operating profit fell 38.2 percent to Rs 21 crore from Rs 34 crore in the previous quarter. Profit before tax declined by 52.8 percent to Rs 17 crore from Rs 36 crore, while net profit dropped 45.5 percent to Rs 12 crore from Rs 22 crore in the last quarter. Operating margin stood at 21 percent.
Year-on-Year (Q1FY26 vs Q1FY25): On an annual basis, the company reported a 37.8 percent rise in revenue from Rs 74 crore to Rs 102 crore. Operating profit more than doubled, rising 133.3 percent from Rs 9 crore to Rs 21 crore. Profit before tax surged 142.9 percent from Rs 7 crore to Rs 17 crore, while net profit jumped 140 percent from Rs 5 crore to Rs 12 crore, highlighting the strong operational recovery over the past year.
FII holdings declined from 2.01 percent in March 2025 to 1.60 percent in June 2025, indicating some degree of cautiousness among institutional investors.
### Comments from Management
Commenting on the Q1 FY26 performance, Mr. Kamal Singal, Managing Director, Arvind SmartSpaces Ltd, said, “Our financial performance continues to remain strong, driven by strong execution. In Q1, revenue grew 37 percent YoY to Rs. 102 crore, Adj. EBITDA improved 205 percent YoY to Rs. 24.5 crore, and PAT increased 159 percent YoY to Rs. 12 crore. Further, we continue to generate positive operational cash flows and the balance sheet remains strong with Net Debt at Rs. (50) crore.”
He added, “We are on track to conclude the ongoing business plan of adding new projects with a cumulative topline potential of Rs 5,000 crore across Gujarat, Bengaluru, and MMR. We remain positive about the demand scenario we are witnessing in the sector. Relatively lower interest rates, supportive government policies, and rising disposable incomes continue to support homebuyer demand.
Over the medium to long term, we believe the sector will witness further consolidation in favor of organized players, driven by stronger execution, rising capital intensity, and improving cash flows. This is an opportunity we are well prepared to capture, backed by our healthy balance sheet, growing brand equity, and disciplined approach to business development.”
### Operational Highlights
The company reported bookings of Rs 175 crore in Q1FY26, compared to Rs 201 crore in Q1FY25. Collections also declined to Rs 191 crore from Rs 249 crore last year. However, adjusted EBITDA jumped 205 percent to Rs 24.5 crore. Net Debt (Interest-bearing funds) at Rs. (50) Cr as on June 30, 2025, from Net debt of Rs. 27 Cr as on Mar 31, 2025. Net Debt (Interest-bearing funds) to Equity ratio stood at (0.08) as on June 30, 2025, as against 0.04 as on Mar 31, 2025.
### About the Company
Established in 2008 and backed by the 120-year-old Lalbhai Group, Arvind SmartSpaces is one of India’s prominent real estate development companies, headquartered in Ahmedabad. The company has developed approximately 106 million square feet of real estate across cities such as Ahmedabad, Gandhinagar, Bengaluru, Mumbai Metropolitan Region (MMR), and Pune.
Leveraging the brand strength of the Arvind group and a track record of timely project deliveries, the company is positioning itself as a key player in the evolving Indian real estate market, with an eye on consistent growth and stakeholder value creation.
Frequently Asked Questions
What was the QoQ decline in net profit for Arvind SmartSpaces in Q1FY26?
Arvind SmartSpaces reported a 45.5 percent decline in net profit in Q1FY26 compared to Q4FY25.
How did the revenue of Arvind SmartSpaces perform YoY in Q1FY26?
The revenue of Arvind SmartSpaces grew 37.8 percent YoY in Q1FY26, increasing from Rs 74 crore to Rs 102 crore.
What is the current market capitalization of Arvind SmartSpaces?
The current market capitalization of Arvind SmartSpaces is Rs 2,833.5 crore.
What are the key factors supporting homebuyer demand in the real estate sector?
Key factors supporting homebuyer demand include relatively lower interest rates, supportive government policies, and rising disposable incomes.
What is Arvind SmartSpaces' strategy for the future?
Arvind SmartSpaces aims to add new projects with a cumulative topline potential of Rs 5,000 crore across Gujarat, Bengaluru, and MMR, leveraging its strong balance sheet and brand equity.
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