Realty stock in focus after its pre-sales increases by 39% YoY

Synopsis: Prestige Estates reported robust Q3 FY26 operations: pre-sales of Rs 4,184 crore were up by 39% YoY, while collections rose by 40% to Rs 4,548 crore. Nine-month pre-sales reached an all-time high of Rs 22,327 crore on pricing gains and high occupancies in offices and retail.

The shares of this company, which has a diversified business model across various segments, that is, residential, office, retail, hospitality, property management and warehouses, with operations in several major locations in India, had declared its operational updates with record pre-sales and more. 

With the market cap of Rs 64,517 crore, the shares of Prestige Estates Projects Ltd have closed at Rs 1,498 on Wednesday. The shares are trading at a PE of 84.4, whereas their industry PE is at 33, and the shares have given a return of more than 400% over the last 5 years. 

About the Q3 FY26 Operational performance

Prestige Estates’s operations performance was truly impressive and was driven by record demand in the group’s residential segment. The company’s Q3 FY26 pre-sales stand at Rs 4,184 crore, marking a sharp 39% jump from the same period last year. More significantly, the group’s pre-sales for the first nine months stand at Rs 22,327 crore, already a record on a yearly basis.

How the sales data becomes believable is the drastic improvement seen in the cash collections. The Q3 cash collections increased 40% YoY, achieving Rs 4,548 crores, and for 9M FY26, the cash collections stood at an all-time high of Rs 13,283 crores. Because of the improvement, the difference between the bookings and the cash collections is shrinking, and this is the key for the capital-intensive business of the company, which is the real estate segment.

Pricing strength was a notable positive. Average residential realisations rose 6% YoY to Rs 14,459 per sq ft, while plot realisations surged 31% YoY, indicating strong traction in land-led and premium formats. This is indicative of growth not being driven by discounting/lower ticket sizes but by genuine pricing power, an important margin lever going forward.

On the execution side, Prestige had a well-balanced development cycle. The company launched 5.02 million sq ft in the quarter while completing 4.72 million sq ft, keeping launches broadly aligned with deliveries. Over nine months, launches of 23.83 million sq ft alongside 12.71 million sq ft of completions hint that Prestige is scaling responsibly, avoiding the risk of over-launching without execution follow-through.

Beyond residential, the annuity portfolio continues to quietly strengthen the overall operating profile. Office occupancies remained above 95%, retail occupancies above 99%, and leasing activity stayed healthy. With office annuity income projected to scale sharply by FY30 and retail rentals set to expand meaningfully as new malls come online, Prestige is steadily building a more stable, recurring income base to offset residential cyclicality.

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