Prestige Estates Projects Ltd, a leading name in India’s real estate sector, released its fourth-quarter financial results for FY25 after market hours on Thursday, May 29. The results revealed a sharp decline in net profit and revenue, raising concerns among investors even as the stock had been performing well in the lead-up to the earnings announcement.

Revenue and Profit Decline

The company reported a 29% year-on-year (YoY) decline in revenue, which fell to ₹1,528 crore from ₹2,164 crore in the same quarter last year. Sequentially, revenue also dropped by 8% from ₹1,654 crore reported in Q3 FY25.

Net profit suffered an even more severe decline of 82% YoY, falling to ₹43 crore compared to ₹236 crore in Q4 FY24. On a positive note, this was a 35% sequential increase from ₹32 crore in Q3 FY25, showing a slight recovery in the most recent quarter.

EBITDA and Margin Contraction

Prestige Estates also saw a sharp drop in its Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA), which declined by 35% YoY to ₹541 crore from ₹828 crore. Sequentially, EBITDA dropped by 7% compared to ₹583 crore in Q3.

The company’s EBITDA margin contracted by 285 basis points to 35.4%, down from 38.25% in Q4 FY24. However, it showed a slight sequential improvement of 16 basis points from Q3's 35.25%.

Weak Operational Performance

In an earlier operational update, the company had already signaled a weaker-than-expected performance for FY25, attributing the issues to delays in project approvals and deferred launches.

• New sales dropped 19% YoY to ₹17,023.1 crore, significantly short of the company’s guidance of ₹23,000-₹24,000 crore.

• Sales volume dropped 38% to 12.58 million square feet.

• Collections increased just 1% YoY to ₹12,084 crore, which was still below the guidance of ₹16,000 crore.

Rising Realisations Provide Some Relief

Despite the decline in volume and total sales, the company saw a sharp rise in average realisations:

• Apartments, villas, and commercial products saw realisation rise to ₹14,113 per square foot, marking a 36% YoY increase.

• Plot sales realisation jumped 50% YoY to ₹7,167 per square foot.

These improved realisations helped partially offset the impact of declining volumes and lower collections.

Market-wise Contribution

Among the key markets:

• Bengaluru contributed 45% to the company’s total sales.

• Mumbai followed with 30%, and Hyderabad contributed 23%.

• Other markets accounted for the remaining 2%.

This reflects Prestige’s stronghold in South India, with gradual inroads being made in Mumbai and NCR.

Recent Developments Signal Long-Term Growth Intent

Despite the subdued earnings report, the company made several important announcements over the past week that underscore its growth strategy and diversification across geographies.

1. SPV Formation with Valor Estate for Mumbai Project

On May 29, Prestige Estates and Valor Estate Ltd signed a framework agreement to form a special purpose vehicle (SPV) for a new development in Mumbai. The property, owned by Valor’s subsidiary Esteem, will be jointly developed with a total leasable area of 1.5 million square feet and a gross development value of ₹4,500 crore.

2. Three Projects Completed in Mumbai

On May 28, the company announced that it had successfully completed and delivered three landmark projects in Mumbai, comprising over 800 units across 2.8 million square feet. This achievement demonstrates Prestige’s ability to deliver large-scale urban projects in key metro markets.

3. Bengaluru Project Launched and Sold Out

On May 27, Prestige Gardenia Estates was launched in Bengaluru and sold out immediately. Spanning 47 acres, the project features over 1 million square feet of development area and is expected to generate revenue of around ₹80 crore.

4. Entry into NCR with Indirapuram Project

On April 30, Prestige Estates made its entry into the NCR market by launching a project in Indirapuram. The development comes with a gross development value exceeding ₹12,000 crore, marking a major step toward national expansion.

Investor Sentiment and Market Movement

Despite the weak Q4 earnings, Prestige Estates’ stock ended 3.86% higher at ₹1,507.8 on May 29. The stock has been in the green for five straight sessions, with a total gain of nearly 5% in that time and 9.65% over the past month.

This suggests that investors may be focusing more on long-term growth, future launches, and recent partnerships rather than the short-term earnings miss.

Management Commentary

Irfan Razack, Chairman and Managing Director of Prestige Group, commented that while approval delays impacted key launches, the final quarter showed strong sales traction and a positive uptick in realisations.

He remains optimistic about FY26, citing that deferred launches will now move forward with approvals expected to come through, helping the company regain growth momentum.

Conclusion: Short-Term Pain, Long-Term Potential

Prestige Estates’ Q4 FY25 results reveal significant short-term challenges, including lower revenue, profit, and sales volumes. However, the company has continued to launch, complete, and plan projects aggressively, signalling a strong pipeline and confidence in India’s booming real estate market.

With improved realisations, successful launches, and strategic partnerships—especially the Valor Estate SPV and NCR expansion—the company may be well-positioned to recover and grow in FY26.

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