NEW DELHI: Concorde is set to invest approximately ₹200 crore in FY27 as it aims to grow its project pipeline in Bengaluru, using a combination of outright land purchases and joint development agreements. The company reported sales of about ₹450 crore for FY26, compared to ₹340 crore the previous year, while recognized revenue fell between ₹395-400 crore. The firm anticipates improving its profit margin to around 15% in FY27 from the current 8-10% range.
Traditionally focused on joint development projects, the company is now increasing its budget for outright land acquisitions as landowners in Bengaluru favor cash transactions due to rising land costs. Anil R.G., the Managing Director, noted that they will continue to concentrate on Bengaluru, especially in mid-segment residential projects, while selectively expanding plotted development and finalizing ongoing villa projects.
How did FY26 turn out for you? Did you meet your internal targets?
FY26 was satisfactory for us. We achieved around ₹450 crore in sales, with recognized revenue estimated to be between ₹395-400 crore. In the previous year, we reported sales of approximately ₹340 crore and recognized revenue of ₹300 crore.
While we had set a higher target of about ₹525 crore, two anticipated project launches were delayed due to approval-related issues, now pushed to FY27.
How was project completion this year?
We made substantial progress, completing two projects. One was Concorde Auriga, a 7 lakh sq ft apartment development comprising 501 units, where both sales and handover have concluded. We also finished a plotted development in Malur, East Bengaluru, spanning 24 acres with roughly 200 plots.
How many projects did you launch in FY26?
We initiated two projects: Concorde Eleve, a three lakh sq ft apartment complex, and a plotted development in North Bengaluru covering approximately 16 acres. The plotted project is anticipated to be completed by the end of FY28, while the apartment project will take about three years.
What are your plans for FY27?
We’re looking to launch roughly 1.5-2 million sq ft in FY27, with a conservative estimate of at least 1.5 million sq ft. Additionally, we plan to allocate around ₹200 crore this year.
What sales target are you aiming for in FY27?
We aim for a 10-12% increase in sales for FY27. The postponed launches from FY26 should also bolster our numbers this year.
Has your land acquisition strategy evolved?
Previously, our approach mostly revolved around joint development agreements. Since last year, we’ve pivoted to also consider outright purchases. Last year, we transacted ₹90 crore for a three-acre land parcel in Hennur, with expectations to develop it this financial year.
Moving forward, if we engage in five or six projects in a year, we intend to execute one or two through outright purchases while the rest will continue to be joint developments.
Why are outright purchases becoming a focus for Concorde when you’ve historically preferred an asset-light model?
Outright purchases allow for more favorable revenue recognition and margins. Furthermore, the number of JDA options has decreased, as landowners increasingly prefer cash transactions. Currently, 60-70% of landowners favor outright sales over JDAs when we assess 10-15 land parcels.
Major developers with stronger balance sheets have also engaged in outright transactions, impacting landowner expectations.
What is your budget for outright land acquisitions?
Previously, we allocated around ₹80-90 crore for outright purchases. We aim to raise this to approximately ₹150-160 crore due to steeply rising land prices. In areas like Hennur, land costs increasing from ₹25-26 crore per acre to nearly ₹35 crore per acre have been observed.
What type of land parcels does the company prioritize?
As a mid-scale developer, we avoid acquiring very large land parcels of eight to ten acres. Our ideal range is three to five acres, aligning with the scale of our known projects—around five to six lakh sq ft.
Are increasing land prices affecting your business strategy?
Indeed, land costs have risen throughout Bengaluru. Nonetheless, residential selling prices have also seen a 10-12% increase in the past year, which has helped offset some of the increased land expenses.
Has global uncertainty or the West Asia crisis impacted sales?
There has been a slight slowdown; where we previously recorded monthly sales of about ₹40-45 crore, this has decreased by 10-15%. A notable change is that buyers are now taking longer to decide—purchase decisions that used to take around a month now take 45-50 days.
This uncertainty arises not only from geopolitical issues but also from concerns about artificial intelligence, job security, and the overall employment landscape, particularly in the IT sector.
Which segments are most affected?
The impact is predominantly seen in apartments and villas, whereas plotted development continues to attract steady demand.
Will you consider lowering prices due to the slower decision-making process among buyers?
We have no intentions of reducing prices. Concorde primarily operates in the mid-segment, with prices starting around ₹1.5 crore and extending to ₹2.25 crore, while only one recent project reaches ₹2.5 crore. We view this segment as stable with Bengaluru largely being an end-user market.
Do you foresee discounts in the broader Bengaluru market?
Some discounts may occur over a quarter or two, especially where developers need to accelerate sales, but I do not anticipate significant price reductions in Bengaluru over the next two years.
What is your current portfolio distribution across apartments, villas, plots, and commercial properties?
Apartments represent approximately 80% of our portfolio, with villas and plots together contributing around 10-15%, and commercial at about 3-4%.
Do you expect this mix to change?
We aim to slightly increase our plotted development share for faster cash flow while maintaining the significance of apartments for overhead and marketing support. We may undertake one or two commercial projects, but we want to limit commercial ventures from dominating our portfolio.
What is your take on commercial real estate?
Commercial properties require substantial upfront investment. We recently leased our entire commercial structure, Concorde Hi Connect (1.5 lakh sq ft), to BHIVE Workspace. Our next commercial project is planned at around 2.5 lakh sq ft on Airport Road, primarily as office space.
In commercial real estate, we prefer smaller projects, ideally around one to two acres or about 2 to 2.5 lakh sq ft, predominantly through JDAs.
Have construction costs escalated?
Yes. There has been an uptick in material costs over the past two months. UPVC materials have risen, and steel prices have surged nearly 25%, resulting in a 10-15% increase in some input costs.
We plan to monitor the trend over the next couple of quarters. This could impact margins; however, inflationary assumptions have already been factored into our project calculations.
What were your margins in FY26 and what are your projections for FY27?
In FY26, we expect our profit margin to be around 8-10%, equating to roughly ₹40 crore. For FY27, margins are projected to improve to approximately 15%, given our plans to launch close to two million sq ft.
What is your current debt status?
We currently hold a debt of about ₹315 crore, which may slightly increase due to new outright land acquisitions.
How do you plan to finance your intended expenditures?
For the ₹200 crore planned investment in FY27, we typically source around 70% from external financing and cover the remaining 30% through internal funds. We are currently in discussions with various AIFs.
Will Concorde enter the premium housing market?
Our primary focus remains on the ₹1.5 crore to ₹2 crore segment, which we identify as our niche. We may consider one premium project at a time, primarily due to better returns in villas, where costs and land prices are higher. However, our core strength lies in the mid-segment, which we wish to prioritize.
Are there plans to enter the affordable housing sector?
No, we do not intend to venture into affordable housing.
In which cities do you currently operate?
We are active in Bengaluru and Hubballi. In Hubballi, we possess a significant land parcel of about 50-60 acres, with approximately 18 acres slated for development. Yet, our main focus remains on Bengaluru.
How much land do you control in Bengaluru?
We own around 80-100 acres in Bengaluru, which we believe can support the development of 3-3.5 million sq ft annually. Until we reach this scale, we see no need to enter another major city like Hyderabad.
What projects do you aim to complete in FY27?
We expect to finalize one plotted development in Hubballi and one villa project on Sarjapur Road, accommodating 151 villas spread over roughly 12 acres.
