Arvind Smartspaces Reports 65% Profit Drop in Q2 FY26 Amid Revenue Decline

Arvind Smartspaces Ltd announced a significant year-on-year decrease in its financial performance for the second quarter of fiscal year 2026 (Q2 FY26), ending September 30, 2025. Net profit dropped by 65% to ₹14 crore, compared to ₹41 crore in the same period last year. Revenue from operations saw a 47% decline, falling to ₹140.5 crore from ₹265.5 crore. The company's EBITDA also decreased by 56% to ₹29.2 crore, and its profit margins narrowed to 20.7% from 25% a year prior.

Despite the year-on-year downturn, the company demonstrated sequential growth in Q2 FY26. Quarterly bookings surged by 147% quarter-on-quarter to ₹432 crore, significantly driven by the launch of Arvind Everland at Mankol, Sanand, which alone contributed ₹400 crore in sales bookings. Quarterly collections improved by 23% sequentially to ₹236 crore. Revenue from operations increased by 38% quarter-on-quarter, and Adjusted EBITDA rose by 27% sequentially.

For the first half of FY26 (H1 FY26), net profit was ₹30 crore, down from ₹47 crore in H1 FY25. Revenue stood at ₹242 crore versus ₹340 crore, and Adjusted EBITDA was ₹55.5 crore, down from ₹91 crore.

In terms of business development, Arvind Smartspaces entered Vadodara with a ₹700 crore horizontal township project and plans to expand in Gujarat, Bengaluru, and the Mumbai Metropolitan Region. The company's net debt position improved to negative ₹32 crore.

Impact: This news is likely to negatively affect Arvind Smartspaces' stock performance due to the sharp decline in quarterly profits and revenue. It may also influence investor sentiment towards the real estate sector. Investors will be closely monitoring future sales and project execution. Rating: 6/10.

Difficult terms: * **YoY (Year-on-Year)**: A comparison of financial figures from the current period against the same period in the previous year. * **Q2 FY25 (Second Quarter of Fiscal Year 2025)**: Refers to the financial quarter from July 1, 2024, to September 30, 2024. * **EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization)**: A metric used to measure a company's operational profitability before accounting for financing costs, taxes, and non-cash expenses. * **PAT (Profit After Tax)**: The net income of a company after all taxes have been deducted. * **H1 FY26 (First Half of Fiscal Year 2026)**: Refers to the financial period from April 1, 2025, to September 30, 2025. * **QoQ (Quarter-on-Quarter)**: A comparison of financial data from the current quarter to the immediately preceding quarter. * **Net debt**: The total amount of debt a company owes, minus its cash and cash equivalents. A negative net debt indicates the company holds more cash than it owes in debt. * **Net debt-to-equity ratio**: A financial leverage ratio that compares a company's total debt to its shareholder equity. A negative ratio here implies net cash. * **Joint development model**: An arrangement where two or more parties collaborate on a real estate project, often with one party providing land and the other managing development and sales, sharing profits or revenue.