Embassy Reit Q2 revenue jumps 12% to Rs 997 crore, beats estimates

Embassy real estate investment trust (Reit) reported revenue of Rs 997.32 crore for the second quarter of financial year 2025 (Q2 FY25), up 12.14 per cent year-on-year (Y-o-Y). The revenue beat the Bloomberg estimate of Rs 968.7 crore.

 

The trust’s total expenses for the quarter stood at Rs 248.14 crore, up by about 13 per cent Y-o-Y, primarily driven by operations and maintenance activities.

 

The total comprehensive income attributable to the unitholders stood at Rs 1,530.4 crore in comparison with the income of Rs 216.7 crore in Q2 FY24.

 

The trust reported earnings before interest, taxes, depreciation, and amortisation (Ebitda) for Q2 FY25 was Rs 806.4 crore, up 12 per cent Y-o-Y, beating the Bloomberg estimate of Rs 757.2 crore. Meanwhile, on an annual basis, the Ebitda margin remained unchanged at 81 per cent, against the Bloomberg estimate of 73.78 per cent.

 

 

Further, the Reit also declared a distribution of Rs 553 crore, or Rs 5.83 per unit, up 5 per cent Y-o-Y. As per Indian Reit regulations, Reits are mandated to distribute at least 90 per cent of their taxable income to the unitholders.

 

Aravind Maiya, the chief executive officer of Embassy Reit, said, "With a record 4 msf of leasing in the first half of FY25 and a robust pipeline for the rest of the year, we are pleased to revise our leasing guidance upwards to 6.5 msf. We've seen our occupancy grow to 90 per cent (by value) this quarter, and with a very healthy 12 per cent growth in both revenue and NOI, we continue to solidify our position as the home for leading corporates that prefer large, integrated office ecosystems."

 

Earlier, the Reit raised Rs 2,000 crore debt at the rate of 7.95 per cent to refinance upcoming non-convertible debentures’ (NCDs) maturity. As per the company statement, the raise saw strong participation from mutual funds and banks.

 

“Based on independent valuation as of September 2024, the Reit’s gross asset value (GAV) increased by 12 per cent Y-o-Y to Rs 59,104 crore and net asset value (NAV) by 4.3 per cent to Rs 415.84 per unit,” the Reit stated.

 

During the quarter, the Reit leased 2.1 million square feet (msf) of space across 24 deals, including 1.3 msf of new leases and 0.4 msf of renewals at 71 per cent rent reversions. As per the company statement, global capability centres (GCCs) accounted for around 50 per cent of the leasing activity during the quarter, with Bengaluru leading the demand as the city contributed 77 per cent of the total quarterly leasing activity.

 

The Reit has 8.0 msf active developments at 19 per cent expected yield on cost. “100 per cent of developments are in Bengaluru and Chennai, both amongst the top three Indian cities in terms of absorption and annual rent growth,” as per the Reit.