Nuvama’s in-depth analysis of H1FY25 cash flows among leading real estate developers underscores the sector’s resilience. Cash EBITDA margins have been sustained at a strong 40%, comparable to FY22, FY23, and FY24 levels. Land-related capex increased to 33% of collections, up from 29% in FY24 and 16% in FY22, reflecting developers’ focus on expansion.
Despite higher capex, 11 developers successfully reduced net debt, thanks to efficient cash flow management. Additionally, 10 developers maintained a negative working capital cycle, a significant improvement from prior years. Interest costs remained stable, at 6% of collections.
Nuvama has identified Prestige Estates and Brigade Enterprises as top picks, citing their strong financial metrics and growth-oriented strategies. The report highlights that these companies are well-positioned to capitalize on the ongoing momentum in the real estate sector, driven by robust demand and efficient capital allocation.
