HSBC Maintains 'Buy' on Oberoi Realty, Raises Target to ₹2,100 from ₹1,960 After Record Q4 FY26 Results

HSBC Maintains Buy Rating, Lifts Target 7% to ₹2,100

HSBC maintained its 'buy' call on the largecap stock with a revised target of Rs 2,100 instead of the earlier Rs 1,960. The upgrade reflects confidence in Oberoi Realty's execution, particularly in its core Goregaon market. HSBC highlights Goregaon core market strength and expectations of accelerated launches, while acknowledging risks from a potential luxury real estate slowdown. The revised target implies approximately 28.5% upside from prevailing levels at the time of the note.

Q4 FY26: Record Quarterly Performance

Oberoi Realty reported a consolidated net profit of Rs 703 crore for the final three months of FY26, marking a 62 per cent jump over the corresponding period a year ago. Its revenue rose 52.1 per cent to Rs 1,749 crore for the March quarter.

The property developer registered March-quarter earnings before interest, taxes, depreciation and amortisation (EBITDA) of Rs 959 crore, up 55 per cent over the year-ago period. The quarter reflected robust project execution in premium segments, driven by strong residential demand in key micro-markets.

Full-Year FY26 Strength

Mumbai-based premium real estate developer Oberoi Realty's net profit for the fourth quarter of financial year 2026 (Q4FY26) grew 62.35 per cent year-on-year (YoY) to Rs 703.28 crore on the back of strong revenue growth. In FY26, the company's revenue grew 13.67 per cent YoY to Rs 6,009.06 crore. Meanwhile, its profit for the same period stood at Rs 2,507.43 crore, up 12.66 per cent YoY.

Bookings and Unit Sales Acceleration

Oberoi posted gross bookings of Rs 1,673 crore for Q4FY26, with YoY growth of 96.13 per cent. It received bookings for 229 units, up from 78 in Q4FY25. The carpet area booked during Q4FY26 stood at 357,552 square feet, up 160.37 per cent YoY.

Full-year bookings remained steady despite a selective approach to launches. Oberoi Realty's bookings for FY26 stood at Rs 5,447 crore, up 3.14 per cent YoY. However, the number of units booked declined 24.86 per cent YoY to 698. The decline in unit volume reflects a deliberate shift toward higher-value projects, consistent with the developer's premium positioning.

Goregaon: Core Market Momentum

The company plans new residential towers in Goregaon and Borivali, along with developments in Thane, Pedder Road, and NCR/Gurugram. Oberoi said, "Not really because like I said that we have increased prices in Goregaon (project), we have increased prices in Borivali (project), and we don't see any slowdown there at all."

The developer's flagship Oberoi Garden City spans ~80 acres, making it one of the largest integrated townships in Mumbai, with a mix of luxury residences, office spaces, retail, and hospitality. Growth phases like Elysian, Esquire, and Exquisite within the campus continue to drive presales momentum.

Annuity and Retail Assets

Beyond residential, Oberoi is strengthening recurring revenue streams. The brokerage expects Sky City Mall to potentially achieve full occupancy by the end of FY27, which could become a meaningful driver of recurring income. Commerz II achieved rental realisations of Rs 282 per sq ft per month in Q4FY26, while Oberoi Mall maintained occupancy near 98%.

Hospitality Expansion and Strategic Land Acquisitions

The developer secured a development agreement for a premium Nepean Sea Road project, with groundbreaking expected within nine months, demonstrating continued expansion in Mumbai's luxury real estate segment. With a war chest of ₹4,000 crore potentially being raised, the developer is positioned to capitalize on high-value redevelopment opportunities in South Mumbai.

The hospitality business posted Q4FY26 revenue of Rs 55 crore; FY26 revenue of Rs 198 crore. The company plans to operationalise Marriott Hotel, Sky City during H1FY28 and Ritz Carlton, Worli during FY27.

Balance Sheet and Capital Allocation

Total borrowings declined to approximately Rs. 2,816 crore as of March 31, 2026 from Rs. 3,300 crore a year earlier. The debt-equity ratio improved to 0.16 from 0.21, and interest service coverage moved up to 11.96 times from 11.56 times. The Board declared a 4th interim dividend of Rs 2 per share for FY25-26, with record date May 14, 2026 and payment on or before May 22, 2026.

Analyst Consensus and Risk Outlook

Beyond HSBC, multiple brokerages shifted views post-results. CLSA upgraded the stock to 'hold' from 'reduce' but raised its target price by Rs 175 to Rs 1,500, which indicates a downside of 8.2 per cent from Monday's close. CLSA has upgraded Oberoi Realty to Hold with a target price of ₹1500, revising FY27–28 presales estimates upward by 8%/7% and projecting 28% FY27 presales growth, while cautioning on execution risk from 9–10 greenfield projects plus 3 phases.

Nomura maintains a Buy with a raised target price of ₹1850, citing a ~30% FY26–28F presales CAGR and 20% CAGR in annuity and hotel income. Execution on new launches, particularly in Goregaon and emerging markets like South Mumbai and Gurgaon, will be key to validating forward guidance.