During Wednesday’s trading session, the shares of one of India’s leading real estate developers are in focus on BSE after Morgan Stanley projects a 38 percent miss on the FY25 presales target of Rs. 24,000 crores.
Price Movement
With a market cap of Rs. 52,062.3 crores, at 02:48 p.m., the shares of Prestige Estates Projects Limited were trading in the red at Rs. 1,208.7, down by around 1 percent, as compared to its previous closing price of Rs. 1,221.25. The stock has delivered positive returns of nearly 5 percent over a one-year period, while around 27 percent of negative returns year-to-date.
What’s the News
According to sources, Morgan Stanley estimates that Prestige Estates will fall short of its FY25 presales target of Rs. 24,000 crore by nearly 38 percent. If this forecast proves accurate, it could indicate slower-than-expected sales growth for the real estate developer in the current financial year.
In February, Prestige Group’s CMD, Irfan Razack, expressed confidence that the company will achieve a Rs. 24,000 crore pre-sales goal for FY25, despite a decline in total sales bookings during the first nine months of the fiscal year.
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Operational Highlights for Q3 FY25
Despite the absence of new launches during the quarter, Prestige Group achieved sales of Rs. 3,013.5 crores in Q3 FY25, with a total area of 2.23 million sq. ft. sold across 888 units. The company maintained strong pricing, with an average realization of Rs. 13,684 per sq. ft., and recorded healthy collections of Rs. 3,257.5 crores during the quarter.
The average realization for the period stood at Rs. 13,128 per sq. ft., while collections remained strong at Rs. 8,910.9 crores. The sales performance continued to be well-diversified, with significant contributions from Bengaluru, Mumbai, and Hyderabad.
Financial Performance
Prestige Estates reported a decline in revenue from operations, experiencing a year-on-year decrease of nearly 8 percent, falling from Rs. 1,796 crores in Q3 FY24 to Rs. 1,654 crores in Q3 FY25.
Similarly, during the same period, the company’s net profit decreased from Rs. 165 crores to Rs. 32 crores, representing a decline of around 80.6 percent YoY. The company recognized a mark-to-market loss of Rs. 58.4 crores on its holdings in REIT units during Q3 FY25 (as against a gain of Rs. 80.1 crores recognised during Q3 FY24).
Key Financial Ratios
In terms of key financial metrics, Prestige Estates Projects has a Return on Equity (RoE) of 12.9 percent and a return on capital employed (RoCE) of 14.9 percent. Additionally, the stock has a P/E ratio of 89.8, compared to the industry’s P/E ratio of 31, and its debt-to-equity ratio stands at 0.75.
About the Company
Prestige Estates Projects Limited is engaged in the business of real estate development and related activities. The company follows a diversified business model across several segments, including residential, office, retail, hospitality, property management, and warehousing, with operations in over 12 major locations across India.
Written by Shivani Singh
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