Embassy Office Parks REIT (EMBASSY) Q1 24/25 earnings summary

Executive summary

• Leased 1.9 million sq ft in Q1 FY25, a 70% year-over-year increase, with 70% of leasing driven by Global Capability Centres.

• Achieved a major 5 million sq ft asset acquisition in Chennai, expanding presence in a top growth market.

• Q1 distributions reached INR 5.6 per unit, up 7% quarter-on-quarter and 4% year-over-year, with unitholder base surpassing 100,000.

• Standalone net profit for Q1 FY25 was ₹2,380.71 million, with EPS at ₹2.51, reflecting a year-over-year decline.

• Active development pipeline of 8.6 million sq ft, with ~70% of next two years' deliveries pre-leased to multinationals.

Financial highlights

• Revenue from operations was INR 934 crore (₹9,342 million), up 2% year-over-year; NOI at INR 758 crore (₹7,575 million), up 3% year-over-year.

• Commercial office segment revenue and NOI grew 4% year-over-year; hotel segment NOI up 16% year-over-year.

• Q1 distributions totaled INR 531 crore (₹5,308 million), or INR 5.6 per unit, up 4% year-over-year and 7% quarter-on-quarter.

• EBITDA increased 2% year-over-year to ₹7,697 million, with an 80% margin.

• Net profit margin for the quarter was 56.54%.

Outlook and guidance

• FY 2025 NOI guidance: INR 3,215–3,345 crore (₹32.1–33.5 billion); DPU guidance: INR 22.4–23.1 per unit, implying 10% NOI and 7% DPU growth at midpoint.

• Updated annual leasing guidance to 5.6 million sq ft, with March 2025 occupancy guidance at 88% by area and 91% by value.

• Management expects to refinance upcoming debt maturities, supported by undrawn borrowing facilities and a low leverage ratio.

• Embedded growth levers include 5.8 million sq ft of upcoming deliveries, contracted escalations, and mark-to-market rent opportunities.

• Guidance subject to risks from global macroeconomic conditions and their effects on assets and occupiers.