Keystone Realtors’ Q2 profit rises sharply on associate gains

Keystone Realtors Limited reported consolidated profit of Rs 100.75 crore for the quarter ended September 30, 2026, compared with Rs 9.89 crore a year earlier, after booking Rs 73.24 crore as its share of profit from associates and joint ventures. Revenue from operations was broadly unchanged at Rs 496.69 crore.

Why did Keystone Realtors’ September-quarter profit rise sharply?

Keystone Realtors’ quarterly profit rose because its share of profit from associates and joint ventures was Rs 73.24 crore in the September 2026 quarter, compared with a Rs 0.43 crore loss in the September 2025 quarter. Profit before tax consequently reached Rs 109.81 crore, up from Rs 16.89 crore, while total tax expense was Rs 9.06 crore against Rs 7 crore.

The Rs 73.24 crore contribution from equity-accounted investments exceeded Keystone Realtors’ Rs 36.57 crore profit before the associate and joint-venture contribution and tax. That pre-contribution profit still increased from Rs 17.32 crore a year earlier. The filing lists three associates and nine joint ventures, but does not identify the individual entities that generated the quarterly contribution.

Keystone Realtors’ profit attributable to owners of the parent was Rs 100.02 crore for the quarter, compared with Rs 8.55 crore a year earlier. Basic earnings per share were Rs 7.92, against Rs 0.68. The September 2026 results were approved by the board on November 4, 2026 and were reported as unaudited consolidated results.

How did Keystone Realtors’ revenue and costs change?

Keystone Realtors’ revenue from operations declined by Rs 2.59 crore year on year to Rs 496.69 crore in the September 2026 quarter, but increased from Rs 470.29 crore in the June 2026 quarter. Including other income of Rs 16.40 crore, total income was Rs 513.09 crore, compared with Rs 520.90 crore a year earlier and Rs 493.26 crore in the preceding quarter.

Construction cost rose to Rs 358.64 crore from Rs 287.74 crore in the year-earlier quarter. Employee benefits expense increased to Rs 44.96 crore from Rs 39.55 crore, finance costs rose to Rs 31.81 crore from Rs 15.72 crore, and depreciation and amortisation expense was Rs 5.85 crore against Rs 3.99 crore.

Total expenses nevertheless fell to Rs 476.52 crore from Rs 503.58 crore. The main offset was a Rs 38.04 crore credit from changes in inventories of completed saleable units, construction work in progress and stock-in-trade, compared with a Rs 92.34 crore expense in the September 2025 quarter. Keystone Realtors reported one operating segment, real estate and allied activities, rather than separate project or geographic segments.

For the half year ended September 30, 2026, revenue from operations increased to Rs 966.98 crore from Rs 772.40 crore in the corresponding prior period. Profit before the share of associates and joint ventures and tax rose to Rs 105.81 crore from Rs 35.23 crore, while the equity-accounted share moved from a Rs 2.49 crore loss to a Rs 74.32 crore profit. Half-year profit therefore rose to Rs 153.12 crore from Rs 26.22 crore.

Did Keystone Realtors generate operating cash in the first half?

Keystone Realtors did not generate positive operating cash flow in the first half, reporting net cash used in operating activities of Rs 190.38 crore for the six months ended September 30, 2026, compared with Rs 102.63 crore used a year earlier. This contrasted with half-year accounting profit of Rs 153.12 crore and reflected working-capital movements and tax payments.

Operating profit before working-capital changes was Rs 174.88 crore, up from Rs 79.45 crore in the corresponding 2025 period. Inventories consumed Rs 54.92 crore of cash and other assets consumed Rs 265.11 crore. These outflows were partly offset by an Rs 80.74 crore reduction in trade receivables, whereas trade receivables had consumed Rs 39.43 crore in the prior-year period.

Investing activities generated net cash of Rs 2.73 crore in the 2026 half year, compared with net cash used of Rs 189.50 crore a year earlier. Financing activities used Rs 117.19 crore after Keystone Realtors received Rs 361.21 crore from borrowings and repaid Rs 313.45 crore. Cash and cash equivalents fell by Rs 104.84 crore to Rs 363.37 crore at September 30, 2026, from Rs 468.21 crore at the beginning of the period.

The cash-flow statement also recorded Rs 82.03 crore of finance costs and Rs 11.36 crore of depreciation and amortisation in the first half. The associate and joint-venture profit of Rs 74.32 crore was deducted in arriving at operating cash flow because it is an equity-accounted profit rather than operating cash received by Keystone Realtors during the period.

What changed in Keystone Realtors’ funding and financial position?

Keystone Realtors’ inventories rose to Rs 3,724.28 crore at September 30, 2026 from Rs 3,569.36 crore at March 31, 2026. Investments accounted for using the equity method increased to Rs 362.93 crore from Rs 299.51 crore, consistent with the Rs 74.32 crore half-year contribution reported from associates and joint ventures.

Total equity stood at Rs 3,063.24 crore at September 30, 2026, compared with Rs 2,894.44 crore at March 31, 2026. Equity attributable to owners of the parent was Rs 3,032.17 crore, up from Rs 2,863.32 crore, while non-controlling interests were Rs 31.07 crore. During the six-month period, Keystone Realtors allotted 86,801 equity shares of face value Rs 10 each following employee option exercises.

Current borrowings increased to Rs 1,262.36 crore at September 30, 2026 from Rs 1,016.21 crore at March 31, 2026. Non-current borrowings declined to Rs 269.01 crore from Rs 417.22 crore over the same period, indicating a change in the maturity classification of borrowings as well as financing activity during the half year.

Keystone Realtors said its non-convertible debentures were fully secured and listed on BSE Limited. An auditor’s certificate on the security cover stated that nothing had come to the auditor’s attention suggesting that the required minimum security cover of 1.33 times for the senior secured debentures was not maintained at September 30, 2026.

Conclusion

Keystone Realtors’ September-quarter profit increase was principally driven by the Rs 73.24 crore share of profit from associates and joint ventures, while profit before that contribution rose to Rs 36.57 crore. Revenue was nearly flat at Rs 496.69 crore, and the first-half figures showed that higher reported profit did not translate into positive operating cash flow, with Rs 190.38 crore used in operations.

The next disclosure to watch is whether Keystone Realtors converts its Rs 3,724.28 crore inventory balance and Rs 966.98 crore of first-half revenue into cash collections. The filing identifies working capital as the unresolved issue in the period, with other assets rising by Rs 265.11 crore in the cash-flow statement, inventories using Rs 54.92 crore of cash and current borrowings increasing by Rs 246.15 crore from March 31, 2026.