Axis Securities has issued a BUY recommendation on Arvind SmartSpaces Limited, setting a target price of Rs 740 amid robust profit trajectories and strategic pivots in India's red-hot real estate sector. This company update, dated December 24, 2025, underscores surging pre-sales guidance of 30-35% growth to Rs 1,700 Cr for FY26, bolstered by a transformative management overhaul and tri-city expansion. With current market price at Rs 611, the implied upside stands at 21%, fueled by asset-light models, elevated IRRs exceeding 25%, and a pristine balance sheet projecting EBITDA margins at 25%. Investors eye high-conviction entry amid H2FY26 launches worth Rs 3,000 Cr GDV, though risks like approval delays loom.

Management Metamorphosis Accelerates Growth

Arvind SmartSpaces Ltd has undergone a seismic shift in its leadership echelon, installing Priyansh Kapoor as CEO while Kulin Lalbhai retains vice chairmanship. This restructuring pivots the firm toward process-driven efficiencies, slashing project announcement-to-launch timelines. Kapoor, armed with over a decade in Mumbai's cutthroat real estate arena, brings pedigree from helming 20-30 concurrent projects, now scaling Arvind's footprint across Ahmedabad, Bangalore, and Mumbai Metropolitan Region (MMR).

The organization morphs into a city-led powerhouse, empowering last-mile decisions. Bolstered by 16 new hires in business development and sales, Arvind jettisons people-centric silos for scalable platforms. This recalibration promises 30-35% pre-sales escalation, translating to Rs 1,700 Cr, with business development pipelines eyeing Rs 4,000-5,000 Cr.

Tri-City Strategy Redefines Market Positioning

Arvind's blueprint crystallizes around three bastions: Ahmedabad, Bangalore, and MMR, ditching suburban sprawl for high-yield verticals and redevelopments. In Mumbai, joint developments (JD) and vertical thrusts target Rs 30,000-60,000 per sq. ft., with mid-income tickets of Rs 3-5 Cr, partnering legacy players to minimize cash outlays. No longer chasing Navi Mumbai or Karjat horizontals, the focus sharpens on low-competition, value-accretive plays—first-home enclaves over second-home villas.

Bangalore's sales torpor eases, heralding momentum resurgence. Ahmedabad and Bangalore sustain horizontal-vertical hybrids, each city primed for Rs 1,500-2,000 Cr contributions post-reform. Recent outright purchases signal H2FY26 value accretion, with 45-project launches aggregating Rs 3,000 Cr GDV.

Financial Fortitude Underpins Bullish Projections

Axis Securities' forensic gaze reveals Arvind's financial sinews strengthening, with FY26E net sales vaulting 28% to Rs 913 Cr and EBITDA swelling 36% to Rs 228 Cr at 25% margins. Net profit surges to Rs 124 Cr (EPS Rs 27.3), escalating to Rs 218 Cr by FY28E (EPS Rs 48.0), yielding ROE north of 20%. Collections hold steady at Rs 236 Cr in Q2FY26, despite a 7% YoY dip in pre-sales to Rs 432 Cr, rebounding 147% QoQ.

Stock Levels and Investor Targets

For traders, Axis delineates clear technical thresholds: support at Rs 567 (low-end), resistance at Rs 933 (high-end), with CMP Rs 611 offering a 21% ascent to TP Rs 740. Enter aggressively above Rs 620 for momentum plays, accumulating dips to Rs 590-600 amid volume spikes exceeding 43,403 shares daily average. Long-term investors target Rs 740 by mid-FY26, banking on 5.5x FY28E Pre-sales/EBITDA valuation, PBV contracting to 2.6x.

Portfolio allocation: 5-7% for growth aggressors, trailing stops at Rs 567. Market cap Rs 2,807 Cr, promoter holding dips to 49.8%, FIIs 1%, MFs 3.9%. Relative outperformance versus BSE Sensex persists.

Risks Tempering the Narrative

Notwithstanding optimism, headwinds persist: launch approvals could falter, derailing pre-sales cadence. MMR sales unproven, Surat project's technical snags delay timelines, and organizational flux risks execution hiccups. Cash flows hinge on disciplined capex, targeting Rs 1,000 Cr annually en route to Rs 10,000 Cr setups.

Axis upholds BUY, revising from prior Rs 840 TP, affirming Arvind's ascent in India's realty renaissance.