Horizon Industrial Parks Q1 FY27: ₹2,000 Crore Capex Plan, 30 Million Sq Ft Pipeline and Profitability Expected From Q2-Q3
Horizon Industrial Parks Limited (NSE: HORIZONIND, BSE: 544880) has outlined an ambitious growth plan following its recent IPO, with management highlighting a stronger balance sheet, a large development pipeline, expansion of higher-rental in-city logistics assets, and multiple new revenue opportunities.
During its Q1 FY27 earnings call held on September 11, 2026, management said the company is entering a new phase of growth after raising ₹4,250 crore through its IPO and using the proceeds largely for deleveraging.
IPO Proceeds Bring Down Net Debt
According to CEO Urvish Rambhia, the IPO has fundamentally changed Horizon’s financial position.
The company raised ₹4,250 crore of fresh primary capital, with the proceeds deployed towards debt reduction. Management said pro forma net debt stood at approximately ₹2,500 crore as of June 30, 2026, equivalent to around 12.5% of enterprise value.
The company expects the lower debt burden to reduce interest costs and create additional financial flexibility for future development.
Management indicated that the company’s current debt cost is around 8.2%, while improved credit ratings following deleveraging could potentially reduce the cost of debt by 40-50 basis points.
Q1 FY27 Revenue Rises 23%
Horizon reported its strongest-ever quarter operationally in Q1 FY27.
Key figures highlighted by management include:
- Revenue: ₹200 crore, up 23% YoY
- EBITDA: ₹161 crore, up 36% YoY
- EBITDA margin: 80%
- Pro forma cash PAT: ₹116 crore
- Contracted revenue run rate: approximately ₹967 crore
- Leasing: 1.9 million sq ft across 13 transactions
- New customers: 9
- Contracted revenue added: ₹65 crore
The company reported a ₹12 crore net loss for Q1 FY27. Management attributed the reported loss primarily to non-cash depreciation and interest costs.
The company expects its reported P&L to turn profitable from Q2 or Q3 FY27.
₹1,500-2,000 Crore Capex Planned Over Three Years
One of the most important takeaways from the earnings call was Horizon’s planned capital expenditure.
Management expects approximately ₹1,500 crore to ₹2,000 crore of capex over the next three years.
The company intends to fund approximately:
- One-third through internal accruals
- Two-thirds through incremental debt
Management believes its stronger balance sheet and increasing internal cash generation provide sufficient capacity to fund the development pipeline.
30 Million Sq Ft Development Pipeline
Horizon said it has a fully paid land bank capable of supporting approximately 30 million sq ft of further development, providing substantial visibility for future expansion.
The company expects to develop around 25 million sq ft in its large-format parks over the next four to five years.
Management said this could effectively double the company’s large-park development footprint during that period.
The company is targeting approximately 6 million sq ft of completions in FY27.
It also expects operational area to reach around 35 million sq ft by the end of the fiscal year.
FY27 Leasing Target at 6.5 Million Sq Ft
Horizon is targeting approximately 6.5 million sq ft of leasing during FY27, which management said would represent roughly 30% growth over the previous fiscal year.
The company leased 1.9 million sq ft during Q1, with around three-fourths of the leasing coming from industrial customers.
Management expects the combination of new development, leasing, and rent escalations to drive growth over the coming years.
In-City Logistics Emerging as a Major Growth Engine
A particularly important part of Horizon’s strategy is its expansion into in-city logistics infrastructure.
The company currently has around 17 in-city assets across seven major cities, with approximately 7 million sq ft in this portfolio.
Management highlighted the substantial rental premium available from these assets.
In-city assets are expected to command approximately 2.5-3 times the rentals of Horizon’s traditional large-format parks.
Management also expects the in-city portfolio to contribute approximately 25% of the company’s top line once fully developed.
The company plans to deliver around 6 million sq ft of in-city development over the next three years.
Pune In-City Project Expected in Q4 FY27
Horizon expects its first major in-city delivery in Pune by Q4 FY27.
Management said leasing discussions are already underway and indicated that rentals could be in the range of approximately ₹70-75 per sq ft.
The company expects in-city assets to generate approximately 13-14% yield on cost, compared with around 11-12% for its big-format parks.
Industrial Customers Becoming More Important
Industrial customers are increasingly becoming a major part of Horizon’s portfolio.
Management said industrial buildings are currently achieving rents of slightly above ₹29 per sq ft, compared with around ₹24 per sq ft for standard warehousing.
This represents approximately a 15-20% rental premium for industrial properties.
Industrial customers also tend to sign longer leases because of the significant investment they make in the facilities.
Management said such leases can run for approximately 9-15 years.
5% Annual Rent Escalation and 12% Re-Leasing Spread
Horizon has approximately 29.5 million sq ft of operational network, according to management.
Existing leases generally include contractual rent escalations of around 5% annually.
However, management said current market rents are growing faster than contractual escalations.
The company achieved a 12% re-leasing spread during Q1 FY27, while management said it had achieved approximately 15% re-leasing spreads in the previous year.
This creates an additional growth opportunity as existing leases expire.
Approximately 4 million sq ft, or around 13% of the portfolio, is expected to come up for expiry over the next 21 months.
Rooftop Solar and Value-Added Services
Horizon is also building additional revenue streams beyond basic rentals and common-area maintenance charges.
These include:
- Rooftop solar
- Worker accommodation
- Hospitality
- Skill centres
- Other ecosystem services
The company currently has approximately 38 MW of rooftop solar capacity, with around 20 MW operational and another 17-18 MW being operationalised.
Management expects value-added services to contribute approximately 5-10% of revenue over the next five years.
Management sees 13-14% Yield on Future Capex
For the approximately 25 million sq ft of future development already supported by the company’s land bank, management expects incremental capex to generate a 13-14% yield on cost.
Management believes this could improve further as the portfolio shifts increasingly toward industrial properties and higher-yielding in-city assets.
Acquisitions Could Continue
Despite having substantial development capacity already available, Horizon does not intend to completely rule out acquisitions.
Management said the immediate priority is to execute the existing pipeline, but the company will continue evaluating opportunities in both industrial/logistics and in-city markets.
Horizon has expanded from around 10 million sq ft to approximately 60 million sq ft in six years, according to management.
The company currently operates across nine states and 10 markets, with approximately 2,300 acres of land and more than 120 customers.
Blackstone Remains a Key Shareholder
During the Q&A, management was asked about Blackstone’s plans.
CEO Urvish Rambhia said that Blackstone had not sold any shares while the company raised ₹4,250 crore of capital between December and August.
However, management clarified that questions about Blackstone’s eventual exit strategy would be better answered by the shareholder itself.
Therefore, investors should not interpret the comments as confirmation of any specific future holding period or exit plan.
Management Commentary on Profitability
One of the most important near-term statements came towards the end of the earnings call.
Management expects the company’s reported P&L to move into profit from Q2 or Q3 FY27.
The Q1 loss of ₹12 crore was described as marginal, with management pointing to non-cash depreciation and the expected benefit from debt repayment as important factors behind the improvement in the company’s underlying cash profitability.
Key Investor Takeaways
Horizon Industrial Parks’ Q1 FY27 earnings call highlighted several potential growth drivers:
- ₹4,250 crore IPO proceeds raised and deployed largely toward deleveraging
- Pro forma net debt reduced to approximately ₹2,500 crore
- Q1 revenue increased 23% YoY to ₹200 crore
- EBITDA increased 36% YoY to ₹161 crore
- EBITDA margin reached 80%
- Pro forma cash PAT stood at ₹116 crore
- Contracted revenue run rate reached approximately ₹967 crore
- FY27 leasing target of 6.5 million sq ft
- FY27 completion target of 6 million sq ft
- Approximately 25 million sq ft of large-format development pipeline
- Around 6 million sq ft of in-city development planned over three years
- In-city rentals expected at 2.5-3 times big-format park rentals
- ₹1,500-2,000 crore capex planned over the next three years
- Potential 40-50 bps reduction in borrowing costs
- Management expects reported profitability from Q2-Q3 FY27
- Value-added services could contribute 5-10% of revenue within five years
FutureSense India View
Horizon Industrial Parks is entering FY27 with a significantly stronger balance sheet and a large development pipeline.
The most important aspect for investors is the combination of deleveraging + development + rent escalation + in-city logistics + industrial demand.
The existing land bank provides several years of development visibility, while the company’s newer in-city strategy offers significantly higher rental potential than traditional large-format parks.
At the same time, investors should monitor execution of the development pipeline, incremental borrowing, occupancy levels, re-leasing spreads, and the conversion of the strong cash profitability into reported earnings.
The management’s expectation of a return to reported profitability from Q2-Q3 FY27 will also be an important near-term milestone.
Disclaimer: This article is based on the company’s Q1 FY27 earnings conference call transcript and management commentary. Forward-looking statements and targets are subject to business, market, regulatory, and execution risks. This article is for informational and educational purposes only and is not investment advice.