ICICI Securities Retains 'Buy' on Phoenix Mills, Raises Target Price to Rs 2,200 Post Q4 FY26 Results
Analyst Upgrade on Strong Operational Base
The Phoenix Mills reported strong retail consumption growth of 31% year-on-year during Q4 FY26, prompting ICICI Securities to retain its 'Buy' rating and raise its target price to Rs 2,200 per share. The upgrade reflects confidence in the company's trajectory following a quarter marked by operating profit before depreciation, interest, and tax reaching Rs 749.60 crore, the highest quarterly operating profit in the company's history.
Full-Year FY26 Performance
Phoenix Mills delivered consolidated revenue of Rs 4,423 crore (up 16% year-on-year) and EBITDA of Rs 2,637 crore (up 22%), with net profit reaching Rs 1,557 crore, up 20%, and retail consumption at Rs 16,587 crore growing 21%. Commercial and hospitality performance stayed firm, while residential sales were strong on a year-on-year basis.
Portfolio Scale and Growth Trajectory
The Phoenix Mills operates approximately 11.5 million square feet of retail space across 12 operational malls and plans to reach 18 million square feet across 17 malls by FY30, while its commercial office and hotel portfolio spans 5 million square feet and 588 keys, with plans to reach 9 million square feet and 2,188 keys by FY30.
Segment Strengths and Forward Guidance
Retail rental income grew 14% year-on-year at Rs 551 crore, with commercial office revenues up 13% year-on-year. Retail consumption during Q4 FY26 grew 31% year-on-year to Rs 4,261 crore, with Phoenix Mall of Asia, Bangalore seeing 122% year-on-year growth in consumption to Rs 649 crore. Management retained its double-digit consumption growth guidance for FY27.
Operational Momentum and Lease Renewals
Over 50% of the company's mall portfolio area will come up for renewals and repricing over the next three years, positioning the operator to benefit from rate escalations in an inflationary market. The office portfolio achieved gross leasing exceeding 2.2 million square feet with 70% occupancy, residential sales more than doubled to Rs 471 crore from Rs 212 crore, and the hospitality segment maintained resilience with St. Regis Mumbai posting 7% RevPAR growth and 86% occupancy.
Market Context
Despite strong quarterly results, shares of Phoenix Mills declined 2.05% to Rs 1,766.75 following the announcement, reflecting investor caution around stretched valuations. The Rs 2,200 target represents ICICI Securities' conviction that the company's growth visibility and operational momentum justify the premium valuation multiple, based on net asset value expansion across its diversified portfolio of retail, office, and hospitality assets.