Godrej Properties shares fell over 4% on Tuesday after the company reported a 42% drop in Q1 net profit despite record booking values.

The drop came right after the company announced its June quarter results. Consolidated net profit fell 42% year on year to around Rs 349 crore, down from close to Rs 598 crore in the same period last year.

Total income also slipped, coming in at Rs 1,345 crore against Rs 1,620 crore a year earlier. Here’s the twist though. While profit fell, the company’s actual sales performance was its best ever for a June quarter.

Booking value jumped 22% year on year to a record Rs 8,651 crore, and customer collections rose 18% to Rs 4,348 crore.

The company sold 3,738 homes covering 6.2 million square feet during the quarter, with Bengaluru alone contributing 44% of total bookings.

Management explained that real estate profits and actual sales don’t always move together.

Profit gets booked only when projects are delivered, while booking value reflects new sales made during the quarter. So a strong sales quarter can still show a profit dip on paper.

The company also approved merging its subsidiary, Godrej Housing Projects, into the parent company on the same day, a move aimed at simplifying its corporate structure and cutting administrative costs.

Looking ahead, Godrej Properties expects to close the full year with bookings above Rs 39,000 crore and collections of around Rs 24,000 crore, which should generate roughly Rs 9,000 crore in operating cash flow.

As of 13:43 pm, the stock was trading around Rs 2,035.90 on the NSE, down 2.57% for the day.

Ready to invest like a pro? Tradz by EquityPandit app equips you with 100+ Free tools and knowledge you need to succeed. Download the Tradz by EquityPandit app and gain access to daily stock lists and insightful market analysis and much more!