Phoenix Mills Limited (PML) has announced a significant strategic move, approving the acquisition of Canada Pension Plan Investment Board's (CPP Investments) 49% stake in Island Star Mall Developers Private Limited (ISMDPL) for Rs 5,449.00 crores. This transaction, subject to shareholder and regulatory approvals, will give Phoenix Mills complete ownership of the platform, marking a pivotal milestone in the company's growth journey.

Transaction Details

The consideration of Rs 5,449.00 crores will be payable over 36 months in four tranches. This structured payment plan allows Phoenix Mills to maintain financial flexibility while pursuing its growth aspirations. The transaction is expected to be significantly value-accretive, with the potential to drive robust EBITDA growth over the next five years.

ISMDPL Portfolio

ISMDPL, which began as a joint venture with CPP Investments in 2017, has grown substantially over the past eight years. The platform currently comprises:

• 4.4 million sq ft of operational retail space
• 2.2 million sq ft of completed offices
• Planned expansions including additional retail and office spaces

In the fiscal year 2025, ISMDPL generated an EBITDA of Rs 617.00 crores, demonstrating strong financial performance.

Strategic Rationale

Shishir Shrivastava, Managing Director of Phoenix Mills, highlighted several key benefits of this acquisition:

1. Elimination of minority interest leakages
2. Enhanced operational flexibility
3. Improved ability to upstream cash flows to PML
4. Potential for future platform monetization through REITs or listing
5. Option for individual asset-level monetization

Growth Prospects

The management expects significant growth potential from the ISMDPL platform:

• Organic growth from the operational retail portfolio
• Ramp-up of occupancy in completed office assets
• Expansion plans at Phoenix MarketCity Bangalore
• Additional FSI potential across developments in Indore, Pune, and Bengaluru

Funding Strategy

The acquisition will be primarily funded through ISMDPL's cash flows, dividends, buybacks, and available leverage headroom. The company's strong balance sheet and growing free cash flows position it well to pursue this acquisition without compromising on other growth initiatives.

Q1 FY2026 Performance Highlights

Alongside this strategic announcement, Phoenix Mills also reported its Q1 FY2026 results:

The company noted that the lower rental income growth was due to planned repositioning exercises at MarketCity malls and the demolition of retail blocks at Phoenix Palladium for expansion.

Future Outlook

Phoenix Mills remains committed to its expansion plans and sees this acquisition as a step towards strengthening its position in the retail-led mixed-use development space. The company continues to focus on creating high-quality assets and driving value for its shareholders.

As Phoenix Mills moves forward with this strategic acquisition, it reaffirms its position as a leading player in India's retail and commercial real estate sector, setting the stage for continued growth and value creation in the coming years.

Phoenix Mills Limited (PML), a leading retail-led mixed-use developer, has reported a 5% year-on-year increase in consolidated revenue to Rs 953.00 crore for the first quarter of fiscal year 2026. The company's performance was driven by strong growth across its retail, hospitality, and residential segments.

Financial Highlights

• Consolidated revenue rose to Rs 953.00 crore in Q1 FY26, up from Rs 904.00 crore in Q1 FY25
• Operating EBITDA increased by 6% to Rs 564.00 crore
• Net profit after tax and minority interest grew by 4% to Rs 241.00 crore
• Diluted earnings per share (EPS) improved to Rs 6.73, compared to Rs 6.50 in the same quarter last year

Segment Performance

The company's core businesses, comprising retail, office, and hospitality, showed robust growth:

• Retail consumption increased by 12% year-on-year to Rs 3,588.00 crore
• Retail rental income grew by 4% to Rs 506.00 crore
• Hospitality segment revenue rose by 11% to Rs 130.00 crore

Acquisition of CPP Investments' Stake in ISMDPL

In a significant move, Phoenix Mills announced the acquisition of Canada Pension Plan Investment Board's (CPP Investments) 49% stake in Island Star Mall Developers Private Limited (ISMDPL), a material subsidiary of the company. The transaction, valued at approximately Rs 5,449.00 crore, will be paid over 36 months in four tranches.

Key points of the acquisition:

• Post-completion, PML will hold 100% ownership of ISMDPL
• The deal is subject to shareholder approval and necessary regulatory clearances
• The acquisition is expected to be earnings-accretive from the first year

Management Commentary

Shishir Shrivastava, Managing Director of Phoenix Mills, stated, "This transaction allows us to consolidate full ownership of a portfolio of high-quality, retail-led mixed-use assets across key Indian cities. ISMDPL has grown into a strong platform with scale, stability, and clear visibility for future growth."

Future Outlook

The company remains focused on its expansion plans, with several projects in the pipeline:

• ISMDPL platform is expected to include over 5.2 million sq. ft. of retail space
• Around 4 million sq. ft. of office space is planned
• 2 to 3 hotels totaling approximately 1,000 keys are in development

Phoenix Mills continues to strengthen its position in India's retail and commercial real estate sectors, with this acquisition marking a significant step in its growth strategy.