Against the backdrop of the ongoing West Asia conflict, Mumbai-based developer Vikas Oberoi, CMD of Oberoi Realty, said rising construction and energy costs, expensive labour and challenges in material availability are putting pressure on the real estate sector. “These are stressing us out, but it is a problem for the entire industry,” Oberoi said during the company’s Q4 FY26 earnings call recently.
Oberoi said on May 11, 2026 that the company now expects construction costs to rise and is factoring the increase into the projects it is undertaking.
Responding to a question on the impact of the West Asia conflict on customer sentiment, construction activity, raw material availability and project costs, Oberoi said, “Yes, costs are going up. And luckily, we literally, we really make sure we have a lot of contingency built in when we do our budgeting. But yes, costs have gone up. Energy cost has gone up, aluminium has gone up, glass has gone up, labour’s become expensive,” Oberoi said.
“So, all these are, and then again, I mean, availability of materials become a bit of a challenge. So, these are stressing us out. But like I said, it’s a problem for the entire industry and we all are grappling with it. But yes, now it’s like slowly starting to hurt you in a way,” Oberoi said.
Answering a question on the impact on margins and earnings per share (EPS), Oberoi said the company had already built contingencies into its projects to protect ‘our margins’. However, he acknowledged that these buffers are now getting ‘consumed or eroded, as we speak.’
Oberoi said the company has repriced several aspects of its projects, factoring in the expectation of higher future costs. “We actually made sure that we now know for a fact that there will be a cost increase and we are factoring that within the projects that we are doing,” Oberoi said.
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West Asia conflict may raise construction costs by 2-3%
According to Oberoi, the company is currently estimating an overall cost increase of around 2% to 3%. However, he said the rise remains within the contingencies already built into projects and is therefore unlikely to impact the bottom line at present.
“But like I said, it’s within the contingencies built. So really, it won’t affect the bottom line right now,” he said.
Launch pipeline
Oberoi said the company has announced business development activities covering nearly four million square feet of development potential across multiple locations in the Mumbai Metropolitan Region (MMR).
“We are planning to launch Three Sixty North (Gurugram), launch a small development on Carter Road, Oceanic. We are we have topped up this again another small project at Malabar Hill, Fairview. We will be launching Tower D of Forestville (Thane). These are all four launches in this first quarter itself,” Oberoi said.
Commercial project on RLDA land
According to Oberoi, the company plans to launch a project on the 11-acre parcel of land acquired from the Rail Land Development Authority (RLDA). In February 2026, for the lease rights of the Bandra East plot, with a bid of ₹5,400 crore.
“We realize that there are very few Grade A developers willing to sell commercial. So, we feel that if we strategise and do strata sale, we will end up doing really well and it will be great for the cash flows also. So, we will focus on RLDA being a sale model rather than a lease model,” Oberoi said during the call.
“The percentage is not decided. It could be 50-50, it could be 60% sale and 40% held back or whatever. But by and large, we want to do a sale model. We see, in fact, big houses approaching us and wanting to do a stand-alone building for us. “So, there is a big market for people like that also,” Oberoi said.
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Oberoi Realty to launch ultra-luxury Gurugram project in FY27 quarter
According to Oberoi, the company plans to launch its Gurugram project in the ongoing quarter of FY27.
Responding to a question on the project’s sales strategy, Oberoi said the company is still evaluating its approach, as for Oberoi Realty. He said that the developer has set internal targets and expects strong interest given the market buzz around the launch.
“We have not really dwelled that deep into our strategy. We want to see how we are received in Gurgaon (Gurugram). It’s a new market for us. We have set a certain internal target, given the buzz in the market because everybody knows we are coming.”
On pricing, Oberoi said the company is not yet ready to disclose details for the Three Sixty North project. However, he indicated that the development would mirror the luxury positioning of Three Sixty West in Mumbai, featuring apartments larger than 5,000 sq ft and 8,000 sq ft.
“To start with Three Sixty North, let pricing be a little bit of a suspense. We are still not ready to divulge. We have a very good idea what we want, but we don’t want to divulge the price. So, we’ll hold that. Everybody now knows that we are doing very similar to a product that we’ve done which is Three Sixty West. So the sizes are big. These are 5,000 plus and 8,000 plus square feet apartments and they’re like they’re really top on luxury,” he said at the investors’ call.
Oberoi said that work on the show apartment has already begun at the site, while pricing details will be revealed closer to the launch.
“The show apartment is getting ready there on site. So, physically also work has started in a way, but as far as prices go, like I said that let that be a bit of a suspense because we still have some more time to go,” Oberoi said.
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According to the latest investor presentation, Oberoi Realty’s sales bookings or pre-sales rose to ₹5,447 crore last fiscal from ₹5,281 crore in 2024-25 amid strong demand for luxury homes. The company plans to raise up to ₹6,000 crore through the issue of securities to support business expansion.
During 2025-26, Oberoi Realty’s consolidated net profit rose to ₹2,507.64 crore, up from ₹2,224.05 crore in the preceding year.