Shriram Properties Targets ₹5,000 Crore Pre-Sales Amid AI Concerns

Shriram Properties is targeting ₹4,600–5,000 crore in pre-sales over the next two years, as the real estate developer focuses primarily on residential housing while taking a cautious approach to commercial real estate amid uncertainties surrounding artificial intelligence (AI), work-from-home trends and rising construction costs. The company plans to invest around ₹1,750 crore across Bengaluru, Chennai, Pune and Kolkata during FY27 and FY28, with Chennai emerging as a key market for expansion.

Residential Sector Remains the Focus

Shriram Properties recorded pre-sales of around ₹2,300 crore last year and plans to roughly double this figure over the next two years. The company also aims to increase revenue from approximately ₹1,000 crore to ₹2,700–3,000 crore and profit from ₹60–70 crore to ₹250–270 crore over the next three years.

Chennai is expected to contribute significantly to this growth. The company plans to invest approximately ₹368 crore in Chennai to acquire 3.3 million sq ft of development potential. It also expects to hand over more than 500 units in the city by the end of the current fiscal, with an estimated sales value of around ₹250 crore.

Company Cautious on Commercial Projects

Shriram Properties is not planning an aggressive expansion into commercial real estate due to uncertainty over how AI could affect office demand, employment patterns and rentals.

“We are a little cautious about commercial space projects. We do not know what AI is going to do,” said Murali Malayappan, Chairman and Managing Director, Shriram Properties.

The company is instead discussing build-to-suit facilities, where properties are developed according to the specific requirements of identified tenants. This approach could help reduce vacancy risks and provide greater certainty of occupancy.

Malayappan also pointed to the continuing impact of work-from-home trends. He said around 25–30 per cent of employees continue to work from home, creating uncertainty around future office-space requirements.

Existing Office Presence

Despite its cautious approach, the company will continue to participate in the office segment. Shriram Properties has developed approximately four million sq ft of office space at Shriram The Gateway in Chennai.

It is currently evaluating office-space opportunities in Coimbatore and is also exploring warehousing projects. However, commercial development is expected to remain a smaller part of its overall strategy, with housing continuing to be the primary business focus.

Rising Construction Costs Add Pressure

The company's growth plans come amid increasing construction costs. Shriram Properties expects raw material and construction-related costs to rise by around 8–10 per cent, particularly for products linked to oil imports such as lifts, sanitary fittings and tiles.

While cement and steel prices have remained relatively stable, other construction inputs have become more expensive. The company said it has limited ability to pass the entire increase on to homebuyers because affordability remains a key constraint.

The developer is also looking at increased imports from China as a potential way to ease the pressure on construction material prices, given the country's excess manufacturing capacity in several segments.

Conclusion

Despite uncertainties in commercial real estate and higher input costs, Shriram Properties remains optimistic about residential demand. The company expects housing demand to remain supported by rising employment and household incomes.

With Chennai identified as a key growth market and residential development remaining its core focus, the company is pursuing expansion while taking a measured approach to commercial real estate. Its strategy is to scale housing sales significantly while limiting exposure to potential disruptions in the office market.