Ladies and gentlemen, good day and welcome to the Knowledge Realty Trust Q2 and H1 FY 2026 earnings conference call. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference, please signal an operator by pressing star and then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Senthil Kumar, Head of Investor Relations, Knowledge Realty Trust. Thank you, and over to you, sir.
Thank you, and good afternoon to everyone joining us today. On behalf of the management team, I would like to extend a warm welcome to all participants of Knowledge Realty Trust Q2 FY 2026 earnings call. Our latest report since listing are already verified. Before we proceed, a couple of important disclaimers. I would like to highlight that the management may make certain comments that may constitute forward-looking statements. Please be advised that our actual results may differ materially from these statements. KRT does not guarantee the statements or representations and does not intend to update them at any point of time. Joining me today on the call are Shirish Godbole, KRT CEO; Quaiser Parvez, our COO; and Neeraj Toshniwal , our CFO. We will start off with brief remarks on our business, macro environment, and financial performance, and then open the floor to questions. Over to you, Shirish.
Thank you, Senthil. It gives me immense pleasure to address you all on our first earnings call as a listed REIT. The past few months have been transformational for Knowledge Realty Trust, and we are delighted to report a strong and steady start to our journey as a public listed entity. Our IPO in August 2025 marked a significant milestone, not only for KRT but also for India's REIT ecosystem. We received an overwhelming response with over 12 times oversubscription. To reiterate a few points, we are the largest REIT in India by market cap of over INR 52,000 crores, with a high-quality 46 million sq ft portfolio. We are also the most geographically diversified office REIT, with over 95% of our value comprised in three core markets, namely Mumbai, Hyderabad, and Bangalore, and the best micro markets within these cities. India's macro performance remains strong.
India's GDP is expected to grow at 6.8% in FY 2025-2026, with quarter one growth already at 7.8%. The office market fundamentals continue to be extremely positive, with a record 60 million square feet of gross absorption during the nine months of calendar year 2025, leading to the lowest vacancy levels post-COVID. In line with our focus on delivering sustainable and long-term returns, we have been focused on driving efficiencies, enhancing asset productivity, and leasing our assets to high-quality tenants. We have actively managed our capital structure to secure competitive financing terms. Simultaneously, we continue to scout for acquisitions across markets to deliver inorganic growth, an important value driver for our business.
The leasing activity for our portfolio was strong in the first half, wherein we have achieved over 1.8 million sq ft of gross leasing, taking the completed portfolio occupancy up to 92%. We are seeing continued demand from both GCC as well as domestic occupiers, who collectively contributed 70% of our leasing volumes in the first half. As per our plan, we reduced leverage from 31% to 18% by using IPO proceeds to repay our debt. Post listing, we have successfully refinanced and renegotiated our debt portfolio to achieve a blended 7.4% interest cost, a saving of 120 basis points. With strong operating performance and strategic debt management, we are also pleased to announce our first distribution of INR 1.56 per unit for net distributable cash flow of INR 690 crore.
We are delighted to highlight that although our REIT was listed on 18th August, the NDCF for the full quarter is being distributed to all the unitholders. Over and above the distribution, we are glad to note that our REIT has also delivered a price appreciation of over 18% to our investors since listing. With that, let me now hand you over to Quaiser with an update on our business performance.
Thank you, Shirish. India's office sector truly is in the midst of a structural growth cycle, powered by GCCs and fast-growing domestic companies. In the first nine months of this calendar year, GCCs alone accounted for about 30% of India's office leasing, underscoring the sustained depth of this demand. Our portfolio service acts as an office for India and office for the world, and is strongly positioned to capture this growth. Let me now dive into our business highlights for the first half. We achieved a healthy gross leasing of 1.8 million sq ft and added 18 new occupiers. Gross leasing comprised 1.2 million sq ft of new leases and 0.6 million sq ft of renewals at a healthy 29% average spread.
Out of the total expiries of 1.4 million sq ft in the first half, we renewed 0.6 million sq ft and re-leased an additional 0.7 million sq ft, resulting in an impressive retention and re-leasing ratio of 90%. Backed by strong leasing momentum, our occupancy increased 340 bps year-on-year to 92%. With ramp-up in occupancy and enhanced operational efficiency, we were able to deliver a NOI growth of 20% year-on-year and a record NOI margin of 89%. In terms of performance in our core markets, our Hyderabad portfolio is a standout. At 12.9 million sq ft and 99% occupancy, it is one of the largest GCC hubs in India. In Mumbai, occupancy has improved by 6% year-on-year to 88%. With the contained supply, the outlook remains strong. Bengaluru has seen a 4% year-on-year occupancy increase to 88%, driven by demand from technology and GCC occupiers.
Our leasing momentum continues to be underpinned by strong re-leasing strength and client confidence across key assets. For instance, at Sattva Knowledge City in Hyderabad, an existing occupier of ours expanded by over 100,000 sq ft at 34% re-leasing spread. At One BKC in Mumbai, a renowned BFSI occupier occupied 41,000 sq ft at a 25% spread. These re-leasing opportunities reflect the embedded value in our portfolio. Overall, in our 1.2 million sq ft new leasing in the first half, we have achieved an 8% premium to the market rent. We are able to command these premiums, given we represent one of India's finest Grade A office ecosystems and buildings of choice. Leasing activity during the reporting period was driven by a healthy balance between the demand from new tenants and expansion from existing occupiers.
What's particularly encouraging is that 57% of our new leasing in the first half came from existing occupiers, endorsing our portfolio's quality and tenant stickiness. This has been the trend in our portfolio over the last three years, where expansion by our existing clients contributed to about half of our leasing activity. Also, we have been strategically working on our rental escalation profile. Over 90% of our leasing in the first half comprised of annual rental escalation compared to the standard three-year escalation. The annual escalation is also driven by a front office exposure in Mumbai, which constitutes 32% of our portfolio by value. This focus on annual escalation provides greater visibility and steady compounding rent growth across the portfolio. Our SEZ exposure remains lowest among all REITs in India at about 15% of the total leasable acres at a healthy 89% occupancy.
Looking at our embedded growth, we also carry a 22% mark-to-market potential with a staggered expiry profile that allows us to capture this upside in a measured manner. Our development pipeline of 9.2 million sq ft is in Bangalore, comprising of near-ready under-construction portfolio of 1.2 million sq ft across two assets. We are on track to deliver these completions by the end of FY 2026 and expect substantial pre-leasing as we move closer to the completion. The under-construction assets, along with a strong acquisition focus, will deliver growth in the near to medium term. We are also investing in the future. We are deploying digital tools with AI-enabled building operations that improve efficiency, reduce costs, and enhance the tenant experience. Combined with our sustainability initiatives, this highlights KRT's forward-looking tenant-centric approach. With that, I'll now hand over to Neeraj to walk you through the financial performance.
Thank you, Quaiser. Good afternoon, everyone. Let me highlight our financial performance for Q2 and H1 FY 2026. KRT delivered strong operating performance and remains focused on achieving its projected financial targets. The current consolidated financials reflect performance for the period starting from August 8th to September 30th, 2025, basis REIT formation. Revenue for H1 FY 2026 was INR 22,019 million, up 17% year-on-year, with NOI of INR 19,544 million, up 20% year-on-year. We continue to maintain an EBITDA margin at 89% and 87%, respectively. We are also pleased to announce our first distribution. The board approved a distribution of INR 1.56 per unit that is NDCF of INR 6,900 million. 98% of the distribution for Q2 FY 2026 is tax-exempt or tax-deferred in the hands of unitholders. We expect this figure to normalize around 86%-91% for the full year FY 2026.
We successfully raised INR 16 billion through AAA-rated listed non-convertible debentures at the REIT level. The proceeds were used to repay debt at the SPV level. The NCDs were issued at a competitive coupon of 7.2% with a maturity of three years. Additionally, we have renegotiated and refinanced our SPV-level debt, which has resulted in our overall cost of debt going down to 7.4%, a saving of 120 basis points. We will continue to explore refinancing opportunities to further optimize financing costs. Our LTV remains low at 18%, offering substantial headroom for future acquisitions in the portfolio. Our gross asset value as of September 30th, 2025, stands at INR 646 billion and NAV translates to INR 118 per unit. Overall, KRT enters the second half of FY 2026 with operating momentum, low leverage, and multiple levers ahead to drive growth.
With that, I'll now hand the call back to the moderator to open the floor for questions.
Thank you very much. We will now begin the question- and- answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to please use handsets while asking a question. Ladies and gentlemen, we will now wait for a moment while the question queue assembles. Our first question is from the line of Deep Shah from B&K Securities. Please go ahead.
Yeah. Hi. Thanks for the opportunity and congrats on the listing and the set of numbers. I have three questions.
Sorry, we cannot hear you. Howdy.
Hello. Is this better?
Yeah, this is better.
Yeah. Sorry, apologies for that. I have three questions. First is specifically on the Knowledge part. We saw significant improvement in revenues and NOI this quarter. Anything to call out there, and is that a one-off or something? That first. Second, on our debt structure. I think we are probably at the end of low interest rate regime or maybe one more interest rate cut. Any particular plans that you have to lock in fixed-rate debts at these prices? Third is on the expiry. Whilst our overall expiries are quite low, any discussions that you are in for, say, two assets in particular, One BKC and Global City. Any qualitative remarks around this would be very useful. Thank you.
Hi, Deep. I much appreciate the question. For the first two questions, I will pass this on to Neeraj to answer them, and I will take the third question.
Sure, Quaiser. Regarding your first question, Deep, significant improvement in NOI margin because in one of the assets leasing started from this year and hence full year impact is there. That's the reason. On second question regarding the debt structure, low interest rates where you said will come in the way, on more cuts and locking for fixed rates. We are closely monitoring the macroeconomic indicators and basis the GSEC and other parameters. We will be taking call to move the interest rates, the loans from fixed to floating.
Currently, as I said, the way the portfolio is, we have very balanced portfolio linked to floating with various benchmarks with MCLR-linked loan and T-bill linked loan and repo rate-linked loan. Anything happens, it will be ultimately benefited in certain manner.
I just want to add that we are going to be monitoring and we will fix the rate as we deem appropriate over the next few quarters.
Deep, I'll take the third question with regards to the expiry. Our portfolio has a standard expiry profile of 1.5 million sq ft, and that essentially 44%-45% of those expiries come from Mumbai, and that's largely because of the fact that the portfolios as compared to the other parts of the portfolio which is much longer because the leases are much longer. If your specific question on One BKC is 70,000 sq ft, which is expected to be coming in for expiry, which has already been tied up for as we speak, and there are no new expiries coming in the Global City as such.
Understood. This is very useful. Thank you and all the best.
Thank you. Participants, you may press star and one to ask a question. Our next question comes from the line of Pritesh Sheth from Axis Capital. Please go ahead.
Yeah. Good afternoon, and thanks for the opportunity. Firstly, on the guidance, or rather, I would say the projections that were put out while we were doing the IPO. You still hold on to that? In terms of achieving the NOI targets, what would be the broader building blocks to achieve that guidance in terms of end of the year occupancy, et cetera, whatever you want to point out. Just in terms of NDCF, I think if I analyze the current quarter's distribution run rate, we are already doing better than the FY 2026 estimate that we had put out. Any upside risk to your NDCF projections that you had put out? That's my first question. In two parts. Yeah.
I'll take that question, Pritesh. With regards to our projections, we remain focused on achieving our NDCF guidance. It's also important to bear in mind not a linear period for us because the IPO came in in the middle of the quarter. In fact, we will be able to better leverage the full run rate of the second half as we step into the second half. To your specific question number two of what the broader guidance would look like in terms of occupancy for us to meet the projection, that number would be in the range of 93%-94% of portfolio occupancy, up 1%-2% from where we stand now.
Got it. On the NDCF, you will still probably want things to settle down and come up with the projection number?
Let me take this. As Quaiser has mentioned, we are having a focused view on this NDCF guidance, right? As he has also mentioned, H1 is not linear for us, right? IPO came middle of the quarter.
Yeah.
We believe that because of strong leading momentum, we will be able to leverage full run rate in second half.
Sure. Got it. With the kind of the rate cuts that we have seen or interest rate benefits that we have already seen, were these numbers already part of the projections? Or we will see some upside risks coming with this lower interest rates that we are seeing now? In this quarter's NDCF number, the benefit of 8.6 going to 7.4, has that been fully materialized into this number, or we will still see further benefit of this 7.4 coming in the following quarters? Yeah.
Yeah. Pritesh, let me take this one. Between projections and the current quarter where we are, there is still some room which is available, which we will get some benefit in the second half because of this interest rate reduction at 7.4%.
Got it. Was this number—
The full impact of the interest rate reduction is not fully baked in, Pritesh, just to clarify.
Yeah, just to answer that question.
Sure. There would be upside risk to our projection NDCF in the final document because of these lower interest rates, right?
There will be upside benefits.
Yeah. Not risk, but yeah, potential.
Yeah. Upside benefit. Yeah. Okay. That's it from my side. Thank you.
Thank you.
Thank you.
Our next question is from the line of Mohit Agrawal from IIFL. Please go ahead.
Yeah, good afternoon, and congratulations to the team on a very good listing. My first question is on your Mumbai portfolio and specifically on Lower Parel. So if I look at your draft offer document numbers in terms of occupancy and what you have shared now, there is a fairly 600 bps, 900 bps kind of an improvement across OIC, OUC, and OWC assets. Could you talk about that and with healthy in-place rentals increases as well? You also alluded in your opening remarks about Mumbai having annual escalation. So could you kind of run us through what is the kind of demand that you're looking at? Also, there's a fair bit of expiry in the next four to six quarters, about 25%-30%.
How do you see the demand shaping up, and where do you see probably Mumbai portfolio by the end of this year?
Thank you, Mohit. I will take that. Mohit, in fact, in our view, Mumbai is going through a very healthy tightening phase. As you would agree, vacancy in majority of the key sub-markets, if I have to look at in terms of Lower Parel particularly, is in the zip code of about 8%-9%, expected to be by about 5% in the next two years. BKC is already in the much lower single digits for vacancy. That is one of the reasons of, A, the domestic Indian conglomerate occupiers, the resurgence of the domestic occupiers, their preference for Grade A assets.
Plus the amenities and the expansion with the scheme and the tightening of the demand. The combination of all these three reasons has led to a 600 bps increase in our occupancy, particularly in terms of our Lower Parel, where we have moved from 79% to 85%. In fact, we feel quite optimistic of reaching 90% in the next coming few months. If I have to talk about BKC and Powai, each of these sub-markets again have a low single-digit vacancy. Our Powai market asset has a 95% occupancy, and BKC particularly 70,000 was up for expiry that has been renewed again. Mumbai market particularly has seen the re-leasing spread of roughly about 22%.
Every lease which we have done in the last six months has come with an annual escalation, and that is a strong reflection of the pivot the office market is making from the three-year, 15-year escalation to an annual escalation.
Okay. Great. So that's clear. On the portfolio, you've done about 1.8 million gross leasing for the first half. What will be the target for the full year? Also, your 92% committed occupancy, where does it broadly sit on March 2026?
Yeah. As for the H2, if you have to look at the consolidated numbers, we are targeting a portfolio occupancy of 94%, and that would mean a total new leasing for H2 to be done of roughly about 1.4 million-1 .5 million sq ft in the next half of the year.
Okay. So about 3.5 million for the full year, right?
Yes, absolutely.
Okay, perfect. Thanks a lot. Those are my questions.
Done. Thank you, Mohit.
Thank you. The next question is from the line of Puneet from HSBC. Please go ahead.
Yeah, thank you so much, and congrats on your first call. My first question is actually on growth. How do you think about growing this fleet? What are the organic and inorganic routes you are likely to explore here?
Hi, Puneet. I take that. We have multiple growth levers, few organic and few inorganic. I take the more organic ones, which is embedded in our portfolio. Number one is essentially the mark-to-market potential of 22%. Our in-place rent for the portfolio is INR 94, up from the INR 91. If I compare that to the mark-to-market potential of 22%, it's complete. In fact, the 1.8 million sq ft of leasing has happened with an 8% premium to market. That's a big important growth here. In addition to this, we have an under-construction asset of 1.2 million sq ft, which is progressing very well, and we are targeting completion by the end of this fiscal year.
Depending upon the pre-leasing on the 1.2 million sq ft on a caseload basis, we will do up the occupancy at that time. The third growth lever comes from our ROFO assets, which is 6.7 million sq ft from our four assets, expected to be available to the REIT for evaluation in the next two to three years. Fourth, and the most important is the inorganic pursuit of acquisitions. For that, I will place Senthil to answer few questions.
Yeah. Thank you.
Senthil, go ahead.
Puneet, in terms of our design itself, we are brand neutral. There is a clear focus on acquisitions. Second, if you notice our LTV is at 18%, which gives a substantial headroom for growth. Naturally, at this point of time, we are building our pipeline quite actively, but the focus is clear on acquisitions. As and when we progress on any of these transactions that we are evaluating, we will give you some color.
Understood. For MTM perspective, how long do you think will it take to realize that 22% LTV? If you can give some thoughts on next two to three years perspective, how much of that should we be able to capture?
Sure, for the 22% embedded mark-to-market upside, this comes from very strong rentals, INR 94 versus the INR 115. We are already 8% premium to the market. As I see it, as more leases renew over the next two to three years, the whole MTM gap will progress. NOI—
Sir, sorry to interrupt.
—NAV and then to the GAV.
We lost your audio in between, sir. This last sentence, if you could please repeat that.
I was saying, as more leases renew over the next two to three years, this MTM gap of 22% will progressively flow through in terms of driving the growth, both in terms of NOI, NAV, and GAV.
Yeah. So any numbers that you can throw for next two years? Because the last part of it as I see is in Hyderabad, where these are recent released assets will probably renew much later as well.
I can give you an anecdote on the Hyderabad. The in-place rentals we need in Hyderabad for our portfolio is INR 78- INR 79, whereas the marginal rents in the micro market, the sub-market where we operate prominently is in the INR 120 range. That's a significant 40%- 45% jump in terms of the rental MTM possibility. In fact, if I have to look at the spread, out of the 1.8 million sq ft , 400,000 has come from Hyderabad at a re-leasing spread of 36%. That's a very strong re-leasing spread and MTM potential market.
No, I understand that. But only 5% of portfolio comes up for renewal in next three years, right? In Hyderabad. So bulk of it—
Yes. Only 5% of the portfolio comes up for renewal.
Yeah. So next two years, 2027, 2028, bulk of it will be from Bangalore and Mumbai. Is that understanding correct?
Okay. Your understanding is correct, Puneet. Out of the 1.5 million square foot, which naturally expires every year, about 40%-45% comes from Mumbai. Remaining comes Bangalore. As you rightly pointed out, little comes from Hyderabad. That is why Hyderabad anchors the portfolio from a stability standpoint. Every time there is a churn in the Hyderabad portfolio, the upside opportunity in terms of re-leasing is significantly higher. That is something which we have seen in the first half by leasing 400,000, which was from 97%- 99% at a 36% spread. Your point is right. Less of Hyderabad is coming up for leasing because its occupancy is 99%.
Okay. Understood. That is helpful. Philosophically, in terms of distribution and loan to value, you are at 18%. What is the level you are comfortable with? From distribution perspective, most of the other REITs are pretty much distributing 100% of their NDCF. Should we expect you to do the same?
Yeah. We are distributing 100% and that is the plan. We will continue to distribute all the cash flow that we will have. The other question, the first question was—
Loan to value.
—on the loan to value of 18%. The clear plan was to actually take the LTV up over time. We intend to make acquisitions. As we make acquisitions, we will finance those acquisitions through leverage. So over time, this leverage will go up, and it depends on when we find the acquisitions and how much. If we were to take it up 13%, 14%, that's a good INR 6,000-7,000 crores of potential that we can borrow and finance acquisitions as we move forward. So that is for the broad plan. Exact timing, obviously, is to be determined.
Your headroom for level of comfort would, if I were to add this 14% over 18%, 33%- 34% is your headroom?
The headroom. I guess, yeah.
Puneet, currently as Shirish mentioned, we are at 18%. We will be following the guidelines. So whenever we reach at a threshold, let's say 25%, we'll seek necessary approvals. We are conservative. We can go up till 49%, but we are conservative. Maybe you can say 30%, 31% is something we can easily go to.
Yeah. Understood.
It really is acquisition dependent. We will just see where we are. If it is very accretive and a very attractive acquisition, it may go up a little bit in leverage, but obviously we are going to be prudent. It is not going to be silly. We will go through the appropriate process in terms of approvals.
Understood. That is helpful. Similarly, on the debt side, a large part of your debt is floating debt. Is there a thought process to convert that into fixed?
Yes. The short answer is yes. Obviously, we are considering that. It is interesting times on the rate side. Inflation continues to stay low. Rates are at attractive levels, tempting to fix them. We are considering what percentage of the portfolio we should fix over the next few quarters. We will be doing that and monitoring the situation as it goes. It is not an exact number. But yes, over time, we will be fixing a part of the portfolio to take advantage of the low rate environment. But we feel that there is potential for maybe some rate movement downward, and we want to make sure we time it right.
Okay. Lastly, I could not find the NDCF walk-down in your presentation. Any thoughts on when you want to try to put in that?
Puneet, this is a runoff quarter. As mentioned earlier also, H1 is not linear. IPO came middle of the quarter. Maybe H2 is the place when we will be taking advantage of strong leading momentum. So maybe at the right point of time, we will be disclosing this walk down.
Okay. Understood. Thank you so much, and all the best.
Okay. Thank you.
Thank you. Our next question comes from the line of Kunal from Bank of America. Please go ahead.
Great. Thank you. Two quick questions from me. Number one, could you remind us what is the re-leasing status of the 1.2 million that is nearing completion by end of the year?
Is that the only question, Kunal? Should we wait for the second one?
The second one is on the point around the guidance that we should see a stronger flow through in H2. I just want to verify that is this contingent upon incremental leasing in back half of the year? Given that most of the leases would have a rent free period of three to six months. I am assuming that it isn't really contingent.
Okay, I will take the first question, Kunal. With regards to
Under the hood. Yeah.
Re-leasing. Re-leasing status of—
The re-leasing status of you know. Yes, Kunal, mostly the assets coming up by end of the year.
Okay, coming up.
So with regards to the pre-leasing for the 1.2 million sq ft, the assets are in advanced stages of completion. We expect that to be completed by the end of this year. There is no significant visibility on the leasing. The reason being, Kunal, is we are mindful of not strata leasing this. When I say strata leasing this, is to lease this to few anchor tenants instead of really doing this floor by floor or smaller denominations. As a part of the leasing strategy, we want to approach this in a formal manner, where there is only these assets are leased out to only three, four occupiers or at best only one occupier.
That's something which we are sort of following through as per a leasing strategy, and we are hopeful that by the end of this fiscal year, we should have a strong pre-leasing as visibility.
Got that. The second part would be the guidance for now.
Kunal, as I mentioned earlier, the guidance for H2 and in fact for the consolidated for the whole FY 2025-2026 will be on a same store basis, 93%-94% occupancy at the portfolio level.
Right. I hear the year-end occupancy levels. My only question was, would that define part of the run rate you are expecting to hit by Q4? Because I think we are talking of committed occupancy as opposed to rent yield number.
Kunal, sorry, I could not get the question right. Just from a timing standpoint. Are we trying to differentiate between committed occupancy and economic occupancy?
Absolutely. My point being that as you are looking at the 92% number going up to 94-ish in another six months, that may not necessarily convert into a rent yielding or an economic occupancy perspective. Is that needed for you to hit the guide or not really?
No. That is not needed, but I will just give you a slight color around the committed occupancy and the economic occupancy. Today, as we speak, we have a total committed occupancy of 92%, and the economic occupancy is 86%. This is essentially a difference which has come to a six-point difference, which has narrowed down from a nine-point difference starting March of 2025 when this difference was 91% of occupancy and 82% of economic occupancy. In fact, as we go along, we think this difference will narrow down further to three to four points of difference as we start bringing the new occupiers in the next few months.
Understand. Correct. Very clear. So essentially, this is predicated on 86.2-89, 90.
Yes.
Perfect. Okay. All right. Thank you so much.
Thank you. Our next question comes from the line of Praveen Choudhary from Morgan Stanley. Please go ahead.
Thank you. Thank you, to Shirish, Quaiser, Neeraj, and Senthil . Most of my questions are thoroughly answered, so thank you. Wanted to congratulate you on the successful IPO. If I were to ask a question, it is on inorganic growth strategy. Two parts to it. Would you be looking in cities outside of the three core markets, Bangalore, Hyderabad, and Mumbai, when you're looking for inorganic growth? And second, would you be using equity if it would make sense for the acquisition, or you think LTV is low enough that initially it will all be debt-funded? Thank you.
I'll take the first part of the question, Praveen. Particularly, will we be looking for acquisitions beyond the three cities? The simple answer is yes. We will be looking at all the key markets where office market has depth and buoyancy. But particularly the way we look at acquisitions will go through the same big qualifiers of being in the right city. Even more important is being in the right sub-market and high asset quality with the right set of tenant profiles. That being said, Shirish can answer of how we wanted to approach this from a debt and an equity mix.
Yeah, Praveen, I think you're aware, right? We are at 18% leverage, so obviously we have the finance capabilities to finance the acquisitions going forward. But we use a judicious mix, right? We look at the needs of a seller. We can obviously issue equity as well, to the extent that it benefits the capital gains treatment for a seller and/or combine it with cash and equity. So it really depends on the opportunity and the situation. With 18% leverage, and we can take it up to, let's say, 31%, 32%, that gives us INR 10,800 crores of financing capability. As you're aware, you saw the NCD rates we had of 7.2%, obviously.
Very attractive and given where the market cap rates are, that gives us the potential to make those future acquisitions. Right. So we'll judiciously use a mix of equity and debt as appropriate and in the market as I just pointed out. So hopefully that answers your question, Praveen.
It does. Thank you again and congratulations.
Thanks, Praveen.
Thank you. Ladies and gentlemen, to ask a question, may please press star and one. Our next question comes from the line of Vinay Nair from Rare Enterprises. Please go ahead.
Hi, thank you for the opportunity. I have an accounting question. Could you help us please reconcile the revenue numbers in the press release about INR 1,124 crores, with the reported financials? We are looking at the consolidated number close to INR 700 crores. Similarly, EBITDA and NOI also, that would be very helpful.
The reported number is from the mid of the quarter. The other number what you have is reckoning for the full half year.
Yeah. Because we had the listing in the mid of August, that's why it brings up this unusual quarter for us. Some of the numbers are just for that period, and obviously the first half numbers are for the full half year. Right.
Yeah. Because acquisition happened mid-quarter, so that's why reported number is mid quarter. Sorry?
Okay. Fair enough. The press release number INR 1,124 crores is both including the reacquisition also.
That's right. You're right.
Okay. That explains it. Thank you so much.
All right.
Thank you.
Thank you. Ladies and gentlemen, if you wish to ask questions, may you please press star and one. To ask a question, ladies and gentlemen, you may press star and one on your touch-tone telephones. We have no further questions at this time. On behalf of Knowledge Realty Trust, we can conclude this earnings call. Thank you all for joining us. You may now disconnect your lines.
Thank you.
Thank you.
Thank you.