Real Estate Stock
ICICI Securities has a Buy call on Macrotech Developers Ltd. (LODHA) for a target price of Rs 1,262 apiece. Given the target price, if you buy the stock at the current market price, it can fetch robust gains up to 42%.
On April 22, 2023, LODHA announced a bonus issue of equity shares to investors in a proportion of 1:1. In addition, it recommended a final dividend of Rs 2 i.e. 20% per equity shares of Rs 10 each.
LODHA is a midcap real estate sector stock. It owns and develops commercial and industrial properties. Macrotech Developers serves customers worldwide. It has a market capitalisation of Rs 43,059.88 crore.
Recommended Bonus Shares and Final Dividend
“Issuance of bonus equity shares in the proportion of 1 new fully paid up equity share of Rs 10 each for every existing 1 equity share of Rs 10 each held by the members of the Company as on the record date, subject to shareholders’ approval through postal ballot,” Macrotech Developers said in an exchange filing on April 22, 2023.
It added, “Recommended a final dividend of Rs 2 i.e. 20% per equity share of Rs 10/- each of the Company on pre bonus paid up equity share capital (to be adjusted proportionately for bonus issue). Dividend will be paid to the shareholders holding equity shares on the record date to be determined by the Company after approval of the shareholders at the ensuing 28th Annual General Meeting.”
Real Estate Stock To Buy For 42% Gains, Announces 1:1 Bonus Issue, Rs 2/Share Final Dividend
The last traded share price is Rs 893.75/share, down 1.53% from its previous close. Its 52 week high is Rs 1,189 apiece and 52 week low is Rs 711 apiece, respectively.
It declined 4.26% in week, however, it jumped 8.19% in 1 month. It has fallen 9.34% in 1 year. Since its listing on 9 April 2021, its share value jumped 92.1%.
New launches key to sustaining sales momentum
According to ICICI Securities, Macrotech Developers (LODHA) achieved its best-ever annual sales bookings in FY23 worth Rs120.6bn (up 34% YoY) and higher than its guidance of Rs115.0bn at the beginning of FY23. Further, the company’s India business net debt reduced by Rs22.3bn YoY in FY23 to Rs70.7bn as of Mar’23. FY23 was also strong year for business development with the company adding GDV of Rs198bn across 12 new projects vs. its FY23 guidance of Rs150bn of GDV addition.
For FY24, the company is targeting 20% YoY growth in sales bookings to Rs145.0bn (I-sec estimate of Rs134.0bn) driven by new Mumbai/Pune launches and two Bengaluru project launches and expects to generate an operating surplus of Rs60bn pre-interest. Beyond FY24, the company is targeting a further 20% CAGR between FY24-26E which implies FY26E sales bookings of Rs210bn which is contingent on new project additions and the residential cycle remaining favourable over the long term.
“We retain our BUY rating with a revised target price of Rs1,262/share (earlier Rs1,275) based on FY23 NAV owing to balance sheet adjustments. Key risks are demand slowdown in the MMR market and rising interest rates,” the brokerage has said.
Disclaimer – The stock has been picked from the brokerage report of ICICI Securities. Greynium Information Technologies, the Author, and the respective Brokerage house are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to consult with certified experts before making any investment decision.
By Shubham Kumar Goodreturns
