Accumulate Anant Raj Inds; target of Rs 108: P Lilladher

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Accumulate Anant Raj Inds; target of Rs 108: P Lilladher

Prabhudas Lilladher is bullish on Anant Raj Industries (ARIL) and has recommended accumulate rating on the stock with a target of Rs 108 in its May 30, 2011 research report.

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Prabhudas Lilladher is bullish on Anant Raj Industries (ARIL) and has recommended accumulate rating on the stock with a target of Rs 108 in its May 30, 2011 research report.

"Anant Raj Industries (ARIL) reported revenues of Rs 618m, YoY growth of 81.3%, however, a sequential decline of 62% on account of initial slackness in sales at their newly launched project in Sector 91, Gurgaon. Operating margins for the quarter were extremely robust at 71% as revenues included car parking and other ancillary income on flats booked in the previous quarters. Costs were, thereby, lower. The progress of construction at both the previously launched projects, Manesar and Kapashera, is fairly on track. Both projects are fully sold out and POCM revenue booking to the tune of Rs 290m was done in Manesar, while Rs 90m was done at Kapashera.

The company is focusing on launching its 105 acre project in Gurgaon in H2FY12. ARIL is planning a plotted development on this land for which zoning and notification has been completed. If launched successfully, this project shall be a large cash flow driver for the company over the next couple of years. Besides, the company is also looking at launching two more projects during the course of the year. ARIL's fifth hotel is likely to commence operations next month, which shall lead to additional rentals of Rs 22.5m/quarter. Besides, the company is focusing on completion of Rai and Panchkula IT parks, which shall yield additional rentals towards the end of the fiscal. As per our estimates, ARIL's NAV stands at Rs 167. Our target price is based on a 40% discount to the NAV. We maintain 'Accumulate', with a target price of Rs 108," says Prabhudas Lilladher research report. 

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