Accumulate Peninsula Land; target of Rs 69: P Lilladher

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Accumulate Peninsula Land; target of Rs 69: P Lilladher

Prabhudas Lilladher is bullish on Peninsula Land and has recommended accumulate rating on the stock with a target of Rs 69 in its May 13, 2011 research report.

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Prabhudas Lilladher is bullish on Peninsula Land and has recommended accumulate rating on the stock with a target of Rs 69 in its May 13, 2011 research report.

"Peninsula Land (Peninsula) reported revenues of Rs 900 million, a decline of 60% YoY and 23.7% QoQ, on account of a delay in sales at the Peninsula Business Park. POCM revenues at PBP contributed Rs 360 million, income from Swan Mills contributed Rs 250 million to revenues, while Rs 290 million was from rentals and arrears from Piramal Chambers. On account of the high-margin PBP revenues as well as arrears from Piramal Chambers booked during the quarter which flowed directly to the bottom-line, EBITDA margins strengthened to 64% from 46% in Q4FY10 and 44% in Q3FY11."

"During FY11, Peninsula spent Rs 6 billion towards a new project acquisition and another Rs 3 billion is yet to be paid for the same. It acquired 10 new projects, of which three are in Mumbai, two in Alibaug, two in Pune, one in Thane, one in Bangalore and one in Lonavla. The company now has ~6.2m sq.ft in their short-medium term pipeline, whereby, the company expects to commence construction/launch within this fiscal. Post the acquisitions, the company's balance sheet continues to appear strong as its debt:equity ratio stands at 0.67:1."

"Although the momentum for the company has been slow in the last fiscal on account of lack of inventory and absence of projects to be launched, we expect FY12 to look better, with the company having acquired a substantial number of new projects. We do not expect launches to take place at a rapid pace on account of the long approval process. However, we do expect a significant improvement over the last year. Besides, with Peninsula Business Park almost complete, we expect sales momentum to pick up at the project. The company has already concluded two deals in the month of May and expects to sell 50% of the second tower (first tower sold to Alok) within the current fiscal. The company's NAV, excluding the recent acquisitions, stands at Rs 69. We maintain 'Accumulate' for a target price of Rs 69," says Prabhudas Lilladher research report.

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