Brokerages raise target price on Oberoi Realty, optimistic on realty player's growth projections

"We are pleased to announce another successful quarter, driven by healthy demand in the luxury real estate market," said Vikas Oberoi, CMD, Oberoi Realty.

Brokerages bumped up their target prices on Oberoi Realty on its improved sales performance and healthy earnings momentum.

The real estate major's net profit surged close to 82 percent on year to Rs 584.50 crore in Q1 of FY25, up from Rs 321.60 crore recorded in the corresponding quarter of the preceding fiscal.

The sharp uptick in net profit was aided by robust revenue growth of 54.4 percent to Rs 1,405.20 crore in the quarter under review, as against Rs 910 crore in the year-ago period.

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Morgan Stanley upgraded Oberoi Realty to 'equal-weight' from 'under-weight' earlier, and raised the target price to Rs 1,900 per share. This implies an upside of nine percent from the previous session's closing price.

The brokerage lifted the FY25 pre-sales growth forecast to 30 percent on-year from 20 percent earlier. The development multiple was also raised to 30x from 25x, as Morgan Stanley sees Oberoi Realty's growth projections above its peers.

Oberoi Realty reported healthy Q1FY25 revenue, EBITDA and PAT, ahead of our expectations, said Kotak Institutional Equities.

However, despite the improvement, the brokerage believes the CMP adequately reflects the positives, even as the company has lagged the peer set on growth in the development business. Therefore, Kotak maintained its 'reduce' rating, but increased the fair value to Rs 1,550 per share, up from Rs 1,375 earlier.

"We are pleased to announce another successful quarter, driven by healthy demand in the luxury real estate market with homeowners constantly looking to elevate their lifestyles," said Vikas Oberoi, Chairman and Managing Director, of Oberoi Realty.

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