Accumulate Prestige Estates; target of Rs 168: PLilladher

Prabhudas Lilladher is bullish on Prestige Estates Projects has recommended accumulate rating on the stock with a target of Rs 168 in its October 30, 2012 research reports.

“Prestige Estates’ (PEPL’s) Q2FY13 performance has been in line with expectations on the revenue recognition front, however, has exceeded expectations in terms of launches and sales. Revenues for the quarter stood at Rs2.4bn, 88% YoY and 10% QoQ growth, margins stood at 30% as against 32% in Q1FY13 and PAT stood at Rs0.45bn, 74% YoY growth and 7.3% sequential decline.”

“On the back of 2.19m sq.ft of launches in Q1FY13, the company has launched/soft launches another 6.25m sq.ft in Q2FY13 surpassing its launch guidance of 8m sq.ft for the full year. Within residential, it launched four projects totaling to 4.49m sq.ft this quarter, while commercial and retail accounted for the remaining. Given the fact that PEPL has exceeded its launch targets for the year, the company has further increased its launch pipeline by another eight projects which include projects from its existing land bank as well as newly acquired projects. The company has spent Rs1.1bn on land acquisition this quarter. In terms of sales, the volume number stood at 1.63m sq.ft for the quarter as against 2.03m sq.ft in Q1FY13, while the value stood at Rs8.16bn as against Rs10.1bn in Q1FY13. As a percentage of the full year sales guidance, the company has achieved 73% in H1FY13. New leasing for the quarter stood at 0.54m sq.ft as against 0.46m sq.ft in Q1FY13, of which, PEPL’s share stands at 0.07m sq.ft. For the full year, the total leasing guidance stands at 2.5m sq.ft, of which, PEPL’s share is expected to be 1m sq.ft.”

“A continuing healthy performance on all fronts, improving operating metrics and a strong sales outlook in Bengaluru aids us in retaining our positive stance on the company. We maintain ‘Accumulate’ with a PT of Rs168,” says Prabhudas Lilladher research report.  

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