Ruby Mills can move to Rs 1500: SP Tulsian

Ruby Mills can move to Rs 1500, says SP Tulsian of sptulsian.com.

Tulsian told CNBC-TV18, "Ruby Mills is an interesting play. The company owns about 12,200 square meters of land at Dadar in Mumbai. They have leased the land for joint development in which the ownership, building and the land will remain with the company. The huge inflow from this property has started flowing in into the books of the company."

He further added, "In FY11, they booked an income of about Rs 70 crore from this company. About four lakh square feet has been leased out and by end of 2011, and the entire property will get leased out through the lease rental or the advance premium. The company is recognising the income from this property on the cash flow basis."

"The company also has their existing real estate property developed on the same plot. It has the balance FSI of close to about 5-6 lakh sq. ft that is likely to get developed in the next six months or so. The valuation of the Dadar property estimates to about Rs 2,000 crore. The company should be able to have a PAT of close to about 75-100 crore every year, on a sustainable basis, which will give them an EPS of close to about Rs 300 to Rs 350 starting from FY13."

"There is going to be a vast re-rating of the stock. The stock is likely to be move to about Rs 1,500 in next six to eight months time. I am quite positive on the stock from both short-term and long-term point of view."