Accumulate Oberoi Realty; target of Rs 228: PLilladher
Brokerage house Prabhudas Lilladher is bullish on Oberoi Realty and has recommended 'Accumulate' rating on the stock with a price target of Rs 228 in its research report dated October 31, 2013.
November 05, 2013 / 15:15 IST
Prabhudas Lilladher's report on Oberoi Realty
"Oberoi Realty's sales declined 26.7 percent YoY and 13.5 percent QoQ to Rs1.89bn for the quarter on account of weak volumes. Margins were also subdued at 45.5 percent as against 58.1 percent in Q2FY13 and 61.1 percent in Q1FY14, aided by a one-time cost of Rs260m towards approval of Splendor Grande under the new DCR regime. PAT for the quarter stood at Rs641m, 48.4 percent YoY decline and 37 percent QoQ decline.""The company's sales volumes at its Goregaon projects were extremely dull during the quarter, declining 67 percent QoQ and 31 percent YoY. Although, construction work at Esquire was restarted, sales has not witnessed a pick up. For the quarter, the company has accounted for Sales at its Worli Oasis project till date as letters of allotment were issued at the same. Inclusive of those, sales stood at Rs0.15m sq.ft valued at Rs3,997bn.""With regards to the Supreme Court proceedings at its Mulund project, although the proceedings have commenced, the outcome still seems a month away. Optimistically, the company is targeting a Q4 launch for the project. At Oasis, the agreement with the hotel operator is not yet finalized and hence, the formal launch in awaited. Leases at Commerz II have also been subdued and hence, the overall progress for the company projects has been muted."Valuations: "The company's NAV stands at Rs99.8bn which translates to Rs304/share. We are assigning a 25 percent discount to the NAV to arrive at our target price on account of the uncertainty with regards to new project acquisitions as well as regulatory clearances, coupled with the weak macro-economic environment. We maintain 'Accumulate' on the stock with a target price of Rs 228," says Prabhudas Lilladher research report.Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions. 
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