ICICI Direct's research report on Brigade Enterprises
Q1FY24 saw Brigade Enterprises (BRGD) clocking sales bookings of 1.5msf worth INR10.0bn (I-sec estimate of INR9.0bn) which rose 22% YoY in value terms. We model for residential sales bookings of INR45.8bn in FY24E and INR51.3bn in FY25E driven by a residential launch pipeline of ~8msf over next 12 months. The company has recently acquired ~10acre land parcel in Kokapet, Hyderabad for INR7.0bn which is slated for a H2FY25 launch and expected to have 3.5msf of saleable area (assuming 8x FSI). We expect the company to clock rental NOI CAGR of 16% over FY22-25E to INR6.2bn led up lease-up of vacant space in Tech Gardens, Bengaluru and Brigade Twin Towers office project becoming fully operational in FY25E.
Outlook
We retain our BUY rating with a revised target price of INR695/share (earlier INR638) as we roll forward to 1x FY24E NAV incorporating new Hyderabad land and balance sheet adjustments. Key risks are weakness in office leasing and slowdown in residential demand.
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