Motilal Oswal's research report on Brigade Enterprises
We met the management of Brigade Enterprises (BEL) to understand its business outlook. Key takeaways are (1) Demand momentum is intact owing to favorable affordability despite 200bps increase in interest rate (2) BEL expects to launch 13msf of projects over the next 12 months (3) re-iterated its target to grow sales volumes by 15-20% over the next three years (4) focus on business development to continue across Bengaluru, Chennai, and Hyderabad and (5) expect commercial portfolio to be fully leased by Sep-23. On the back of a strong launch pipeline, we expect BEL’s pre-sales to record a 17% CAGR to 7msf by FY25. We believe pick up in business development activity will lead to re-rating in value of its residential segment as the current market price does not reflect the growth potential.
Outlook
We reiterate our Buy rating with an unchanged SOTP-based TP of INR720, implying 55% upside potential.
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