August 12, 2016 / 13:16 IST
Motilal Oswal's research report on Indiabulls Real Estate
1QFY17 revenue grew 18% YoY to INR 8.7b v/s our estimate of INR 6.9b. EBITDA grew 27% YoY to INR 3b, translating into EBITDA margin of 34% v/s 26.5% for 4QFY16. PAT grew 29% YoY to INR 1.2b. Total annualized revenue (based on current leasing) was INR 5.9b.
Higher comfort on asset monetization key to re-rating IBREL trades at 0.5x/0.48x FY17/18E BV and at 10.7x/8.3x FY17/18E EPS – at a steep discount to peers and its own valuation history (average P/B of 0.75x). Key concerns are operational weakness in core regions (Central Mumbai and Gurgaon) and discomfort on London asset. Divestment of stake in London asset (as per media reports) at healthy valuation, coupled with success in de-leveraging target would be key trigger. We reiterate Buy. Our target price is INR 98 (10% discount to NAV).
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