Buy Kolte Patil Developers; target of Rs 560: Motilal Oswal

Motilal Oswal's research report on Kolte Patil Developers

Kolte Patil Developers (KPDL) reported pre-sales of INR6.3b in 4QFY25, down 15%/7% YoY/QoQ, (31% below estimate). In FY25, pre-sales were at INR28b, flat YoY and 9% below estimates due to delay in launches. Volumes also reduced 22%/1% YoY/QoQ to 0.8msf (15% below estimate). Realization increased 9% YoY to INR7,888/sft (18% below estimate). In FY25, the company launched projects with a total GDV of INR40b, which contributed 42% of total bookings for the year. Collections were up 19%/24% YoY/QoQ to INR7b (16% above estimate). In FY25, collections were up 18% YoY to INR24.3b, which was in line with estimates. Planned launches are expected to spill over to FY26 due to approval delays.

Outlook

The promoter overhang, with Blackstone’s entry, appears to be waning. As a result, the discount to NAV previously applied has been removed. Additionally, the spillover from project launches has been factored into FY26 estimates. This led to a revised TP of INR560 (INR450 earlier). We continue our BUY rating with a potential upside of 39%.