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Buy Mahindra Lifespace; target of Rs 520: ICICI Direct

ICICI Direct recommended buy rating on Mahindra Lifespace with a target price of Rs 520 in its research report dated August 02, 2017.

August 04, 2017 / 05:36 PM IST
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ICICI Direct's research report on Mahindra Lifespace

Mahindra Lifespace Developers’ (MLD) standalone net sales grew robustly by 22.9% YoY to Rs 109.3 crore The EBITDA margin contracted 334 bps YoY to 10.6% mainly on account of a change in the project mix Standalone PAT de-grew 30.3% YoY to Rs 10.7 crore due to lower other income (Rs 14.5 crore in Q1FY18 vs. Rs 18.0 crore in Q1FY17) On a consolidated basis, topline grew 40.9% YoY to Rs 136.1 crore. However, its bottomline declined 20.8% YoY to Rs 13.8 crore.


We like MLD given its strong parentage, management’s focus on improving efficiency & return ratios through strategic partnerships, MLD’s affordable housing foray & comfortable balance sheet (0.2x debt to equity). With an anticipated pick-up in leasing activity at industrial clusters on back of economic revival and various high margin projects to hit revenue recognition, we expect its bottomline to grow at 25.6% CAGR to Rs 161.2 crore while sales volume are expected to grow at 44.3% CAGR in FY17-19E to 2.0 msf. We also factor in dilution by rights issue. We have BUY rating on MLD with target price of Rs 520 (0.8x its potential NAV).

For all recommendations report, click here


Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on are their own, and not that of the website or its management. advises users to check with certified experts before taking any investment decisions.

first published: Aug 4, 2017 05:36 pm

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