Buy Puravankara; target of Rs 430: Emkay Global Financial

Emkay Global Financial's research report on Puravankara

It has gained market share faster than peers in the last 5 years in Bengaluru – its core market (comprises 60-65% share in presales). It is now diversifying into the West with ~48% of new launches planned in MMR and Pune. Initial response has been strong; and a dedicated team, focus on faster capital churn, and healthy inventory pipeline lend comfort on performance continuity. We thus expect the West to drive a strong 29% CAGR in pre-sales, in FY25-27E (share in mix: @35% by FY27E). Consequently, increase in collections would deleverage the balance sheet post-FY26E. Growth outlook remains robust, valuations are undemanding, and multiple avenues for re-rating abound which underpin our conviction on the stock.

Outlook

We initiate coverage on Puravankara with BUY and SoTP-based TP of Rs430. The company is among the top-5 players in the South India real estate market with a strong brand recall.