February 20, 2017 / 13:50 IST
Pre-sales in Q3 were steady at Rs 6.9 bn (GPL’s share: Rs 3.2 bn) vs. Rs 6 bn in Q2 (GPL’s share: Rs 2 bn) driven by two new launches which contributed >70% to Q3 pre-sales. However, pre-sales in its ongoing projects were muted (Rs 1.9 bn vs.Rs 3.4 bn in Q2) due to demonetization. Management said that new project launches were delayed due to delay in approvals.
Outlook
Due to rich valuations (P/B of 3.7x vs. 1-2x for its peers), we believe, the stock is fairly priced from a 1-year perspective. However, we like the stock from a 3-5 years perspective, as we believe that GPL can take its operations to another level driven by polarization of demand towards reputed developers and continued acquisition of new projects on attractive terms due to consolidation in the industry.
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