Sunteck Realty share price jumps over 5%; Motilal Oswal expects a 41% upside

Sunteck Realty share price jumps over 5%; Motilal Oswal expects a 41% upside
Sunteck Realty share price jumps over 5%; Motilal Oswal expects a 41% upside

Sunteck Realty share price jumped over 5 per cent in morning trade on BSE on Tuesday, November 21. The stock opened at 474 against the previous close of 453.70 and rose 5.5 per cent to hit the intraday high of 478.50 on BSE.

Sunteck Realty share price has gained almost 38 per cent this year so far against an 8 per cent gain in equity benchmark Sensex.

Sunteck Realty is one of the leading real estate developers in the Mumbai Metropolitan Region (MMR), the largest micro-market in the country.

Also Read: Titagarh Rail Systems share price hits 52-week high on partnership with ABB for metro projects in India

Brokerage firm Motilal Oswal Financial Services has initiated coverage on Sunteck Realty stock with a buy recommendation, pegging a target price of 640 indicates which a 41 per cent upside from the stock’s November 20 closing price of 453.70 on BSE.

In a report on November 21, Motilal said it expects Sunteck to deliver a healthy 25 per cent pre-sales CAGR over FY23-26, fueled by a ramp-up in launches from both new and existing projects. Furthermore, Motilal expects Sunteck to deliver 4,500-5,000 crore worth of units at its projects in Naigaon and Goregaon, driving 72 per cent revenue CAGR over FY23-26 and multi-fold growth in PAT to 350 crore.

(Exciting news! Mint is now on WhatsApp Channels. Subscribe today and stay updated with the latest financial insights! Click here!)

Motilal Oswal believes the company’s sound balance sheet, strong cash flow, and recent partnership with IFC would spur project additions and drive a sustainable growth trajectory.

Also Read: Day trading guide for stock market today: Six stocks to buy or sell on Tuesday — 21st November

“We value its residential segment based on the NPV of existing pipelines and its commercial segment based on an 8 per cent cap rate on FY25E EBITDA. We also assign 1,400 crore of value to future project additions through the IFC platform to arrive at our target price of 640, indicating 41 per cent upside potential,” said Motilal Oswal.

Also Read: IREDA IPO opens today. GMP, price, date, review, other details. Apply or not?

Motilal Oswal pointed out that Sunteck’s pre-sales growth was underdue during FY14-18 (posting a 10 per cent CAGR over the period); However, it accelerated thereafter at 22 per cent CAGR over FY18-23, led by three new project launches.

The company is now gearing for the next leg of growth, with two new project launches planned in Kalyan and Nepean Sea Road. Cumulatively, the company is lining up 5,700 crore of launches from new projects ( 2,200 crore) and successive phases in existing projects ( 3500 crore) over the next two to three years, the brokerage firm said.

Also Read: Buy or sell: Vaishali Parekh recommends three stocks to buy today — November 21

However, key risks, as per Motilal Oswal, include a delay in the launch of new projects and subdued sales velocity which would lead to a longer monetization timeline and a lower discounted value.

Read all market-related news here

Disclaimer: The views and recommendations above are those of individual analysts, experts and brokering companies, not of Mint. We advise investors to check with certified experts before making any investment decisions.

Milestone Alert!Livemint tops charts as the fastest growing news website in the world

For Latest Updates Follow us on Google News


PREV Argentina and Brazil will clash in the quarterfinals of the U17 World Cup | Sports
NEXT TVS Motor share price gains 2.63% to scale 52 week high on its foray into Vietnam