Buy This Stock For +17% Return, In 1 Year

Target Price

The Current Market Price (CMP) of Macrotech Developers is Rs. 1359. The brokerage firm, Emkay Global has estimated a Target Price for the stock at Rs. 1600. Hence the stock is expected to give a 17.7% return, in a Target Period of 1 year.

Company performance

The company's sales stood at Rs. 59.7 bn, in FY 2021, and Emkay Global is expecting Rs. 114.9 bn sales in FY22 and Rs. 156.4 bn sales in FY23. On the other hand, revenue was Rs. 54.5 bn in FY 21; the firm is anticipating Rs. 80.9 bn revenue in FY 22, and a Rs. 88.2 bn revenue in FY 23. Emkay Global said, "Key upside risks to our estimates include higher average pricing, existing market size expansion, and forays into new cities. Expansion into new markets will be key to achieving management's vision of executing 50,000 homes annually by the end of this decade."

Comments by Emkay Global

Maintaining a buy rating Emkay Global said, "We believe Macrotech's scale of operations is geared for a reset following the sooner than-anticipated Rs. 40 bn capital raise. Over the next 12-18 months, the developer plans to deploy a majority of the capital in joint development agreements amounting to Rs. 400bn in GDV."

About the company

Macrotech Developers, a part of Lodha Group, enjoys a leadership position in its existing micro-markets with a ~15-30% market share. It aims to replicate a similar market share performance in new markets. Notably, the sales-to-launch ratio in Pune/Kandivali has been in the range of 15-60% in 3-4 months after a soft launch.

Disclaimer

The above stock was picked from the brokerage report of Emkay Global. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution. Greynium Information Technologies, the author, and the brokerage house are not liable for any losses caused as a result of decisions based on the article.