Buy This Small Cap Mahindra Entity For 30.5% Upside In 1 Yr.: ICICI Direct

Indian indices have again reacted to a host of factors including sky-rockering crude prices, rising bond yield which in the US have again scaled to 1.95% levels and hence high expectations around much anticipated rate hike by as much as 50 bps in March.

As now there is a lurking correction in the markets, here is a stock from the real estate space given a 'Buy' tag by ICICI Direct for a buy for 1 years time.

Buy Mahindra Lifespace for a target price of Rs. 335, potential upside of 30.5%:

Company’s financial performance:

Residential sales volume value recorded gains with 29% YoY growth. Collections at the company also witnessed an increase and were up around 58% YoY. The company primarily recorded profitability in the industrial segment hence PAT of Rs. 25 crore, though the residential segment was still in losses

Rationale for buying Mahindra Lifespace:

The brokerage suggested the scrip to value at Rs. 335 per share. And its robust performance going ahead shall be backed by strong pipeline, unsold inventory that could bring in cash flow to the tune of Rs. 2628 crore.

Further the company is going ahead aggressively and plans to put Rs. 500 crore annually on land. "IC& IC business to benefit from PLI/manufacturing push Borrowing cost lowest among peers- a huge competitive advantage", adds the brokerage.

About Mahindra Lifespace:

This is a small cap real estate player that along with its subsidiaries is engaged in developing residential projects as well as large format, integrated developments such as SEZs etc.

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