ICICI Direct Places Buy On Midcap Real Estate Stock, Soars 445% In 3 Yrs, Declares 20% Dividend

ICICI Direct places a Buy rating on Brigade Enterprises Ltd. (BEL) with a target price of 650/share. If you buy the stock at the current market price, it can fetch up to 19% return, considering the given target price. BEL is a Midcap Real Estate sector stock. It has a market capitalisation of Rs, 12,612.95 crore.

The company in its Board meeting held on 24th May 2023, recommended a final dividend of Rs 2/share i.e. 20% of Rs 10 each. The recommended dividend is subject to approval of the shareholders at the 28th AGM.

Recommends Dividend

According to the regulatory filing by the Board of Directors of Brigade Enterprises Ltd., "Recommended a final dividend of Rs. 2/- per equity share (20%) of Rs.10 each which is subject to approval of the Shareholders in the ensuing Twenty Eighth Annual General Meeting of the Company. The dividend will be paid within 30 days from the date of Shareholders approval in the ensuing Annual General Meeting of the Company."

Q4FY23 Results

According to ICICI Direct, BEL reported a strong performance. The company reported sales volume of 2.37 mn sq feet (residential sales volume 2.33 mn sq feet (msf), up 55% YoY), up 53% YoY driven by new launches of 2.8 msf. The sales value at RS. 1489 crore was up 44.8% YoY driven by strong demand momentum. FY23 residential sales volume was ~6.1 msf worth Rs. 3907 crore, up ~31% and 32.4%, respectively. Reported revenues declined 10.6% YoY to Rs. 843 crore, with revenue recognition from real estate being lower at Rs. 572.8 crore, down 21% YoY. Revenues from hospitality (up ~102% YoY and 11% QoQ) were at Rs. 112 crore with occupancy at~69% (68% in Q3), higher than pre Covid levels of ~62% with ARR now ~12% above pre-Covid levels at Rs. 6022. EBITDA at Rs. 202 crore was muted YoY owing to lower revenues YoY. Reported EBITDA margins up 220 bps YoY to 24%, given the revenue mix. PAT was at Rs. 69.3 crore up 113% YoY, given lower interest costs.

Buy for a Target Price Of Rs. 650/share

BEL's share price has grown at ~27% CAGR over the past five years (from ~Rs. 163 in May, 2018 to ~Rs. 542 levels currently). "We maintain our BUY rating. Apart from robust residential sales volumes traction (led by strong end user demand & new launches), we expect sustained recovery in commercial/hospitality to drive overall traction. We value BEL at Rs. 650/share," the brokerage has said.

Stock Outlook

The stock of BEL last traded at Rs. 546.65/share, up 0.85% from its previous close of Rs. 542.05/share. Its 52 week high is Rs. 585/share and 52 week low is Rs. 426.45/share, respectively. It has given 3.7% in the past 1 week. While in the past 1 month, it has given 8.92% and in 3 months it gave 12.1%, respectively. It has given 23.34% positive return in 1 year. It has given 445.02% multibagger returns in 3 years. In 5 years, it gave 238.34% in the past 5 years.

About - Brigade Enterprises Ltd. (BEL)

Brigade Enterprises (BEL) is one of the leading property developers in South India. Its offerings include Grade-A commercial property, affordable to ultra-premium housing in real estate business and operational marquee hotel assets in hospitality segment.

Disclaimer - The stock has been picked from the brokerage report of ICICI Direct. Greynium Information Technologies, the Author, and the respective Brokerage house are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to consult with certified experts before making any investment decision.