Macrotech Developers - Palava Likely To Be Big Beneficiary Of Infra Boom In MMR: Motilal Oswal

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Motilal Oswal Report.Macrotech Developers Ltd. has been delivering a steady performance across key parameters of presales, cash flows, profitability and return ratios for the last two years. It has successfully expanded beyond its core markets and as it further strengthens its position in geographies, we expect this consistency in operational performance to continue.While ex-Palava business will continue to grow at a steady pace, a bigger delta in value is likely to emerge from Palava, which is expected to witness a surge in volumes as well as pricing due to the factors discussed above.  As per Macrotech Developers, Palava’s ~4300-acre land provides over 600 msf of residential development potential. However, we assume a portion of that to be monetized as industrial land sales. We value 250 msf of residential land to be monetized over the next three decades at Rs 515 billion and during this period, pricing would reach at par with nearby markets - implying an 8% CAGR in realization.The infrastructure upgrades, along with strong focus on increasing the share of its premium segment, can lead to higher price growth. Thus, a sensitivity analysis with a CAGR of 8-12% in realization yields a value of Rs 515-670 billion or $6-8 billion. We use our usual DCF-based method for ex-Palava residential segment and arrive at a value of ~Rs 1,100 billion, assuming WACC of 11% and a terminal growth rate of 5%. Accordingly, we raise the fair value to Rs 1,705 billion or Rs 1,770 per share (versus Rs 1,415 earlier), indicating 14% upside potential. Reiterate Buy. .Click on the attachment to read the full report:.Vedanta - Well Positioned; Focus On Structural Cost Rationalisation To Drive Earnings: Motilal Oswal.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Macrotech Developers - Palava Likely To Be Big Beneficiary Of Infra Boom In MMR: Motilal Oswal

Township segment can be a $6-8 billion opportunity

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Macrotech Developers - Palava Likely To Be Big Beneficiary Of Infra Boom In MMR: Motilal Oswal

Township segment can be a $6-8 billion opportunity

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