MOSL: BRIGADE ENTERPRISES (Buy)-Strong operational performance-Traction likely to continue
BRIGADE ENTERPRISES: Strong operational performance; Traction likely to continue
(BRGD IN, Mkt Cap USD0.6b, CMP INR207, TP INR245, 18% Upside, Buy)
- Pre-sales soared 24% YoY to 1msf in 2QFY20; booking value was up 15% YoY to INR5,288m with average realization of INR5,306psf, down 8% YoY. Growth was largely driven by affordable housing (AFH) projects (Eldorado and Utopia), which contributed 45% to the sales volume.
- 2QFY20 financial performance: BRGD’s revenue/EBITDA declined 11%/13% YoY to INR7,353m/INR1,902m. PBT stood at INR653m, down 51% YoY. This was mainly due to increased interest cost (up 35% YoY) and depreciation (up 40% YoY) due to capitalization of Brigade Opus, WTC@Kochi Tower 2, BTG Phase I and Four Points by Sheraton (Kochi). Adj. PAT was down 45% YoY to INR374m.
- 1HFY20 performance: Sales/EBITDA/Adj. PAT declined 5%/6%/40% to INR14.4b/INR3.7b/INR0.8b; EBITDA margins contracted 30bp YoY to 25.8%.
Brigade Enterprises Limited is a property development company. The Company focuses on residential, offices, retail and hospitality projects. The Company operates through three segments: Real Estate segment, Hospitality segment and Leasing segment. Its residential properties include Brigade Altamont, Brigade At No. 7, Brigade Caladium, Brigade Cosmopolis, Brigade Exotica, Brigade Mountain View, Brigade Orchards Luxury Apartments, Plumeria At Brigade Meadows and Brigade Sparkle. Its commercial projects include Brigade Bhuwalka Icon, Brigade Irv Centre, Brigade Magnum, Nalapad Brigade Centre and Signature Towers Brigade Golden Triangle. The Company's retail projects include Orion East Mall, Nalapad Brigade Broadway and Brigade Vantage. Its hospitality projects include Woodrose Club, Augusta Club, Galaxy Club, MLR Convention Centre and Signature Club Resort. Its projects extend across various cities in South India, including Chennai, Chikmagalur, Hyderabad, Kochi, Mangalore and Mysore.
Motilal Oswal Financial Services Ltd. is a reputed name in Financial Services and Online Trading with group companies providing services such as Private Wealth Management, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Principal Strategies & Home Finance.
Motilal Oswal Securities is a group company of Motilal Oswal Financial Service Limited which started as a stock trading company and has blossomed into well diversified firm offering a range of financial products and services. Motilal Oswal has built a reputation as the source for best stock trading company and this has taken a wealth of experience, knowledge and expertise, constantly working in tandem, over the years.
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