Buy Brigade Enterprises, target price Rs 619: HDFC Securities

HDFC Securities has buy call on Brigade Enterprises with a target price of Rs 619. The current market price of Brigade Enterprises is Rs 480. Time period given by analyst is one year when Brigade Enterprises Ltd. price can reach defined target.

Brigade Enterprises Ltd., incorporated in the year 1995, is a Mid Cap company (having a market cap of Rs 11086.85 Crore) operating in Real Estate sector.

Brigade Enterprises Ltd. key Products/Revenue Segments include Income From Real Estate Development, Lease Rentals, Other Services, Other Operating Revenue for the year ending 31-Mar-2022.


Financials
For the quarter ended 31-03-2022, the company reported a Consolidated Total Income of Rs 964.72 Crore, up 3.38 % from last quarter Total Income of Rs 933.19 Crore and up 17.53 % from last year same quarter Total Income of Rs 820.86 Crore. Company reported net profit after tax of Rs -11.72 Crore in latest quarter.

Investment Rationale
Brigade Enterprises Ltd (BEL) presents a unique investment opportunity in a structurally strong southern real estate market. The mixed use developer is firing from all cylinders with residential, commercial and hospitality segments delivering strong performance/recovery. Over the next few quarters, the brokerage expects BEL to deepen its presence in Chennai and Hyderabad markets while consolidating further in the Bengaluru market. Hospitality/mall asset monetisation shall release further cash to grow residential and commercial businesses. Given BEL’s strong cash position of INR 15.8bn, a robust business development pipeline (added ~8.5mn sqft of land in FY22, INR 6.8bn consideration, INR 55bn GDV), and a healthy balance sheet, it remains constructive. It reiterates BUY, with an unchanged TP of INR 619.

Promoter/FII Holdings
Promoters held 43.88 per cent stake in the company as of 31-Mar-2022, while FIIs owned 13.64 per cent, DIIs 23.86 per cent.