Phoenix Mills Ltd. share price target

Steady Performance, H2FY20 Expected to be Better: PHNX s revenue grew 3 percent YoY to Rs. 4150 Mn and EBITDA grew by 6 percentYoY to Rs. 2107 Mn.

PML reported retail rental income growth of 7% YoY to | 259.4 crore while retail consumption growth was slow at 1% YoY to | 1,694.8 crore in Q2FY20. Consumption was impacted largely on account of higher area under fit outs at a couple of assets and ongoing metro work near PMC Bangalore. On a positive note, the festive month of October, 2019 saw consumption growth of more than 20% over that witnessed in last year's festive month (November, 2018), which is encouraging. PMC Lucknow (Phoenix Palassio) is expected to get operationalised in January/February, 2020. With this and...

PHNX's revenue grew 49% YoY to Rs. 6150 Mn. The significant growth in revenue was on account of revenue recognition from tower 6 of its residential project One Bangalore West which has received OC in Q1FY20.

Core portfolio PAT grows 40% YoY: 1QFY20 revenue grew 49% YoY to INR6,150m (v/s est. of INR4,447m). The beat was primarily driven by lopsided revenue growth in the residential segment driven by revenue recognition of One Bangalore West Tower 6'. EBITDA margin expanded 30bp YoY to 47.6% (v/s est. of 51.5%). Its core portfolio comprising retail malls, commercial and...

Steady Performance Across Malls; Capex Activity on Track: PHNX revenue grew 66%/64% YoY/QoQ to Rs. 7233 Mn. The significant growth in revenue was on account of revenue recognition from the company residential project Kessaku which has received OC in Q4FY19.

PML's retail rental income grew only 9% YoY to | 249.9 crore in Q4FY19 while retail consumption growth was slow at 6% YoY to | 1,626.5 crore in Q4FY19. The slowdown in consumption is on account of ongoing infrastructure work and change in store format at a few retail assets (HSP & Palladium, PMC Chennai & PMC Bengaluru). Overall, with >20% area coming up for renewal in FY20E-21E at each of its key assets along with expansion mode, we expect PML's retail rental income to grow at a CAGR...

Additional 1.6msf can be built at HSP (0.5msf mall, 1.1msf office space); however, this is in the planning stage and finalization will take ~12 months. < Valuation view: We believe that PHNX offers a unique way to play India's retail growth story due to its (a) strong track record of execution and (b) scalability, as reflected in the line-up of five new under-construction malls and (c) robust cash generation. We value PHNX's retail assets based on the DCF-based NAV approach, assuming a cap rate of 8.5% (HSP - 8%) and a...

HNX is well on track to achieve 11-12msf portfolio by FY23. Currently, the company has a retail portfolio of 5.9msf (operational) and 4.6msf (under construction), with plans to add another 1-2 new assets -taking the total portfolio to 11-12msf by FY23. The company is developing five new malls - three under the Canada Pension Plan Investment Board (CPPIB) platform (PMC Wakad, PMC Hebbal, and PMC Indore), Palladium Ahmedabad (a 50:50 alliance with BSafal group), and PMC Lucknow (100%self-owned).

Steady Performance Across Malls; Capex Activity on Track: PHNX's revenue grew 6%/5% YoY/QoQ to Rs. 4404 Mn in-line with our estimates. EBITDA margins expanded by 90 bps YoY to 50.5% vs our estimates of 49%.

Phoenix Mills' (PML) topline grew 5.7% YoY to | 440.4 crore almost in line with our estimate of | 448.6 crore in Q3FY19. On a sequentially basis, revenues grew 8.8% in Q3FY19...