Oberoi Realty Ltd. share price target

With limited upside we maintain NEUTRAL. ORLs 4QFY18 financial performance was inline, with adjusted net profit coming 4.2% above our estimates. The management commentary during conference call signaled (1) Pricing top out in micro markets (2) Strategic shift towards volumes driven market share gain (3) Focus on achieving sales velocity on completed projects through deferred payment programs & (4) Creating cash reserves for upcoming land acquisition.

ICICI Securities Ltd | Retail Equity Research Oberoi Realty's Q4FY18 sales performance was below our estimate mainly due to subdued sales in Worli project. On the financials front, the results were above our estimates on the topline, bottomline front Oberoi Realty's (ORL) Q4FY18 sales volumes fell 13.6% sequentially to 1.31 lakh sq ft with sales value of | 263.3 crore. Sales volume was below our estimates of 1.66 lakh sq ft due to lower-than-expected sales of 9562 sq ft in Worli project (our expectation: 50000 sq ft)...

OBER's sales volumes declined 3% YoY to 131,052sf (est. of 132,500sf) and sales value fell 24% YoY to INR2,633m (est. of INR3,095m) in 4QFY18, primarily due to falling traction in its 360 West project. Collections increased 18% YoY to INR5,466m due to higher collection in its Enigma and Esquire projects. OBER's revenue grew 19% YoY to INR3,450m (est. of INR3,139m) in 4QFY18. EBITDA margin expanded80bp YoY to 53.1% (est. of 54.1%). Adjusted PAT rose 40% YoY to INR1,429m (est. of INR1,073m), primarily led by a lower tax rate of 20.1%

ICICI Securities Ltd | Retail Equity Research Oberoi Realty's Q2FY18 sales performance was below our expectations mainly on account of subdued sales in the Eternia and...

Maintain NEUTRAL with a TP of Rs 487/sh. ORLs reported marginal beat with net profit coming in 6.5% above our estimates. Management commentary was bit muted and guarded on real estate outlook. This is also reflected in development portfolio witnessing muted sales in Goregaon and Mulund. Sluggish pre-sales has also resulted in postponement of revenue recognition in key projects Worli, Mulund and Borivali to FY19E.

Results exceed expectations: OBER's revenue grew 41% YoY to INR3,562m (est. of INR3,388m), partially due to a favorable base (3QFY17 was impacted by demonetization). OBER recorded revenue growth of 17% QoQ. EBITDA margin expanded 400bp YoY to 54.1% (est. of 51.4%) due to (i) reduction of 260bp in employee expenses (to 4.2% of net sales) and (ii) 100bp decline in operating expenses (to 38.5% of net sales). EBITDA grew 53% YoY to INR1,926m (est. of INR1,741). Adjusted PAT grew 42% YoY (+15% QoQ) to INR1,202m (est. of INR1,128m). Booking value up 52% YoY/15% QoQ to INR4b: OBER recorded sales volume growth of 43% YoY (-12% QoQ) to 151,763sf (est. of 133,930sf), primarily due to increased traction in the Exquisite and 360 West projects. Booking value increased 52% YoY (+15% QoQ) to INR4,063m (est. of INR3,083m). Collections increased 34% YoY to INR4,301m

Oberoi Realty Limited (ORL) is engaged in construction and real estate development, and hospitality. The Company's segments include Real estate and Hospitality. The Company is involved in the development of approximately 40 projects that aggregates over 9.18 million square feet of space. It handles residential, commercial, retail, social infrastructure and hospitality projects. Its residential projects include Oberoi Splendor, Oberoi Splendor Grande, Prisma by Oberoi Realty, Oberoi Sky Gardens, Oberoi Sky Heights, Oberoi Springs, Esquire by Oberoi Realty, Exquisite by Oberoi Realty, Oberoi Seven, Oberoi Woods, Beachwood House, Oberoi Gardens, Oberoi Parkview, Eternia &...

Oberoi Realty Ltd (ORL)s pre-sales and collection improved to Rs 3.5 bn/ Rs 1.5 bn in Q2 (vs. 2.9 bn/Rs 1 bn in Q1FY18), but it is still below its normal run-rate. Lag in collections in wake of RERA implementation but continued execution pushed the debt (construction finance) up at Rs 2.5 bn.

ICICI Securities Ltd | Retail Equity Research Oberoi Realty's Q2FY18 sales performance was above our estimate mainly on account of sales in the Esquire and SkyCity projects. Furthermore, sales volumes are back to the pre-demonetisation...

Oberoi Realty Ltd (ORL) reported subdued pre-sales of Rs 2.9 bn in Q1FY18 (vs. Rs 3.5 bn in Q4FY17), as GST and RERA^ muted the demand in all of its projects.