KOLTE PATIL DEVEL­OP­ERS

Dalal Street Investment Journal - - RECOMMENDATIONS | EQUITY -

Acon­struc­tion com­pany head­quar­tered in Pune, Kolte Patil Devel­op­ers is en­gaged in the devel­op­ment and man­age­ment of both com­mer­cial and res­i­den­tial projects. The com­pany has re­cently sold its land par­cel at Wakad sub­urb for a con­sid­er­a­tion of ₹160 crore as a part of strate­gic di­vest­ment. More­over, de­spite de­mon­eti­sa­tion, it posted de­cent growth in both pre-sales. Con­sid­er­ing this, the com­pany is ex­pected to main­tain its 0.5x debt-eq­uity with strong op­er­at­ing cash flows. Go­ing for­ward too, the com­pany’s 70% of launch port­fo­lio un­der LIG/MIG would ben­e­fit from the gov­ern­ment’s af­ford­able hous­ing scheme and thereby aid re­cov­ery from FY19E. Fi­nan­cially, the com­pany has re­ported ex­u­ber­ant 50% and 53% rev­enue and PAT growth in FY17 on the back of ro­bust per­for­mance from Life Repub­lic, Mirabil­lis and Corolla projects. Im­ple­men­ta­tion of RERA may re­sult in con­sol­i­da­tion or shut down of small builders. Thereby, we rec­om­mend a Buy on the scrip, for a tar­get of ₹182 and with a stop loss of ₹147.

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