Kolte-Patil Developers Ltd: Creative builder
(BSE Code: 532924) (CMP: Rs.218.20) (FV: Rs.10)
Pune-based Kolte-Patil Developers Ltd (KPDL) is a well-established real estate company and the largest developer of India which has completed 1 crore sq.ft. of landmark developments in Pune and Bengaluru in the last 25 years. It has built projects in multiple segments such as residential, commercial, retail, IT parks and integrated townships and is now working on some upscale redevelopment projects in Mumbai. Its future outlook remains strong considering its
leadership position in Pune (which has strong employment/economic drivers and a large end-user demand), proven execution skills, comfortable debt levels and higher contribution from asset-light Mumbai projects. KPDL raised ~Rs.275 crore through its IPO in November 2007 at an issue price of Rs.135/share with the objective to augment its capital base for funding future growth plans. Its IPO was oversubscribed 45 times. During Q1FY19, KPDL reported 200% higher PAT of Rs.76.25 crore on 59% higher income of Rs.390.56 crore. The stock’s risk:reward ratio is quite favorable offering more upside potential with limited downside on account of its excellent track record of consistent dividend payouts, high promoter stake and a manageable debt on books unlike DLF and HDIL. Its projects under development as well as projects in the pipeline will generate decent cash flows and profitability. Buy on every dip for good returns.