Shares of Godrej Properties jumped 5.70% to ₹1,235.15 on BSE on November 10 a day after the company reported its September quarter earnings.
Godrej Properties on November 9 reported a nearly 88% year-on-year (YoY) jump in consolidated profit for Q2FY23 at ₹67.03 crore against ₹35.73 crore in Q2FY22.
Revenue from operations rose 27.6% YoY to ₹165.09 crore against ₹129.32 crore in the same quarter last year.
However, the stock fell after the company released its September quarter scorecard; it suffered a loss of more than 7% on BSE.
Godrej Properties stock hit its 52-week high of ₹2,416.60 on BSE on November 10, 2021, and as of November 9, 2022, it is nearly 52% below its 52-week high.
Brokerages expressed mixed views on the stock after the September quarter earnings.
Nuvama Wealth Management Limited (formerly Edelweiss Securities Limited) maintained a buy call on the stock but reduced the target price to ₹1,462 from ₹1,887 earlier.
The brokerage firm believes Godrej Properties would benefit significantly from the uptick in housing demand; however, investors are focussed on cash flow generation. Cash flow trajectory would be a key stock catalyst in our view, said the brokerage firm.
Motilal Oswal Financial Services has a 'neutral' call on the stock with a target price of ₹1,300. The brokerage firm left unchanged its operational and financial estimates for FY23 and FY24 and said Godrej Properties remains on track to clock a record fiscal in terms of pre-sales and execution.
"While the management’s target with respect to business development is strong, at 2 times P/NAV, sustenance of this strong project addition momentum is already priced in," said Motilal Oswal.
Kotak Institutional Equities maintained a 'sell' call on the stock and cut the target price to ₹1,200 from ₹1,310 earlier.
"Godrej Properties continues to report healthy pre-sales with improved contribution from MMR owing to project launches in the market. However, weak execution and deteriorating cash profile during the quarter continue to remain an area of concern," said Kotak.
"Market leadership among listed peers was one of the key reasons for Godrej Properties’ premium valuations—though several others have ramped up their sales performance resulting in the relative underperformance of the company in recent years," Kotak said.
HDFC Securities has an 'add' call on the stock and said given that all the positives are fairly priced in, it retains an 'add' with a reduced SOTP-based target price of ₹1,418 per share.
According to a MintGenie poll, an average of 21 analysts have a ‘hold’ call on the stock.
Disclaimer: The views and recommendations given in this article are those of broking firms. These do not represent the views of MintGenie.
