The shares of Macrotech Developers (the erstwhile Lodha Developers) zoomed 18.25% on Thursday’s early trades to reach an intraday high of ₹ 998.95 apiece. The shares extended gains for the fourth straight session.
This happened after Motilal Oswal in its recent report said that the company is targeting sustainable growth on the back of industry tailwinds.
“The management believes that the housing segment will be the biggest beneficiary of an increase in the country’s per capita income from $2,000 to $5,000 over the next decade, especially on the back of substantial growth in the middle-class strata,” Motilal Oswal said in its report.
Macrotech Developer’s shares were trading 16.56% higher at ₹ 984.65 per share at 01:29 PM on the National Stock Exchange (NSE). Volumes jumped at the counter and 4.54 million shares changed hands as compared to 1.60 million shares on the previous day.
Macrotech Developers is one of the largest real estate developers in India with a presence in Mumbai Metropolitan Region and in Pune markets.
Mr. Abhishek Lodha, Managing Director and Chief Executive Officer, Macrotech Developers, expects the industry to clock annual sales of ~1mn units by the end of the decade, versus 360,000 units in CY22. The propensity of customers to associate with a large/branded developer has significantly increased after the pandemic, according to the report.
Moreover, funding options for small developers have largely dried up after recent regulatory changes. These factors have collectively triggered a consolidation wave in the industry. Hence the management believes that a few large developers with the ability to capture a significant part of incremental demand are best placed.
Motilal Oswal has a ‘buy’ rating on the stock with a target price of ₹ 1250, which translates to an upside of 26.94% as compared to its share price of ₹ 984.65.
According to brokerage firm Sharekhan, property registrations in Mumbai and Maharashtra have remained resilient during January-February 2023 clocking a similar monthly average run-rate as seen during Q3FY2023.
It said that Macrotech Developers is well placed to benefit from the supply consolidation as the highest interest rate regime affects unorganized players. The company is likely to exceed its pre-sales guidance for FY 2023 with a strong launch pipeline for Q4 and it has already surpassed new project addition targets, according to the brokerage.
Written by Simran Bafna
