Kolte-Patil Developers -Stable quarter, all eyes on ‘Nest Fest’ :: HDFC Securities

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Stable quarter, all eyes on ‘Nest Fest’
Kolte-Patil Developers’ (KPDL) 3QFY15 revenues of Rs
2.2bn were ahead of our est. of Rs 1.9bn owing to
sale of Alyssa commercial project in Bengaluru for Rs
360mn with EBITDA margin of 30% coming in line
with estimates. However, higher depreciation and
~30% of revenues being booked from Downtown
(49% minority interest) led to PAT of Rs 198mn that
was in line with estimates. Collections from
residential projects remained flat QoQ at Rs 2.1bn
with an additional Rs 0.5bn coming from Alyssa (Rs
360mn) and land sale to Talwalkars of Rs 130mn
(total deal value of Rs 520mn).
3QFY15 sales bookings were stable at 0.64msf worth
Rs 3.9bn. KPDL has achieved sales bookings of Rs
11bn in 9MFY15 and is on track to achieve its
guidance of Rs 15-16bn in FY15 (our est. is Rs 16bn).
We expect traction in 4QFY15 volumes with the
launch of KPDL’s ‘Nest Fest’ in Feb-15 that will see
the launch of five new projects (including Life
Republic Phase II) and thirteen projects being offered
for sale overall.
We maintain our BUY rating on KPDL based on FY16E
NAV of Rs 257/sh. Key upside risks are addition of
more redevelopment projects in Mumbai,
development manager fees from other projects and
increase in township FSI from 0.5x to 1.0x in Pune.
 Robust launch pipeline : At the end of FY14, KPDL
has completed over 7msf of projects and has ~19.6msf
of ongoing projects, 16.2msf of forthcoming launches
in FY15E and another ~18msf of future land bank. With
KPDL recently receiving the location clearance (LC) for
Life Republic Phase II of 6.9msf, Sanjivani township
Phase I (6msf) and another 5.9msf of SEAC approvals in
CY14, KPDL is well positioned to grow its sales bookings
over FY15-17E.
 Key Risks : Key downside risks are lower than
expected volumes in Pune projects, delay in regulatory
clearances especially for Sanjivani Township and any
sharp rise in input costs for materials

LINK
http://www.hdfcsec.com/Share-Market-Research/Research-Details/StockReports/3010909