Buy Macrotech Developers Ltd : Sales traction intact; strong show on BD - Motilal Oswal Financial Services
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Sales traction intact; strong show on BD
LODHA released its 3QFY23 business updates. Following are the key takeaways:
* The company has managed to maintain the sales momentum and reported its best ever 3Q performance by achieving bookings of INR30b, up 16% YoY (v/s our estimate of INR28b, 8% beat). Bookings for 9MFY23 stood at INR90.4b, up 62% YoY, surpassing its FY22 sales and is on track to beat its FY23 guidance of INR115b.
* 9MFY23 pre-sales include INR6b of bookings achieved in projects where MDL is development manager (the company will generate 11% DM fee).
* Collections improved 26%/14% YoY/QoQ to INR26b. Net debt declined by INR7.5b to INR80b and the company is targeting to it bring down to below INR60b in FY23.
* During the quarter, it has signed four new JDA projects (across MMR and Pune) with cumulative development potential of 5msf and GDV of INR85b. In 9MFY23, Macrotech signed 11 new projects with GDV INR178b, exceeding its full-year new project addition guidance of INR150b.
Valuation and view: We will revisit our estimates post its 3QFY23 earnings. We have a Buy rating on the stock.
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