Earnings Outlook
Strong pre-sales to boost Oberoi Realty's Oct-Dec results
This story was originally published at 13:08 IST on 17 January 2025
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By Akshay V. Johnson
MUMBAI – Oberoi Realty Ltd. is expected to report strong earnings growth for the December quarter on the back of strong pre-sales. On a year-on-year basis, the real estate company's consolidated net profit is expected to nearly double in the December quarter, while the revenues are also expected to see strong growth. If the results are in line with expectations, Oct-Dec will be the fourth successive quarter of growth in revenues and net profit for the company. The real estate sector in general is expected to see better pre-sales, owing to seasonality and better launches during the quarter, analysts said.
The company is expected to report a consolidated net profit of INR 6.64 billion for the latest quarter, up 84% on year, an average of estimates from six brokerages showed. Among the six, HDFC Securities Ltd. has projected the highest net profit of INR 7.97 billion and Systematix Shares and Stocks (India) Ltd. has estimated the lowest net profit of INR 5.18 billion.
The real estate company's consolidated revenue is seen growing 42% on year to INR 14.99 billion for the December quarter, according to the average of estimates from six brokerages. The highest estimate for revenue is INR 17.82 billion by HDFC Securities and the lowest is INR 13.91 billion by Kotak Institutional Equities. Sequentially, the company's net profit is expected to grow 13%, while the revenues are expected to grow 14%.
Oberoi Realty is expected to post strong pre-sales, guided by the exceptional response to Jardin by Oberoi Garden City, Thane, Motilal Oswal said. Three Sixty West in Worli is expected to achieve strong bookings during the latest quarter. The company's pre-sales are expected to nearly triple on year to INR 22 billion in the December quarter, the brokerage added.
Kotak Institutional Equities said it expects the company to report a revenue of INR 11 billion from its residential real estate business and a revenue of INR 2.6 billion from its hotel and commercial segments. The brokerage expects the company to report pre-sales of INR 25 billion, aided by a contribution of INR 13.5 billion from Oberoi Garden City, Thane, sustenance sales, and better traction at Three Sixty West.
Oberoi Realty's earnings before interest, tax, depreciation, and amortisation is estimated to be INR 9.22 billion, an average of the estimates from five brokerages showed. The estimates for EBITDA range from INR 7.79 billion by Kotak Institutional Equities to INR 11.41 billion by HDFC Securities.
Excluding southern players, the real estate players will deliver steady pre-sales performance as the approvals have been timely, HDFC Securities said. The residential real estate market was strong in the December quarter, driven by luxury projects in the National Capital Region and the Mumbai Metropolitan Region. The mid and ultra-luxury housing segments continue to lead the growth, particularly in tier-1 cities, the brokerage added. Among the real estate players that the brokerage covers, Oberoi Realty is expected to post the highest EBITDA margin for the latest quarter.
The company is scheduled to report its December quarter earnings on Monday. At 1305 IST, shares of the company traded at INR 1,992.30 on the National Stock Exchange, up 1.4% from the previous close.
Following are the Oct-Dec earnings estimates for Oberoi Realty based on reports from six brokerage firms in the descending order by the estimate of net profit:
Brokerage firm | Net Sales (in mln INR) | Net Profit (in mln INR) | EBITDA (in mln INR) |
HDFC Securities Ltd. | 17,819.00 | 7,971.00 | 11,407.00 |
Nuvama Wealth Management Ltd. | 14,011.00 | 7,385.00 | 8,861.00 |
JM Financial Institutional Securities Pvt. Ltd. | 15,240.00 | 7,331.00 | 9,469.00 |
Motilal Oswal Financial Services Ltd. | 14,653.00 | 6,304.00 | 8,589.00 |
Kotak Institutional Equities | 13,912.00 | 5,669.00 | 7,786.00 |
Sharekhan Ltd. | 14,280.00 | 5,180.00 | -- |
Average | 14,985.83 | 6,640.00 | 9,222.40 |
End
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Tanima Banerjee
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