Robust Residential Sales Likely To Grow In Q4
<span style="font-weight: 400;">The real estate and construction companies are expected to witness strong revenue growth in the fourth quarter of fiscal 2021 led by a benign base, pick-up in project execution and robust residential real estate sales.</span> <span style="font-weight: 400;">Strong
Published -
Apr 19, 2021 4:18 AM
The real estate and construction companies are expected to witness strong revenue growth in the fourth quarter of fiscal 2021 led by a benign base, pick-up in project execution and robust residential real estate sales. Strong demand for residential properties continued in Q4FY21 leading to robust residential sales volumes growth for listed realty companies. This sales growth was led by factors such as pent up demand, benign interest rates and measures such as Maharashtra stamp duty cut. Among listed real estate players, ICICI Direct estimates 34 percent YoY growth in sales volumes of Brigade Enterprises while 2.6x growth for Oberoi Realty. "We expect Brigade Enterprises’ sales volumes to grow around 34 percent YoY to 14.1 lakh square feet, driven by demand uptick and new launches. On the financial front, it expects the topline to grow 5.7 percent YoY to Rs 672 crore, led by higher robust revenue recognition in the residential segment and offset by relatively weak hospitality and mall portfolio performance," ICICI Direct said in a note. Overall, at the PAT level, we expect Rs 27.6 crore, up around 9x YoY on depressed base. For Oberoi Realty, the brokerage expects sales volumes to continue their sharp growth trajectory led by stamp duty cut and demand uptick. "We bake in sales volumes growth of 2.6x YoY at Rs 4.6 lakh square feet on a benign base. On the financial front, it is likely to witness a sharp growth in revenue on account of a depressed base and strong revenue recognition in the residential segment. We expect topline to grow 53 percent YoY to Rs 941.7 crore," ICICI Direct said. Oberoi Realty is expected to see net income growth of 23.9 percent YoY at Rs 311 crore. Among commercial real estate players, Phoenix Mills’ revenues are expected to de-grow 1.5 percent YoY to Rs 393.1 crore largely dragged by hospitality segment while retail is expected to show continued improvement. Profit is expected to rise 63 percent YoY, given the costs rationalisation. However, the company’s outlook on business ahead amid second wave and lockdowns will be key monitorable. On the leasing front, new leasing activity is likely to remain on the back burner with continued work from home scenario. The hospitality and retail segment is likely to show a marked improvement in Q4, albeit the second wave of COVID-19 implies weakness may persist in the subsequent quarter.
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