Buy Godrej Properties: target of Rs 2293: ICICI Securities

Moneycontrol • 6 days ago

Original source

Key Investment Pillars

  • Godrej Properties has a strong launch pipeline, with H1FY27 gross sales bookings of INR 167bn and a planned H2FY27 launch pipeline worth INR 320bn.
  • The company expects to generate ~INR 70bn of operating cash flow (OCF) in H2FY27, driven by ~10msf of scheduled deliveries, which should help reduce net debt.
  • Management has provided a formal sales booking guidance of INR 390bn for FY27, implying 14% YoY growth, supported by the FY27 launch pipeline of INR 480bn.
  • The company's ability to balance growth and generate adequate OCF is a key monitorable.

Thesis Validation Checklist

  • Investors should watch for the company's ability to meet its FY27 sales booking guidance and generate expected OCF in H2FY27.
  • Key signals to validate the thesis include: (1) sustenance of sales momentum, (2) improvement in operating cash flows, and (3) reduction in net debt.
  • Risks to the thesis include a residential demand slowdown and muted price growth.
  • The company's strong launch pipeline and expected cashflow pickup are key drivers of the buy recommendation.