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A file photo of a Sunteck Realty project in Mumbai.  (A file photo of a Sunteck Realty project in Mumbai. )
A file photo of a Sunteck Realty project in Mumbai.
(A file photo of a Sunteck Realty project in Mumbai. )

Sunteck Realty shares rise as bookings improve

  • Sunteck Realty Ltd's shares jumped on the NSE in Tuesday's trade
  • Sunteck Realty has seen robust sequential growth of 75% in new bookings for Q3FY21 on improving demand

Shares of Mumbai-based realty developer Sunteck Realty Ltd rose more than 3% on the NSE on Tuesday. The company has seen robust sequential growth of 75% in new bookings for Q3FY21 on improving demand. On a year-on-year (y-o-y) basis, pre-sales grew 7%, the company informed exchanges.

Momentum in company's sales was aided by its ready-to-move-in, nearing-ready inventory as well as newly launched projects. Further, collections also grew at 79% quarter-on-quarter to 252 crore for Q3FY21 and by 52% y-o-y.

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A combination of favourable factors such as the reduced stamp duty and low interest rates is expediting the home-purchase decision, the company said in a press statement. Investors should note that Sunteck is also seen to be among the beneficiaries of recently announced reduction in levies by the Maharashtra government.

According to analysts, most Mumbai-based developers are likely to report decent earnings performance in the December quarter on the back of recent government measures. Latest data shows that housing sales in Maharashtra have zoomed in recent months with Mumbai witnessing a record registration of around 19,600 units in December 2020 and more than 36,000 units in the last quarter of calender year 2020.

While these numbers are a sentimental positive, investors would want to know the status of reduction in inventory levels. Also, commentary on luxury residential sales would be a key monitorable for this company, analysts add.

Analysts at Kotak Institutional Equities expect the company's sales in to remain weak at BKC and Naigaon while reduction in stamp duty in MMR could likely push up sales in ODC Avenue 1 and 2 which are near completion. "Collections at Naigaon are likely to pick up with completion of construction at seven ongoing towers. We expect revenues of 220 crore (+15% y-o-y) with Ebitda margin of 24.5%, said the Kotak report dated 6 January. Ebitda is short for earnings before interest, tax, depreciation and amortization.

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