Housing Development & Infrastructure Ltd (HDIL)

HDIL is Mumbai centric with 112 mn sq ft land bank, next two yr rev in the region of Rs 2000-2500 cr with 40% profit margins, Net asset value = 500-540 Rs

Q1 FY08 results:
Revenues = Rs 4458.40 million
Net Profit = Rs. 2026.90 million
EPS for Q1 = Rs. 11.28
Est EPS for FY08 = approx: 50 Rs
EPS for FY07 Rs 28

Face Value = Rs. 10
Company declared interim dividend of 20%.
The debt-equity ratio pre- IPO is of 0.4.

By March 2008 even we apply P/E of 14 then conservative tgt should be 700 Rs.
Being Mumbai centric the company will not be affected much if at all there is any slowdown in reality market.

DLF EPS Rs. 3.77 for Q1 FY08 and for Unitech EPS stands at Rs. 4.29 For Q1 FY07

New developements

1. Bought land at Ghatkoper 8.5 acres for 125 cr
2. Navi mumbai Eveready deal for 115 cr 15 acres
3. Entered in alliance with Lehman Brothers for Dharavi Project bid (HDIL stands very good chance to clinch the project as they have vast exp of slum rehab projects compare to other bidders..
4.Forms "HDIL Entertainment" planning muliplex chain across the country
5. Rs 20 bn IT Park in Kochi spread across 70 Acres (about 8mn sq ft salable area)....generating approx. 65k jobs
6.GVK set to tie up with HDIL in airport project ::
GVK, the company managing Mumbai International Airport Pvt Ltd (MIAL), is close to finalising Housing Development and Infrastructure Ltd (HDIL) as its partner for the airport slum rehabilitation project.
The project envisages the rehabilitation of 85,000 families on 276 acres, or 1.2 crore sq ft, of land. (Slum Developement is big a plus of HDIL)
7. HDIL plans raising up to Rs 1000 cr via debentures ::
to part-fund recent land acquisitions

HDIL Q2 FY08 results:
Rev up 4.87% to Rs. 4648 mn qoq
Net profit up 13.26% to Rs. 2293 mn qoq
total land bank 120 mn sq ft except mumbai airport project

Conclusion: Good management, dominent presence in slum developement, mumbai centric land bank and cheap valuations vis a vis peers.
BUY with target of 1000+ in next 12-15 months

Update: Since recommendation on 18th Nov at Price of Rs 713, HDIL appreciated to Rs 824 on 29th Nov 2007 giving over 15% returns!

HDIL made a high of Rs 999 on 12th Dec 1007. HDIL hit the target in 24 days resulting in 40% handsome gains...

Book profits at these levels....

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