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    Peninsula+Land 10-6-08 PL

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    Peninsula Land reported weak results for the fourth quarter of fiscal year 2008, in line with expectations. Revenue declined 8% year-over-year due to a stop-work notice issued for four Mumbai projects in the previous two quarters. Profit after tax declined 42% over the same period. The company expects revenue to grow 117% over the next two years, driving by ongoing projects in Mumbai. While results were soft, analysts rate the stock as an outperformer due to its growth potential.

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    Peninsula+Land 10-6-08 PL

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    Peninsula Land reported weak results for the fourth quarter of fiscal year 2008, in line with expectations. Revenue declined 8% year-over-year due to a stop-work notice issued for four Mumbai projects in the previous two quarters. Profit after tax declined 42% over the same period. The company expects revenue to grow 117% over the next two years, driving by ongoing projects in Mumbai. While results were soft, analysts rate the stock as an outperformer due to its growth potential.

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    Peninsula Land, Morarji Realty, NSE, BSE, India Equity

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    Peninsula Land reported weak results for the fourth quarter of fiscal year 2008, in line with expectations. Revenue declined 8% year-over-year due to a stop-work notice issued for four Mumbai projects in the previous two quarters. Profit after tax declined 42% over the same period. The company expects revenue to grow 117% over the next two years, driving by ongoing projects in Mumbai. While results were soft, analysts rate the stock as an outperformer due to its growth potential.

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    27 views3 pages

    Peninsula+Land 10-6-08 PL

    Uploaded by

    api-3862995
    Peninsula Land reported weak results for the fourth quarter of fiscal year 2008, in line with expectations. Revenue declined 8% year-over-year due to a stop-work notice issued for four Mumbai projects in the previous two quarters. Profit after tax declined 42% over the same period. The company expects revenue to grow 117% over the next two years, driving by ongoing projects in Mumbai. While results were soft, analysts rate the stock as an outperformer due to its growth potential.

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    Peninsula Land

    Results weak; in line with expectations

    June 10, 2008 „ Results: Peninsula Land (PLL) declared weak results for 4QFY08. This was

    Q4FY08 Result Update


    primarily on account of the stop-work notice issued by the Municipal
    Corporation of Greater Mumbai, whereby the company had to stop work
    Rating Outperfomrer
    on four of its Mumbai projects in Q3FY08 and Q4FY08. The company
    Price Rs66 resumed some part of the work in March 2008, while the notice was fully
    Target Price Rs129 withdrawn with effect from April 2, 2008. Topline for the quarter
    Implied Upside 94.9% witnessed 8% YoY decline, while PAT witnessed 42% decline.
    Sensex 15,066
    „ Ashok Towers - major revenue driver: The company booked 65% of its
    (Prices as on June 9, 2008)
    quarterly revenue from Ashok Towers, a residential project located in
    Parel. While 94% of the project has been pre-sold, 55% construction has
    been completed. PLL booked another 13% of its revenue from Peninsula
    Trading Data
    Business Park and 17% from the sale of TDRs, which were generated from
    Market Cap. (Rs bn) 18.5
    the company’s Bhandup project.
    Shares o/s (m) 279.5
    Free Float 46.6% „ 117% CAGR revenue growth expected over 2 years: PLL has four on
    3M Avg. Daily Vol (‘000) 1,002.9
    going projects in Mumbai, which are likely to drive its revenue and
    profits over FY09 and FY10. We expect revenue growth of 117%
    3M Avg. Daily Value (Rs m) 98.3
    accompanied with PAT growth of 119%.

    „ Valuation: Our estimate of the company’s NAV, excluding the SEZs,


    which have not been notified (as well as the newly acquired land at
    Major Shareholders Hyderabad) stands at Rs101, while we attribute a value of Rs28 to the
    Promoters 53.4% realty fund. At the CMP, the company is trading at 34% discount to the
    Foreign 18.9% NAV. We rate the stock Outperformer.
    Domestic Inst. 6.6%
    Public & Others 21.1%

    Key financials (Y/e March) FY07 FY08 FY09E FY10E


    Revenue (Rs m) 3,272 3,574 10,858 16,842
    Growth (%) 19.1 9.2 203.8 55.1
    Stock Performance
    EBITDA (Rs m) 1,742 1,509 5,400 8,939
    (%) 1M 6M 12M PAT (Rs m) 1,294 1,321 3,526 6,302
    Absolute (32.3) (55.7) (40.0) EPS (Rs) 6.1 4.7 12.6 22.5
    Growth (%) (15.7) (23.1) 167.0 78.7
    Relative (20.6) (29.8) (45.2)
    Net DPS (Rs) 0.6 0.5 0.5 0.5

    Source: Company Data; PL Research

    Price Performance (RIC: PENL.BO, BB: PENL IN) Profitability & valuation FY07 FY08 FY09E FY10E
    (Rs) EBITDA margin (%) 53.2 42.2 49.7 53.1
    180 RoE (%) 57.6 19.1 29.5 37.3
    160
    RoCE (%) 26.0 17.3 38.7 44.1
    EV / sales (x) 5.2 4.3 1.3 0.8
    140
    EV / EBITDA (x) 9.7 10.2 2.7 1.4
    120
    PE (x) 10.8 14.0 5.2 2.9
    100 P / BV (x) 3.8 1.8 1.4 0.9
    80 Net dividend yield (%) 0.01 0.01 0.01 0.01
    60 Source: Company Data; PL Research
    Apr-08
    Dec-07

    Feb-08
    Jun-07

    Aug-07

    Oct-07

    Jun-08

    Kejal Mehta Subramaniam Yadav


    KejalMehta@PLIndia.com SubramaniamYadav@PLIndia.com
    Source: Bloomberg +91-22-6632 2246 +91-22-6632 2241
    Peninsula Land

    Q4FY08 result overview (Rs m)


    Y/e March Q4FY08 Q4FY07 YoY gr. (%) Q3FY08 FY07 FY08 YoY gr. (%)
    Net sales 1,112 1,204 (7.6) 224 3,272 3,574 9.2
    Expenditure
    Construction, mfg. & others 803 574 39.9 94 1,413 1,830 29.5
    % of net sales 72.3 47.7 42.2 43.2 51.2
    Personnel cost 57 38 47.9 50 116 235 101.7
    % of net sales 5.1 3.2 22.5 3.6 6.6
    Total expenditure 860 613 40.4 145 1,530 2,065 35.0
    EBITDA 252 591 (57.4) 79 1,742 1,509 (13.4)
    Margin (%) 22.7 49.1 35.3 53.2 42.2
    Other income 77 8 867.5 0 16 108 586.1
    Depreciation 10 2 405.0 5 13 26 99.7
    EBIT 319 597 (46.5) 74 1,745 1,591 (8.8)
    Interest (90) 18 NM (27) 129 (66) NM
    PBT 409 580 (29.4) 100 1,616 1,657 2.5
    Total tax 115 73 (320) 75 194 157.8
    % PBT 28.0 12.5 NM 4.7 11.7
    PAT 295 507 (41.9) 420 1,541 1,463 (5.0)
    Extraordinary item (47) (172) (41) (252) (152)
    Share of associates - - - 4 15
    Minority interest - - - 1 (5)
    PAT after minority int. 247 335 (26.2) 379 1,294 1,321 2.0

    June 10, 2008 2


    Peninsula Land

    Prabhudas Lilladher Pvt. Ltd.


    3rd Floor, Sadhana House, 570, P. B. Marg, Worli, Mumbai-400 018, India.
    Tel: (91 22) 6632 2222 Fax: (91 22) 6632 2209

    PL’s Recommendation Nomenclature

    BUY : > 15% Outperformance to BSE Sensex Outperformer (OP) : 5 to 15% Outperformance to Sensex
    Market Performer (MP) : -5 to 5% of Sensex Movement Underperformer (UP) : -5 to -15% of Underperformace to Sensex
    Sell : <-15% Relative to Sensex
    Not Rated (NR) : No specific call on the stock Under Review (UR) : Rating likely to change shortly

    This document has been prepared by the Research Division of Prabhudas Lilladher Pvt. Ltd. Mumbai, India (PL) and is meant for use by the recipient only as information
    and is not for circulation. This document is not to be reported or copied or made available to others without prior permission of PL. It should not be considered or taken
    as an offer to sell or a solicitation to buy or sell any security.

    The information contained in this report has been obtained from sources that are considered to be reliable. However, PL has not independently verified the accuracy or
    completeness of the same. Neither PL nor any of its affiliates, its directors or its employees accept any responsibility of whatsoever nature for the information,
    statements and opinion given, made available or expressed herein or for any omission therein.

    Recipients of this report should be aware that past performance is not necessarily a guide to future performance and value of investments can go down as well. The
    suitability or otherwise of any investments will depend upon the recipient's particular circumstances and, in case of doubt, advice should be sought from an independent
    expert/advisor.

    Either PL or its affiliates or its directors or its employees or its representatives or its clients or their relatives may have position(s), make market, act as principal or
    engage in transactions of securities of companies referred to in this report and they may have used the research material prior to publication.
    We may from time to time solicit or perform investment banking or other services for any company mentioned in this document.

    June 10, 2008 3

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