This Small Cap Stock Has Slumped 15% In 5 Days, But Analysts See Over 40% Upside


Shares of Sunteck Realty have gone down close to 15% in the past five sessions. However, analysts at Prabhudas Liladhar see the stock making a strong comeback as it noted that the company’s September quarter results were steady.

The Sunteck Realty Analyst: The Param Desai-led analyst team at Prabhudas Liladhar maintained the “buy” rating for the stock with a price target of ₹545. The target indicates an around 44% upside from the stock’s last closing price of ₹393.90.

The Sunteck Realty Thesis: The analysts noted that the real estate company reported robust pre-sales of ₹400 crore in the September quarter, marking a 17% increase year-on-year and a 2% growth quarter-on-quarter. As per the brokerage, these impressive numbers are primarily driven by high mid-income projects. However, the firm highlighted that collections saw a decline of 26% quarter-on-quarter due to a substantial portion of sales being executed toward the end of the quarter.

See Also: Why Suzlon Shares Are Up 4% Today

However, the firm pointed out that not all was bright in the company’s recent results. Sunteck Realty has faced operational challenges, with a lack of significant project completions leading to an EBITDA loss, the brokerage firm remarked in its latest note.

Looking forward, the domestic brokerage expects the company’s pre-sales to double over the next three years, supported by ongoing projects and a robust pipeline of new launches. Moreover, with the anticipated strong cash flow generation estimated at Rs 800-1,000 crore over the period from FY23 to FY26, Sunteck Realty is likely to increase its portfolio with new project additions. The firm expects this to serve as a key catalyst for the company’s stock performance.

Take Stock Of The Week Ahead

Get all the latest Share Market trends and news to set you up for the week ahead.

You have successfully subscribed.

Price Action: Sunteck Realty’s share price was up 4.58% to trade at ₹411.95 on Friday afternoon.

Read Next: Jio Beats Elon Musk’s Starlink And Airtel’s OneWeb To Debut India’s First Satellite-Based Broadband Service

Posted In: Analyst ColorEquitiesPrice TargetReiterationMarketsAnalyst RatingsSunteck Realty