
Signatureglobal (India) has delivered multibagger returns to investors in less than a year, since its IPO and listing at the bourses. A couple of brokerages continued to remain positive on the stock after Q1 earnings. In addition, the New Delhi-based company has been able to draw some fresh interest from analysts as well.
Domestic brokerage firm Motilal Oswal Financial Services has initiated coverage on the stock, citing it as a gem in making, while ICICI Securities is also positive on the stock following a strong show in the June 2024 quarter. Kotak Institutional Equities believes that the company is growing from strength to strength.
Signature Global reported a consolidated net profit of Rs 6.76 crore for the quarter ended June on higher income. The company had posted a net loss of Rs 7.22 crore in the year-ago period. Realty firm's total income rose 140 per cent on a yearly basis to Rs 427.98 crore in April-June 2024 period. The company projects sales of Rs 10,000 crore in this fiscal.
Signature Global has so far delivered 11 million square feet of housing area and boasts a robust pipeline of about 32.2 million square feet of saleable area in the forthcoming projects along with 16.4 million sq ft of ongoing projects, set for execution over the next 2-3 years.
Signatureglobal reported a strong 63 per cent CAGR in pre-sales over FY21-24, driven by an increase in projects under execution and premiumization. As it gears up with a strong launch pipeline of premium projects, we expect it to deliver 35 per cent CAGR in bookings over FY24-27E as the growth momentum remains intact, said Motilal Oswal in its IC report on the stock.
"Strong pre-sales growth will also lead to a rapid scale-up in operations across the key parameters will give confidence in the company’s execution capability and future growth potential," it said. "The current valuation implies 30 per cent of going concern premium for the company. We initiate coverage on Signatureglobal with a 'buy' rating and a target price of Rs 2,000."
The company achieved Q1FY25 sales bookings of Rs 31,200 crore driven by the launch of its Titanium premium housing project in Sector 71, Gurugram which accounted for 90 per cent of sales bookings for Q1, said ICICI Securities citing, slowdown in Gurugram market and inability to replenish land bank as key risks for the company.
Given its strong launch pipeline of projects with a cumulative GDV of more than Rs 45,000 crore over FY24-28, we estimate Signature may clock 19 per cent sales booking CAGR over FY24-27E with sales booking ranging between Rs 10,000-12,000 crore annually over FY25-27E at average realisation of over Rs 13,000 per sq feet, it added with a buy rating a target of Rs 1,707.
Shares of Signatureglobal India Ltd rose more than 4.1 per cent during the trading session Tuesday to Rs 1512.70, commanding a total market capitalization of more than Rs 21,000 crore. The scrip had settled at Rs 1,452.60 in the previous trading session on Monday.
Shares of Singatureglobal were listed at the bourses in late September 2023, when the company raised a total of Rs 730 crore via its IPO, selling its shares for Rs 385 apiece. The stock has rallied about 300 per cent from its IPO price so far.
Signatureglobal reported a second-consecutive quarter of strong pre-sales in 1QFY25, against FY2024 pre-sales of Rs 72,700 crore and guidance of Rs 10,000 crore for FY2025E. Sales performance was aided by Rs 2,800 crore contribution from its new launch in Sector 71, Gurugram, said Kotak Institutional Equities.
"Collections were also strong at Rs 12,100 crore, leading to a reduction in net debt to Rs 980 crore Signature Global is on track to achieve its full-year operational guidance, while better deliveries should aid revenue recognition," it added, maintaining 'add' rating with a fair value of Rs 1,555.