Recent correction in HDIL’s stock price has augmented its attractive valuations, taking it below the implicit price of its key properties with high execution visibility in the short term. As per our stress case, the value attributable to HDIL’s three key properties is Rs179/share – key projects being Bandra-Kurla complex (BKC) slum rehabilitation scheme (SRS), 53acres in Kurla and ~3.5mn sqft ongoing SRS project in Mumbai. Also, remaining land-bank at ~110mn sqft and Mumbai airport construction transferable development right (TDR) at ~39mn sqft offer Rs316/share upside (stress case). We do not expect funding requirement for ongoing projects – HDIL’s balance sheet is stable with inventory of Rs185/share outstanding as on March 31, ’08. Though the sector outlook remains cautious, we believe HDIL offers good valuation upside with the worst already factored in. Reiterate STRONG BUY.

Download HDIL+-+ICICI+Securities+01+10+08

HDIL+-+ICICI+Securities+01+10+08 - Get more Business Documents