Real estate stocks have emerged as hot picks on Dalal Street in the past year, fueled by a surge in demand for residential properties and office spaces. With real estate developers consistently reporting record sales quarter after quarter, the trend underscores the robust growth in the Indian economy.
As disposable incomes rise among Indians, more individuals are opting to invest in real estate, which remains a preferred choice for households in India.
Amid this backdrop, the majority of constituents of the Nifty Realty index have delivered stellar returns, and Macrotech Developers is one such stock in this regard.
Lodha or Macrotech Developers (formerly known as Lodha Developers) is an Indian multinational real estate company headquartered in Mumbai, India. It was founded in 1980 by Mangal Prabhat Lodha. It has developed residential and commercial properties in Mumbai, Thane, Hyderabad, Pune and London.
Some of its notable projects include Lodha Altamount, The World Towers, Lodha Bellissimo, Trump Tower Mumbai and Lodha Park. The company is also credited for developing Palava, an integrated smart city near Mumbai. The company was listed as Macrotech Developers on 19 April 2021.
Issued in April 2021, Macrotech Developers IPO was oversubscribed by more than 1.37 times. Foreign Institutional investors were the biggest contributors in this IPO, accounting for over 53% of total bids in the IPO book holding.
Albeit, the stock didn’t show an exceptional performance in charts due to covid-19 issued and lockdown, but since 2023, the stock has shown exceptional performance in the market. Ever since its debut, the stock has grown over 485%.
This large cap company with an established market share has shown a robust performance, with exceptional sales and revenue growth, debt reduction and a very promising outlook.
The stock price CAGR of Macrotech Developers is almost 172% in the last year itself. In March 2024, the company raised ₹3,300 crore by selling shares to institutional investors.
The QIP was subscribed nearly three times within 5 hours of issue opening and witnessed traction from a diversified set of investors, including sovereign funds, pension funds, and insurers.
This marks the fourth equity raise by Lodha in the last 36 months, bringing the total capital raised to over ₹13,000 crore.
Recently, Jefferies ascribed the price of Rs. 3000 by the financial year 2029, almost triple of the price today.
"Significant upside over time will come from the improving realizations and sales velocity at its township business. Fast developing infra will raise the land value and visibility of development driving a transformation in the township land value perceptions," the Jefferies note said.
