Macrotech Developers Shares Recover From Lows Even As Q1 Profit Falls 34%

Shares of Macrotech Developers Ltd., which sells properties under the brand Lodha, recovered from intraday lows on Friday.

It closed about 2.5% higher on the BSE, after falling as much as 4% in early trade as its profit declined in the first quarter.

The real estate developers' consolidated net profit declined 34% year-on-year to Rs 179 crore in the quarter ended June, according to an exchange filing. It reported other income of Rs 54 crore during the April-June period, as compared with nil in the year-ago quarter.

Macrotech Developers Q1 Results (Consolidated, YoY)

• Revenue down 40% to Rs 1,617 crore.

• Ebitda fell 29% to Rs 330 crore.

• Ebitda margin at 20% versus 17%.

• Net profit down 34% to Rs 179 crore.

The company's net debt rose marginally to about Rs 7,200 crore from Rs 7,000 crore as of March 30, 2023 (actuals), due to the seasonality impact on collections and accelerated investments growth, leading to marginal increase in debt

"Our net debt has increased marginally, primarily on account of front-loaded business development investment. We remain on the path to achieve our full-year guidance of lowering net debt to below 0.5 times equity and one times operating cash flow, with significant debt reduction to be seen in second half [of current fiscal]," said Managing Director and Chief Executive Officer Abhishek Lodha.

Though the real estate company said that it reported its best ever first quarter pre-sales performance at Rs 3,350 crore. The management shared that the embedded Ebitda margin for pre-sales reported in 1Q stood at around 30%.

It added five projects with a gross development value of Rs 12,000 crore. The new projects include projects in the Western Suburbs of the Mumbai Metropolitan Region, Alibaug, and Bengaluru.

Out of the 17 analysts tracking the stock, 14 recommend a 'buy' and three suggest a 'hold', according to Bloomberg data. The average 12-month consensus price target implies a potential upside of 1.2%.

Shares of Macrotech Developers ended 2.5% higher at Rs 746 apiece, as compared with a 0.16% decline in the benchmark Sensex.