Prestige Estates Projects Ltd - Surprises operationally, disappoints financially - Emkay

Reco: HOLD
CMP: Rs 113
Target Price: Rs 124

- Strong quarter on Sales booking front but neutral show on cashflow generation. Additional debt taken at SA level QoQ to fund land and SPV stake acquisition

- Debtors from completed projects decreased by just Rs 0.5bn QoQ to Rs 5.2bn. Co. intends to reduce the same by another Rs 3.2bn in FY13 v/s reduction of ~Rs 1.8bn in FY12

- Debt in FY13 should stabilize at current levels of Rs 13.5bn (SA) & Rs 20.2bn (Conso.) Reduction in debtors and cash from launches should fund the construction-to-collection gap

- Marginally upgrade TP to Rs 124 but maintain Hold rating as no surplus cash generation envisaged at SA level in FY13.

Source : Equity Bulls

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