Sunteck Realty: Jefferies says recent revamp plans to support growth, see 28% upside and maintains ‘Buy’ at Rs 555 Jefferies see 28% upside potential in Sunteck Realty stocks on account of Improved growth and governance prospects. The share price of Sunteck Realty surged nearly 7% to hit a 52-week high of Rs 481.90 during the intra-day trade on Wednesday. Jefferies has maintained ‘Buy’ rating on the scrip with a revised upside target or Rs 555. “Sunteck’s deal with IFC comes as a boost to perceived Corporate Governance for the company. The platform, alongside any affordable housing policy benefits, raise visibility on growth and land monetization. We roll forward our NAV to Sep’23 and cut our target discount to 10% from 30%, implying a target price of Rs 555,” said Jefferis in its report. Jefferies anticipated the FY24E sales projections of Rs 2000 crore in revenue reflecting a 25% on-year growth, and builds-in new launches for the second half of the fiscal year. “As of Jun’23, Tr-4Q pre-sales of Rs 160 crore, were up 14% year-on-year. Previous launch at Mira Road (Mar’23) has done well,” said the report. Jefferies expected the company to capitalise on the residential upcycle and said the company should get help to procure market share in Mumbai from demands for affordable and mid-income projects. “We also believe that the partnership model for growth is the right path and that the company is unlikely to seek higher gearing,” said the report. Jefferies further cautioned about the key risks which include, “any issues such as regulatory or lockdowns which may impact project cash flows and sales pace, high exposure to Mumbai market; and interest rate risks inherent to the real estate business.”
If the current trend continues for a longer period of time, not only oil mills but oilseeds growers will also not be able to get good rates of their produce, says Samir Shah, president of Gujarat State Edible Oils and Oil Seeds Association (GEOA). Shah who is also past president of SOMA says that due to various international factors rates of edible oils had gone up considerably, especially imported oils earlier this year.
“With a view to curb rising prices of edible oil, the Government of India reduced import duty on edible oils. Considering the fact that India is producing hardly 30 percent of its edible oil requirement, the decision was right at that point of time. Now when international prices of edible oils have gone down by 15 percent to 25 percent and high production period has started in edible oil exporting countries, the government should gradually increase import duty to protect local oil mills and oilseeds growers,” said Shah. GEOA has also made representation before Union Minister for Commerce & Consumer Affairs, Piyush Goyal to increase import duty.
In June import duty on edible oils was ranging from 35 to 55 percent, since then the government gradually reduced import duty and at present it is ranging from zero percent to 15 percent on different edible oils, he said.
Just a month back prices of edible oils were through the roof and the government took appropriate measures by reducing import duty in order to protect consumers, says Atul Chaturvedi, president of Solvent Extractors Association of India (SEA). “Prices of edible oils are coming down globally. Kharif sowing has already started across the country. In the interest of local farmers, it is high time to enhance import duty in a phased manner to encourage local edible oil value chain,” opined Chaturvedi.
On Thursday imported Palm oil prices were at around Rs 2100 per 15 kg as against local Rs 2700 and Rs 2550 of groundnut and cottonseed oils. Prices of other local oils including ricebran, coconut, soyabean and mustard remained as high as Rs 2350, Rs 2520, Rs 2500 and Rs 2580 respectively.
India imports around 13-13.5 million tonnes of edible oils, of which around 8-8.5 million tonnes (around 63 per cent) are palm oil. Though the price of other imported Sunflower oil remained at around Rs 2700 per 15 kg, but import quantity of the oil is much lower than that of palm oil.