2 ‘Fastest-Growing’ Real Estate Firms on NSE!
The real estate sector is the second-highest employment generator in India, after the agriculture sector. Currently, it is contributing roughly 6%-8% to the Indian GDP (gross domestic product) which is expected to soar to around 13% by 2025, hence this sector cannot be ignored for a well-diversified portfolio.
To make the job easier, here are 2 listed real estate firms on the NSE that have grown their EBITDA at the fastest pace over the last 5 years. This list excludes companies with a market capitalization of less than INR 1,000 crores.
D B Realty Limited
A real estate development and construction company, D B Realty (NS:) has a market capitalization of INR 3,052 crores. It is making strides in the real estate sector which can be seen in its financial performance. DB Realty posted record revenue of INR 774.43 crores in FY22, translating into an EBITDA of INR 428.9 crores, which was a mere INR 58.99 crores in FY17, representing a growth of 48.7% (CAGR).
In FY22, the company turned net profitable for the first time after FY14, with a profit of INR 26.9 crores. D B Realty shares have also delivered a return of 43.8% in the last one year, compared to the return of -15.3%. FIIs also hold a stake of around 2.42% in the company, as of September 2022. However, a P/E ratio of 113.41 (as per FY22 earnings) is making the current valuations a bit stretched.
Prestige Estates Projects Limited
Prestige Estates Projects (NS:) is a midcap real estate development company, having a market capitalization of INR 18,124 crores. Despite FY22 EBITDA taking a hit of a decent 48.9% to INR 2,535.6 crores due to revenue decline, the company still managed to clock a 5-year CAGR of 20%. FIIs have a very strong interest in the company as they hold a sizable stake of 23.17%, as of September 2022.
The stock fell 9.7% in the last one year, which helped to make valuations attractive. The current P/E ratio of 15.76 is very lucrative, especially considering the industry’s average of 48.08. On the weekly chart, there is good support around INR 380 (CMP – INR 443) which can be looked upon as a good level in case investors are willing to add it to their portfolios.
