Valor Estate Ltd: Stock Overview & Financial Insights by Fundcode's Workspace
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00:00:00 Valor Estate Ltd: Stock Overview & Financial Insights
### Valor Estate Ltd: Stock Overview
Valor Estate Ltd, trading on BSE under the code 533160 and on NSE as DBREALTY, closed at ₹163 on October 30, reflecting a 1.61% increase. The company has a market capitalization of ₹8,783 crore. Over the past year, the stock has seen a high of ₹285 and a low of ₹156, giving it a price-to-earnings (P/E) ratio of 7.01 and a book value of ₹93.2. Currently, there is no dividend yield offered.
### Financial Performance
In terms of profitability, Valor Estate has shown a commendable profit growth of 65.7% CAGR over the past five years, though it has a relatively low return on equity (ROE) of 4.10% over the same period. The company has also successfully reduced its debt and improved its debtor days from 164 to 84. However, notable concerns arise from the fact that 42.1% of promoter holdings are pledged, and the reduction of promoter holding by 15.5% over the last three years could signal potential risks.
The company reported other income of ₹1,339 crore, which significantly contributes to its earnings. Despite positive growth indicators, there are hints that Valor Estate may be capitalizing interest costs.
### Peer Comparison
In the real estate sector, Valor Estate's performance can be compared to several peers. For example, DLF has a current market price of ₹826.40 with a P/E ratio of 56.80, while Macrotech Developers is priced at ₹1,179.20 with a P/E of 54.69. In contrast, Valor Estate's P/E ratio suggests it may be undervalued compared to its peers.
### Quarterly Results and Trends
Recent quarterly results illustrate fluctuations in sales and profits. For instance, in the latest quarter, the net profit was reported at a loss of ₹13.19 crore, with sales showing a dramatic year-on-year increase of 3169.55%. Operating profit margins have been inconsistent, experiencing significant losses in some quarters but displaying recovery in others, indicating volatility in financial performance.
### Growth and Financial Metrics
The company's long-term growth metrics are as follows:
- **Compounded Sales Growth**: 10 Years: 1%, 5 Years: 0%, 3 Years: 144%, TTM: -37%
- **Compounded Profit Growth**: 10 Years: 59%, 5 Years: 66%, 3 Years: 78%, TTM: 283%
- **Stock Price CAGR**: 10 Years: 9%, 5 Years: 83%, 3 Years: 63%, 1 Year: -6%
Despite fluctuations, the company has shown resilience in profit growth, especially in the recent quarter.
### Balance Sheet Insights
The balance sheet highlights a gradual increase in equity capital from ₹243 crore in 2013 to ₹538 crore in 2024, alongside a significant rise in reserves to ₹4,477 crore. Borrowings peaked at ₹3,721 crore before decreasing to ₹2,223 crore, indicating an effort to manage debt levels effectively.
### Shareholding Structure
The shareholding pattern shows a decline in promoter holding from 63.03% in December 2021 to 47.38% in September 2024. Conversely, foreign institutional investors (FIIs) increased their stake, reflecting growing institutional interest, while the public shareholding rose to 48.78%.
### Conclusion
Valor Estate Ltd presents a mixed picture of financial performance. While there are promising signs of growth and debt reduction, concerns regarding promoter pledges and fluctuating returns necessitate cautious optimism. The stock's low P/E ratio in comparison to its peers may present a buying opportunity for investors, yet the recent trends in shareholding and profitability warrant close monitoring.
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