Buy Karda Constructions, target Rs 250: Rakesh Bansal

Rakesh Bansal of R K Global has a buy call on Karda Constructions with a target price of Rs 250.

The current market price of Karda Constructions is Rs 168.75.

Time period given by the analyst is one year when Karda Constructions price can reach the defined target.


Investment rationale by Rakesh Bansal:
Karda Constructions is a Nashik based real estate company.

The company has 13 ongoing and 3 planned projects, with a total carpet area of more 17 lakh sq.ft which will increase company's revenue in the upcoming years.

The company has a huge developable land area of around 4.1 lakh sq.ft in and around Nashik. Nashik's emergence as a hub for the industrial and service sectors, infrastructure development in the area and affordability of real estate present strong potential for the city's property market in terms of both investment and end-use demand.

The company has a track record of delivering project before time due to its strong execution capacity.

On average, the company has taken a little over 2 years to construct a project comprising 71 units with a carpet area of over 67,000 sq ft.

On latest reported financial for FY18 company shows growth on YoY basis in top line with 19.9 per cent.

The net sales reported for FY18 was Rs 126.79 crore, as compared to Rs.105.78 crore in FY17.

On the other hand, the bottom line shows growth of 65 per cent and reported PAT for FY18 was Rs 13.05 crore.

The expected EPS for FY20 is around 15.83.

With current PE the expected future price for the stock is around 250. One can buy this stock for the given level.

(Views and recommendations given are the analyst's own and do not represent those of ETMarkets.com. Please consult your financial adviser before taking any position in the stock/s mentioned.)