Capacit`e Infraprojects Limited (CIL) is a leading building construction company, with majority focus on residential construction, which constitutes more than 85% of the company`s `5,682cr order book. It caters to
established realtors such as Kalpataru, the Wadhwa group, Oberoi Construction Ltd, Lodha, Rustomjee, TATA trust & Godrej properties.
Outlook & Valuation: The sector is undergoing tectonic changes, which in turn should increase confidence amongst home buyers towards reputed developers as a preferred choice while buying home. With 3-4X of order book, improving financial indebtedness, and association with reputed and healthy developers, we believe CIL is in a sweet spot to tap upcoming opportunities in the Real Estate sector. At the CMP of `273, stock is available at PE of 14x of FY20E EPS of `20. On a conservative basis we like to assign a multiple of 17x to FY20E EPS and arrive at target price of `340 with potential upside of 24% and recommend to ACCUMULATE the stock.
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