Value of operational assets > Current Market Cap
Brigade Enterprises Ltd. (BRGD) is a South India based developer with operations concentrated primarily in Bengaluru along with other cities like Hyderabad, Mysore, Chennai and Kochi. The developer currently has ongoing projects of ~12msf and land bank of 24msf. Additionally, its ready portfolio of marquee rental and hospitality assets in Bengaluru makes BRGD an excellent proxy for a revival in the Bengaluru rental market over the next three years.
We initiate coverage on BRGD with a BUY recommendation and a TP of Rs 253/sh (CMP Rs 159/sh). Key upside triggers are addition of more land parcels through the 50:50 JV tie-up with GIC to cumulatively invest ~Rs 15bn (Rs 7.5bn each) across South India and value accretion from Rs 5bn of committed investment in GIFT City, Gujarat.