Broker’s call: Signature Global (Buy)

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Target: ₹2,000

CMP: ₹1,477.55

Signature Global began its operations in 2014 and in just a decade, it has become one of the leading real estate developers in the Delhi-NCR market. The company commenced its journey in the affordable and low/mid-income housing segment by leveraging the State government’s housing policies.

Through its standardised offerings and quick turnaround strategy, Signature Global has scaled up rapidly and delivered a 42 per cent CAGR in pre-sales over FY21-23. Its agility in adapting to changing market preferences has enabled Signature Global to foray into the premium segment, which doubled its pre-sales to ₹7,300 crore in FY24. Its strong execution capabilities have enabled it to churn the capital and gear up with a strong about 30msf project pipeline to be launched over the next two years.

We, thus, expect the growth momentum to remain intact and expect Signature Global to deliver 35 per cent CAGR in pre-sales over FY24-27 to ₹17,800 crore. The management’s disciplined land acquisition strategy has enabled it to curtail costs and report margins of over 35 per cent (better than peers). We initiate coverage on Signature Global with a Buy rating and a DCF-based target price of ₹2,000, implying 38 per cent upside potential.