Broker’s call: SignatureGlobal (Buy)

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Target: ₹2,007

CMP: ₹1,303.20

SignatureGlobal India had delivered 63 per cent sales booking CAGR over FY21-24, largely via affordable/mid-income housing projects. It has now achieved H1FY25 sales bookings of ₹5,900 crore driven by the launch of its Titanium project in Sector 71, Gurugram and Daxin Vistas project in Sohna, Gurugram. Given its strong launch pipeline of projects with cumulative GDV of over ₹45,000 crore during FY24-28, we estimate 21 per cent sales booking CAGR over FY24-27, ranging between ₹11,000-13,000 crore annually over FY25-27E.

Factoring in strong H1FY25 result, we raise FY25/26E sales bookings by 7 per cent each to ₹10,800 crore and ₹11,400 crore, respectively. Accordingly, we retain Buy with revised target price of ₹2,007 (earlier ₹1,905), based on 10x FY24-26E average embedded EBITDA of ₹2,920 crore at EBITDA margin of 30 per cent.

Our multiple of 10x is at 25 per cent discount to DLF, which is its closest peer – considering that Signature would need to reinvest the internal accruals for land bank replenishment while DLF has the luxury of a historical low-cost land in Gurugram

Key risks: Slowdown in Gurugram market; inability to replenish land bank.