Shares of Sri Lotus Developers and Realty Ltd gained over 4% to ₹193.38 on Tuesday, September 24, after Motilal Oswal Financial Services initiated coverage on the stock with a ‘Buy’ rating and a target price of ₹250, implying an upside potential of 35% from the current levels.
Strong pipeline of projects
The brokerage highlighted LOTUSDEV’s robust development pipeline with five ongoing projects having a gross development value (GDV) of ₹19–20 billion, eight upcoming projects worth ₹70–75 billion, and three commercial projects valued at ₹30–35 billion. Presales are expected to clock a strong 129% CAGR over FY25–28.
Niche positioning in premium markets
LOTUSDEV focuses on luxury society redevelopment in prime Mumbai micro-markets such as Juhu, Bandra, Worli, and Nepean Sea Road, with a proven track record of eight completed projects, all delivered ahead of schedule.
Asset-light and scalable model
With 89% of its projects under JD/JV/redevelopment, the company has been able to rapidly scale without heavy land capex. The balance sheet remains zero-debt, which further enhances scalability.
Financial outlook
Motilal Oswal projects Revenue CAGR of 58% (FY25–28), EBITDA CAGR of 52% with 47% margin, and PAT CAGR of 50%, reaching ₹7.7 billion by FY28. Cumulative operating cash flows are expected at ₹69 billion by FY32.
Valuation and view
Using a NAV-based DCF valuation (WACC: 13%, terminal growth: 2%), the brokerage arrived at a target price of ₹250 per share. It views LOTUSDEV as a rare pure-play on Mumbai’s redevelopment story with best-in-class execution, superior margins, strong cash flows, and a structural compounder in India’s real estate sector.
