Anant Raj rallies 7%, hits new high on healthy outlook; zooms 200% in 1 yr

The stock price of real estate company Anant Raj has appreciated by 40 per cent since December 2024

Shares of Anant Raj hit a new high of Rs 947.25, rallying 7 per cent on the BSE in Wednesday’s intra-day trade amid heavy volumes in an otherwise weak market on a healthy outlook. The stock price of the real estate company has surpassed its previous high of Rs 892, touched on January 2, 2025. In comparison, the BSE Sensex was down 0.28 per cent, while the BSE MidCap and BSE SmallCap indices were down 1 per cent each at 09:53 AM.

 

Anant Raj is engaged in the business of real estate development (residential and commercial) in the National Capital Region (NCR), Rajasthan and Haryana. The company continues to significantly reduce its debt and expects to be net debt free by the end of the calendar year 2024.

 

 

Since December 2024, the stock price of Anant Raj has appreciated by 40 per cent. In the past one year, it has zoomed nearly 200 per cent, as compared to the 9.5 per cent rise in the BSE Sensex.

 

Anant Raj, in its Q2FY25 results conference call on October 30, 2024, had said that it has commenced 6 megawatts IT load of the data centre at its Manesar facility, and work on 21 megawatts capacity is going ahead at full tilt. This will take the company's total capacity, including the capacities at its Manesar and Panchkula facility, to 28 megawatts of IT load by the end of FY2025. 

 

In the meantime, the company has also commenced cloud services, and the pilot project, with a capacity of half a megawatt, has already started. The company is of the view that this cloud service will be initially provided as an infrastructure-as-a-service, which has been built along with the world's best OEM and service provider.

 

Anant Raj has 220 acres of land parcels in total at Golf Course Extension Road (Sector 63A, Gurugram, Haryana); a significant (around 120 acres) portion of this has yet to be developed and sold (comprises ongoing and planned projects). Also, another approximately 101 acres of land bank that it holds in Delhi could have a development potential of approximately 12msf (depending on the master plan; current potential at 6msf).

 

Brokerage firm Emkay Global Financial Services believes the real estate cycle appears to have strong legs. "Demand continues to be very strong and the absorption rate for new launches continues to be very healthy. There are no significant execution challenges either. Availability of finance is vastly improved in a post-RERA world. Manpower and logistics are also not posing any challenges," the brokerage firm noted .

 

According to the brokerage firm, access to land and ready-made civil structures position the company well for cost and time advantage over peers. "Profitability is higher and ranges between 75 per cent and 80 per cent Ebitdam (earnings before interest, tax, depreciation and amortisation margin), which bodes well for a robust consolidated PAT growth and strong OCF generation, the brokerage firm said. However, currently the stock is trading above the target price of Rs 925 per share.

 

Anant Raj is transitioning from its stronghold in the real estate sector to a diversified business model with strategic investments in data centers (DCs) and cloud services. This shift capitalises on India's burgeoning data localisation and digital transformation trends. With a planned capacity of 300MW for DC over the next 4-5 years, the company is leveraging its existing technology parks to enhance execution speed and cost efficiency, analysts at Motilal Oswal Financial Services Limited (MOFSL) said in its initiate coverage report, with a ‘Buy’ rating for a target price of Rs 1,100.

 

“The company’s foray into higher-margin cloud services (IaaS) in partnership with Orange enhances its profitability potential, with cloud capacity projected to rise to 25 per cent by FY32. Its residential business remains robust, with 14msf deliveries expected by FY30, generating a cumulative net operating profit after tax of Rs 8,220 crore. While execution risks remain, we expect significant revenue and earnings before interest, tax, depreciation and amortisation (Ebitda) margin expansion, driving long-term value creation,” MOFSL said in a note.