Phoenix Mills on recovery track, expansion plan in focus

Total Consumption in Q1FY23 21.90 crore was 123% of the pre-covid quarter of Q1FY20. As a result, the incremental revenue share contributed 13% to its total rental income compared to 10% Q1FY20.

In the post earnings conference call, the management said that consumption in July 7.92 crore, the highest ever monthly consumption. under construction mall Indore/Ahmedabad/Pune/Bangalore are now on pre-lease at 83/98/73/76% respectively. The company plans to open Indore and Ahmedabad malls in the second half of FY23 and other malls in the second half of FY24. The management said that its Project Rise and Kolkata Project have received environment clearance and are likely to start operations in FY 25-26 and FY 26-27 respectively.

Reacting to earnings announced after market hours on Thursday, the stock ended Friday’s session up 3.5%. Indian Stock Exchanges are closed today due to public holiday.

So far this calendar year, the stock has gained 35%, beating the sector index Nifty Realty, which has lost around 9.5%. Apart from timely opening of the under-construction mall of Phoenix Mills, investors will also keep an eye on the company’s expansion strategy.

The management has said that it plans to venture into the warehousing and residential sectors. For that, it will make a capital expenditure of from 350 450 crores.

Analysts at HDFC said, “Given strong traction in consumption, captive brownfield mall expansion, addition of office space, consolidation of Chennai Mall and strong business growth pipeline, we increase our NAV premium by 15% to 25%. Offices also include assets,” said HDFC analysts. Securities Ltd. said in a report on August 12. NAV is the net asset value.

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