Brigade Enterprises share price: Rising for the fourth consecutive session, Brigade Enterprises share price jumped nearly 8 percent in morning trade on BSE on Friday, March 22. Brigade Enterprises share price opened at ₹906.30 against its previous closing of ₹904.90 and touched its intraday high of ₹974.35 in Friday trade so far. Brigade Enterprises shares traded up 6.60 percent ₹964.60 around 10:45 am
The stock witnessed strong traction after brokerage firm Kotak Securities upgraded the stock to ‘add’ from ‘reduce’ with an unchanged target price of ₹1,025, citing the company’s business prospects remain strong.
“We are upgrading Brigade Enterprises to ‘add’ from ‘reduce’ with an unchanged fair value of ₹1,025, as the stock has corrected 16 percent since our downgrade likely on concerns of a possible ban on construction activity in Bengaluru, due to the local water crisis,” Kotak said.
“Although the water crisis may worsen in the summer season before some respite in monsoon, underlying business prospects remain strong for Brigade with strong performance across business segments,” added the brokerage firm.
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The stock price of Brigade Enterprises hit its 52-week high of ₹1,107.65 on BSE on February 7 this year. It has experienced some profit booking since then. At the current market price of ₹974.35, the stock is down about 12 percent from its 52-week high in a span of about one-and-a-half months.
According to Kotak Securities, despite strong growth prospects across business segments, Brigade Enterprises’ share price currently trades at six times adjusted EV/EBITDA on FY26E earnings.
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Kotak sees value in this stock and believes that the current weakness in the stock is a good opportunity to add to it.
“We do admit the risk of a temporary ban on construction activity in Bengaluru, although believe that the onset of monsoon is likely to address the situation, while the government projects would help structurally solve the water crisis in Bengaluru. Therefore, we are taking advantage of the current weakness. in stock returns as an opportunity, and upgrade the stock to ‘add’,” said Kotak.
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Meanwhile, Brigade Enterprises in a BSE filing on March 20 said that rating agency ICRA “has assigned a long-term credit rating of ICRA AA- for the improvement in banking facilities of ₹500 crore (increase from ₹2,500 crore to ₹3,000 crore). The outlook for the rating is stable.”
In addition, the company added that ICRA further “confirmed that the long-term rating of ICRA AA- with a stable outlook and short-term rating of ICRA A1+ assigned to the ₹2,500 crore existing titled bank facilities remain the same.”
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Published: 22 Mar 2024, 10:50 IST