This realty stock hit upper circuit for fifth day in a row, up 28% in one week

Shares of Emami Realty, the real estate arm of the Emami Group, continued their exceptional bull run, hitting the 5 per cent upper circuit limit for the fifth consecutive trading session on Wednesday, December 4, reaching a seven-week high of ₹123.17 apiece. This took the five-day cumulative gain to 28 per cent and marked a 38.20 per cent jump from its low of ₹89.21 in October.

The sharp rally can be attributed to several positive developments. One key factor is the company’s ambitious investment plans, which focus on both residential and commercial developments, as well as its new project launch in Kolkata.

Strong pipeline of 22 million sq ft in development

The company plans to develop 22 million sq ft, consisting of 19 million sq ft for residential projects and 3 million sq ft for commercial spaces, with an estimated revenue potential of ₹15,000 crore, the company said in its November 28 exchange filing. However, the company has not shared any further details about the timeline of these projects.

The total estimated investment for these developments is approximately ₹10,000 crore, with ₹4,500 crore allocated for various residential and commercial projects in Bengal.

The remaining ₹5,500 crore will be used for realty projects in Uttar Pradesh, Jharkhand, Odisha, and Tamil Nadu. Of the total investment, approximately ₹9,000 crore will be directed towards residential projects and ₹1,000 crore for commercial projects. 

The company has a significant presence with over 3.7 crore sq ft of development across West Bengal, Tamil Nadu, Andhra Pradesh and Maharashtra.

In Bengal, Emami Realty recently launched its new residential project, Emami Aamod, in Kolkata. This luxury development is expected to generate revenue of approximately ₹850 crore. The company has several upcoming projects in Bengal, including developments in Joka, 13 Station Road in Liluah, Konnagar, 327 and 384 Motilal Gupta Road, and Basanti Cotton Mill on 115 BT Road.

Outside Bengal, Emami Realty is also focusing on projects like Emami Tejomaya Phase II in Chennai, Emami Miraai in Sipcot, Chennai, as well as developments in Buda (Jhansi), Govindpur, and Raghunathpur Jali.

Amid sustained demand, inventory levels in key cities have seen significant reductions, particularly in cities like Pune, which recorded a 13 per cent annual decline in inventory levels. Other cities such as Chennai and Kolkata also experienced notable reductions, with annual declines ranging from 7 per cent to 9 per cent, according to the CREDAI—Colliers—Liases Foras report.

The overall reduction in unsold inventory is viewed as a positive sign, indicating healthy market absorption across the country.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.