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Hidden Gem: Mahindra lifespace Developers (CMP - ₹ 413, PT - ₹ 550, Reco – Buy)

ICICIdirect Research 05 Dec 2025 DISCLAIMER

Mahindra Lifespace Developers, identified as a Growth Gem by Mahindra Group, has ~53 million square feet (msf) of residential projects across seven cities and 5,000+ acres of integrated cities / industrial clusters (IC& IC) business (typically 99-year lease agreements with customers along with O&M charges) spread across four locations.

  • The company has aggressively scaled up in terms of new business developments adding ~₹ 32000 crore since FY24 till date, which is 3x of ~₹ 10,200 crore added during FY17-FY23. Consequently, its cumulative Gross development value (GDV) stands robust at ₹46,250 crore providing it multi-year pre-sales growth visibility.
  • The company is exiting affordable projects (a drag on margins/return ratios), which are expected to get completed by FY29.
  • The company is targeting residential pre-sales of ~₹ 9500 crore in FY30 (~₹ 10,000 crore including IC&IC sales) at a 28% CAGR over ₹ 2804 crore in FY25. Its sustenance sales contribution is expected to rise from 35% in FY25 to 75% in FY30. Over the medium term, it targets pre-sales of ~₹ 4500-5000 crore by FY27 (~27-34% CAGR).
  • The company raised ₹ 1495 crore through rights issue in Q2FY26. The same was utilised in debt repayment and future acquisitions. It now has a net cash surplus of ₹ 445 crore (-0.17x ND/E) compared to net debt of ₹ 734 crore (0.39x) as on FY25. Further, excluding redevelopment projects and owned land projects, it is left with a staggered land payment schedule for balance ~₹ 11,500 crore projects, which can be comfortably financed through internal cash flow generations.

View: We have a Buy rating with a SOTP based price target of ₹ 550 (25% premium to NAV considering new business developments over the next three years). Currently, the stock trades below its estimated NAV, which provides an attractive opportunity to buy.

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