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Wednesday, September 30, 2009

Ganesh Housing - Mid Cap Stock From Real Estate Sector

Ganesh Housing is an Ahmedabad based real estate company which is amongst the largest land bank owners in Ahmedabad. Last year this company consolidated all its land bank into Ganesh Housing by way of merger of five of the promoter group companies into Ganesh Housing.

This company has two wholly owned subsidiaries; and one of them is setting up an integrated township in Ognaj which is on the outskirts of Ahmedabad and the second subsidiary is setting up a mall cum shopping complex in Ahmedabad. Today the company is sitting on a land bank close to about 650 acres. Most of its development is concentrated among four mega projects. This company is making a155 acre SEZ (Special Economic Zone) on the outskirts of Ahmedabad, and a 450 acre Golf Township at a place called Godhavi which is close to Ahmedabad.

Besides these two projects, this company has two other township projects and about 85-90% of its total development is constituted by these four projects. There are few fundamental factors which make us optimistic on the prospects of Ganesh Housing major one being the investment commitments which the state has received in the Vibrant Gujarat Summit would lead to the growth rate in Gujarat to be much higher than other states.Besides this there is a lot of infrastructure development happening close to Ahmedabad; there is a new international airport which has come up then there is a Dholera Port which is close to Ahmedabad which is been developed by the Adani Group.

Besides this, there is a huge SEZ coming up between Dholera and Ahmedabad so the focus of the growth is centred on Ahmedabad. All this would mean migration of people into Gujarat and all this would need creation of more infrastructures to accommodate those people.Given all these fundamental factors Ganesh Housing being one of the largest land bank owners in the country is well positioned to take this opportunity and there are few concerns about the real estate sector which apply to Ganesh Housing also but every person on the street knows about those concerns.

The positive factor however is that companies are finding customers for their projects at lower prices. Ganesh Housing also lowered prices of one of their projects by about 30% and they have got good response for that project. The negatives with regard to the real estate sectors are getting discounted in the stock price with the price having fallen from about a high of Rs 850 to a current price of close to Rs 100. I believe the negatives are already priced in and any positive sentiment emerging for the real estate stocks and will lead to these concerns going away and this may lead to rerating of the stock of Ganesh Housing.A great stock to buy at lower levels.
Source:Ashish chugh (Author of Hidden Gems)

1 comment:

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