Ashiana Housing Ltd

Ashiana Housing Ltd
Realty

Market Cap.: ₹ 1,444.19 Cr.
Current Price: ₹ 141.10
Book Value: ₹ 64.81
Stock P/E: 11.40
Dividend Yield: 0.35%
Face Value: ₹ 2.00

Company is virtually debt free.
Company has good consistent profit growth of 23.80% over 5 years

Net profit: 129

Growth: 23%

So cheap right now can buy

Good business good future not going out of market soon. Currently price is down because of real state situation in India.
Many value investors are into this company so copy paste. Great management Annual letter is really nice.

adequate cash flow

P/E is also okay

So buy??

Next 7-10 years growth you expect ..

Graham style:
Intrinsic value = EPS X (8.5 + 2 g)
Good P/E + 2 times growth you say for next decade
reasonable expected growth

So for Ashiana housing
EPS is varying a lot why??
EPS last year is 12 but before that it was 4 before 2 then 17 37 etc
(8.5 + 2 g) = 8.5 + 20 =
current share price is 140 so even 7 EPS is okay

With demonetization buyers of real state are less now
So??
affordable housing
good long term investment for slow and focused investment

but it will take another 1-2 year for real state to boost once again
so can keep adding at low values I think ??

inished unsold inventory that is in the company’s books? This is becoming a concern and how do you plan to deal with the situation?
There is finished unsold inventory of 9.72 Lakhs sq. ft. as on 31st March, 2017. This is clearly a concern in a slow market and has led to blockage of our capital. We are making efforts to deal with the situation in terms of raising debt capital to fund this inventory (and release our expensive equity capital), special subvention schemes in projects like Ashiana Town and Navrang, focus on increasing occupancy in our projects, etc. We expect the stock of finished inventory to reduce once the sales pickup. While it’s difficult to predict how soon this will happen, we expect things to start improving in the next 6-12 months, given the fiscal incentives and the interest rate subvention scheme that the government has given.

our operational cash flows have been negative for the last 2 years? When you expect them to turn positive?
Our operational cash flows have been negative for the last two years primarily due to lower collections resulting from slowdown in sales and we continued to construct as per our commitments to ensure timely delivery to our customers. This led to blockage of funds in built unsold inventory. We have 9.72 Lakhs sq. ft. of inventory as on 31st March, 2017. The good part is that as and when market turns around, we will realize accelerated cash flows by majorly selling ready to move inventory. Moreover, to align construction with sales, we have been launching smaller phases to reduce our construction commitment and optimise our cash flow management

Builders will not be able to provide houses within the affordable price range within city limits because land is costly. This is why such projects are coming up in Karjat and Titwala beyond Mumbai. Travelling from these areas to any of the office locations will be quite tough,” says Ajay Jain, executive director, investment banking & head, real estate group, Centrum Capital.

“Affordable housing is more of a social need and should ideally not be looked at as an investment option,” adds Oberoi.

cheaper rate of house loan ..

lot of cash available to the company in reserve
last two years were not great .. realizing losses
inventries were not sold

eventually people will stop booking flats?? too many inventories are empty .. benefit.. loss is realized if market catches just gain has to reaized..

Why Ashiana?

Is housing in my circle of competency?
yes
Who are competitors?

Management?
I am happy with

Copy paste?
Yes

Future Prospects?

How does it compare with Poddar housing?

With tata value homes ?

Online review is good for the builder.

Final Verdict: Buy

Disclaimer
I am very new to value investing and this is me taking random notes just for myself. Please don’t base any of your decision on these write-ups. That will be foolish.

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