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Peninsula Land to Outperform – ENAM

August 30, 2007

ENAM Securities Research is recommending Peninsula Land as an outperformer with a price target of Rs 719.

Peninsula has applied for necessary approvals to change the land usage for its Dawn Mills property, in Lower Parel, from commercial to an IT Park, thereby doubling the FSI and saleable area to ~1.2mn sq. ft., resulting in a significant upside in our valuations. The selling prices at Sewri currently range between ~Rs 13,000 psf to 14,000 psf (Ashok Gardens project) and at Kurla, between ~Rs 13,500 psf to 14,500 psf (Peninsula Technopark project). The company expects to receive Rs 25-27bn in revenues over the next 3 years from Dawn Mills Project.

ENAM believes that the company is a high quality real estate player in Mumbai with a strong focus on the commercial segment. At CMP of Rs 450, the stock trades at a significant discount of ~29% to NAV of Rs 637.

ENAM’s base Case Target for the Stock is Rs 719 and the bear case target is Rs 550 based on Sum of Parts Evaluation.

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