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INVESTMENT INSIGHTS

Check Before You Invest : Lodha Developers Ltd

BSE: 543287 NSE: LODHA ISIN: INE670K01029
  |   Sector:  Construction & Infrastructure   |   Industry:  Construction - Real Estate

Snapshot

Q.1 Which industry/sub-sector does Lodha Developers Ltd belong to?
Lodha Developers Ltd belongs to the Construction & Infrastructure sector, operating specifically within the Construction - Real Estate segment.
Q.2 Is Lodha Developers Ltd a good quality company?
Lodha Developers Ltd is a average quality company, based on a somewhat consistent multi-year financial track record.

This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q.3 Is Lodha Developers Ltd undervalued or overvalued?
Lodha Developers Ltd appears Undervalued, as its key valuation ratios are lower than their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios Current 5-year
Historic Median
Price to Earnings 30.23 58.60
Price to Book 4.05 5.87
Price to Sales 6.07 8.90
EV to EBITDA 20.25 36.41
Q.4 Is Lodha Developers Ltd a good buy now?
Lodha Developers Ltd is a neutral opportunity now, based on stable price trend analysis suggesting prices may move sideways. However, you need to check its quality and valuation before making a decision

Performance Analysis

We have analysed the performance of the company on the following:

  • How has it performed on generating Profits?

    By checking its Revenue growth, Gross, Operating and Net Margins compared to its last 5-year median.

  • How efficiently has it utilized Capital?

    By checking its ROCE, ROA, ROE and its Cash Conversion Cycle.

  • How is it managing its Debt?

    By checking its Debt to Equity and Cash Flow from Operations.

A: What are the trends in revenue and profit margins?

Q.1 Revenue growth of Lodha Developers Ltd?
Lodha Developers Ltd revenue growth is 34% for FY-2025, which is above its 5-year CAGR of 9.33%, indicating faster growth.

Q.2 Gross Profit margin of Lodha Developers Ltd?
Lodha Developers Ltd Gross profit margin which is the profit after deduction of direct costs, is 25.2% for FY-2025, which is above its 5-year median of 19.8%, indicating increasing margins.

Q.3 Operating Profit Margin of Lodha Developers Ltd?
Lodha Developers Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 26.59% for FY-2025, which is above its 5-year median of 20.31% indicating increasing margins.

Q.4 Net Profit Margin of Lodha Developers Ltd?
Lodha Developers Ltd Net Profit Margin is 17.27% for FY-2025, is above its 5-year median of 12.3%, indicating increasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 25.2 19.8
Operating Profit Margin (%) 26.59 20.31
Net Profit Margin (%) 17.27 12.3

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Lodha Developers Ltd?
Lodha Developers Ltd Return on Asset is 4.54%, which is above its 5-year historical median of 2.65%, indicating improved asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Lodha Developers Ltd?
Lodha Developers Ltd Return on capital employed is 13.67% for FY-2025, which is above its 5-year historical median of 8.96%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 11.25%, indicating value creation.

Q.7 Return on Equity (ROE) of Lodha Developers Ltd?
Lodha Developers Ltd Return on equity is 12.53% for FY-2025, which is above its 5-year historical median of 8.18%, indicating the business is making better use of its shareholders capital.

Q.8 Cash conversion cycle of Lodha Developers Ltd?
Lodha Developers Ltd Cash conversion cycle is 857 days, below its 5-year historical median of 1070 days, indicating improved working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 0.26 0.23
ROE (%) 12.53 8.18
ROCE (%) 13.67 8.96
Cash Conversion Cycle 857 days 1070 days

C: How much debt does the business have and is it at a sustainable level?

Q.9 Debt to Equity ratio of Lodha Developers Ltd?
Lodha Developers Ltd Debt-to-Equity ratio is 0.41, which is above the industry average of 0.23, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Lodha Developers Ltd?
Lodha Developers Ltd Debt to cash flow from operations is 6.38, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Lodha Developers Ltd?

Q.1 Promoter shareholding and pledge status of Lodha Developers Ltd?
Promoters hold 72.27% of the Lodha Developers Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Lodha Developers Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Lodha Developers Ltd vs industry peers?
Lodha Developers Ltd revenue CAGR is 9.33%, compared to the industry median CAGR of 9.33%, indicating stable growth and maintaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 34 9.3
Gross Profit Growth (%) 52.1 17
Operating Profit Growth (%) 392.1 15.4
Net Profit Growth (%) 88.1 29.6
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.26 0.19
ROE (%) 12.53 8.18
ROCE (%) 13.67 8.96
Cash Conversion Cycle (days) 856.85 664

Valuation & price assessment

Q.1 Stock return of Lodha Developers Ltd over the last decade?
Over the last 5 year(s), the stock has delivered a CAGR of 22.47% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR		 - 22.5% 22.7% -37%
Q.2 Valuation ratios of Lodha Developers Ltd vs historical?
The current P/E ratio of 30.23 is lower than its historical median of 58.60, indicating that the stock is trading below its historical average valuation.
Q.3 How do the current valuation ratios compare with 5-year historical median and industry numbers?
Valuation Ratios Current 5-year
Historic Median		 5-year
Industry Median
Price to Earnings 30.23 58.60 33.43
Price to Book 4.05 5.87 1.53
Price to Sales 6.07 8.90 5.23
EV to EBITDA 20.25 36.41 14.43

Check more companies

1. Lodha Developers
2. Phoenix Mills
3. Oberoi Realty
4. Prestige EstatesProj
5. Godrej Properties

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3. National Aluminium Company Ltd.
4. Muthoot Finance Ltd.
5. Motilal Oswal Financial Services Ltd.
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