Brokerage firm CLSA has maintained its ‘O-PF’ ratings for Phoenix Mills and Oberoi Realty, stating that though it’s cautious on the near-term outlook, it’s positive on malls in the long-term.
Brokerage firm CLSA has maintained its ‘O-PF’ ratings for Phoenix Mills and Oberoi Realty, stating that though it’s cautious on the near-term outlook, it’s positive on malls in the long-term. CLSA has lowered the target price for Phoenix Mills from Rs 929 to Rs 850, but has maintained the target price for Oberoi Realty target at Rs 625.
The brokerage firm believes that the COVID-19 restrictions will deter people from visiting malls and thereby delay the recovery process. In January 2021, the consumption level was at 75-80 percent of pre-COVID-19 levels. The brokerage note also states that this may result in a delay in reinstating the pre-COVID-19 rental terms with tenants at malls in Maharashtra.
The brokerage firm also cut its 2022 fiscal earnings estimates for Phoenix Mall 9 percent and for Oberoi Mall by 1.6 percent.
CLSA in its note has also recommended investors switch from Godrej Properties Ltd to Oberoi Realty Ltd looking at the valuation front. CLSA has a sell rating on Godrej Properties Ltd.
In the note, the brokerage also states that amid a surge in COVID-19 cases in Mumbai, the civic body will be conducting random Rapid Antigen tests on customers visiting malls in the city from March 22, 2021. The cost of such tests will be borne by customers.
“We expect similar curbs to be introduced in Pune, which is also seeing a sharp rise in new COVID-19 cases,” stated the report, adding that “this will dissuade genuine customers from visiting malls”.
(Edited by : Abhishek Jha)