Macrotech shares can triple in the next five years, says this analyst

"A reset in land values at its township land, alongside penetration of new geographies driving a 15% to 20% medium-term pre-sales Compounded Annual Growth Rate (CAGR), are the key valuation drivers," Jefferies wrote in its note.

On analysing data of the past 15 years, Jefferies said that even if they assumed a 5% long-term demand growth for urban housing (top 7 cities), there is still a significant volume catch-up to do over the medium-term.

Annual township sales from Palava can also rise to $1 billion from $300 million in the medium term as travel time reduces and as Lodha introduces new premium-priced offerings, alongside the existing affordable units, the brokerage said.

"Significant upside over time will come from the improving realisations and sales velocity at its township business. Fast developing infra will raise the land value and visibility of development driving a transformation in the township land value perceptions," the Jefferies note said.

Macro risks where job losses in the Indian economy may lead to a contraction in residential sales, and concentration risks in the Mumbai Metropolitan Region (MMR), are some of the key risks to Jefferies' estimates for Macrotech.

"Though we note that given the wide-spread product mix and multiple micro-market presence, Lodha should be relatively resilient," the brokerage said.

Shares of Macrotech Developers are trading 5% higher at ₹1,053.8. The stock is risen 144% over the last 12 months.