Hemisphere is pure asset play. People with patient capital need to enter if any one thinks they can make a quick buck, they can get disappointed. Low expectations is the key, this is more like Pabrai’s philosophy Heads I will big Tails lose very little.
Some context recent Telangana Govt land auction fetched 40cr/acre in the financial district, where as 15cr/acre 30kms away ( Bahadurpally), so there are a range of outcomes possible.
If all 700acres are sold at very high price like what Hyderabad land plots are sold for that’s roughly 28000crs ( highly unlikely scenario)
the lowest possible sale could be 3-5cr/acre range which is current market cap of company.
Someone mentioned in the thread of possible risks, at this point nobody is certain whether they will sell outright and distribute to share holders, give it for development or develop land themselves. Everybody knows govt is very poor and in efficient operator, so if the scenario one play out share holders are rewarded handsomely, if they choose to develop not sure what would be the outcome.
I have very small investment and I can wait 3-5 years so my views may be biased.
Best
Siva
@ SivaBoppana Nice thought adn clarification.
Just to add some more points like govt need money now , they will not let this go easily , this could be the cash cow for the govt . they already thought on this and will give clarity FY23 First Q.
Since it is govt, if they plan to distribute, they will give it as dividends so that they can gain on taxing it from the investors.
I think if one has to play on Land book it is better to look at HUBTOWN as they hold best land parcel in MUMBAI.
As the value of land bank companies mainly depend on their land assets, it worth to compare the book value.
Just you can compare the book value vs market price of HUBTOWN and Hemisphere.
HUBTOWN is worth investing as its book value is 196 and Cmp is 46.
The book value of hemisphere is Rs 9. And cmp is 125.
@9 BV you are valueing 740 acres of land at less than 300cr, @ganesh_bastwadkar correct me if my calculations are wrong.
PSU must be best bet to get benafit from land monetization.
They are yet to declare the Valuation of land, Once they re done with this they will show the value on books. Appx 500+ It should show.
Disc: My views can be baised.
Hoes is getting the valuation done has anything to do with the change in book value? The book value remains the same irrespective.
I have written to the Company secretary to ask when the valuation report will be given, They have acknowledged they are working on this and it will be shared soon.
Here we go, finally we have the value
part of enclosed financial results
Q4 Results_Hemisphere.pdf (6.5 MB)
This means current market cap is at 72% discount, good valuation considering focus on disinvestment
Absolutely current market cap is at 72% discount, and these are given to NBCC for devlopment.
I feel this BV is based only on Company internal valuation and may not ne the figures of valuation report. Market anticipates anything in range of 18k to 21k for their land parcels and 10K cr market cap my be way conservative.
Finally Land Monetization process started for chattarpur land which is clear title land 58 acres at 20-30 per acre.
Where is the land monetization news came? There is no disclosure in stock exchange.