Buy Phoenix Mills; target of Rs 2044: Motilal Oswal

Motilal Oswal's research report on Phoenix Mills

During FY15-25, PHNX’s retail portfolio witnessed an 11% CAGR in consumption, supported by ~7% like-for-like growth in the existing malls and the opening of new malls in Lucknow, Indore, Ahmedabad, Pune, and Bengaluru. Additionally, retail rental income clocked a similar 12% CAGR during this period, mirroring the consumption growth. We anticipate this positive growth trend to continue, primarily driven by the ramp-up of new malls. As of 1QFY26, trading occupancy stood at 89%, down from 91% in Mar’25. Flat or declining consumption in certain mature assets is linked to ongoing revamps and tenant churn. In Bengaluru, approximately 10% of the leasable area is currently under fit-outs or being repurposed from hypermarkets to high-performing fashion anchors. Pune is undergoing a similar transformation, replacing outdated anchors and restaurants with newer, more relevant offerings. Management remains optimistic about the long-term performance, projecting strong growth from FY27 onward once the revamps are completed.

Outlook

We upgrade our rating to BUY with a revised TP of INR2,044 (earlier INR1,673), implying upside potential of 35%.

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Phoenix Mills - 02092025 - moti