Proptech companies are taking the real estate industry by storm, capitalizing on innovative technologies and bespoke solutions amid a surge in digitization preferences among consumers. Aurum PropTech (AURUM) stands out as a trailblazer in this landscape, heralding a new era of transformation in India’s burgeoning proptech sector, according to brokerage firm DART.
DART has initiated coverage on Aurum with a bullish ‘BUY’ rating, setting a DCF-based target price of ₹250, indicating a potential upside of over 68%. This optimistic outlook is underpinned by Aurum’s robust market positioning, extensive portfolio of cutting-edge platforms/products, and its holistic approach to addressing consumer needs throughout the property lifecycle.
Anticipating a revenue CAGR of 46% over FY24-FY27E and PAT profitability by FY27E, DART foresees Aurum’s meteoric rise driven by diverse and robust revenue streams. Products like HelloWorld and Nestaway, focusing on co-living and property management, are poised for impressive growth, with expected CAGRs of 43% and 64%, respectively.
Moreover, Aurum’s foray into fractional ownership, asset management, property management software, and home valuation via ventures like WiseX, Integrow, The House Monk, and Aurum InstaHome is expected to further fuel its growth trajectory.
Unlike its peers, Aurum has successfully navigated the rental space, achieving operational profits and positive unit economics. It has demonstrated a knack for turning around businesses, evident in milestones like reaching break-even in Nestaway within three quarters of acquisition and substantial revenue growth in HelloWorld.
DART is optimistic about Aurum’s EBITDA and margin prospects, expecting a sharp improvement in operating margins from -32% in FY24 to profitability by FY27. The brokerage envisions Aurum reporting positive PAT by FY27E, marking a significant turnaround from the loss incurred in FY24.
While Aurum has started generating positive operating cash flow since FY24, investments related to asset acquisitions will continue to impact free cash flow generation in the near term. However, DART expects Aurum to achieve positive free cash flow generation from FY27 onwards.
In conclusion, Aurum’s strategic focus on growth, unit economics, and operational excellence positions it as a frontrunner in the proptech arena, poised to capture significant market share and investor attention in the coming years.