Stock Analysis: Amid real estate market boom, Sunteck Realty underperforms, down 4% this year; should you still buy?

livemint.com:

Sunteck Realty has emerged as the worst-performing stock in the sector, both over the past year and in the year-to-date (YTD) period of 2024. While the realty sector has seen significant gains, with the Nifty Realty index soaring, Sunteck Realty has shown comparatively modest performance. Over the past year, it has gained 44 percent, and this year, it is down by 4 percent, significantly underperforming the broader realty index.

The stock is up 10 percent in the 2 sessions of April after a 15.75 percent and 1.43 percent drop in March and February, respectively. Meanwhile, it rose 5.3 percent in January this year. The scrip is also trading almost 17 percent away from its 52-week high of ₹511.65, hit on December 4, 2023.

Still, it has jumped 57 percent from its 52-week low of ₹271.25, hit on June 23, 2023. While many real estate companies are experiencing an upswing in sales and revenues, Sunteck Realty has encountered a notable downturn. In the third quarter (October-December), the company reported a substantial decline in revenue, along with losses.

In Q3FY24, Sunteck Realty witnessed a significant decline in revenue, with a staggering 52 percent drop to ₹42.4 crore. Additionally, the company reported an EBITDA loss of ₹15.6 crore, marking a stark contrast from the previous year's EBITDA of ₹18 crore in the same quarter. Furthermore, Sunteck Realty recorded a net loss of ₹9 crore, a notable downturn from the profit of ₹2 crore reported in the corresponding period last year.

These figures reflect a challenging financial performance for the real estate firm compared to the previous year. The counter has experienced a significant correction from ₹500 to ₹380 levels. This suggests a substantial decline in price over a given