Updated: Feb 11, 2019
When I attended the AGM of Inland Homes (INL.L) in early December what I saw in the housebuilding and brownfield property development company’s presentation confirmed my enthusiasm. It was then, with the shares at just 47p, that I napped them as my Ace Stock for 2019.
I have to admit now that I am a very big fan of boss Stephen Wicks and his finance director Nish Malde. I followed them after their first company, Country and Metropolitan Homes, went public in 1999 at 68p per share and all the way up to 2005 when it was taken over by Remo Dipre’s Gladedale group, for 300p per share. That made their shareholders a very handsome profit in the process.
Almost immediately the duo set up Inland Homes and it went public in 2007. Then the share price was 50p and the company was capitalised at £81m. However, the financial collapse and subsequent sector recovery has created up, then down and then up again movements. The market fall-off late last year saw the shares falling from a near 75p High to their Low of 47p.
Inland Homes acquires brownfield land in the South and South-East of England principally for residentially led development schemes. The business then enhances the land value by obtaining planning permission, before building open market and affordable homes or selling surplus consented land to other developers to generate cash.
Land owned or controlled now stands at approximately 7,000 plots, of which some 1,700 are consented, with a further approximately 2,000 in the planning pipeline. It also has 750 plots where terms have been agreed, including a major regeneration scheme for 325 units in East London.
This company has ‘legs’, its potential is excellent and its management is more than capable of delivering the best profit that it can achieve.
For the year to end June 2018 the company reported: EPRA NAV per share (undiluted) up 6.3% to 102.28p (2017: 96.22p); a 9.0% increase in net asset value to £142.4m (2017: £130.6m); profit before tax of £19.3m (2017: £18.1m, before a revaluation uplift of £1.5m); and a 29.2% increase in proposed final dividend to 1.55p (2017: 1.2p) per share.
As far as I am concerned I feel that the shares of Inland Homes offer incredible value to investors looking for capital growth. Now capitalised at just £130m I am convinced that has very strong takeover prospects.
At the current levels it is a totally attractive proposition to both investors and predators. I see the shares, now around 53p, rising to 60p quite soon and then back above June 2018 level of around 75p.