Buy Sobha; target of Rs 2150: Motilal Oswal

Motilal Oswal's research report on Sobha

SOBHA posted flat YoY bookings of INR15b (in line) in 4QFY24, which declined 23% QoQ for the first time since 2QFY22. While the company launched four projects with a saleable area of 3.2msf, two of those large launches came at the end of the quarter, thus limiting its contribution to pre-sales. Volumes declined 9%/19% YoY/QoQ to 1.3msf, while realizations improved 13% YoY to INR11,200/sqft. SOBHA’s share of sales value was down 27% QoQ but rose 5% YoY to INR12.7b.

Outlook

Based on the above, we arrive at a valuation of INR200b or INR2,150/share, indicating an 18% upside potential. Reiterate BUY.