Sobha Limited profit surges 10-fold to Rs 8 crore in Q1

Real estate developer Sobha, on Monday, reported a standalone profit of Rs 8 crore, an increase of 900 per cent, as compared to Rs 80 lakh in the same quarter last year. Its revenue soared nearly 60 per cent to Rs 889 crore as opposed to Rs 571 crore in the same quarter last year.

Sobha quarterly performance 

However, the company’s earnings before interest, taxes, depreciation and amortisation (EBITDA) fell by 8 per cent to Rs 55 crore against Rs 60 crore in the year ago period. Furthermore, the company also witnessed a drop in its margin to 6.2 per cent as compared to 10.5 per cent in the corresponding quarter last year.

Sobha said that it recorded its highest-ever quarterly sales value of Rs 1,465 crore in June quarter, up 27.9 per cent annually.

Jagadish Nangineni, Managing Director, Sobha Limited said, “Company’s strong brand recognition through world class quality delivery continues to drive demand for our homes across all our operating locations in 12 cities of the country. This is reflected in our record sales yet again, with the best price realisation in this quarter, moving above Rs. 10,000 per square feet. mark for the first time. 

Nangineni added, Bangalore, Sobha’s home market, contributed to 54 per cent of total sale value with other markets such as NCR, Kerala, GIFT City etc contributing consistently. 

Meanwhile, the total collections in the first quarter of FY24 stood at Rs 13.55 billion, up 21.3 per cent as compared to the first quarter of FY23.  

The Bengaluru-headquartered company also claims to have reduced its net debt by Rs 70.2 crore in the first quarter of FY24, with Net Debt to Equity ratio falling to 0.63

Founded in 1995, Sobha Limited is a real estate brand offering international quality homes, and commercial and contractual projects. So far, the company has delivered over 129.45 million square feet of developable area across 27 Indian cities. 

It competes with Godrej & Boyce, Prestige Estates Projects, and DLF Limited among others in this segment. 

The stock of Sobha Limited settled at Rs 604 apiece, up over 1.5 per cent.

Real estate market size 

By 2024, the real estate market will grow to Rs 65,000 crore ($9.30 billion) from Rs 12,000 crore ($1.72 billion) in 2019. The real estate sector in India is expected to reach $1 trillion in market size by 2030, up from $200 billion in 2021, and will be contributing 13 per cent to the country’s GDP by 2025, according to India Brand Equity Foundation (IBEF).