 "Sobha delivers strong HI sales but upcoming festive season is real acid test")
Realty firm Sobha Developers today said the company’s sales bookings rose by 23 percent to Rs 1,235 crore during the first half of this fiscal on account of increase in volume and realisation.
The company had sold properties worth Rs 1,006.8 crore in the corresponding period of previous financial year.
Shares of the realty major were trading up 12.79 percent at Rs 323.50 following the BSE filing.
However, the real est would be the sales figure in the upcoming festive months.
[caption id=“attachment_1117077” align=“alignleft” width=“380”]  AFP[/caption]
“Upcoming festive season which shall witness the real paternity test as buying property is a 6-months legwork and drop in footfall usually reflects with a 2 quarter lag,” said Karvy in a research report.
Brokerage Morgan Stanley is bullish on the stock in view of its good operational scale up, market diversification, end-to-end capability and reasonable valuations.
According to Morgan Stanley, Sobha could benefit from long-term growth visibility, which is closely linked to GDP growth and the continuing trends toward urbanization and nuclear families.
Even ICRA has upgraded the long-term rating of the company to ‘A-’ from ‘BBB+’.
In a filing with BSE, the Bangalore-based developer said it sold 1.92 million sq ft area during April-September period of 2013-14, up 8 percent from 1.78 million sq ft in the same period of last fiscal.
Impact Shorts
More ShortsThe average price realisation improved to Rs 6,420 per sq ft from Rs 5,651 per sq ft during the period under review.
Sobha attributed the higher sales bookings to the company’s strategy to diversify into newer markets backed by a consistent launch pipeline.
In the quarter ended September 30, the company sold one million sq ft of new space valued at Rs 632 crore.
During the entire last financial year, Sobha had sold 3.75 million sq ft area for Rs 2,214.5 crore.
“At the half way mark, despite the existing macroeconomic uncertainties of GDP growth, interest rates and inflation, the company remains hopeful in achieving its guidance for the current fiscal,” the filing said.
Besides Bangalore, the company has projects in NCR, Chennai, Pune, Thrissur, Coimbatore, Kozhikode and Mysore.
With inputs from PTI
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