Sobha Q4 Results Review - Operating Performance Inline; Gearing Up For A Strong FY25: Motilal Oswal

Motilal Oswal Report

Sobha Ltd. posted flat YoY bookings of Rs 15 billion (inline) in Q4 FY24, which declined 23% QoQ for the first time since Q2 FY22. While the company launched four projects with a saleable area of 3.2 msf, 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 1.3 msf, while realisations improved 13% YoY to Rs 11,200/sqft. Sobha’s share of sales value was down 27% QoQ but rose 5% YoY to Rs 12.7 billion.

During FY24, its pre-sales stood at Rs 66 billion (up 28% YoY), largely driven by a 19% improvement in realization to INR11,000/sqft and a 7% increase in volumes.

Kerala, GIFT City, and Bengaluru reported a strong growth in FY24, while the lack of significant inventory led to a decline in pre-sales at Gurugram. Contribution from Bengaluru sustained at over 65% in Q4 FY24.

Total collections were up 5% YoY to Rs 15 billion, which led to a 10% YoY jump in oprrating cash flow to Rs 4 billion. Sobha’s spending on land, at Rs 2.3 billion, increased during the quarter. Surplus cash flows of Rs 0.8 billion were utilized to repay debt, which, at the end of FY24, stood at Rs 12.6 billion, or 0.5 times of equity.

P&L performance: Revenue declined 37% YoY to Rs 7.6 billion (38% below our estimate) due to lower completions. Ebitda declined 46% YoY to Rs 0.6 billion due to a 150 bp drop in margins. Residential Ebit margin contracted 260 bp YoY, while contractual business margin recovered to 13%.

Net profit came in at Rs 70 million, down 86% YoY. FY24 PAT halved to Rs 0.5 million.

Click on the attachment to read the full report:

DISCLAIMER

This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.

Users have no license to copy, modify, or distribute the content without permission of the Original Owner.