Sobha Ltd: Analyst Reaffirms 'Buy' Rating, Unchanged Rs 1840 Target

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AuthorAnanya Iyer|Published at:
Sobha Ltd: Analyst Reaffirms 'Buy' Rating, Unchanged Rs 1840 Target
Overview

Choice Institutional Equities has reaffirmed its 'BUY' rating on Sobha Ltd, setting an unchanged target price of INR 1,840 per share. The real estate developer's strong performance stems from robust project deliveries, boosting revenue, profit, and margins. With a promising launch pipeline and strengthened balance sheet, management anticipates sustained pre-sales and collection growth, projecting 15-20% YoY growth in FY27E.

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Choice Equities Sticks to 'Buy' on Sobha Ltd

Choice Institutional Equities has reaffirmed its 'BUY' rating on Sobha Ltd, keeping the target price unchanged at INR 1,840 per share. The real estate developer's strong operational execution, shown by the delivery of 1.76 million square feet of completed projects, has boosted revenue, profit, and margins.

Strong Pipeline and Outlook Point to Growth

Management's outlook remains optimistic, supported by a solid launch pipeline and a strengthened balance sheet. Sobha Ltd expects to maintain strong pre-sales and collection figures. Projections show a 15-20% year-over-year growth in pre-sales for FY27E, building on a record INR 81.36 billion achieved in FY26. This pipeline includes nine recently launched projects covering approximately 6.04 million square feet across six cities in FY26.

Financial Outlook and Land Assets

Sobha anticipates generating net cash flows of INR 95.6 billion over the next four to five years from its current and completed projects. Future developments totaling 20.67 million square feet are expected to generate pre-sales of INR 271.65 billion. The 'BUY' rating is underpinned by the strength of its residential business, growth potential in the commercial segment, a stable contract and manufacturing division, and the company's substantial land bank.

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