Sobha Tumbles 4% Post Q3 Results, Analysts Firmly Bullish Long-Term

REAL-ESTATE

Overview

Sobha shares slid nearly 4% after the real estate developer reported a significant year-on-year drop in net profit and revenue for the December quarter. Net profit fell 29% to ₹15.4 crore, and revenue decreased 21.7% to ₹983.1 crore. Despite the quarterly downturn, brokerages like JM Financial and Motilal Oswal remain bullish, reiterating 'Buy' ratings and pointing to strong pre-sales momentum and substantial long-term growth prospects fueled by an extensive land bank.

Quarterly Performance Mired by Declines

Sobha Limited saw its stock price dip 3.9% on the BSE, reaching an intra-day low of ₹1,466.10. This market reaction followed the release of its third-quarter financial results for FY26. The company posted a net profit of ₹15.4 crore, a substantial 29% decrease from ₹21.7 crore in the same period last year. Revenue from operations also contracted by 21.7% year-on-year, falling to ₹983.1 crore from ₹1,256.9 crore.

Earnings Before Interest, Tax, Depreciation, and Amortisation (EBITDA) stood at ₹78.5 crore, down from ₹100 crore a year prior. The EBITDA margin remained flat at 8%. Management attributed the weaker quarterly profitability to procedural delays in securing Occupancy Certificates (OCs), which temporarily moderated project completions. However, the company expressed confidence in accelerating future completions to drive P&L improvements. Sobha highlighted its robust balance sheet, with gross debt at ₹910 crore and negative net debt, positioning it to capitalize on market opportunities.

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