Sobha (SOBHA) Q1 24/25 earnings summary

Executive summary

• Q1 FY25 saw four new project launches totaling 3.04 million sq ft, focusing on luxury and high-ticket products in Gurgaon, Chennai, and Coimbatore.

• Achieved second highest-ever quarterly sales value with 562 units sold and sales of INR 1,874 crores, up 28% year-on-year and 24.6% quarter-on-quarter; average realization rose 51.7% year-on-year to Rs. 15,941/sq ft.

• NCR contributed INR 852 crores (45.5% of sales), overtaking Bangalore for the first time.

• Achieved highest ever quarterly collections in Q1 FY25, with total collections of Rs. 1,546 crores, up 14.1% year-over-year.

• Rights issue raised INR 2,000 crores, strengthening capital for expansion.

Financial highlights

• Total income for Q1 FY25 was ₹670 crores; net profit stood at ₹6.4 crores.

• Net operating cash flow reached ₹327 crores, up 68% year-on-year.

• Real estate revenue contributed Rs. 4.75 bn (70.9% of total), contracting & manufacturing Rs. 1.65 bn (24.7%).

• EBITDA margin improved to 12.7% from 10.3% year-over-year.

• PAT was Rs. 61 mn, down 50% year-over-year; PAT margin at 0.9%.

Outlook and guidance

• Targeting at least INR 8,500 crores in sales for FY25, with a diverse inventory mix supporting this goal.

• Expecting to launch at least 6 million sq ft in the remaining quarters, aiming for 9 million sq ft for the year.

• Strong residential launch pipeline of 17.9 million sq ft across 16 projects in seven cities over the next 6-8 quarters.

• Inventory visibility remains strong with 28.16 mn sq ft across ongoing and forthcoming projects.

• Revenue recognition expected to pick up from Q2 as OC delays resolve.