Published on 25/11/2020 12:52:33 PM | Source: Motilal Oswal Financial Services Ltd

Update On Sobha Ltd By Motilal Oswal

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Green shoots visible in residential sales pickup

Sobha Ltd. released its quarterly update highlighting key business numbers for 2QFY21:

* Operational performance: 2QFY21 pre-sales volume was down 14% YoY to 0.89msf. Average price realization increased 18% YoY to INR7,737psf, driving 1% YoY pre-sales value growth to INR6.9b. On a sequential basis, sales volume/value grew 37%/41% QoQ, largely on account of a lower base quarter. Despite the extended lockdown in Jul’20 in Bengaluru, subdued economic environment and lack of any new launches, there was sequential pickup in the sales performance of the company.


* Core market of Sobha: Sobha’s key market i.e. Bengaluru (~60% of pre-sales volume in 2QFY21) remained subdued for the third consecutive quarter with a decline of 31% YoY in pre-sales volume in 2QFY21 (+11% QoQ). Sobha’s share of sales value was down 5% YoY (+35% QoQ) to INR5.3b.


* Other markets: NCR and Pune saw strong pre-sales volume growth of 131% YoY (+168% QoQ) and 18% YoY (+60% QoQ), respectively. Other Tier-II South Indian markets like Thrissur and Kochi saw robust sales volume growth, which enabled them to grab higher share in the overall sales volume.


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