Stocks of Sobha Limited closed today at Rs 516, up around 2 percent as compared to the previous closing price of Rs 506.95. In the last month, the scrip has gained nearly 10.3 percent ranging from Rs 467.75 to the current levels.
Such a movement is observed after the company, through a regulatory filing with the exchange, announced its Q4 as well as Annual results for FY2022-23. Details of the same are mentioned later on in the report.
In addition to the above, the company’s Board also recommended a Final Dividend of Rs 3 (30 percent of its Face Value of Rs 10) for the same financial year.
Engaged in the real estate business, Sobha Limited is involved in the process of developing and constructing properties. It operates in two segments: The ‘Real Estate’ segment and the ‘Contractual & Manufacturing’ segment.
The former is into the development, management, and operation of all or any part of townships and the latter develops commercial premises also including manufacturing activities related to glazing, metal works, interiors, etc.
Having a glance at the sequential financials of the company, the operating revenues generated as well as the Profit After Tax (PAT) numbers have gone up with the former increasing from Rs 868 crores during the December 2022 quarter to Rs 1,210 crores in the March 2023 quarter and PAT figures, during the same time period, increased from Rs 32 crores to Rs 49 crores representing an increase of 53 percent.
On a YoY basis, the above-mentioned metrics have shown movements in opposing directions with the operating revenues, on one hand, rising from Rs 2,561 crores during FY21-22 to Rs 3,310 crores in FY22-23 and the PAT figures, on the other hand, moving down from Rs 173 crores to Rs 104 crores.
Having a positive outlook for the company, ICICI Securities gave a ‘Buy’ recommendation for the stock with a target price of Rs 891 indicating an upside of 73 percent as compared to the current price levels.
The rationale behind providing such a recommendation is the company’s on-track growth of sales booking, operational effectiveness in the Bengaluru markets, etc.
As per the data available for the March 2023 quarter, Promoters of the company hold a 52.26 percent stake, and Foreign Institutional Investors hold a 13.76 percent stake in the company.
Written by Amit Madnani
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