Sobha Developers reports higher sales in Q2 FY13: Religare

BANGALORE: Sobha Developers reported strong Q2FY13 sales volumes of 0.95msf up 13% quarter on quarter aided by higher sales volumes in Thrissur and Bangalore, with new project launches seeing higher sales,” says Religare Institutional Equity in a recent report on Sobha Developers.

“For Q2 FY13, we estimate revenue and profit after tax (PAT) growth of 5% to 7% q-o-q led by first-time revenue recognition for some projects , including Sobha Garnet and the next phase of Sobha City. We would see PAT growth once the International City project (Gurgaon) reaches its revenue recognition threshold in H2FY13,” says Arun Aggarwal from Religare Institutional Equity in the report.

Sobha’s net debt is expected increase q-o-q due dividend payouts of Rs 0.57bn, a pick-up in construction spends, and investments in land acquisitions. “While the operational environment remains good for Sobha, the same is already priced in and we see limited scope for outperformance from here on,” mentions the report.