A mid-cap real estate company's stock has turned multibagger by rallying 257.17 per cent in the past one year. It has outperformed sub-index Nifty Realty's 128.70 per cent jump in a year. The company is Sobha Ltd and its scrip settled 2.96 per cent higher at Rs 1,646 on Wednesday. At this price, it was just 2.51 per cent away from its one-year high price of Rs 1,688.35, a level seen earlier this week on April 9.
Brokerage Nuvama Institutional Equities said Sobha recorded best-ever pre-sales in FY24 (2023-24). "FY24 pre-sales at ~6.1msf (up 8 per cent YoY) valued at Rs 6,640 crore (up 28 per cent YoY) were the best ever in Sobha's history. Realisation at Rs 10,922 rose 19 per cent YoY. Sobha's share of pre-sales was at Rs 5,420 crore in FY24 (up 28 per cent YoY)," it stated.
The domestic brokerage has maintained its 'Buy' call on Sobha maintain with a revised target price of Rs 1,876.
"Sobha's overall sales value in Q4 FY24 at Rs 1,500 crore implies an increase of 3 per cent YoY (down 23 per cent QoQ); the company's share of sales value at Rs 1,270 crore was up 5 per cent YoY (down 27 per cent QoQ) in Q4 FY24. Bookings were impacted by a delay in launches with two projects launched only in the last week of Mar-24," Nuvama said.
"Sobha launched four new projects during the quarter spanning total 3.2msf, two in Bengaluru and one each in GIFT City and Kochi. With this, the company launched six projects spanning ~7msf in FY24. The launch pipeline for the next six–eight quarters is currently ~15msf with an aggregate GDV of Rs 10,000 crore. Over the medium term, Sobha plans to launch 15–20msf annually with increased focus on Bengaluru, Hyderabad, the NCR and Pune," it further stated.
Nuvama also mentioned that the company's average price realisation during Q4 FY24 rose 13 per cent YoY (down 4 per cent QoQ) to Rs 11,230/sft. "FY24 realisations at Rs 10,922/sft were up 19 per cent YoY," it added.
On technical charts, support on the counter could be seen at Rs 1,590 level.
"The stock has surged above the recent consolidation, indicating an improved interest building up in the stock. It has been comfortably positioned above the important moving average. It is likely to move towards Rs 1,774. Support is placed at Rs 1,590," said Rupak De, Senior Technical analyst at LKP Securities.
Bourses BSE and NSE have put the securities of Sobha under the long-term ASM (Additional Surveillance Measure) framework. Exchanges put stocks in short-term or long-term ASM frameworks to caution investors about high volatility in share prices.