Record Q1 sets the stage for FY27 ahead
Sobha’s (SDL) Q1FY27 delivered its highest-ever quarterly operational performance, with total sales value of INR 36.5bn, up 76% YoY and 79% QoQ, on the back of strong response to key new launches in Gurugram and Hoskote, Bengaluru. Sales area rose 62% YoY to 2.34msf, reflecting continued high ownership across projects. ASP improved to INR 15,655psf, up ~9% YoY pointing to sustained pricing power alongside volume growth. Bengaluru anchored the quarter with its strongest-ever sales at INR 20.7bn (56.5% of total), led by robust demand for Sobha OneWorld, Hoskote (we expect INR 18bn sales) and Sacred Grove by the Lake, while NCR contributed INR 13.8bn (37.9%) aided by the launch of Sobha Crescent in Gurgaon. On the launch front, SDL introduced 6.8msf of new saleable area across three projects in Bengaluru and Gurgaon, including the large-format SOBHA One World with an estimated sales potential of over INR 75bn. Execution remained steady, with 671 homes completed across 8 projects (1.08msf). Overall, the quarter has reinforced the demand resilience, brand-led pricing strength, and execution consistency that have underpinned SDL’s recent growth trajectory, setting a strong base heading into the rest of FY27. Consequently, while the broader Bengaluru market may see a slowdown in investor-driven projects, SDL is well-positioned to continue its growth trajectory, leveraging its brand equity to dominate the premium, end- user segment. Given the robust launch pipeline, strong balance sheet, and stable cash flows, we maintain BUY with a TP of INR 1,930/sh.
