SOBHA

SOBHA ended FY25 with 6% lower presales YoY due to approval delays, but the company has a strong project pipeline, supported by its extensive land bank. SOBHA is expected to post a 39% CAGR in presales over FY25-27E, further boosted by its entry into MMR. The recent fundraise through the rights issue has alleviated debt concerns, shifting the company’s focus to driving growth by accelerating BD in new geographies. Outlook SOBHA continues to provide strong growth visibility by unlocking its vast land reserves. Additionally, the strong cash flows will enable the company to focus on new land acquisitions, which will further enhance its growth pipeline. We incorporate the updated launch pipeline and new projects acquired during the year. The ongoing and upcoming projects are valued at INR 75b after deducting future land acquisitions and adjusting for incremental BD during the year. Our land reserve estimated for SOBHA is 165msf and is valued at INR 87b assuming 25-75 years of monetization. We reiterate our BUY rating on the stock with a revised TP of INR 1,803 (previously INR 1,714), indicating a 37% upside potential.