Sobha Limited (SOBHA) AI Stock Analysis

• Market Cap: ₹145.30B
• Dividend Yield: 0.2%
• Average Volume (3M): 9.14K
• Price to Earnings (P/E): 252.9
• Beta (1Y): 1.87
• Revenue Growth: 56.34%
• EPS Growth: 152.41%
• Country: IN
• Employees: 3,814
• Sector: Real Estate
• Sector Strength: 53
• Industry: Real Estate - Development
• EPS (TTM): 1.40
• Shares Outstanding: 106,953,835
• 10 Day Avg. Volume: 14,425
• 30 Day Avg. Volume: 9,144
• PEG Ratio: 1.64
• Price to Book (P/B): 2.69
• Price to Sales (P/S): 3.04
• P/FCF Ratio: -424.37
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): 27.55
• Revenue Forecast (FY): ₹48.42B

• Rating: 58 Neutral
• Price Target: ₹1,389.00 ▼(-6.91% Downside)
• Action: Reiterated Date: 11/22/25
• Date: Action: Reiterated 11/22/25

Sobha Limited's overall stock score is primarily influenced by its financial performance, which shows strong cash flow generation but inconsistent revenue growth and declining profitability. The technical analysis indicates a bearish trend, while the high P/E ratio suggests overvaluation. The lack of earnings call data and corporate events limits further insights.

Positive Factors

Operational Cash Generation

Sobha's consistent ability to convert operations into cash provides durable funding for project execution and reduces reliance on external financing. Strong OCF supports project continuity, enables reinvestment, and cushions the company during cyclical downturns in real estate demand.

Improved Leverage Management

An improving debt-to-equity profile indicates strengthening balance-sheet resilience. Lower leverage enhances financial flexibility for land acquisitions and project starts, lowers refinancing risk, and provides headroom to absorb cash-flow volatility over the medium term.

In-house Execution Capability

Sobha's vertically integrated model and strong in-house design, engineering and construction capabilities afford control over costs, quality and timelines. This structural advantage can sustain margins, speed handovers, and differentiate product delivery across multiple cycles.

Negative Factors

Declining Net Profit Margins

A sustained decline in net margins erodes long-term profitability and return on capital. For a developer, margin pressure reduces retained earnings available for new projects, weakens capacity to fund growth internally, and magnifies sensitivity to input-cost inflation.

Volatile Free Cash Flow

Fluctuating and recently negative FCF signals potential liquidity stress if project collections or handovers slip. Variable FCF can force reliance on external debt or partner funding for project completion, raising execution and refinancing risk over the medium term.

Revenue Sensitivity to Project Cycle & Financing

Revenue and collections are structurally tied to sales velocity, project mix and mortgage availability. Adverse moves in interest rates or slower premium segment demand can depress sales and delay recognition, making top-line recovery and cash conversion cyclical and uncertain.

Sobha Limited Business Overview & Revenue Model

Company Description

Sobha Limited engages in the construction, development, sale, management, and operation of residential and commercial projects primarily in India. It operates through two segments, Real Estate, and Contractual and Manufacturing. The company's residential projects include luxury and super luxury apartments, presidential apartments, villas, row houses, plotted developments, and aspirational homes; and contractual projects for corporates comprise offices, convention centers, software development blocks, multiplex theatres, hostel facilities, hotels, guest houses, food courts, restaurants, research centers, club houses, and factory buildings. It also manufactures corporate and residential interiors, and solid wood veneer and MDF panelled doors; and panelling, partitions, tables, and loose furniture like chairs, sofas, cots and modular kitchens, etc. In addition, the company manufactures and markets aluminum doors, windows, structural glazing products, MS and SS metal fabrications, aluminum composite panels and SS claddings, and pre-engineered buildings; and undertakes other architectural metal works. Further, it manufactures concrete products, such as concrete blocks, pavers, kerbs, water drainage channels, paving slabs, and landscape products; and mattresses under the Restoplus brand. The company was formerly known as Sobha Developers Limited and changed its name to Sobha Limited in August 2014. Sobha Limited was incorporated in 1995 and is headquartered in Bengaluru, India.

How the Company Makes Money

Sobha Limited generates revenue through multiple streams primarily derived from the sale of residential and commercial properties. The company develops and sells high-end residential projects, including luxury apartments and villas, which constitute a significant portion of its income. Additionally, Sobha engages in the construction of commercial properties, such as office spaces and retail outlets, contributing to its revenue. The company also derives income from project management and construction contracts for third-party clients, further diversifying its revenue base. Sobha has established strategic partnerships with various stakeholders, including government bodies and private developers, which facilitate its project execution and expand its market reach. Overall, the company’s emphasis on quality construction, brand reputation, and strategic location selection plays a crucial role in its financial performance.

Sobha Limited Financial Statement Overview

Summary

Sobha Limited shows strong operational cash generation and improved leverage management. However, inconsistent revenue growth and declining net profit margins raise concerns about profitability. The variability in free cash flow indicates potential liquidity issues.

Income Statement

Sobha Limited's income statement shows a mixed performance. The gross profit margin has been relatively stable, but there is a significant decline in net profit margin, indicating some pressure on profitability. Revenue growth has been inconsistent with a notable dip in the latest year. The EBIT and EBITDA margins have shown some resilience but are still below industry benchmarks, suggesting room for improvement.

Balance Sheet

The balance sheet reveals a moderate financial health. The debt-to-equity ratio has improved over the years, indicating better leverage management. Return on equity remains modest, highlighting potential for maximizing shareholder returns. The equity ratio suggests a reasonable level of financial stability, but the company still carries significant liabilities.

Cash Flow

Sobha Limited's cash flow statement highlights strong operational cash generation, with operating cash flow improving considerably. Free cash flow, however, has fluctuated, showing a negative figure in the latest year, which might concern investors. The operating cash flow to net income ratio suggests efficient cash management, but the free cash flow to net income ratio indicates potential liquidity challenges.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	42.50B	40.39B	30.97B	33.10B	25.61B	21.10B
Gross Profit	13.77B	13.33B	11.53B	11.78B	11.22B	11.53B
EBITDA	2.51B	2.87B	2.75B	3.70B	5.27B	6.69B
Net Income	1.02B	946.86M	491.13M	1.04B	1.73B	622.76M
Balance Sheet
Total Assets	0.00	172.21B	136.96B	125.76B	115.42B	112.10B
Cash, Cash Equivalents and Short-Term Investments	1.27B	18.09B	705.48M	9.23B	3.28B	4.03B
Total Debt	0.00	11.83B	19.40B	20.27B	25.29B	30.52B
Total Liabilities	-45.61B	126.61B	111.82B	100.81B	91.19B	87.82B
Stockholders Equity	45.61B	45.61B	25.14B	24.95B	24.23B	24.28B
Cash Flow
Free Cash Flow	0.00	-288.88M	5.23B	10.27B	8.01B	5.71B
Operating Cash Flow	0.00	1.02B	6.47B	11.50B	8.21B	6.13B
Investing Cash Flow	0.00	-12.53B	-4.75B	-2.37B	382.70M	-331.86M
Financing Cash Flow	0.00	11.63B	-3.38B	-7.73B	-8.84B	-4.83B

Sobha Limited Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1492.15
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:SOBHA, the sentiment is Negative. The current price of 1492.15 is above the 20-day moving average (MA) of 1481.03, above the 50-day MA of 1475.60, and below the 200-day MA of 1514.35, indicating a bearish trend. The MACD of -25.00 indicates Positive momentum. The RSI at 29.64 is Positive, neither overbought nor oversold. The STOCH value of 17.75 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IN:SOBHA.

Sobha Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ANANTRAJ	66 Neutral	₹183.29B	33.05	―	0.13%	26.32%	41.66%
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
SOBHA	58 Neutral	₹145.30B	252.91	―	0.20%	56.34%	152.41%
MAHLIFE	56 Neutral	₹74.34B	19.33	―	0.70%	-22.59%	17.35%
SIGNATURE	53 Neutral	₹135.05B	-87.53	―	―	20.05%	43.45%
PURVA	46 Neutral	₹45.39B	23.64	―	―	-23.33%	-512.89%