Sobha Limited (SOBHA) AI Stock Analysis

• Market Cap: ₹160.12B
• Dividend Yield: 0.2%
• Average Volume (3M): 11.47K
• Price to Earnings (P/E): 154.0
• Beta (1Y): 1.88
• Revenue Growth: 50.22%
• EPS Growth: 118.84%
• Country: IN
• Employees: 3,814
• Sector: Real Estate
• Sector Strength: 52
• Industry: Real Estate - Development
• EPS (TTM): 1.30
• Shares Outstanding: 106,953,835
• 10 Day Avg. Volume: 18,470
• 30 Day Avg. Volume: 11,472
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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: ₹1,664.00
• Price Target Upside: 7.06% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 60 Neutral
• Price Target: ₹1,572.00 ▲(1.14% Upside)

Sobha Limited's stock score is primarily impacted by its financial performance, which shows strong cash flow generation but faces profitability challenges. The technical analysis indicates bearish momentum, and the high P/E ratio suggests overvaluation. These factors collectively result in a moderate stock score.

Positive Factors

Business Model Diversification

Sobha's diversified revenue streams from both real estate development and contractual services provide financial stability and reduce dependency on a single market segment.

Operational Cash Generation

Strong operational cash generation indicates efficient cash management and the ability to fund operations and growth initiatives internally, enhancing long-term sustainability.

Improving Leverage

Improved leverage management reduces financial risk and interest burden, providing more flexibility for future investments and strategic initiatives.

Negative Factors

Inconsistent Revenue Growth

Inconsistent revenue growth can hinder long-term planning and investment, impacting the company's ability to scale and compete effectively in the market.

Declining Net Profit Margins

Declining net profit margins suggest cost pressures or pricing challenges, which could affect the company's ability to generate sustainable profits over time.

Free Cash Flow Variability

Variability in free cash flow can signal potential liquidity issues, limiting the company's ability to invest in growth opportunities or weather economic downturns.

Sobha Limited Business Overview & Revenue Model

Company Description

Sobha Limited, established in 1995, is one of India's leading real estate developers, with a strong presence in both residential and commercial construction. Headquartered in Bangalore, the company is renowned for its commitment to quality and excellence in the real estate sector. Sobha specializes in developing luxury residential apartments, villas, plotted developments, and commercial office spaces. The company also operates a robust contractual business, providing interior solutions and construction services to various clients across India and the Middle East.

How the Company Makes Money

Sobha Limited generates revenue primarily through the sale and lease of residential and commercial properties. The company engages in both the development and sale of luxury residential projects, which include apartments, villas, and plots. Additionally, Sobha earns income from its contractual business, which involves providing turnkey construction services and interior solutions to third-party clients. This segment contributes significantly to the company's revenue, as it includes prestigious projects for corporates and government entities. Sobha's diversified business model, combining real estate development with contractual services, allows it to capitalize on multiple revenue streams and maintain financial stability. The company also benefits from strategic partnerships and joint ventures, which enhance its project portfolio and market reach.

Sobha Limited Financial Statement Overview

Summary

Sobha Limited shows strengths in cash flow generation and improving leverage, but faces challenges with inconsistent revenue growth and declining net profit margins. The solid equity base is offset by variability in free cash flow, indicating 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	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	35.61B	40.39B	30.97B	32.75B	25.56B	21.07B
Gross Profit	11.62B	8.78B	11.53B	12.08B	11.26B	11.59B
EBITDA	3.55B	4.18B	3.67B	4.31B	5.95B	7.56B
Net Income	608.61M	946.86M	491.13M	1.04B	1.73B	622.76M
Balance Sheet
Total Assets	0.00	172.21B	136.96B	125.76B	114.10B	112.10B
Cash, Cash Equivalents and Short-Term Investments	13.00B	18.09B	1.31B	9.23B	3.28B	4.03B
Total Debt	0.00	11.83B	19.92B	20.27B	25.29B	33.22B
Total Liabilities	-35.06B	126.61B	111.82B	100.81B	89.00B	87.82B
Stockholders Equity	35.06B	45.61B	25.14B	24.95B	25.11B	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: Positive
• Last Price: 1554.30
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:SOBHA, the sentiment is Positive. The current price of 1554.3 is above the 20-day moving average (MA) of 1477.19, above the 50-day MA of 1536.50, and above the 200-day MA of 1413.82, indicating a neutral trend. The MACD of -26.38 indicates Negative momentum. The RSI at 51.16 is Neutral, neither overbought nor oversold. The STOCH value of 51.84 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IN:SOBHA.

Sobha Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ANANTRAJ	64 Neutral	₹182.82B	39.63		0.14%	33.04%	50.76%
SOBHA	60 Neutral	₹160.12B	154.00		0.20%	50.22%	118.84%
Sector *	53 Neutral	$1.28B	3.13	-6.08%	5.54%	-8.21%	-81.31%
BIRET	―	₹204.77B	88.22		―	―	―
SIGNATURE	54 Neutral	₹158.38B	123.02		―	100.84%	363.67%
MAHLIFE	48 Neutral	₹79.47B	70.60		0.75%	-28.49%	-22.69%
PURVA	47 Neutral	₹67.88B	80.66		2.19%	-24.76%	-449.05%

Sobha Limited Corporate Events

Sobha Limited’s Credit Rating Outlook Upgraded to Positive

Sobha Limited announced an update on its credit rating by India Ratings & Research, which has revised the company’s long-term issuer rating outlook from ‘Stable’ to ‘Positive’. This change reflects a positive shift in the company’s financial stability and could enhance its market position, potentially benefiting stakeholders by increasing investor confidence.