Sobha Q2 net dips 35% to Rs 39 cr on slow realty sales

The revenue declined 33%

Realty player Sobha Ltd said second quarter profits declined 34.8 per cent to Rs 38.8 crore as sales of new apartments reduced in a slowing real estate market. Revenue declined 32.8 per cent for the quarter.

"It has been a difficult period for the real estate sector and the overall demand is yet to show a clear upward trend," said J C Sharma, vice chairman of Sobha.

"During the quarter, the contribution from contractual and manufacturing operations was relatively higher. However, the sales in real estate projects which have reached the revenue recognition threshold were lower than expected, resulting in a low-key financial performance. We believe that, with the Sobha Dream Acres Project qualifying for revenue recognition during this financial year, the next half of the fiscal should see an improvement in the financial performance," he said

Sobha hopes the interest rate cuts from banks and FDI norms in construction sector would revive the real estate sector.