Sobha jumps after sales volume rises 38% YoY in Q1

Sobha surged 6.76% to Rs 524.10 after the company's total new sales increased by 37.69% to 895,539 square feet in Q1 FY22 from 650,400 square feet in Q1 FY21.

Total sales value rose 40.02% to Rs 682.9 crore in Q1 FY22 from Rs 487.7 crore in Q1 FY21. Sobha's share in the sales values at Rs 570.9 crore in Q1 FY22, was higher by 45.23% as compared with Rs 393.1 crore in Q1 FY21.

Total average price realization improved by 1.71% to Rs 7,626 per square feet in Q1 FY22 from Rs 7,498 per square feet in Q1 FY21.

The company said that Bengaluru sales volume have grown by 37% as compared to Ql-21 despite stringent impact of covid second wave during the quarter.

It further said that during the quarter, Gurugram, Kochi, Thrissur, Pune and GIFT CITY have done quite well as compared to Q1 FY21, despite impact of COVID second wave. The company's average cost of borrowing has further come down during the quarter.

Sobha said that the residential real estate sector has been showing encouraging signs of structural revival in the recent past with better preparedness and having already adapted to digital tools. The impact of the second wave was sudden, severe, prolonged, and visible in major metro cities, also in cities where Sabha operates and in rural areas. The company not only withstand the pressures of the pandemic but was also able to maintain the momentum gained post the impact of the first wave of the pandemic.

"Covid has changed certain things. There have been some positive disruptions especially for the services sector. Large number of people are getting used to concepts like - work from home, work near home, digitally enabled spaces, and larger living spaces. Suddenly we see our lives centering around our own living spaces.

This new reset is going to stay for long. The role of organized players in real estate sector will become more significant. Those who have been delivering high quality homes, in time and with transparency will become more important.

The housing sector is witnessing better affordability coupled with low interest rate regime, promotion of home loans by the banks and an overall consolidation. These have helped push demand for housing," the real estate company said in a regulatory filing.

Sobha further said: "Economic activities have started opening, and it is expected that normalcy will return in the second half of FY-2021-22. However, we cannot completely rule out uncertainties and likely impact caused by second wave of the pandemic. We are also unsure about how and when the third wave will strike and with what consequences. However, we have planned new launches of 13.35 million square feet, and we intend to take it ahead."

Sobha is a real estate player primarily focused on residential and contractual projects.

The company's consolidated net profit slumped 64.7% to Rs 17.90 crore on 39.2% rise in net sales to Rs 553.40 crore in Q4 March 2021 over Q4 March 2020.

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