Bangalore-based real estate developer SOBHA Limited has witnessed a 52% increase in quarterly sales YoY, with high sales numbers and solid operational performance, resulting in sales of Rs. 11.45 billion and a sales volume of 1.36 mn sqft. (up 67.7% YoY), according to the audited financial results announced by the company for the first quarter of the financial year 2022-23. Despite challenges due to the RBI’s repo rate hike and higher input costs, the company recorded its highest ever quarterly sales performance since inception, driven by demand across product segments, which continued to be dominated by Bengaluru. Furthermore, the company has generated Rs. 2.27 billion free cash flow and a corresponding debt reduction.
The developer was able to pass cost increases resulting from the rise in input costs to customers who have been investing in the luxury segment and larger homes. It also launched nearly two million sq ft of projects. In total, the developer’s launch pipeline is at about 12 mn sq ft.
Close monitoring of operations has helped the company garner Rs. 2.72 billion of free cash with continued debt reduction by 10% QOQ, making the debt equity ratio lower to 0.84. Cash flow from the real estate business boosted 50% YOY to Rs. 1.87 billion. The Total Income of the company was Rs. 4.80 billion with Real Estate Revenues contributing Rs. 3.67 billion whereas the Contractual and Manufacturing segment generated revenues worth Rs. 1.08 billion.
Jagadish Nangineni, managing director, SOBHA Limited, said, “We have had consecutive four remarkable sales quarters in an inflationary environment boosted by demand from discerning customers who desire the best quality homes. This showcases strong customer confidence, improved affordability and increased aspiration for high quality homes in integrated communities. Our future launches will continue to see traction as the demand for the luxury segment and larger houses takes front seat. Our focus on operational excellence has resulted in superior cash flows resulting in lower debt, a reduction of Rs. 940 crores in the last seven quarters. Our contract and manufacturing verticals have seen improved performance with increased construction activity.”
