Sobha (SOBHA) Q4 14/15 earnings summary

Executive summary

• FY15 consolidated revenue rose 12.44% to ₹24.55bn; PBT increased 0.31% to ₹3.72bn and PAT after minority interests rose 1.26% to ₹2.38bn, amid subdued sector demand.

• Bangalore remained resilient, while slower sales and delayed approvals constrained launches; new compact luxury homes and precast construction supported volume growth.

Financial highlights

• Consolidated EBITDA was ₹6.32bn; standalone revenue was ₹24.02bn, PBT ₹2.99bn and PAT ₹1.99bn, with standalone PBT and PAT down 4.55% and 3.61% YoY.

• Collections reached ₹25.77bn and management-reported net operational cash inflow was ₹3.34bn; consolidated operating cash flow under the indirect method was negative ₹2.16bn.

• New sales totaled 3.28m sq ft and ₹20.95bn, at an average realization of ₹6,389 per sq ft; 25 projects totaling 7.61m sq ft were completed.

Outlook and guidance

• FY16 new-sales guidance: ₹26bn and 4m sq ft, respectively 22% higher in value and 24% higher in volume than FY15.

• Planned FY16 launches include ~3.92m sq ft SBA in Bangalore, 2.11m in Chennai, 3.29m in Cochin, 0.21m in Coimbatore and 0.33m in Mysore.

• Medium- to long-term demand outlook was positive, supported by urbanization, nuclear families, rising incomes and economic growth; near-term recovery depended on easing market and approval constraints.