Sobha shares: 57% upside! Antique maintains Buy, shares target price

Antique Stock Broking maintained its Buy rating on Sobha Ltd, retaining its target price of Rs 1,855 per share on the real estate stock. The target implied a 57% upside for Sobha over its latest closing price of Rs 1,183 apiece. Sobha's strong first-half performance has put it in a position to comfortably surpass its FY27 pre-sales guidance, Antique said.

The brokerage highlighted that Sobha's pre-sales rose 47% year-on-year (YoY) to Rs 5,860 crore in the first half of FY27, supported by a 32% increase in sales volumes to 3.8 million square feet (msf). Realisation also increased 11% to Rs 15,604 per square foot, driven by premium inventory sales at projects including Bellevue, Crescent, Altus and Aranya.

Sobha's H1 pre-sales accounted for around 55% of its full-year guidance. The company recorded pre-sales of Rs 2,210 crore in the September quarter, up 16% YoY, with volumes at 1.42 msf. Antique noted that the performance came alongside ongoing project launches and strong demand for existing inventory.

Strong launch pipeline supports growth outlook

Antique said Sobha has a targeted launch pipeline of 7.2 msf, with a gross development value (GDV) of around Rs 10,800 crore, alongside ongoing inventory of 13.9 msf with a GDV of Rs 22,400 crore. The brokerage believes these projects provide visibility for continued pre-sales growth and expects the company's pre-sales to grow at a compound annual growth rate (CAGR) of around 24% between FY26 and FY29.

The report also highlighted a further 17.1 msf of forthcoming launches, with a GDV of around Rs 24,300 crore. Sobha launched projects totalling 7.95 msf during H1, with a GDV of Rs 11,200 crore. Its regional performance was led by Bengaluru, which accounted for 58% of pre-sales, followed by the National Capital Region at 34%.

Sobha completed 2.56 msf of area during H1 FY27, while its execution track record and premium project portfolio remain key factors in Antique's positive outlook.

Cash generation and valuation underpin Buy call

Antique expects Sobha to collect around Rs 40,900 crore cumulatively over FY26-FY29, translating into operating cash flow of approximately Rs 14,000 crore over the same period. The brokerage said strong cash generation and a cash-positive balance sheet should provide the company with financial flexibility to support growth while maintaining its execution pace.