Sobha Ltd.
NSE: SOBHASobha Ltd.: A 30-second snapshot
Sobha Ltd is a Bengaluru-based residential developer ranked 6th of 6 tracked Realty peers on both trailing PE (105.2) and quality score (41). FY26 delivered record sales of ₹8,136 crore and Q4 profit of ₹92 crore (+124% YoY), and the company reported a net-cash-positive balance sheet for the first time — yet the stock at ₹1,397 remains 5% below its 200-DMA of ₹1,471 and carries a debt-to-equity ratio of 21.83, the highest in the peer set.
P/E
105.2
Forward P/E
19.6
ROE
+4.2%
Debt / Equity
21.83
Profit Margin
+3.7%
Div. Yield
+0.4%
5Y ROE > 15%
0/5
5Y FCF > 0
4/5
Quality
50/100
News
8 headlines · 6 positive · 0 negative
Sobha Ltd Posts Record ₹8,136 Cr FY26 Sales, Becomes Net Cash Positive - Whalesbook
Whalesbook
Sobha share price rallies 9.5% after strong Q4 as profit doubles, sales hit record levels - Mint
Mint
Sobha shares rocket 10% after Q4 profit soars 124% YoY to Rs 92 crore - The Economic Times
The Economic Times
Sobha Developers gains over 2% after Q4 profit jumps 125%, revenue rises to Rs 2,300 crore - Moneycontrol.com
Moneycontrol.com
Sobha Q4 net profit doubles to ₹92 crore as revenue surges 60%; declares ₹6 dividend - CNBC TV18
CNBC TV18
Recent context
- ·SOBHA reported Q4 FY26 net profit of ₹92 crore, a 124% YoY increase, on record FY26 pre-sales of ₹8,136 crore; management stated the company has achieved a net-cash-positive position for the first time — a development that drove a ~10% share price move on the results day per Mint and Economic Times coverage.
- ·Dividend of ₹6 per share was declared for FY26 (yield ~0.43% at current price), alongside the record sales announcement, according to CNBC TV18.
- ·Despite the positive results news flow — 6 of 8 recent headlines positive, 0 negative — the stock remains 5% below its 200-DMA and is down 9.79% over the trailing 3 months, indicating the post-results bounce has not been sustained above the long-term average.
Strengths
- +5-year earnings growth of 124.3% and revenue growth of 60.2% are among the stronger compounding records in the sector, reflecting increasing operational scale.
- +Q4 FY26 results showed profit doubling to ₹92 crore on revenue of ~₹2,300 crore, and the company reported turning net-cash-positive — a structural improvement from a historically leveraged balance sheet.
- +Debt trend is classified as falling; FCF was positive in 4 of tracked persistence years, suggesting the business has begun converting earnings into cash.
- +Mean analyst rating of 1.375 across 16 analysts (1–5 scale, lower = more constructive), with forward PE of 19.6 implying consensus expects a significant earnings expansion from current trailing levels.
Weaknesses
- −D/E of 21.83 is the highest among the 6 tracked Realty peers; at this leverage, any slowdown in bookings, project delays, or rate environment change amplifies downside to equity disproportionately.
- −ROE of 4.17% with zero years above 15% in the tracked period indicates that despite high leverage, returns on equity capital have been structurally weak.
- −Quality score of 41 ranks 5th of 6 peers (OBEROIRLTY 65, PHOENIXLTD 55, LODHA 54, GODREJPROP 44); trailing PE of 105.2 is the highest in the peer group by a wide margin versus the next-highest PHOENIXLTD at 49.6.
- −Profit margin of 3.73% is thin; combined with the wide gap between trailing PE (105.2) and forward PE (19.6), the stock is priced for a significant earnings delivery that has yet to show up in trailing numbers.
Open questions
- ?Does the move to net-cash-positive represent a durable balance-sheet shift, or is it dependent on the pace of project completions and customer collections in FY27?
- ?With forward PE at 19.6 versus trailing PE at 105.2, what level of earnings growth does the business need to deliver to justify the current multiple — and how does that compare to the 5-year historical track record?
- ?Given that ROE has been below 15% for all tracked years despite a D/E of 21.83, what would need to change operationally for leverage to begin working in favour of equity holders?
- ?How does SOBHA's project pipeline and geographic concentration compare to OBEROIRLTY (quality score 65) and LODHA (quality score 54), and what explains the quality-score gap?
Peer comparison: Realty
Ranks 5 of 6 on quality| Symbol | Name | P/E | ROE | Quality |
|---|---|---|---|---|
| SOBHA | Sobha Ltd.You're viewing | 105.2 | +4.2% | 41 |
| Industry avg | across 5 peers | 31.5 | +12.3% | 49 |
| OBEROIRLTY | Oberoi Realty Ltd. | 23.5 | +14.9% | 65 |
| PHOENIXLTD | Phoenix Mills Ltd. | 49.6 | +11.1% | 55 |
| LODHA | Lodha Developers Ltd. | 24.7 | +15.7% | 54 |
| GODREJPROP | Godrej Properties Ltd. | 27.8 | +10.0% | 44 |
| DLF | DLF Ltd. | 31.7 | +10.0% | 29 |
Technical state
Current price
₹1,397.30
SMA 50
₹1,333.59
SMA 200
₹1,471.07
RSI (14)
52.1 (neutral)
From 52w high
-19.4%
1Y return
+5.8%
3M return
-9.8%
50-DMA
Above
200-DMA
Below
Algorithmic support levels
Algorithmic resistance levels
Risk flags
- highDebt-to-equity of 21.83 is exceptionally elevated for a listed residential developer. Peers such as OBEROIRLTY and DLF carry substantially lower leverage; at this D/E level any revenue shortfall or interest-rate move amplifies equity risk materially.
- highROE of 4.17% with zero years above 15% over the tracked persistence window. At a D/E of 21.83 the cost of debt likely exceeds the return generated on equity, raising a structural question about economic value creation.
- mediumTrailing PE of 105.2 vs forward PE of 19.6 — an unusually wide spread that implies consensus expects a step-change in earnings. Profit margin stands at 3.73%, meaning a modest revenue miss or cost overrun could collapse that forward-PE thesis.
- mediumPrice of ₹1,397 is 5.0% below the 200-DMA of ₹1,471 and 19.35% below the 52-week high. Stock has failed to reclaim its long-term average despite the post-results rally.
- mediumRanked 6th of 6 peers on both PE (105.2 vs sector range 23.5–49.6) and quality score (41 vs peer range 29–65). Only DLF ranks lower on quality (29), but DLF trades at a PE of 31.7 vs SOBHA at 105.2.
- lowFCF was positive in 4 of tracked years, but consistency score of 40 and zero ROE years above 15% limit confidence in the FCF sustainability narrative.
Cross-section contradictions
- FY26 revenues grew ~60% over 5 years and Q4 profit doubled YoY to ₹92 crore, yet ROE sits at 4.17% with zero years above 15% — indicating growth has been financed primarily through leverage (D/E 21.83) rather than compounding equity returns.
- Trailing PE of 105.2 implies near-zero current earnings yield, while forward PE of 19.6 implies analysts expect a large earnings step-up; the gap between these multiples is the widest among the 6 tracked peers, creating binary outcome risk around execution.
- News sentiment is uniformly positive (6 positive, 0 negative out of 8 articles) and Q4 results showed record sales of ₹8,136 crore with the company turning net-cash-positive — yet the stock remains 5% below its 200-DMA and is down 9.79% over the past 3 months, suggesting the market has not fully re-rated on the positive news flow.
For informational purposes only. Not investment advice. VivaTrades is not a SEBI-registered Investment Adviser or Research Analyst. Market data sourced from public feeds; consult a registered adviser before any investment decision.
Fundamentals & technicals: refreshed 25 Jun 2026 · refreshed daily at 01:00 IST
AI synthesis (narrative, snapshot, strengths/weaknesses, peer ranking): generated 17 May 2026 · rotates through NIFTY 500 every ~5 days