Motilal Oswal keeps Sobha at Buy with target of Rs 1,710

what happened

According to Motilal Oswal's research report, Sobha's pre-sales grew 16% year on year in the second quarter of FY27, reaching Rs 22.1 billion. That is the company's second-highest bookings figure ever, after the first quarter of FY27. Growth came from both sustenance sales and new project launches.

In the quarter, the developer launched two projects: Sobha Boulevard in Mysuru, a plotted development with GDV of Rs 1.2 billion, and Sobha Bellevue in Calicut, with GDV of Rs 11.5 billion. Bangalore remained the largest contributor with 60% of quarterly pre-sales, followed by NCR at 27% and Kerala at 10%. By price segment, units priced Rs 20-30 million accounted for about 30%, and those above Rs 50 million for 26%. In the first half of FY27, Sobha booked Rs 59 billion in pre-sales, 70% of it from new launches.

The brokerage raised its target price for the stock to Rs 1,710, implying about 45% upside, and reiterated its Buy rating. The report also said it would consider the value of the company's land parcels once concrete development plans are in place.

why it matters

For investors following Indian real estate, strong pre-sales point to demand in the mid-to-premium housing segment, and the high share of new launches suggests growth depends on a steady pipeline of projects. A single brokerage rating typically has a limited effect on the stock, but it gives a reference point for how analysts view the company's results.

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