Sobha Developers - Valuation hinges on sales volume revival… :: ICICI Securities, PDF link

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Valuation hinges on sales volume revival…
• The topline grew 24.0% YoY | 669.5 crore (I-direct estimate: | 567.9
crore) on account of better revenue booking in the real estate
business (grew 28.5% YoY to | 474.9 crore) as some of the projects
reached the revenue recognition threshold like the NCR project
• However, the EBITDA margin contracted 170 bps at 24.7% in
Q2FY15 on account of an increase in input & labour cost
• The net profit grew 5.1% YoY at | 59.5 crore and was marginally
ahead of our expectation (I-direct estimate: | 57.9 crore) on account
of better-than-expected revenues
• However, sales volumes declined 16.9% YoY to 0.83 million square
feet (msf) while the sales value declined 11.6% YoY to | 559 crore
largely on account of muted sales in NCR and Thrissur region
(dipped 53.3% and 52.4% YoY, respectively). On the positive side,
the Bengaluru sales volume improved 6.4% sequentially to 0.56 msf
• The debt to equity stood at 0.7x vs. 0.6x in Q4FY14. The increase
was primarily on account of pursuance of investment opportunities
in Kochi and Pune, dividend payout and capex

LINK
http://content.icicidirect.com/mailimages/IDirect_SobhaDev_Q2FY15.pdf