Emkay Reaffirms Buy on Sobha as First-Half Sales Climb 47 Percent

Emkay Global Financial Services has maintained its Buy rating on Sobha Limited with an analyst target price of INR 1,900, following the developer's operational update for the first half of fiscal 2027. The brokerage's view, published on October 6, 2026, comes after Sobha reported sales value of INR 58.62 billion for the six months ended September 30, 2026, a rise of 47.2 percent over the same period a year earlier. The company described the figure as the highest it has recorded for any half-year.

The Bengaluru-headquartered developer filed its H1 FY27 update on October 2. Emkay's note reads the numbers as evidence that Sobha is on course to beat its own pre-sales guidance for the year. The brokerage expects FY27 pre-sales of INR 110 billion to INR 120 billion, compared with company guidance of INR 106 billion. On the day of the call, the stock traded near INR 1,190 on the National Stock Exchange.

Sales momentum and the make-up of the half-year

Sales area in the first half expanded from 2.84 million square feet to 3.76 million square feet, an increase of 32.4 percent. The company sold 2,260 residential units, compared with 1,746 in the same period of FY26. The average realisation rose to INR 15,604 per square foot from INR 14,028 a year earlier, which points to a firmer pricing environment alongside higher volumes.

Bengaluru remained the largest contributor, accounting for 57.7 percent of total sales value at INR 33.85 billion. The National Capital Region contributed 33.7 percent, or INR 19.74 billion. Sobha's own share of first-half sales value stood at 83.1 percent, up from 81.7 percent in the first half of FY26.

The second quarter delivered INR 22.06 billion in sales value, growth of 16 percent over the year-earlier quarter, with 1.42 million square feet sold across 828 units. It was the second-highest quarterly sales figure in the company's history. Sales value in the second quarter was lower than in the first quarter, which the company attributed to the timing of project launches rather than to weaker demand.

Details of the financial position

The first quarter of FY27 provided the base for the half-year figures. Sobha reported sales bookings of INR 3,656 crore, up 76 percent from INR 2,078.8 crore a year earlier. Operational revenue rose 50 percent year on year to INR 1,278.1 crore, while EBITDA increased to INR 77.6 crore from INR 23.7 crore. Total income for the quarter grew 48 percent to INR 1,330 crore, and profit after tax climbed 66 percent to INR 50.7 crore.

• Net cash position of INR 659 crore at the end of the first quarter
• Sales area of 6.89 million square feet of fresh saleable area unveiled in the first quarter
• Emkay estimated net asset value of INR 1,571 per share
• Market capitalisation of about INR 127.3 billion as of October 6, 2026

Emkay's valuation sits at a substantial premium to the current share price. The stock's 52-week range runs from INR 1,130 to INR 1,732.

Projects driving the new launches

Among the recently launched projects that the company highlighted is Sobha One World in Hoskote, on the Bengaluru Rural side of the city. The scheme covers 3,484 apartments across 14 wings on a 48-acre net site at Amanidoddakere Village in Kasaba Hobli. Karnataka RERA registrations for the project's six phases were issued on May 8, 2026, and the official launch took place on June 13, 2026. The company also reported a strong response to Sobha Crescent in Gurugram.

The developer's footprint

Sobha Limited is primarily known for residential and contractual real estate projects. Its operations also include manufacturing of interiors, glazing, metal works and concrete products, which supports its construction activity. The company reported pre-sales of INR 81.4 billion in FY26, a rise of 30 percent, and operates across eleven cities. Bengaluru accounted for about 58 percent of pre-sales in the latest period, followed by the National Capital Region at about 34 percent.

What comes next

Management has guided for pre-sales growth of at least 30 percent in FY27, with the possibility of exceeding that if planned launches are completed on schedule. The company has nine projects left to launch in the year, covering 8.2 million square feet, which implies gross development value of about INR 12,000 crore at current pricing. Market analysts expect margins to recover from the third quarter of FY27 onward, and Emkay's view rests on the launch pipeline delivering the sales growth the company has signalled.