Sobha

Sobha (SOBHA): Q2 FY27 results analysis (quarter ended 30 Sep 2026)

All figures consolidated, ₹ crore unless stated. Results filed after market hours on 19 Oct 2026 [1]. EBITDA here excludes other income. YoY/QoQ %, margins and ratios are my calculations from reported numbers.

Sources: [2][3]

Source note: the company's presentation shows Q2 EBITDA of ₹119 cr (~11%) [5]. That figure appears to include other income (₹69 cr + ₹50 cr) [3]. I use the ex-other-income number.

Read P&L and bookings separately

Real estate revenue is recognised on handover, not on sale. So the P&L lags the business by 2–3 years.

Bookings tell the operating story. Q2 sales value was ₹2,206 cr, +16% YoY but −40% QoQ against a launch-heavy Q1 [4]. H1 bookings hit a record ₹5,862 cr, +47% YoY [1]. Average realisation rose to ₹15,522/sq ft from ₹13,648 [4]. Collections were a record ₹2,084 cr [1][5].

Quality of earnings

This is the weak spot. Other income (₹50 cr) was larger than PBT (₹47 cr) [2]. In other words, core operations roughly broke even before treasury income (my reading).

Finance cost rose 25% YoY to ₹40 cr; D&A rose 21% to ₹32 cr [2]. The tax rate rose to ~30% from ~27% [3]. Management cited low revenue recognition, higher sales and marketing spend, and a few low-margin legacy projects [5]. Sales and marketing spend was up 76% YoY in H1 [6].

Base effect: Q2 FY26 was a strong quarter (₹1,408 cr revenue, the second-highest of the last five quarters) [3]. Part of the −31% YoY is that high base.

Margins (Chart 3)

EBITDA margin (ex-OI) over five quarters: 6.8% → 4.1% → 7.6% → 6.1% → 7.1% [3]. It is range-bound and low, which reflects the mix of projects being handed over (interpretation).

Guidance: what changed

• Margin: After Q1, management guided EBITDA margin rising to 17–20% by end-FY27/Q4 [7][8]. Now it says H2 margin will be "much higher than 15%", moving "towards 20% and beyond" in FY28 [5]. My reading: the 20% goal has moved out by about a year.
• Profit: At least 50% PAT growth over FY26 reiterated [5][6]. H1 PAT of ₹84 cr is down 2.6% YoY [1], so H2 has to carry the target (my calculation from FY26 PAT of ₹193 cr [3]).
• Launches: Q1 guidance was ~8.2 mn sq ft over nine months (~₹12,000 cr) [7][8]. Now it is ~12 mn sq ft in 8 projects in H2 (~₹18,000 cr), but approvals are "time-sensitive" [5][6].
• Pre-sales: The 30%+ FY27 growth guidance from Q1 [7]: H1 is running at +47% [1].
• Deliveries: ~6 mn sq ft for FY27, with 2.56 mn done in H1 [5]. Q1 guidance was 6–6.5 mn [7].
• Other: Net cash ₹322 cr, and the zero-net-debt target is maintained [5]. ~₹22,000 cr of revenue from sold units is still to be recognised [5][6]. The company is acquiring a fire-safety unit from a group company (~₹65 cr revenue) [5].

Positives

• Record H1 bookings (+47%) and collections [1]
• Realisation up ~14% YoY [4]
• Net cash, and borrowing cost at 7.75% [5][6]

Concerns

• Core profitability is thin: PBT is lower than other income [2]
• The margin ramp-up has been pushed to H2/FY28 [5][7]
• The H2 launch plan depends on approvals [5]
• Net cash fell ₹337 cr in Q2 on land payments [5]

Things to track in Q3 FY27

1. EBITDA margin vs the ">15% in H2" guidance
2. Handovers toward ~3.5 mn sq ft in H2 [5]
3. Q3 launches and bookings (the Q3 update usually comes in early January)
4. Net cash after land spending

Not a buy/sell recommendation. Facts are sourced; opinions are labelled.

Sources [1] NSE – Sobha Q2 FY27 press release · [2] Equitybulls – consolidated & standalone · [3] Screener.in – consolidated · [4] NSE – Q2 FY27 operational update · [5] GuruFocus – Q2 call highlights · [6] Investing.com – Q2 slides · [7] DSIJ – MOFSL Q1 FY27 note · [8] Quartr – Q1 FY27 summary · [9] MarketsMojo, 21 Oct · [10] Moneycontrol via TradingView, 21 Oct · [11] Outlook Business – Q4 FY26 bookings · [12] HDFC Sky – market holidays

Charts: (1) last 5 quarters revenue & PAT [3];

(2) FY24–FY26 revenue & PAT [3];

(3) margins (own calc. from [3]) and quarterly bookings [4][11]. The Q3 FY26 bookings figure is derived: FY26 minus H1 minus Q4.