SOBHA - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 2.9
| Stock Code | SOBHA | Market Cap | 15,328 Cr. | Current Price | 1,433 ₹ | High / Low | 1,732 ₹ |
| Stock P/E | 66.5 | Book Value | 424 ₹ | Dividend Yield | 0.21 % | ROCE | 6.98 % |
| ROE | 3.31 % | Face Value | 10.0 ₹ | DMA 50 | 1,360 ₹ | DMA 200 | 1,434 ₹ |
| Chg in FII Hold | -0.03 % | Chg in DII Hold | 0.32 % | PAT Qtr | 30.7 Cr. | PAT Prev Qtr | 104 Cr. |
| RSI | 64.9 | MACD | 36.3 | Volume | 1,26,691 | Avg Vol 1Wk | 1,30,790 |
| Low price | 1,130 ₹ | High price | 1,732 ₹ | PEG Ratio | -8.42 | Debt to equity | 0.23 |
| 52w Index | 50.4 % | Qtr Profit Var | 11.4 % | EPS | 21.6 ₹ | Industry PE | 27.0 |
📊 SOBHA reflects weak fundamentals with very low ROE (3.31%) and ROCE (6.98%), indicating poor efficiency in generating returns. EPS of ₹21.6 provides limited earnings visibility, while dividend yield (0.21%) offers negligible passive income. Valuation is expensive with P/E (66.5) compared to industry average (27.0), and PEG ratio (-8.42) highlights poor growth relative to valuation. Profitability has declined sharply (PAT ₹30.7 Cr. vs ₹104 Cr. QoQ). Current price ₹1,433 is near DMA 200 (₹1,434) and above DMA 50 (₹1,360), suggesting short-term momentum but weak long-term fundamentals. Entry zone is attractive near ₹1,300–1,380 for accumulation.
💡 Long-term investors should remain cautious, holding only with a 2–4 year horizon if profitability improves. Exit strategy: partial profit booking near ₹1,700–1,730 resistance or full exit if ROE/ROCE remain weak and earnings fail to recover.
Positive
- 📈 Low debt-to-equity ratio (0.23) ensures financial stability.
- 💰 Book value of ₹424 provides asset backing.
- 📊 DII holding increased (+0.32%), showing domestic investor confidence.
Limitation
- ⚠️ Weak ROCE (6.98%) and ROE (3.31%).
- 📉 High P/E (66.5 vs industry 27.0) indicates overvaluation.
- 📊 Negative PEG ratio (-8.42) reflects poor growth efficiency.
- 📉 Dividend yield of 0.21% offers negligible passive income.
Company Negative News
- 📉 PAT declined sharply (₹104 Cr. → ₹30.7 Cr.).
- 📊 FII holding decreased (-0.03%), showing reduced foreign investor confidence.
Company Positive News
- 📈 Technicals: RSI at 64.9 and MACD positive (36.3), showing bullish momentum.
- 📊 EPS of ₹21.6 supports earnings base despite weak profitability.
Industry
- 🏭 Industry PE at 27.0 is much lower than SOBHA’s 66.5, highlighting premium valuation.
- 📈 Real estate sector benefits from housing demand and infrastructure growth but remains cyclical with profitability pressures.
Conclusion
⚖️ SOBHA is a weak candidate for long-term investment due to low ROE/ROCE, stretched valuations, and declining profitability. Ideal entry is near ₹1,300–1,380. Long-term investors may hold cautiously for 2–4 years, but exit near ₹1,700–1,730 or on further deterioration of earnings.
This structured HTML report captures SOBHA’s fundamentals, valuation risks, and sector context with clear entry/exit guidance. Would you like me to extend this into a peer benchmarking overlay against DLF, Prestige Estates, and Godrej Properties to highlight relative positioning in the real estate sector?