Sobha Ltd., a real estate company based in Bangalore, has had its rating revised by Geojit Financial Services to "Accumulate" with a target price of Rs. 1,802.

The company has completed 546 projects, totaling approximately 136 million square feet, across 14 states in India.

In the second quarter of FY25, Sobha experienced a 32% year-on-year decline in pre-sales, which was attributed to lower traction from recent launches totaling around 3.5 million square feet.

Total sales volume fell by 45% year-on-year to 0.9 million square feet, but the average realization improved by 56%.

The company reported a 28% year-on-year increase in completions, supporting a revenue growth of approximately 26%.

However, EBITDA margins contracted by 192 basis points year-on-year.

Looking ahead, Sobha expects to recognize Rs. 14,500 crore in revenue over the next 4-5 years, with an expected margin of 33%.

Despite a challenging first half, the company is expected to perform better in the second half of FY25, thanks to its robust inventory in ongoing projects and plans to launch around 5.5 million square feet from a substantial pipeline of 19.3 million square feet.