1 hr ago
Sobha Stock Falls 12% as Emkay Projects 56% Upside
Sobha is a company that builds homes and other real-estate projects.
Its share price has fallen by about 12%-14% so far in 2026.
However, Emkay Global Financial Services believes the shares could rise significantly.
Emkay gave the stock a Buy rating and a target price of ₹1,900.
The brokerage expects Sobha to achieve more than ₹100 billion in sales bookings in FY2026-27.
Sobha plans to launch many projects in cities including Bengaluru, Gurugram, Chennai, Hyderabad, and Thrissur.
Emkay expects the company’s profit margins to improve later in FY2027.
Margins are currently low, so this remains a major concern.
Strong demand in Bengaluru could help Sobha’s future growth.
Sobha shares have declined about 12%-14% year to date in 2026.
Emkay Global Financial Services retained a Buy rating with a ₹1,900 target price.
The target implies approximately 56.3% upside from the cited share price.
Sobha is expected to exceed ₹100 billion in pre-sales during FY2026-27.
Margin improvement is expected from the third quarter of FY2027, although margins remain a concern.
- Who
- Sobha Limited and Emkay Global Financial Services.
- What
- Sobha shares declined about 12%-14% year to date, while Emkay forecast 56.3% upside and maintained a Buy rating.
- Where
- Sobha is headquartered in Bengaluru, with planned projects in Bengaluru, Gurugram, Chennai, Hyderabad, and Thrissur.
- When
- The report refers to Wednesday intraday trading in 2026 and expectations for FY2026-27 and FY2027.
- Why
- Emkay expects strong launches, healthy project absorption, higher pre-sales, and improving margins, while current margins remain muted.
Growth Case
Margin Risks
Future performance
Growth Case
Emkay expects strong launches, healthy absorption, pre-sales above ₹100 billion, and a potential share-price rise to ₹1,900.
Margin Risks
The stock has declined about 12%-14% year to date and 21.69% over one year, showing recent market weakness.
Profitability
Growth Case
Margins could improve from the third quarter of FY2027 and potentially reach 20% in the second half of FY2027.
Margin Risks
Margins remained around 6% in FY2026 and the first quarter of FY2027, making profitability a continuing concern.
Market opportunity
Growth Case
Strong demand and easing real-estate hurdles in Bengaluru could support more supply and growth.
Margin Risks
The expected increase in supply from developers means Sobha may face a more competitive market.
Key facts
- Emkay rating
- Buy
- Target price
- ₹1,900 per share
- Implied upside
- 56.3% over 12 months
- Expected FY2026-27 pre-sales
- More than ₹100 billion
- FY2026 launches
- 14.8 million square feet
- FY2027 launch expectation
- 15 million square feet
- Cited trading price
- ₹1,235.10 per share on BSE at 11:07 a.m. Wednesday
- Current margin level
- Approximately 6% in FY2026 and the first quarter of FY2027
Quotes
Emkay Global Financial Services
Brokerage that issued the outlook and target price for Sobha Limited
“We maintain BUY and TP of Rs1,900, based on 8x Sep-28E EV/embedded EBITDA, at 21% premium to NAV (the stock currently trades at a 23% discount to NAV).”
livemint.com
“We expect margins to improve from 3QFY27 onward, likely reaching the 20% level in 2HFY27 and improving progressively thereafter.”
livemint.com
Sources
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