20150624-Maybank_KERPL-Strong_project_line-up_11页_823kb

报告摘要

Summary of Sobha Developers (SOBHA IN) Analysis

Core Content and Key Information

Sobha Developers (SOBHA IN) is a real estate company based in India, with a current share price of INR359 and a target price of INR551, indicating a potential increase of +54%. The company's market capitalization is INR35.2B, and the average daily trading volume is USD1.0M. The stock has fallen 15% in the past three months due to a decline in presales in FY15, which was attributed to delays in new launches. However, the company's planned launches now have necessary approvals, which is expected to boost FY16 presales by 24%.

Main Points

Project Line-up and Performance

Strong Project Pipeline: SOBHA has a robust project pipeline for FY16, with new launches expected to rise by 35% to INR40b.
Presales Growth Guidance: The company maintained its FY16 presales growth guidance of 24% to INR26b, which is achievable due to the stable housing demand in Bangalore (40-50m sqf annually).
Target IRR: The company aims for a 26% IRR on new projects, achievable due to its leadership in South India and ability to pass on cost escalations to customers.
Gross Margins: SOBHA is expected to maintain gross margins of 35-40%, supporting its profitability.

Market Focus

Bangalore Dominance: SOBHA holds 70% of its land bank in Bangalore, which is a key market for its operations. It expects 75% of FY16 presales to originate from this region.
Chennai Projects: The company is active in Chennai, the third-largest market for it, with four projects under execution, totaling 1.7m sqf of saleable area. Despite a sluggish housing market in Chennai due to a manufacturing sector slowdown, SOBHA's projects are located near the IT hub, which supports strong demand.
Cochin and Other Markets: SOBHA is also active in Cochin and other regions, with new developments planned.

Financial Performance

Revenue Growth: Revenue is projected to grow from INR21,734.0m in FY14A to INR38,385.6m in FY18E, with an expected CAGR of around 16.6% in FY16.
EBITDA and Profitability: EBITDA is expected to grow from INR6,025.0m in FY14A to INR9,463.1m in FY18E. Core net profit is projected to increase from INR2,350.0m in FY14A to INR3,776.3m in FY18E.
Earnings Per Share (EPS): Core EPS is expected to grow from INR24 in FY14A to INR39 in FY18E.
Dividend Yield: The net dividend yield remains constant at 2.0% across all fiscal years.
Valuation Metrics:
- Core P/E ratio is expected to decline from 15.0x in FY14A to 9.3x in FY18E.
- P/BV ratio is projected to decrease from 1.5x to 1.1x.
- EV/EBITDA ratio is expected to drop from 8.2x in FY14A to 6.4x in FY18E.
Leverage: Net debt/equity is projected to increase from 56.3% in FY14A to 80.2% in FY18E, indicating a rising debt burden.

Key Projects

Bangalore

Yelahanka Property: 0.35m sqf, located at Kogilu Cross.
Kanakapura Road Property: 0.46m sqf, near Forest View, Hosahalli.
Sarjapur Road: 1.46m sqf, located at Hoddasiddhapura.
Langford Town Property: 0.01m sqf, near Richmond circle.
Padmanabha Nagar Property: 0.18m sqf, located at Bhanashankari Ext. (ORR).
Gopalapura Property: 0.19m sqf, near Sobha Indraprastha.

Chennai

Sholinghanallur Property: 1.37m sqf, located on OMR.
Sobha Meritta: 556 apartments, expected to be delivered in FY17, located on OMR.
Sobha Evergreens: 117 plots, expected to be completed in FY16, located near Sai Ram Group of Institutions, West Tambaram.
Sobha Winchester: 344 housing units, 4.2 acres, located on Thuraipakkam - Pallavaram Road.

Cochin

Marine Drive Property: 1.6m sqf.

Mysore

Jettihundi Property: 0.32m sqf.

Coimbatore

Harishree Gardens: 0.21m sqf.

Strategic Outlook

Aspirational Homes: SOBHA has launched a new mid-end housing format in Bangalore, with strong initial demand and plans for subsequent phases.
Market Confidence: Investors remain confident in SOBHA's strong project line-up and growth potential, despite recent share price declines.
Future Outlook: The company is expected to maintain strong financial performance and growth in FY16 and beyond, supported by its market position and project execution.

Research Team and Contact Information

India:
- Anubhav Gupta: (91) 22 6623 2605, anubhav@maybank-ke.co.in
- Vishal Modi: (91) 22 6623 2607, vishal@maybank-ke.co.in
- Abhijeet Kundu: (91) 22 6623 2628, abhijeet@maybank-ke.co.in
- Neerav Dalal: (91) 22 6623 2606, neerav@maybank-ke.co.in
Malaysia:
- Wong Chew Hann, CA: (603) 2297 8686, wchewh@maybank-jb.com
- Desmond Ch'ng, ACA: (603) 2297 8680, desmond.chng@maybank-ib.com
- Liaw Thong Jung: (603) 2297 8688, tjliaw@maybank-ib.com
- Ong Chee Ting, CA: (603) 2297 8678, ct.ong@maybank-ib.com
- Mohsin Aziz: (603) 2297 8692, mohshin.aziz@maybank-ib.com
- Juniman: (62) 21 29228888 ext 29682, Juniman@bankbii.com
Singapore:
- Jigar Shah: (65) 6231 5832, jigar@maybank-ke.com.sg
- Anubhav Gupta: (65) 6231 5805, anubhav@maybank-ke.com.sg
- NG Wee Siang: (65) 6231 5838, ngweesiang@maybank-ke.com.sg
- Gregory Yap: (65) 6231 5848, gyap@maybank-ke.com.sg
- Yeak Chee Keong, CFA: (65) 6231 5842, yeakcheeong@maybank-ke.com.sg
- Derrick Heng, CFA: (65) 6231 5843, derrickheng@maybank-ke.com.sg
- Joshua Tan: (65) 6231 5850, joshuatan@maybank-ke.com.sg
- Wei Bin: (65) 6231 5844, weibin@maybank-ke.com.sg
- John Cheong: (65) 6231 5845, johncheong@maybank-ke.com.sg
- Truong Thanh Hang: (65) 6231 5847, hang.truong@maybank-ke.com.sg
- Yeak Chee Keong, CFA: (65) 6231 5842, yeakcheeong@maybank-ke.com.sg
Indonesia:
- Isnaputra Iskandar: (62) 21 2557 1129, isnaputra.iskandar@maybank-ke.co.id
- Rahmi Marina: (62) 21 2557 1128, rahmi.marina@maybank-ke.co.id
- Aurellia Setiabud: (62) 21 2953 0785, aurellia.setiabudi@maybank-ke.co.id
- Pandu Anugrah: (62) 21 2557 1137, pandu.anugrah@maybank-ke.co.id
- Janni Asman: (62) 21 2953 0784, janni.asman@maybank-ke.co.id
- Adri Tasmin: (62) 21 2557 1209, adhi.tasmin@maybank-ke.co.id
Philippines:
- Luz Lorenzo: (63) 28498836, luz_lorenzo@maybank-atrke.com
- Lovell Sarreal: (63) 28498841, lovell_sarreal@maybank-atrke.com
- Rommel Rodrigo: (63) 28498839, rommel_rodrigo@maybank-atrke.com
- Mayuree Chowikran: (63) 2658 6300 ext 1440, mayuree.c@maybank-ke.co.th
- Padon Vannarat: (63) 2658 6300 ext 1450, padon.v@maybank-ke.co.th
- Chatchai Jindarat: (63) 2658 6300 ext 1401, chatchai.j@maybank-ke.co.th
- Termporn Tantivivat: (63) 2658 6300 ext 1520, termporn.t@maybank-ke.co.th
- Jaroonpan Wattanawong: (63) 2658 6300 ext 1404, jaroonpan.w@maybank-ke.co.th
- Sutthichai Kumworachai: (63) 2658 6300 ext 1400, sutthichai.k@maybank-ke.co.th
Vietnam:
- Thai Quang Trung, CFA: (84) 844555888 × 8180, trung.thai@maybank-kimeng.com.vn
- Le Nguyen Nhat Chuyen: (84) 844555 888 × 8082, chuyen.le@maybank-kimeng.com.vn
- NGUYEN Thi Sony Tra Mi: (84) 844555 888 x 8084, mi.nguyen@maybank-kimeng.com.vn

Disclaimer

This report is for general information and should not be considered as investment advice.
MKE disclaims any liability for the use of this report.
Forward-looking statements are subject to change and should not be relied upon.
The report is prepared for MKE's clients and may not be reproduced or distributed without prior consent.

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