Sobha Ltd.
ISIN: INE671H01015 • Market Cap: ₹13,630 Cr
The 5-Pillar Quality Audit for Sobha Ltd.
Evaluated across Profitability, Financial Health, Historical Compounding, Valuation Safety, and Ownership Governance:
1. Profitability & Capital Efficiency
Weight: 25%Measures operating margins (6.5%), Return on Capital Employed (8.2%), and equity compounding (4.1%).
2. Financial Health & Solvency
Weight: 25%Debt-to-Equity is 0.21 with comfortable interest coverage and clean working capital.
3. Growth & Compounding Track Record
Weight: 20%Historical 3Y Sales CAGR (21.9%) and 3Y PAT CAGR (67.6%).
4. Valuation Multiple & Margin of Safety
Weight: 15%Trades at P/E of 59.10 vs PEG of 1.31 and Dividend Yield of 0.5%.
5. Ownership Quality & Governance
Weight: 15%Promoter holding stands at 52.9%, backed by 32.1% institutional ownership.
Key Fundamental Strengths
Strong Topline Expansion (3Y Sales CAGR: 21.9%)
Revenue has expanded at 21.9% CAGR over 3 years, signaling industry market-share gains.
High-Velocity Profit Compounding (3Y PAT CAGR: 67.6%)
Net earnings have compounded at 67.6% annualized, demonstrating operating leverage.
Deep Institutional Sponsorship (32.1%)
Mutual funds, domestic DIIs, and foreign FIIs hold 32.1%, providing strong governance scrutiny.
Areas to Watch & Potential Risks
Subdued Capital Efficiency (ROCE: 8.2%)
A sub-12% ROCE suggests return on capital barely exceeds the company's weighted average cost of capital (WACC).
Sectoral & Macro Headwinds (Realty)
Subject to broader cyclical demand, raw material price shifts, and regulatory frameworks governing the Realty space.
Quantitative Strategy Eligibility
Checking SOBHA against established Indian wealth creation frameworks:
Coffee Can Investing Framework
Fails 10%+ revenue growth or 15%+ minimum capital return benchmark over historical periods.
Quality Factor Screener (High RoIC + Low Debt)
Qualifies for Indian Quality Indices with overall score of 70/100 and clean gearing.
GARP / Value-Growth Blend
Valuation multiple or return metrics require further cyclical pullback.
Realty Sector Peer Comparison
Compare SOBHA directly against top industry peers by market capitalization:
| Company | 5-Pillar Score | Market Cap | P/E | ROCE | D/E | Scorecard |
|---|---|---|---|---|---|---|
| Sobha Ltd. (SOBHA)Current | 70/100 | ₹13,630 Cr | 59.10 | 8.2% | 0.21 | — |
| DLF Ltd. (DLF) | 62/100 | ₹1.65 Lakh Cr | 37.14 | 6.1% | 0.00 | View |
| Lodha Developers Ltd. (LODHA) | 82/100 | ₹1.21 Lakh Cr | 29.21 | 18.2% | 0.44 | View |
| Phoenix Mills Ltd. (PHOENIXLTD) | 68/100 | ₹68,498 Cr | 53.51 | 10.3% | 0.45 | View |
| Prestige Estates Projects Ltd. (PRESTIGE) | 64/100 | ₹67,840 Cr | 59.57 | 13.8% | 0.92 | View |
| Godrej Properties Ltd. (GODREJPROP) | 69/100 | ₹60,093 Cr | 37.55 | 12.4% | 0.80 | View |
Frequently Asked Questions: Sobha Ltd.
Q:What is the 5-Pillar Fundamental Score for Sobha Ltd. (SOBHA)?
Sobha Ltd. has a RupeeTools Fundamental Score of 70/100, placing it in the 'Solid & Healthy' category. Its pillar scores are: Profitability (43/100), Financial Health (74/100), Growth (92/100), Valuation (65/100), and Ownership Quality (85/100).
Q:Is SOBHA fundamentally strong for long-term investment?
Yes, SOBHA exhibits solid fundamental strength with a 70/100 score, driven by a return on equity of 4.1% and a debt-to-equity ratio of 0.21.
Q:Does SOBHA pass the Coffee Can Investing filter?
No. SOBHA does not currently meet the strict 15% ROCE and 10% sustained topline compounding threshold mandated by the Coffee Can investing framework.
Q:How does SOBHA compare against other Realty peers?
Within India's Realty sector, SOBHA trades at a P/E of 59.10 and generates an ROCE of 8.2%. Compare its 5-Pillar score of 70/100 against top sector peers like DLF Ltd. (62/100), Lodha Developers Ltd. (82/100).
Regulatory & SEBI Research Analyst Compliance Disclaimer:
This 5-pillar fundamental score is an automated quantitative health check generated purely from historical public financial statements, corporate filings, and exchange disclosures for educational and informational purposes only. It does NOT constitute investment advice, a stock recommendation, or a solicitation to buy or sell securities. RupeeTools is not a SEBI-registered Research Analyst. Please consult a SEBI-registered financial advisor before making investment decisions.