Nuvama Institutional Equities has maintained its ‘Buy’ rating on Sobha Ltd., with a target price of ₹1,784, after the company reported its highest-ever quarterly pre-sales of ₹2,080 crore in Q1, led by a strong showing in the National Capital Region (NCR).
For the first time, NCR accounted for 49% of total sales, overtaking Bengaluru’s 32% share, marking a significant shift in Sobha’s regional mix. This geographic diversification is in line with the company’s stated strategy to de-risk from its traditional Bengaluru-heavy exposure and tap into high-growth markets like Delhi-NCR, Pune, and Hyderabad.
Nuvama sees this expansion as critical to maintaining growth momentum. The company’s launch pipeline is strong, and it continues to build out projects in both mid-income and premium housing segments. Moreover, Sobha’s in-house backward integration across construction and materials helps it maintain quality and cost control, giving it an edge in execution.
However, the brokerage did raise caution around macro softness in the broader housing market, particularly in Tier I cities where elevated property prices and higher borrowing costs are beginning to pinch demand. While volume softness is not yet acute, it remains a key risk if the Reserve Bank of India delays rate cuts further.
Still, Nuvama believes Sobha’s operational discipline, strong brand recall, and robust project pipeline put it in a favourable position to navigate near-term volatility. It expects demand to remain healthy in NCR and sees upside to the stock if interest rates soften in the second half of FY26.