HDFC Securities has upgraded to 'Buy' from 'Neutral' on Sobha Developers.

Commenting on the investment rationale, the stock broker said, ''Sobha Developers' 1QFY15 revenues of Rs 5.8bn were below our est. of Rs 6.0 billion led by lower than expected real estate revenues of Rs 3.5 (est. Rs 3.8bn).

However, we believe that Sobha will be able to achieve its FY15E sales guidance of 4msf worth Rs 27 billion. This will be primarily achieved through 2.5msf of volumes from Bengaluru and volumes from other Southern markets of Kochi and Chennai on the back of new launches.

We revise our FY16E NAV to Rs 527/sh (Rs 542 earlier) owing to higher debt and land capex but upgrade our rating to BUY from Neutral (CMP Rs 424) given the recent correction in stock price.''

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