Oberoi Realty Q2 profits flatter at Rs138cr despite lower revenues

Oberoi Realty reported nearly 3-fold growth in sales revenues for the quarter on a sequential basis as the company managed to bounce from the weak performance of June.

Oct 17, 2020 05:10 IST India Infoline News Service

Oberoi Realty reported nearly 3-fold growth in sales revenues for the quarter on a sequential basis as the company managed to bounce from the weak performance of June. On a sequential basis, the operating profits were up 260% and net profits were up 390%, although these growth numbers may be misleading due to the COVID impact in June.
What is more relevant is that the company reported almost the same net profit at Rs.137 crore compared to Sep-19, despite the revenues being almost 40% lower. This was evident in the operating margins expanding to 55% in the Sep-20 quarter.


Here are the financial highlights


Particulars Sep-20 Quarter Growth (YOY) Growth (QOQ)
Total Revenues Rs316.06cr -35.69% +167.80%
Operating Profit Rs176.21cr -13.19% +260.64%
Net Profits Rs137.74cr -0.24% +390.70%
Key Ratios Sep-20 Quarter Sep-19 Quarter Jun-20 Quarter
Diluted EPS Rs3.79 Rs3.80 Rs0.77
Operating Margins 55.75% 41.30% 41.40%
Net Profit Margin 43.58% 28.09% 23.78%


Key takeaways from the Sep-20 quarter results
  • The company has managed this profit performance largely by keeping debt well in check. For example, the debt equity ratio at 0.19 is among the lowest in the real estate business. Also, Oberoi Realty has a comfortable interest coverage ratio of 4.33 times and a debt service coverage of 0.91
  • The lockdown severely impacted the mall operations of its subsidiary in the absence of which the actual profit numbers and sales numbers could have been still better at a consolidated level.
  • Operating cash profit has literally halved in the first half of 2020 as compared to the first half of 2019. This was largely due to the pressure created in the June quarter.

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