Why Did Oberoi Realty Shares Drop by 45% in Q4?
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Synopsis
Oberoi Realty's stock has taken a hit, marking a significant profit decline. Discover the factors contributing to this downturn and what it means for investors and the real estate market.
Key Takeaways
- Oberoi Realty shares dropped by 2.82%.
- Net profit fell 45% in Q4 FY25.
- Land acquisition costs surged 207%.
- Revenue from operations decreased by 12.5%.
- Dividend of Rs 2 per share announced.
New Delhi, April 29 (NationPress) The Mumbai-based real estate company Oberoi Realty witnessed a decline in its share price, dropping by Rs 46.80 or 2.82% to Rs 1,610 on the National Stock Exchange (NSE) on Tuesday.
This downturn followed the company’s announcement of a staggering 45% decrease in its consolidated net profit for the fourth quarter (Q4) of FY25.
As detailed in their filing with the Bombay Stock Exchange (BSE), Oberoi Realty reported a net profit of Rs 433.17 crore for the January-March quarter, a significant fall from Rs 788.03 crore during the same period last year.
This drastic profit slump was primarily attributed to a sharp increase in land acquisition expenses and a decline in operational revenue.
Oberoi Realty's land acquisition expenses surged by 207%, reaching Rs 587 crore in the March quarter of FY25, compared to Rs 191 crore a year prior.
This notable rise in costs had a considerable impact on the company’s financial performance, despite maintaining a robust market presence.
Revenue from core operations experienced a 12.5% drop, falling to Rs 1,150.14 crore in Q4, down from Rs 1,314.77 crore in the same quarter of the previous fiscal year.
At the operational level, Oberoi Realty’s EBITDA (earnings before interest, tax, depreciation, and amortization) fell by 21.7% year-on-year (YoY), landing at Rs 617.8 crore in Q4 of FY25, down from Rs 788.9 crore in the same quarter last year.
The company’s EBITDA margin also decreased to 53.7% during the reporting quarter, compared to 60% in the corresponding quarter of the previous fiscal.
In conjunction with its quarterly results, the company declared its fourth interim dividend for the financial year 2024-25.
Oberoi Realty announced a dividend of Rs 2 per equity share for eligible shareholders, with May 5 set as the record date for this dividend distribution.
Point of View
It is crucial to observe the situation of Oberoi Realty with a balanced perspective. The significant drop in net profit raises concerns about the company's operational efficiency and market strategy. While the real estate sector remains competitive, investors should be informed about these developments to make educated decisions.
NationPress
01/05/2025
Frequently Asked Questions
What caused Oberoi Realty's profit to drop?
The profit drop was primarily due to a steep rise in land acquisition costs and a decrease in operational revenue.
What is the current share price of Oberoi Realty?
Oberoi Realty's shares fell to Rs 1,610 on the National Stock Exchange.
What is the dividend announced by Oberoi Realty?
Oberoi Realty declared a dividend of Rs 2 per equity share for eligible shareholders.
When is the record date for the dividend payout?
The record date for the dividend payout is set for May 5.
How did operational revenue change in Q4?
Operational revenue fell by 12.5% to Rs 1,150.14 crore in Q4 compared to the same quarter last fiscal.
