Mumbai focused real estate developer Oberoi Realty Ltd posted robust recovery in the September quarter on a sequential basis. Reacting to it, the stock rose more than 3% to 397 in opening trade on the NSE on Monday. It's profit after tax at 138.38 crore for the September quarter has more than doubled compared to the June quarter. However, it is flat on a year-on-year (y-o-y) basis.


Importantly, Oberoi Realty sold a total of 45 apartments during the quarter this compares with 58 units in the same quarter last year. According to analysts, the sales volume in the September quarter were driven by ready-to-move-in inventory in its Exquisite and Esquire projects, which contribute 30% of the total sales value. Its Three Sixty West project in Worli, which is 39% of the total sales value, is nearing completion and has witnessed sales too. Further, its Sky City project in Borivali and Enigma in Mulund have also contributed to sales.

These numbers are in-line expectations as dealers channel checks also pointed to recovery. However, sustenance is the key here. Couple of factors boosted sales in the September quarter. Ahead of the festive season, developers across the board have offered discounts to push inventory. Given the high inventory pile, the discount was said to be higher for luxury units than other housing segments. Also, the reduction in stamp duty from 5% to 2% by the government of Maharashtra is for a stipulated period of time. It should be noted that in fiscal year 2020, the company sold more than 300 units. So, a full-fledged recovery is still some time away.

Meanwhile, customer collections from residential projects remain weak compared to the year ago period. Further, the company's net debt at the end of the September quarter was flat at Rs127 crore, sequentially.