Income tax department conducts searches at Sobha realty office and other premises

A search by the Income Tax department is being carried out at the registered office and other premises of Sobha Ltd.

Sobha Ltd. is a Bangalore-based real estate company having its presence across the country. Company’s board recently approved continuation of Ravi PNC Menon as chairman and non-executive director of the company.

In December last year, the Enforcement Directorate (ED) made provisional attachment of Rs 202 crore against the company under the Prevention of Money Laundering Act, 2002. According to the provisional attachment order an inquiry was conducted by the authority regarding allotment of certain plots being developed pursuant to a joint development arrangement with certain landowners/licensees in Gurugram, in 2008.

To which company replied that the provisional attachment by ED will not see any impact on company’s operations and that there has been no wrongdoing from company's side and is confident of obtaining a favorable outcome through appropriate legal recourse on this matter.

‘Our volumes have been steady for the past 8 quarters. We are present in 11 cities, adding Hyderabad as the 12th city and have reduced debt by Rs 1,280 crore in last 9 quarter. Collections have been improving due to higher sales’ Jagadish Nangineni of Sobha told CNBC-TV18 on February 10.

Sobha reported a margin decline in third quarter of FY23 with its operational profit dropping nearly 41 percent on a year-on-year basis. However company’s sales volume saw a rise of 12 percent YoY at 1.47 msf and sales value was up 36 percent in the same period.

Shares of Sobha have plunged in today’s trade and is down more than 4 percent in early hours of trade. With a nearly 9 percent decline this week and more than 13 percent fall this month stock price is just 17 points away from its 52-week low.