Shares of Mumbai-based Oberoi Realty rallied after it put up a good show in the September quarter. Net profit on a consolidated basis increased 10 per cent year-on-year to ₹70.5 crore.

The higher net profit was despite a 5 per cent drop in revenue, due to lower construction activity by the company. Oberoi has been facing lower sales due to lack of project launches in the last few quarters. This is likely to improve, as the company plans to launch two projects in Mulund and Borivali shortly.

Also, bookings in its Exquiste project in Goregaon, which were sluggish, doubled Y-o-Y in the September quarter. Sale price also increased 6 per cent sequentially. Cash collections improved nearly 36 per cent sequentially to ₹187 crore, helped by increased receipts from its Oasis Worli project.

The Oasis project, with both residential and hospitality development, was facing delays in finalising a hospitality partner which will also provide service to the residential section. This issue was resolved with the company partnering with Ritz Carlton in May 2014.

Oberoi’s office property, Commerz, witnessed a dip in occupancy to 84 per cent, from 86 per cent in the June quarter. However, other rental properties — Oberoi Mall and hospitality property Westin Mumbai Garden City — recorded improved occupancy and revenue in the September quarter. The stock trades at 16 times its expected 2014-15 earnings, which is lower than its historical range of 22-25 times.

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