Demand in Kochi a worry for Sobha Developers.

This week, the Sobha Developers stock lost three per cent, owing to the near-term sluggishness in the Kochi market, where the company invested Rs. 330 crore recently. Through the deal, it acquired 50 per cent stake in a 17-acre project at Marine Drive, Kochi, from Puravankara Projects.

While the deal gives the company access to the Kochi market's Marine Drive area and the land parcel holds development potential of three million sq. ft., analysts aren't bullish about the prospects for the area. J M Financial's Abhishek Anand says there is concern about the dynamics of the Marine Drive micro market, as it is facing a demand slowdown, especially in the premium segment. Also, the inventory pipeline in the region is likely to result in limited price appreciation, he adds.

BS