Real estate stocks remained under pressure on Wednesday and the BSE Realty index fell 5.7 per cent to 6,719.36 in the day’s trade amid a sharp fall in the market prices of many major companies. This is a 10 month low.
The realty index was trading at its lowest level since March 26, 2024. According to the data, it had made a low of 6,858.75 on March 26. The BSE Realty Index is down 24 percent from its December 2024 high of 8,871.98. Shares of Prestige Estates Projects, Oberoi Realty, Macrotech Developers (Lodha), Shobha and Godrej Properties have fallen 21 to 26 per cent in the last one month.
On Wednesday, BSE Realty index was among the biggest falling sectoral indices with a fall of 4.5 per cent. Sensex rose by 0.75 percent. On Wednesday, Prestige Estates Projects, Oberoi Realty, Lodha, Shobha and Godrej Properties fell between 5 to 6 per cent. DLF, Ananth Raj Industries and Brigade Enterprises recorded a weakness of between 3 to 4 per cent.
Oberoi Realty is seeing an uptick in the performance of its residential business. Apart from this, its rental portfolio is also witnessing growth. It has commenced operations at its key office and retail assets. Elara Capital maintains its Buy rating on the stock with a price target of Rs 2,350. The brokerage firm says the main downside risks are delays in launching projects and regulatory challenges.
Meanwhile, according to HSBC Global Research, demand for real estate is beginning to rise, emanating from middle-income housing. Demand for upgrades has been dominant in the last four years, which has helped developers set better prices.