Realty index hits 6-year high; Godrej Properties, Oberoi Realty at new high

STOCK MARKET - Shares of real estate companies were on a roll with the Nifty Realty index hitting an over six-year high after a strong rally in Godrej Properties, Indiabulls Real Estate and DLF on the National Stock Exchange (NSE).

At 01:25 PM; Nifty Realty index was up 3.8% at 316, its highest level since April 25, 2011, the largest gainer among sectoral indices. On comparison, Nifty 50 index was up 1% at 10,440. The S&P BSE Realty index too up 4% at 2,398, against 1.2% rise in the S&P BSE Sensex.

Godrej Properties, Indiabulls Real Estate and DLF from the Nifty Realty index were up in the range of 4% to 8% on the NSE. The non-index stocks such as Hubtown, Dilip Buildcon, Ansal Buildwell, Emami Infrastructure and Simplex Realty were up 5% to 9% on the BSE.

Oberoi Realty hit a new high of Rs 509 on the NSE in intra-day trade. In past three month the stock rallied 27% against 3% rise in the benchmark index. The company had posted 25% year on year growth in its consolidated net profit of Rs 104 crore in Q2FY18.

“With the onset of Real Estate (Regulatory and Development) Act or RERA and Goods and Service Tax (GST), we are already witnessing an increase in customer confidence and an improved market sentiment. We believe that credible players are likely to gain ground and unorganised players will be pushed out and we will witness consolidation in the sector,” Vikas Oberoi, chairman & managing director of Oberoi Realty said while announcing Q2FY18 results.

According to analyst at Edelweiss Securities, the key uncertainties (RERA & GST) appear to have largely settled. Despite near‐term sluggishness, analyst expect uptick in residential new sales in ensuing quarters across key markets.