Real estate stocks to buy because the outlook for the sector remains bullish: Nifty Realty gains 23% in 4 sessions

Since Friday’s close (September 17, 2021), the Nifty Realty Index has gained 414 points to a new high of 508 in today’s session, posting massive gains of 23% in just 4 trading sessions. . It is suggested that the Nifty Realty index will break again after a period of 10 years of consolidation, which paves the way for further increases in real estate counters.

Triggers for good gains in the real estate index

There is joy in the real estate market as a whole with record interest rates on home loans, pressure for affordable housing, increased demand for large residential premises as part of working from home, the growth of the technological space and consolidation of the industry on the back of RERA. Needs-driven investing in the sector has come into play, analysts say. Also, with FD rates at an all-time high and gold is expensive, real estate is proving to be the option of preferred investment because the recent reduction in stamp duties also provides a boost.

Real estate stocks to buy as suggested by analysts and brokerage firms as outlook for Indian real estate sector remains bullish

Sobha Ltd. : Angel Broking is bullish on this South India-based real estate counter and had recommended a “Buy” on the script priced at Rs. 730.2 long term, setting a target of Rs. 870 per share. This implies a direct increase of 7% from the current price of Rs. 810.6 per share.

Justifications given for a “Buy”:

Company inventory levels have declined over the past 1.5 years. The company is expected to launch 17 new projects spread over 12.56 million square feet. We have witnessed a strong consolidation among listed players in India, specifies the brokerage firm.

The head of research, Swastika Investmart Ltd. believes that the Nifty Realty Index comes out of 10 years of consolidation that could lead to a sharp rise over the next 2-3 years. Sobha is their number one choice in real estate due to its diverse portfolio, strong growth and healthy balance sheet.

Other preferred choices-Oberoi Realty, Kolte Patil, Brigade companies, Prestige and Suntek Realty are other preferred choices.

Properties of Godrej: This real estate stock is also fundamentally strong and one can buy Godrej’s scrip on dips for good long term gains. The Mumbai-based real estate company may well capitalize on the recovery in demand in residential space and sell residential units worth Rs. 575 crore in its luxury project in Noida in a single day.

“We have a very optimistic view of the Indian real estate sector for the next 3-4 years and the market is also taking notice of the turnaround in the Indian real estate sector where the Nifty real estate index has jumped despite negative news from the Chinese real estate market, adds the Research Director, Swastika Investmart Ltd.

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Article first published: Thursday, September 23, 2021, 11:03 PM [IST]