Realty stocks gain ground
The Hindu Business Line, April 18, 2009, Page 10
Home buyers waiting for further price correction, say analysts.
S. Shanker, Mumbai
Brushing aside the decline seen on Thursday, realty stocks on the BSE gathered a little steam on Friday.
The shares of most real estate majors were up and many have logged between 28 per cent and 100 per cent gains month-on-month, though they were far from their 52-week highs.
Unitech on Friday gained 21.34 per cent at Rs 52.60 over its previous close of Rs 43.35. There were reports that the cash-strapped company had raised nearly $325 million by selling fresh shares to institutional investors via qualified institutional placement on Thursday. The stock has risen about 102 per cent since March.
Mahindra Lifespaces rose 10.74 per cent to Rs 195.95, over the earlier close of Rs 176.95. The stock has gained about 86 per cent since March.
Gainers
Bangalore-based Puravankara Projects closed 9.73 per cent higher at Rs 58.35. Over the month the scrip has gained 52 per cent.
Parsvnath Developers rose 8.94 per cent at Rs 51.20 on Thursday’s close. The stock has risen nearly 50 per cent compared to its month-ago close.
Phoenix Mills was up 3.47 per cent at Rs 98.35. This is nearly 76 per cent higher than its closing price this day last month. Housing Development and Infrastructure Ltd rose 3.42 per cent at Rs 128.65 over previous close of Rs 124.40. HDIL has gained 82 per cent since March. Omaxe closed at Rs 57.40, up 3.05 per cent over earlier close and 37 per cent higher over the month. Sobha Developers closed at Rs 100, up 2.35 per cent. The stock has gained 28 per cent since March.
The stock of DLF was down 1.75 per cent at Rs 230.55. However, over the month it has gained 44 per cent.
Indiabulls Real Estate closed at Rs 128.80, down 5.05 per cent over Thursday’s close. The stock clocked a 46 per cent gain from its month ago close. Orbit Corporation, down 4.20 per cent, closed at Rs 69.65. The stock gained 52 per cent since March. Akruti City lost 5 per cent to record its 52-week low of Rs 443. The stock is down 72 per cent since March.
Emkay Global research said a recent interaction with brokers and developers on recent launches in the residential segment and the responses from the buyers indicate a consensus that in the last two months volumes have improved due to new project launches at competitive prices. However, they said this could be called a trend reversal (in terms of volumes and not pricing) only if such encouraging volumes continue for the next few quarters.
Emkay said majors such as DLF, Unitech and HDIL have launched residential projects at competitive prices in the last two months. With loan restructuring for most of the companies over, the research report from Emkay said investors will focus on the interest servicing capabilities of the companies.
Motilal Oswal Securities, which tracked the recent realty expo in Mumbai, said home buyers are awaiting further price correction.
Holding Back
The analysts said that over the past four to five months, many developers across Mumbai have reduced their prices by 10-30 per cent and are also open to negotiations. However, responses from home buyers indicate that they continue to hold purchase decisions, awaiting a further price correction.
Most developers are expected to increasingly focus on affordable housing. However, this could lead to severe competition and continued pressure on property prices, which would lead to lower margins for developers.
The Hindu Business Line, April 18, 2009, Page 10
Home buyers waiting for further price correction, say analysts.
S. Shanker, Mumbai
Brushing aside the decline seen on Thursday, realty stocks on the BSE gathered a little steam on Friday.
The shares of most real estate majors were up and many have logged between 28 per cent and 100 per cent gains month-on-month, though they were far from their 52-week highs.
Unitech on Friday gained 21.34 per cent at Rs 52.60 over its previous close of Rs 43.35. There were reports that the cash-strapped company had raised nearly $325 million by selling fresh shares to institutional investors via qualified institutional placement on Thursday. The stock has risen about 102 per cent since March.
Mahindra Lifespaces rose 10.74 per cent to Rs 195.95, over the earlier close of Rs 176.95. The stock has gained about 86 per cent since March.
Gainers
Bangalore-based Puravankara Projects closed 9.73 per cent higher at Rs 58.35. Over the month the scrip has gained 52 per cent.
Parsvnath Developers rose 8.94 per cent at Rs 51.20 on Thursday’s close. The stock has risen nearly 50 per cent compared to its month-ago close.
Phoenix Mills was up 3.47 per cent at Rs 98.35. This is nearly 76 per cent higher than its closing price this day last month. Housing Development and Infrastructure Ltd rose 3.42 per cent at Rs 128.65 over previous close of Rs 124.40. HDIL has gained 82 per cent since March. Omaxe closed at Rs 57.40, up 3.05 per cent over earlier close and 37 per cent higher over the month. Sobha Developers closed at Rs 100, up 2.35 per cent. The stock has gained 28 per cent since March.
The stock of DLF was down 1.75 per cent at Rs 230.55. However, over the month it has gained 44 per cent.
Indiabulls Real Estate closed at Rs 128.80, down 5.05 per cent over Thursday’s close. The stock clocked a 46 per cent gain from its month ago close. Orbit Corporation, down 4.20 per cent, closed at Rs 69.65. The stock gained 52 per cent since March. Akruti City lost 5 per cent to record its 52-week low of Rs 443. The stock is down 72 per cent since March.
Emkay Global research said a recent interaction with brokers and developers on recent launches in the residential segment and the responses from the buyers indicate a consensus that in the last two months volumes have improved due to new project launches at competitive prices. However, they said this could be called a trend reversal (in terms of volumes and not pricing) only if such encouraging volumes continue for the next few quarters.
Emkay said majors such as DLF, Unitech and HDIL have launched residential projects at competitive prices in the last two months. With loan restructuring for most of the companies over, the research report from Emkay said investors will focus on the interest servicing capabilities of the companies.
Motilal Oswal Securities, which tracked the recent realty expo in Mumbai, said home buyers are awaiting further price correction.
Holding Back
The analysts said that over the past four to five months, many developers across Mumbai have reduced their prices by 10-30 per cent and are also open to negotiations. However, responses from home buyers indicate that they continue to hold purchase decisions, awaiting a further price correction.
Most developers are expected to increasingly focus on affordable housing. However, this could lead to severe competition and continued pressure on property prices, which would lead to lower margins for developers.
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