Downtrend In Realty Sector

MUMBAI: When the Indian economy was on an upswing, brokerage and real estate stocks were said to be the darlings of equity bourses.

When the going was good, some also made their debut on stock exchanges and were a big hit with the investing community. Never mind the fact that some of these stocks were commanding a valuation ahead of some of the reputed state-owned banks in the country.

Now, with global economy in turmoil and the decoupling theory now being dismissed as frivolous, financial services and real estate sectors are finding a few takers. Most of the recently listed entities from these sectors have lost more than 35-40% in the recent past.

“While all sectors have taken a hit, brokerage stocks have been singled out for punishment due to the swift run-up after listing,” he adds. On a different note, the land bank story is also not finding favour anymore. Stocks like DLF, Puravankara, Omaxe, IVR Prime, Parsvnath Developers, Orbit Corporation, Unitech and HDIL have been in the doldrums since the start of the current calendar year.

While Omaxe has lost more than 60% in the past two months, IVR Prime has lost around 55%. Parsvnath Developers has also lost around 60% since January 17.

Similarly, DLF, which was gaining ground almost on a daily basis over reports related to the Singapore listing of one of its group firms, has shed almost 50% in the last two months. May be, the scenario can be summed up in Deutsche Bank’s words,“Chasing a land bank is unwarranted”.


  1. Posted March 19, 2008 at 4:44 am | Permalink

    yes it can be true but see the another face of real estate in recently there is some big deals in real estate sector in noida, its a good sign for real estate sector

  2. Posted March 20, 2008 at 12:58 am | Permalink

    While the bears are ruling the stock market, there is a different asset class where the bulls are keeping away. Speculative investors in real estate market are retreating, at least in the Delhi-NCR region.
    Some foremost developers based in the region say it is becoming more and more complicated for them to sell flats at launch stage due to lack of interest from speculators. This reflects on the inherent demand structure in the real estate market.

  3. Pune Builders
    Posted April 3, 2008 at 12:16 am | Permalink

    I guess this is how brokerage firms work , especially when so many of them enter the market at once.They create a major shift in the country’s economic trend, which would probably help in manipulating the investors to their advantage.

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