The Nifty Realty Index is down 31% from its November 2021 peak, bringing sector valuations (PBx) to within 10% of their last 10-year average valuation. Given the consolidation of the sector, better corporate balance sheets and growing cycles, global brokerage Jefferies believes that realty stocks should trade higher despite rising interest rates.
Godrej Properties (GPL), DLF and Macrotech Developers (Lodha) are its top stocks in the real estate space. The note said, “Developers continue to emphasize new launches as 10-year low inventory drives price growth. Within our coverage, the pre-sales performance of GPL, Lodha, DLF and Prestige should be relatively better.” “
Developers have continued to push ahead with new launches and Jefferies believes that FY 2013 should be a more stable year for Godrej Properties considering good launches in early 2013.
“Our analysis of the prospects data for the months of April-May 2022 shows that primary resin sales in the top-7 cities were maintaining sales momentum near the seasonally strong January-March 2022 quarter level,” it said. Told.
Data from property advisors, new launches and registration data suggest housing momentum in June is strong, maintaining a positive trend during the quarter. Sales jumped amid an increase in mortgage rates of ~75 bps during 1Q.
MTD (month-to-date) property registration data for June 222 from Delhi and Mumbai is 50% higher than June 2019 (pre-Covid) levels, indicating that the overall activity level in property markets remains high. Inventory eg in many cities. Gurgaon, Bangalore, Pune are below the 20-month levels and are in line with the price momentum currently observed in these markets. The data also shows that the trend of rapid sales of sizable homes and premium locations continues.
Based on new launches and data analysis from PropQuity; The brokerage expects strong 1QFY23 pre-sales performance from the listed companies, which will help developers meet the FY23 guidance.
The views and recommendations given above are those of individual analysts or broking companies and not of Mint.