Expected trend of increase in demand for real estate in second half
Despite consumers having kept away from big-ticket terms such as real estate and cars in the recent years, latent demand is set to rebound in real estate in FY15, say analysts. Over the past six months, the BSE Realty Index has risen 44 percent, and the Sensex has risen 24 percent.
Over the past three years, the demand for residential projects in key markets such as Mumbai and Delhi has been weak, at best. Consequently, developers have not announced many new projects, focussing, instead, on completing existing projects.
However, anticipating a trend in pick-up of demand, realty developers have started raising money for expansion. Godrej Properties has announced a premium residential project in Gurgaon, while Ansal Properties is investing Rs 130 crore to develop a special economic zone in Greater Noida. Karvy Stock Broking expects new launches of 7 million sq ft from Oberoi Realty and 6 million sq ft from Kolte Patil, which would be sufficient to prop up the western India numbers. J P Morgan believes the earlier beneficiaries are likely to be those with significant amounts of near-completion stock available, such as Oberoi, Prestige and DLF.
JP Morgan believes exemption on dividend distribution tax will be extremely important if these structures have to go through.
Source: Business Standard
BSE Realty Index, increase in real estate trend, NHAI optimistic about FY15, Q1 FY15 riding on two factors
