No bright light for real estates any soon
According to data by provided by brokerages such as Motilal Oswal Securities, Kotak Securities, Edelweiss Securities, Prabhudas Lilladher and Emkay Global, net profit for the real estate companies are expected to fall by 20 per cent, while net sales may rise three per cent in the first quarter of the current financial year.
According to data culled by BS Research Bureau, net profits of the top 12 property companies showed an average decline of 15 per cent in the fourth quarter of 2011-12, while net sales fell 12 per cent.
The main factors behind the fall is attributed to slow demand and fewer launches in the first quarter by many companies in the sector, including DLF and Unitech. Moreover, there has been high inventory pile-up and approvals were relatively slow in markets such as Mumbai. Owing to high prices and the slowdown in the economy, the absorption of homes in Mumbai fell 35 per cent to 45,000 units in 2011-12, compared to the previous year.
As compared to developers in NCR and Mumbai, Bangalore – based developers are expected to perform better. Analysts also hope for a better second half in 2012 for the realty sector due to expected cuts in interest rates, stable prices and the resultant improvement in absorption.
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Source: Business Standard
Bangalore, BS Research Bureau, DLF, Edelweiss Securities, Emkay Global, Kotak Securities, Motilal Oswal Securities, Mumbai, NCR, net profits, net sales, Prabhudas Lilladher, Real Estate Companies, Real Estate Sector, Realty sector, Unitech
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