On Tuesday, shares of real estate companies rallied on an increase in demand for completed products and expectations of robust revenue collection in 2021. Nifty Realty index was up 5% outperforming other sectoral indices for the day with Indiabulls Real Estate shares climbing 13% after announcing its Q3 results.
With attractive property prices (with discounts offered), low interest on loans and cut in stamp duty in major states, residential real estate has witnessed a strong recovery in the last 6 months. Almost all top cities are clocking record sales as compared to previous years
On Monday, Indiabulls Real Estate reported a 64% rise in its consolidated net profit to Rs 80.69 crore for the December-ended quarter. Its net profit was Rs 49.27 crore in the year-ago period.
"While some part of this recovery may be attributed to pent-up demand, developer discounts and temporary stamp duty waivers, a large part of it is on the back of fundamental factors such as multi-decadal low-interest rates, bottomed-out pricing creating a room for price rise in future and a general increase in the need for owning a home in light of Covid," Motilal Oswal's CEO Sharad Mittal said in a pre-budget note.