Buy This Mumbai Based Real Estate Stock As Demand For Housing Surges

The stock of Mumbai based realtor, Indiabulls Real Estate maybe a good pick at the current levels as demand in the Mumbai region surges.

Property registrations in the region surge

According to Motilal Oswal, property registrations grew 26% YoY to 8,552 units in Aug'22, but fell 25% MoM due to strong property sales in Jul'22. Average ticket size marginally improved to INR13m as compared to the last six months average of 12m, but lower than its peak of INR16-17m clocked in FY21.

As per a Knight Frank report, the sub-1,000 sq. ft. home category dominates absorption with 83% share. Aug'22 witnessed a marginal uptick in the 1,000- 2,000 sq. ft. share to 16% from 14% in Jul'22.

Western (45%) and central suburbs (41%) remain the preferred markets, although their collective share declines to 84% from 87% in May'22.

IndiaBulls Real Estate to benefit from surge in demand

One of the biggest developers in Mumbai is the Indiabulls group with almost 10 million sq feet in the region. The company has projects like Blu Estate & Club, Worli, Sky Forest Lower Parel, Indiabulls Green Panvel, Oneindia Bulls Thane etc. The company has also significantly reduced debt for the quarter ending June 30, 2022 and with a massive landbank, should be one of the top beneficiaries.

Share price available at a discount to 52-week high price

The share price of Indiabulls Real Estate is available at a sharp discount to the 52-week low. The shares are trading at Rs 86, as against a 52-week high of Rs 175. With the Mumbai real estate market booming, this should be one of the top beneficiaries of a resurgent real estate market. In fact, the share of properties within the price bracket of INR10-50m touched 56% as compared to 42-52% witnessed over the last 12 months.