The stock market is all about interpretation, judgement and timing. It is just a matter of reading and good analysis for choosing the right kind of company to invest in. The rise in the value of stocks is a slow and sure reality if investments are backed by proper market research.
‘This time it’s different’, a colloquial stock market phrase, aptly traces the proceedings of the real-estate sector through the pandemic. Investments that are easy on your pocket rarely churn lucrative profits.
Hence, with judgement comes the skill of observing which is a very important factor when investing in stocks. This can easily be done through NIFTY realty which is an index that interprets the behaviour as well as its performance for the financial year for different organisations.
This blog will help you in understanding what NIFTY realty actually stands for, its features, the top 5 realty companies you can invest stocks in, and the reasons as to why one should invest in the same.
Table of contents
NIFTY Realty – Meaning
NIFTY Reality is an index system that examines all the behavioural changes and any increase or decrease in the performance of real estate companies. The NIFTY index consists of 10 companies that are listed under the National Stock Exchange of India (NSE). The maximum lof the NIFTY index is 10 stocks.
Features of Realty Stocks
Attractive Opportunities
- According to the Investment Information and Credit Rating Agency of India, it is anticipated that the Indian firms could see an increase of about INR 3.5 trillion which in US$ is somewhere about 48 billion. This increase is by the infrastructure along with the real estate investment trust for 2022, in comparison with the US$ 29 billion until now.
- Blackstone who is known for investing in the private market has also invested about INR 3.8 lakh crore in the Indian real estate market and is also seeking an additional investment of INR 1.7 lakh crore by the end of 2030.
Strong Demand
- As per Savills India, there can be an increase (for 15 to 18 million square feet) in the demand for data centres by the year 2025, under the real estate market.
- There is a strong demand for the properties made for residential purposes because of the increase in urbanisation and an increase in the household income of an individual. India has therefore been counted amongst the top 10 housing markets even internationally
- It is also expected that the real estate market based on retail can also see an increase from 28% to 82% million square feet by the end of the year 2023.
Increase in Investment
- Due to the rise in transparency and returns, there is also an increase in investment in the private sector.
- At the start of the year 2021, a heavy investment cost of about US$ 2.4 billion was observed along with the property’s assets. The same was registered under the India Investment list.
- Even the Fixed Deposit investment sector was seen at the worth of US$ 51.5 billion from April 2000 to June 2021.
Policy Strategy
- The Indian real estate market captured an institutional investment worth US$ 5 billion in the year 2020, which was almost equal to 93% of transactions that were recorded for last year.
- Apart from this the Indian market also influenced investment in the private sector of worth INR 23,946 crores through nineteen deals in the 4th quarter of 2021.
NIFTY Realty: Sudden Boom
The people that have been a part of the stock market have recently seen a great jump in the stock market by seeing a rise in the same from 47 % to somewhere in between 100% in the past months. The Indian stock market has seen a pretty great stretch in both NIFTY Realty, S&P 500, & BSE by reaching the goal successfully.
Where the S&P 500 witnessed a jump of about 63 % in numbers for 1st January till 10th December for the same year, the NIFTY Realty surged about 60 % during the same time.
There are several factors that can pose hurdles in the process of construction of a property. These implications also impact the stock market. Stock prices shoot up and the bullish phase hits the stock market, even when there is a surge in raw material prices, new project launches coupled with the pandemic have affected the stock market situation.
However, the main players of the realty stock market in India have maintained their grip in the business even in these tough times. These include DLF Limited, Godrej Properties, Oberoi Realty, and Sobha Realtors amongst others who witnessed a tremendous rise in the stock share between 47% to 100 % in the past few months. Meanwhile, Sobha Stocks witnessed a rise of about 122 % in the same time span.
Emerging Real Estate Trends
NIFTY Realty includes 10 companies under the National Stock Market. Listed below are the top 5 lucrative real estate companies for buying shares in India:
DLF Limited
The first position in the list at present is said to be covered by DLF limited. The current market value of this company is worth INR 37166.81 crores, which is why it is known to be the leading organisation in the real estate market that was established in the year 1946.
This organisation has come up with the most remarkable and renowned projects in the real estate market. The reach of these projects has been launched in different sectors of India.
The 52-week ratio that showcases the low and high phases of an organisation shows that the company is performing well in the real estate share market.
Godrej Properties
Investing in the market since 1990, Godrej Properties has successfully completed residential projects, commercial projects as well as township projects in some major parts of the country.
The current market value of this company is worth INR. 22079.75 crores.
The 52-week ratio report depicts the steady growth of the company.
Oberoi Realty
Established in 1980, Oberoi Realty is known to bring about tremendous change in the residential property sector.
The Mumbai-based real estate company is buying stock in India and has emerged profitable for all its investors.
The current market value of this company is worth INR 13680.53 crores.
Phoenix Mills Limited
Phoenix Mills Limited is well-known for its retailing mall development.
The organisation has already built about 8 malls in the major sectors of the country in the past. The current market value of this company is worth INR. 10507.03 crores.
The company managed to again upgrade its value under the 52 weeks ratio list.
Prestige Estates Project Limited
A well-known name in the real estate market, Prestige Estates Project Limited was established in 1997. The organisation has managed to construct some major projects of residential, retailed based and hospitality sectors successfully.
The current market value of the company is INR 9688.83 crores.
And as per the 52-week ratio report, the company has said to make its mark in the list consistently. It is known to be one of the few companies that work in making profits for its shareholders.
Why Should One Invest in Realty Stocks?
Investment in realty goes a long way as it not only provides financial security but it also proved to be an opportunity in the time of the pandemic. There are several reasons for an individual to invest in realty stocks some of which are listed below:
- The boom in the real estate market owing to the pandemic has been a blessing in disguise, as the drop in realty rates lead to investment opportunities.
- The foreign portfolio investors are consistently investing in the realty stock segment.
- It is known that the housing loan sector has also rebounded.
- The medium-term sector will not get affected by the COVID-19 pandemic in the country.
- There are various individuals that have been investing in these plans from different districts of the country.
- Transformation in the structure of demand for properties due to increased urbanisation and economic growth, leading to fruitful returns.
In Conclusion
NIFTY Realty is a reliable index platform that individuals can resort to while making investment decisions in the real estate sector. With the features and the top-most company that it takes into consideration, the procedure of investing into the stock market has become easier. However, a thorough homework of the stock market is essential to achieve optimal returns.
