When markets closed today, the total market capitalization of the realty stocks was 100,874.02 crores. With 13 of the total 14 stocks in the red, realty stocks were still not showing any chance of recovery. The realty stocks shed 196.37 points to close the day 5.80 percent below yesterday's close of 3386.50. Though, it had reached an intraday high of 3430.13 points, it could not sustain through the day. In all a total of 4.5 crore realty shares were traded through the day.
After the onset of the economic slowdown, real estate has been one of the most affected sectors with the demand for residences and offices declining rapidly. Analysts feel that the demand may go down further, before the market starts stabilizing. According to Goldman Sachs, the prices should further fall by 30 percent for the demand to pick up in certain geographies. Some of the developers have even started auctioning their flats due to low demand.
A recent report by global consultancy firm CB Richard Ellis says that the demand for office space in the prime locations have fallen drastically. In the business districts in New Delhi and Bangalore, the rentals have gone down by over 10 percent. Credit Suisse forecasts further correction in the Indian real estate market in the coming 12-24 months. With a gloomy outlook in the real estate market one needs to wait and watch, the future of realty stocks.
Some of the major realty stocks were leading the group during the downfall that was seen through the week. DLF lost almost 17.61 percent in the last one week, Unitech also did not have a good trading week by falling 11.46 percent and even HDIL was down 18.76 percent. Only Sobha Developers (SOBHA) were slightly in the positive territory by gaining 1.84 percent. It was in January 2008 that these stocks had touched the highest level of 13848.09 from which it had dropped to a low of 1297.82 in March this year when the slowdown intensified.
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