Stocks Of Godrej , Dlf, And Oberoi Jump In Nifty Realty Of Over 3%
Stocks in the real estate sector went up as the RBI said it would cut rates and Cash Reserve Ratio (CRR). RBI Governor Sanjay Malhotra shared the news after the Monetary Policy Committee (MPC) meeting. Real estate company shares jumped 3% to 6%.
A few of the companies that gained are Godrej Properties, Oberoi Realty, DLF, Sobha, and Prestige Estates Projects. Nifty Realty saw a surge of over 3% in its share price. All the real estate stocks exhibited positive movement during the market session. Raymond was the only firm that was in the red.
Prashanth Tapse, Mehta Equities Research Analyst and Senior Vice President of Research, why the stocks rose. The rise is because the Monetary Policy Committee cut the repo rate by 50 basis points. The cut expected in the market was 25 basis points. However, it was two times that.
The move by the RBI was unexpected. It has brought the 2025 repo rate down to 5.5%. It is the third consecutive time this year that the rates have been cut. The total reduction so far has been 100 basis points.
The aggressive easing of the monetary policy is being done to boost economic growth. It will bring down borrowing costs and make home loans cheaper. It will help the real estate sector greatly. The action will increase the liquidity in the banking system. It will benefit buyers of homes as lenders can then pass on these benefits to them.
Tapse said that with the supportive stance of policy, he foresees a strong growth in the demand for homes. He also expects that real estate investments might rise in the mid-income and affordable segments. These changes are expected in the next 2 to 3 years.
Niranjan Hiranandani, the chairman of NAREDCO and Hiranandani Group, said the rate cut will help the sector. It will make it easier to get loans and speed up buying velocity. It will add to the pace of development. Home loan rates will be lower, making it affordable to buy homes. It will bring down money stress for buyers.
Lower mortgage rates mean more people can buy homes. It will increase the demand in the housing market with stronger sales of homes and an overall better performance.
It may also spur refinancing as buyers shop for loans that are cheaper. It will strengthen the interest of investors in branded properties by Grade A builders. These will be attractive as they will get better and higher returns.
- The Monetary Policy Committee (MPC) has brought down the repo rate in the liquidity adjustment facility (LAF). It has been lowered by 50 basis points. From now on, it is down to 5.50%.
- The rate for the standing deposit facility (SDF) will be changed to 5.25% as a result.
- The rates for the marginal standing facility (MSF) and Bank Rate are set at 5.75%.
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