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Realty index dives

October 27, 2009

The BSE Realty Index slid nearly 8 percent to a two-month low on Tuesday after the Reserve Bank of India (RBI) withdraws some liquidity measures.

The BSE Realty Index ended 6.2 pct down, with the main losers being Puravankara (down 9.9 percent), Omaxe (down 9.6 percent), HDIL (down 8.6 percent) and Unitech (down 7.6 percent).INDIA-ECONOMY/

“The sector is just recovering and this will definitely affect developers,” Sarang Wadhawan, managing director, Housing Development & Infra, said.

The RBI, in its quarterly policy review on Tuesday, increased provisioning for commercial real estate loans to 1 percent from 0.4 percent for standard assets, and also raised the statutory liquidity ratio by 1 percent.

The realty index has gained over 70 percent so far this year.

Do you think realty stocks will fall further on the RBI’s move?

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