Money on the markets
A maturing market amid the mayhem
Shares of real estate companies closed higher on Thursday as investors started accumulating some sector-specific beaten down stocks.
Property developer Unitech posted its best single-day gain in nearly 16 months, rallying 9.6 percent after JPMorgan upgraded the beaten down stock to “overweight” from “neutral”, citing cheap valuations, reasonable gearing, comfortable liquidity and high embedded land value.
The stock is still down nearly 39 percent this year.
The BSE Realty index was up 2.8 percent on Thursday, outperforming the benchmark index, which was up 0.8 percent.
Shares of Sobha Developers, Indiabulls Real Estate, Orbit Corp and Parsvnath Developers were up between 4 and 6 percent on Thursday.
The BSE Realty index ended lower on Tuesday on concerns of increasing interest rates and as rising input costs weighed on investors.
Analysts said with foreign funds pulling out more than $1 billion from Indian equities since the start of January, the outlook for the near term remained subdued.
The BSE Realty index was down 3 percent, underperforming the benchmark index, which was down 1.5 percent. Shares of DLF, Unitech, Indiabulls Real Estate and Sobha Developers were down between 1 and 7 percent.
The Realty index has slipped over 20 percent in 2011. Do you see a further downside in real estate shares?
The BSE Realty Index pared early losses and closed 5.6 percent higher in a volatile Tuesday session.
Government data showed infrastructure sector output grew 7.0 percent in October from a year earlier, faster than an upwardly revised annual growth of 2.7 percent in September.
Shares of real estate developers came under pressure on Thursday following the arrest of top public sector bankers the previous evening on corruption charges.
The CBI on Wednesday arrested five officials from state-run listed companies, including the chief executive of LIC Housing Finance, for taking bribes to facilitate large corporate loans.
The BSE Realty Index closed 1.2 percent higher on Thursday while the broader market remained volatile and closed 0.4 percent lower at 19417.
Shares that boosted the sectoral index were DLF (up 2.6 percent), Unitech (up 1.5 percent) and Ansal Properties (up 2.1 percent). However, Omaxe dropped over 2 percent.
The BSE Realty Index ended 4.3 percent lower while the broader Index ended 1.2 percent down on Friday leading to the worst weekly fall in six months.
Stocks which declined include Sobha Developers which ended 6.2 percent down, DLF 4.4 percent, HDIL 5.1 percent and Unitech which slipped 4.9 percent.
The BSE realty index ended 3.5 percent lower while the broader index dropped 1.7 percent to 17,380 points.
Some of the other losers were Indiabulls Real Estate, which dropped 6.3 percent, Unitech which ended 3.9 percent lower, and HDIL which slipped 3.7 percent.