The sector which was worse hit by the COVID-19 pandemic was the real estate sector. Just by the time the pandemic began, many real estate stocks plunged to new lows. 50% of the share price of DLF Ltd fell, whereas the share prices of Godrej Properties fell by 37% between January and April 2020. Many real estate stocks were a target of this situation and experienced a fall. Nevertheless, the time has changed, and the economy has started recovering. The share of the real estate companies has now started to rally again.
Indian Real Estate Market
The real estate market has completely transformed over the years. When we talk about the real estate sector, it is not limited to residential properties but also includes commercial properties and hospitality. 80% of space has been taken by the residential space whereas the remaining real estate sector, i.e. 20%, has been acquired by schools, malls, hospitals, hotels and offices. Even if you don't consider yourself a frequent investor, you would still be in life later or sooner and might plan to buy a home. So, it is right to say that at the right time one invests in the real estate sector. The demand for real estate is never-ending, but the applications are limited, due to which the prices of properties are high at this moment.
Since the time the demand for offices and residential spaces has experienced a spike, the Indian real estate sector has started floating in growth. India's private equity investment inflows stood at US 3.3 Billion from January 2021 to September 2021. Across 7 Indian cities, home sales have increased and surged 113% YoY; this has led to an increase in the inflow of FDIs by 7% on a YoY basis.
We can say without a shadow of a doubt that the Indian real estate sector is slowly picking up pace and will soon become the fastest-growing sector.
Below is the list of the top 5 real estate stocks
Current Market Price
52 week high
52 week low
Market Capitalization in crores
Godrej Properties Ltd
Oberoi Realty Ltd
Prestige Estates Projects Ltd
Let's discuss the top 5 real estate stocks in India as per market capitalization
In the first position of the top 5 real estate stocks in India, we have DLF (Delhi Land and Finance Ltd). It is known to be the best real estate company in India and is involved in the development of several offices, residential complexes and retail properties. DLF commercial projects have now become the home of many IT and Fortune 500 companies. The organisation has been in the real estate sector for the past 75 years and has developed over 150 big real estate projects. DLF is also engaged in the business of leasing, generation of power, provision of maintenance services, etc. at this moment; the market cap is Rs 96,339 crores which puts it in the top position of the top 5 real estate stocks.
Lodha developers are the Macrotech Developers Ltd who are engaged in the business of real estate development in India. They have taken the second position in India's top 5 real estate stocks. The company entered the UK real estate market in 2013 and gained a prime property on Grosvenor Square in London. They have successfully completed over 90 projects in India. Macrotech Developers have worked on many commercial and estate development projects and also have contributed to many residential and commercial projects across India.
In the third position of the top 5 real estate stocks, we have Godrej Properties, a subsidiary of Godrej Industries Ltd. The company was incorporated in 1897. They are engaged in the development of real estate. Over the years, Godrej Properties have developed many residential properties, commercial complexes and townships. What DLF is to Gurgaon, the same Godrej Properties is to Mumbai. Godrej Properties own over 3400 acres of land, and the land parcel esteemed development potential is around Rs 1 trillion. Out of the saleable area, Pune takes 27% while MMR accounts for 21%, Bangalore accounts for 18%, Delhi accounts for 15% and the rest is allocated to the location across India. The company stands best for its funding cost, which is yet another reason why it is under the top 5 real estate stocks in India.
Oberoi Realty was known as Kingston Properties Pvt Ltd and was incorporated in 1998. But later, it was renamed Oberoi Realty. The organisation is engaged in the development of residential, office space, retail, hospitality and social infrastructure works. And, if you are concerned about Oberoi realty share price 2022, then you will happy to know that Oberoi realty share price is quite trendy these days. You must know that 81% of revenue is generated from residential projects, while 16% is generated from rental income from investment properties in malls and commercial spaces. The remaining 4% of revenue is generated from hospitality and property management services like food and beverages etc.
The last but certainly not the least position in the top 5 real estate stocks is taken by Prestige Estates Ltd, which was incorporated in 1997. The company is well known for businesses in the real estate sector. Till this month, the company has successfully managed to complete 120 residential projects, 112 office projects and 8 hospitality projects. 76% of the revenue is generated from the real estate sector, while 15% revenue is generated from the leasing business, and the rest 11% of the revenue is generated from offering services in the form of rentals, food and beverages business etc.
In India, the real estate sector contributes to the second-highest employment because of its speedy recovery from COVID-19. If you wish to grow your money, you should consider investing in the real estate stock market. Real estate stock provides high returns and several other benefits. Before investing you must analyse the market, conduct thorough market research and find the best stock out of these top 5 real estate stocks to invest in.