The growth of big real estate companies in India might be slowed down by the lack of new projects starting up in Q2FY25.
According to a report by Motilal Oswal, the Indian real estate market will likely slow down over the second quarter of fiscal year 25.
This is largely driven by the absence of major New Project launches from top real estate players.
Even if there is consistent progress being made in current initiatives, there is a possibility that sales momentum would slow down as a result of the lack of activity in new projects launches.
It was said in the report that “Sequential moderation is expected due to the lack of new projects launches.”
Prominent Developers Slumped on New Projects Launches:
The report said, India’s leading real estate developers, such as DLF, Oberoi Realty (OBER), and Sobha Ltd., did not launch significant new projects during the quarter.
The subdued launch pipeline has hindered growth prospects for Q2 FY25, compelling these enterprises to depend on current inventories to enhance performance.
DLF did not initiate any significant initiatives in the second quarter. Consequently, its performance for Q2 FY25 is anticipated to be solely influenced by its inventory of active projects.
The report projects that DLF is expected to achieve bookings amounting to Rs 20 billion in the upcoming quarter, which indicates a 10 percent decrease in comparison to the corresponding period from the previous year.
The report indicates that DLF is anticipated to achieve bookings of Rs 20 billion, reflecting a decrease of 10 percent year-over-year.
Another important participant in the real estate industry, Oberoi Realty, did not announce any proposed new projects launch during the second quarter of the fiscal year 25.
On the other hand, it has managed to keep a steady level of enthusiasm and advancement in the projects that it is now working on.
As stated in the study, it is projected that the firm would face a decline in bookings of 17 percent compared to the previous year, which will amount to a total of 8 billion rupees.
Sobha Ltd chose to hold off on initiating any significant projects during the quarter.
Nonetheless, it possesses a substantial inventory of unsold apartments worth over one hundred billion rupees and remains in the developmental phase.
The firm is expected to declare pre-sales of Rs 18 billion for Q2 FY25, indicating steadiness relative to the same period last year.
The lack of new project releases has limited the chances for growth that Sobha has for the quarter, even though the company’s unsold inventory provides a certain degree of protection for the business.
Liquidating existing inventories is the primary focus of this endeavor:
This temporary halt in the construction of new projects may be an indication that developers have made a deliberate decision to concentrate on selling off current inventories in response to the changing dynamics of the market.
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