Residential real estate sales in India saw a sequential improvement of 10% even as launches remained weak with 20% qoq decline in Q3FY25. Delhi NCR saw recovery in sales while Hyderabad, Bengaluru and Mumbai Metropolitan Region saw weaker sales impacted by lower launches due to delayed approvals.
Overall inventory across the country reduced and remained at low levels of 1.4 years of sales (trailing 12 months). Our coverage companies delivered a strong Q3FY25 sales (+16%yoy, 56% qoq) with stronger launch pipeline.
Developers continue to remain positive on double digit sales growth supported by industry growth and market share gain. We expect a further pick-up in Q4FY25 sales, aided by improved launches.
Valuations for most of the residential real estate stocks stand at 6-10X adj. EV/EBITDA (FY26E) after the recent correction in the stock price. We remain constructive of demand picking up further and prefer DLF, Brigade and Signature Global at the current price points.
