Real Estate Sector Update - Geojit BNP Paribas Financial Services

- Data released for 2QCY12 reveals that volume in key markets except Bangalore remained flat. Prices have moved up by 13% yoy.

- Bangalore saw significant uptick in volume (1.4 times yoy and 55% qoq.

- Mumbai is in recovery mode where, volume up 19.8% yoy, prices up 15.1%.

- NCR remains inconsistent; volume declined 31%.

- Strong operational data is expected from Prestige Estates, Sobha and Oberoi Realty for 3QCY12. Oberoi is expected to launch its Worli project in the current quarter and expected to report good numbers.

- DLF is unlikely to report significant uptick in the operational front.

- Oberoi Realty remains the top pick in the real estate sector. It has most favorable risk – reward ratio and continues to outperform on the execution front.

- Target price for Sobha Developers hiked to Rs.386 from Rs.329 due to rolling over of the valuation to FY14.

- Target price of Unitech reduced to Rs.24 from Rs 29 on account of execution delays and higher costs of capital.

Source : Equity Bulls

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