Nirmal Bang: Realty Check - Rising Residential Sales Volume Driving Stock Prices Higher; A Case Of Misplaced Optimism
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Nirmal Bang Report
The BSE Realty index has appreciated by 52.8% from its low struck in mid-March post the impact of the Covid-19 pandemic. In our view, the BSE Realty index’s rise is a case of misplaced optimism.
Our view is based on two key points -
1. While we agree that residential sales have increased sharply from October 2020, many experts have said that this is a case of pent-up demand and that growth will peter out from February-March 2021.
2. Strong growth in realty office vertical has slowed sharply, with many companies re-examining their requirements post the impact of the pandemic.
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