RBI rate cut: DLF, Sobha, Prestige Estates, Godrej Properties shares rise in early deals

Shares of real estate firms such as Sobha Limited, Prestige Estates, Signature Global, Godrej Properties, Sunteck Realty and DLF gained up to 3% on BSE today after Reserve Bank of India (RBI) cut the policy repo rate for third time. The apex bank reduced the lending rate by 50 basis points (bps) to 5.5 per cent with immediate effect. The central bank changed its stance from 'accommodative' to 'neutral'. 

Housing finance shares also rallied with PNB Housing Finance and LIC Housing Finance gaining up to 2.14%. 

Sunteck Realty stock rose 3 per cent , DLF (1.68 per cent) and Oberoi Realty ( 2.22 per cent) on BSE. BSE realty index rose 2.5% to 7,800 points compared to the previous close of 7704. 

Realty shares rose on hopes that banks would transmit RBI rate cut to lenders which in turn would lead to lowering of interest on home loans. The realty majors expect this would lead to a surge in sales in residential and commercial projects.

Real estate services firm Anarock said rate cut makes home loan EMIs easier, improving affordability for customers. The firm expects affordable and mid-income segments to potentially see demand boost. Affordable housing sales share fell from 38% in 2019 to 18% in 2024, the realty consultant said adding that a reduction in CRR by 100 bps will aid developers to get more capital access from banks.  However, its sees positive impacts of the rate cut being negated by ongoing global trade tensions and tariffs. 

Kalyan Chakrabarti, CEO – Emaar India said, “This policy shift will support both homebuyers and developers, enabling a better environment for ongoing project execution through improved capital access.  Additionally, the CRR cut and asset reforms will further enhance liquidity access, fostering robust growth in the real estate industry. The reduced home loan rates will also be beneficial for first-time home buyers, resulting in stronger demand for affordable housing."