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Realty stocks gain up to 16% on cabinet nod to Real Estate Bill

Stock of Unitech surged 3.26 per cent, Phoenix Mills rallied 4.28 per cent, while Unitech and NBCC added 3.26 per cent and 2.84 per cent, respectively.

BT Online   New Delhi     Last Updated: December 10, 2015  | 16:48 IST
Realty stocks gain up to 15% on cabinet nod to Real Estate Bill
The S&P BSE Realty index surged as much as 1.58 per cent, with Phoenix Mills being the top gainer in intraday trades. Photo: Reuters

Realty stocks under S&P BSE Realty index rose up to 4 per cent, while those outside index surged up to 16 per cent on Thursday after the Union Cabinet on Wednesday approved various amendments to the contentious Real Estate Bill.   

The S&P BSE Realty index settled the day 1.63 per cent higher with Prestige Estates being the top gainer. The stock ended 4.43 per cent higher on the Bombay Stock Exchange (BSE).

with  being the top gainer in intraday trades. The stock gained 3.65 per cent to Rs 332.00 on the Bombay Stock Exchange (BSE).

Stock of Unitech surged 3.26 per cent, Phoenix Mills rallied 4.28 per cent, while Unitech and NBCC added 3.26 per cent and 2.84 per cent, respectively.

Sobha and DLF gained 3.62 per cent and 2.53 per cent, respectively in intraday trades.

Ajmera Realty shares gained a whopping 15 per cent among stocks that are not part of Realty index. Orbit Corporation, Vas Infrastructure, Ansal Properties and BSEL Infrastructure Realty are few others that zoomed in trade.

Reaching out to the opposition, the Cabinet, in its meeting chaired by Prime Minister Narendra Modi, approved a string of amendments to the Real Estate (Regulation and Development) Bill, 2015, aimed at protecting the interest of the buyers and promoting investments in the sector while ensuring transparency.

A key amendment is the provision for depositing 70 per cent of the money received by the builders from buyers for a project into an escrow account, especially created for the concerned scheme, so the builders do not invest a large portion of the money thus raised for other projects. It would also act as a safeguard against uncertainty over a project in the event of the builder backing out.

The real estate bill approved by the previous UPA government had provided for deposit of 70 per cent of the funds raised from buyers into the escrow account but it was reduced to 50 per cent by Rajya Sabha's select committee which examined the bill.

The amended bill also provides for imprisonment up to 3 years for the builders in case of violations of the provisions of the proposed law and upto one year in case of real estate agents and buyers, according to a senior official of the Urban Development Ministry.

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