India’s Real Estate Sector Faces Slowdown in Q2 FY25
India’s real estate market is expected to slow down in the second quarter of FY25. This is mainly because big real estate companies like DLF, Oberoi Realty, and Sobha Ltd. did not launch new projects, according to a report by Motilal Oswal.
Impact on Major Developers
DLF did not introduce any major projects, relying on ongoing projects to drive performance. The report predicts DLF will generate Rs 20 billion in bookings, a 10% decrease from last year.
Oberoi Realty also did not announce new launches but maintained steady sales in ongoing projects. The company is expected to see a 17% decline in bookings, totaling Rs 8 billion.
Sobha Ltd has a large inventory of unsold stock worth Rs 100 billion. The company is expected to report pre-sales of Rs 18 billion, similar to last year.
Strategic Pause in New Developments
The lack of new launches may be a strategic move to focus on selling existing inventories. As companies clear unsold stock, new project launches might increase in the upcoming festive season.
Doubts Revealed
Q2 FY25 -: Q2 FY25 refers to the second quarter of the financial year 2025. In India, the financial year starts on April 1st and ends on March 31st of the next year. So, Q2 FY25 would be from July to September 2024.
Real Estate Sector -: The real estate sector involves buying, selling, and developing land and buildings. It includes residential homes, commercial buildings, and other properties.
DLF -: DLF is one of India’s largest real estate companies. It develops residential, commercial, and retail properties across the country.
Oberoi Realty -: Oberoi Realty is a well-known real estate company in India, primarily operating in Mumbai. It focuses on developing premium residential and commercial properties.
Sobha Ltd -: Sobha Ltd is an Indian multinational real estate developer headquartered in Bangalore. It is known for its residential and commercial projects.
Bookings -: In real estate, bookings refer to the number of properties that have been reserved or sold to customers. A decline in bookings means fewer people are buying properties.
Pre-sales -: Pre-sales are sales of properties before they are fully constructed. It allows developers to secure funds and gauge interest in their projects.
Festive season -: In India, the festive season includes major festivals like Diwali and Dussehra. It is considered an auspicious time for making big purchases, including buying property.
