Nifty Realty Index Surges 42% YTD: ANAROCK Report Reveals Prestige Estates Stock Leads with the Highest New Supply

The Indian real estate sector has performed well in 2024, with the Nifty Realty index rising 42% year-to-date (YTD). Although housing supply was slower in the first half of the year due to approval delays related to elections, the sector is expected to grow significantly in the coming months. In particular, a BSE 500-listed company, Prestige Estates, is leading the way with the highest number of real estate projects planned for the coming years.

Current Trends in the Indian Realty Market

India's real estate market saw a modest supply of new housing in the first half of 2024. This can be largely attributed to election-related delays in approvals and the impact of state elections later in the year. However, the outlook for the remainder of 2024 and into 2025 appears promising. According to ANAROCK report, the market is expected to see a significant new supply of residential units, particularly from the country's leading developers. This surge in housing supply will likely be driven by high demand for branded offerings, as developers seek to capitalize on favorable market conditions.

Among the top 11 listed real estate developers in India, several have announced ambitious plans for new projects. By the start of FY 2025, these companies collectively plan to launch 253.16 million square feet of new residential and commercial real estate across cities. However, only about 23% of this supply (roughly 57.15 million square feet) is expected to be launched in the first half of FY 2025, which indicates a more substantial new supply pipeline in the latter half of the year. 

Key Players in the Realty Market with Planned New Supply

Prestige Estates

Prestige Estates has seen impressive stock price performance, with its share price rising 299.62% over the past two years and 310.56% over the last three years. In the last month, its stock price surged by 19.67%, outpacing the overall market index. As of December 17, 2024, the company's share price closed at INR 1,852.25 per share, reflecting investor confidence in the company’s future growth prospects.

Signature Global

Following Prestige Estates, Signature Global is another prominent developer in the Indian market, with a pipeline of approximately 29.3 Mn sq. ft. of planned launches over the next few years. Signature Global launched around 9.5 Mn sq. ft. of projects in the first half of FY 2025, accounting for 32% of its planned supply. This company, known for its affordable housing projects, is expected to continue its growth trajectory as demand for budget-friendly housing options remains high.

Signature Global's approach to scaling its business involves leveraging capital markets, having raised INR 12,801 crore through Qualified Institutional Placements (QIPs) in the first nine months of 2024. These funds are being earmarked for land acquisition and residential project launches, which will further strengthen its position in the competitive market.

In addition to these leading developers, several other companies in the BSE 500 index are making significant investments in the real estate sector. These include both established developers and new entrants that are seeking to tap into the rapidly expanding housing market.

Future Outlook for the Indian Realty Sector

Looking ahead, the Indian real estate market is expected to continue its upward trajectory, bolstered by several factors. First, the demand for residential properties, particularly in urban centers, is set to remain strong. As India's middle class grows and urbanization increases, the need for quality housing will continue to rise. Additionally, government initiatives aimed at supporting affordable housing and the real estate sector as a whole will provide further impetus to growth.

Moreover, the continued interest from foreign investors in India's real estate market indicates confidence in the sector's long-term potential. The government's focus on improving infrastructure, such as the development of new smart cities and transportation networks, will also contribute to the sector's growth.

The Indian real estate sector is on a solid growth path, with several major developers like Prestige Estates leading the way. The outlook for 2025 is particularly positive, with a strong new supply pipeline expected to meet the growing demand for housing. Investors and homebuyers alike are likely to benefit from the continued expansion of the sector, as developers ramp up their efforts to meet the needs of an evolving market.