Housing Demand Expected to Moderate in FY27; Select Listed Developers Poised for Outperformance

Housing Demand Expected to Moderate in FY27; Select Listed Developers Poised for Outperformance​

India's residential real estate sector is entering Fiscal Year 2026-27 (FY27) amid a transition into a more mature stage of the housing cycle, with analysts suggesting that the vertical growth witnessed over the past four years may not be replicated. However, market experts note that select listed developers are likely to outperform the broader market, driven by strong balance sheets, consolidation within the sector, and sustained demand for branded properties.

In a sector report, Emkay Global Financial Services noted that growth in FY27 will become "more selective," depending on execution strength rather than broad-based demand expansion. They pointed out that presales growth among 18 listed developers slowed to 17 per cent in FY26, down from 43 per cent in FY23 and 20 per cent in FY25. Emkay Global now anticipates FY27 presales growth will further moderate to a 10-15 per cent range.

While structural factors such as urbanization, premiumization, and gains in market share by organized developers continue to support overall residential demand, potential headwinds include geopolitical tensions, uncertainties related to AI-led job disruptions, slower wage growth, and moderating corporate earnings, according to Emkay Global.

Realty Sector Performance Snapshot​

Data compiled on June 2 provides a view of the performance among key realty stocks:


As of the date of data compilation, several major players—including Brigade Enterprises, Aditya Birla Real Estate, Lodha Developers, DLF, Prestige Estate, and Godrej Properties—have shown declines in the range of 14.5 to 25.4 per cent. For comparison, the Nifty 50 index and Nifty Realty index have dropped 10.5 per cent and 12.5 per cent, respectively.

Analyst Outlook and Key Bets​

Nomura suggests that the first quarter (Q1) of FY27 is set to begin on a healthy footing due to a strong launch pipeline. The brokerage cited Godrej Properties, Oberoi Realty, and Sobha as having a relatively stronger launch lineup. Nomura also expressed confidence in Prestige Estate’s Golden Grove project in Hyderabad and Sobha's One World township project in Bengaluru.

Emkay Global anticipates Mahindra Lifespace’s Rainforest project near Kanjurmarg to book approximately 900 to 1,000 crore in Q1FY27, noting strong traction for Prestige Estates’ Golden Grove project.

When focusing on developers with resilient pipelines and healthy balance sheets, Emkay's preferred stocks include Mahindra Lifespace Developers, Sobha, and Lodha Developers. Nomura identifies Oberoi Realty's 360 North, Godrej Properties' Samaris, and Sobha's Crescent in the National Capital Region (NCR) as crucial demand drivers for the quarter.

Smallcap Valuations See Moderation​

A report from Bajaj Finserv Asset Management Company (AMC) suggests that current market conditions represent a favorable entry point for investors looking at smallcap funds, citing improved fundamentals and moderated valuations. The segment has seen rallies between 2020 and 2024 but began to underperform from October 2024, with the category showing a 6.3 per cent rise over the last three months.

Analysts from Edelweiss Mutual Fund and Centricity WealthTech noted that while valuations have moderated significantly from their 2024 peak, pockets still trade at a premium, requiring disciplined investment. Fundamentals of the smallcap segment remain sound, with many companies utilizing internal cash flows for expansion rather than relying on debt. Sorbh Gupta of Bajaj Finserv AMC emphasized that earnings recovery remains the most crucial catalyst for the sector.

Corporate Update: JK Cement Announces Share Transfer to IEPF​

J.K. Cement Limited has processed the transfer of equity shares and unclaimed/unpaid dividend related to Financial Year 2018-19 to the Investor Education and Protection Fund (IEPF) Authority. The company released newspaper advertisements regarding this transition, which was published in Business Standard and Hindustan.

JKCEMENT Stock Price Movement​

JK Cement Limited saw its stock tumble today after settling at ₹4877, following a 3.81% drop in the trading session. The decline pushed the stock towards its annual low, with shares trading as low as ₹4865.5 amid a volume of 95,853 shares.