The Indian real estate sector, often hailed as a cornerstone of economic growth, is facing a turbulent 2025. Contributing around 7% to the nation's GDP, the industry was projected to expand to $1 trillion by 2030, fueled by urbanization and infrastructure booms. Yet, halfway through the year, all 21 tracked stocks in the real estate and construction space are in the red, with year-to-date (YTD) declines ranging from a modest 5% to a staggering 38%. This sector-wide slump isn't just bad luck—it's a cocktail of escalating construction costs, a 13% drop in residential sales volumes in H1 2025 due to shifting buyer preferences and macroeconomic pressures, and affordability crunches in metros where prices have surged 21% annually. High interest rates and reduced launches have compounded the pain, leading to a 27% YoY dip in institutional investments to $1.2 billion in the first half.
In this two-part deep dive, we'll unpack the first half of these laggards—11 stocks that highlight the sector's vulnerabilities. From luxury heavyweights like DLF to mid-tier players like NBCC, each has its story of resilience tested by rising input costs (up due to inflation) and cautious buyers favoring premium segments over affordable homes. If you're an investor eyeing a rebound—perhaps with anticipated rate cuts easing mortgage burdens—this analysis could spotlight potential turnaround plays. Let's break it down, stock by stock.
1. DLF Ltd. (-20% YTD)
DLF, India's largest publicly listed real estate firm by market cap, has shed 20% this year, trading around ₹727 as of late September. Despite robust Q1 FY26 revenue jumping 99% YoY to ₹2,717 crore on strong bookings, the stock's fall mirrors broader sector woes: a 28% YoY drop in housing sales across top cities in Q1 2025. High valuations (P/E over 40) and promoter holdings steady at 74% signal caution, but DLF's ₹8,000 crore pipeline in Gurugram could fuel recovery if urban demand rebounds. Analysts remain bullish long-term, citing its debt reduction to 0.1x net debt-to-equity.
2. Lodha Developers (Macrotech Developers Ltd.) (-15% YTD)
Lodha, synonymous with Mumbai's skyline, is down 15%, hit by a 23% sales slowdown in key markets like Mumbai. Construction costs have ballooned 15-20% due to raw material inflation, squeezing margins despite a 48% YoY sales value rise to ₹3.47 lakh crore in FY23 (pre-2025 trends). The firm's pivot to luxury (41% of sales over ₹1 crore) has boosted average realizations but alienated mid-segment buyers amid affordability gaps. With ₹50 billion in fresh equity infusions, Lodha eyes suburban expansion—watch for H2 catalysts.
3. Prestige Estate Projects Ltd. (-16% YTD)
Bengaluru-based Prestige has tumbled 16%, underperforming amid a 13% H1 sales contraction. Escalating land and labor costs (up 10-12%) have deferred launches, while high home loan rates (8.1-8.75%) deterred end-users. Yet, Prestige's 33% market share in Bengaluru's office leasing offers a silver lining, with GCCs (global capability centers) absorbing 40% of space by year-end. Promoter stake at 37% remains firm; expect stabilization if infra projects like the Dedicated Freight Corridor boost suburban appeal.
4. Godrej Properties Ltd. (-37% YTD)
Godrej's brutal 37% plunge is the sector's starkest, despite record Q4 FY25 sales. High debt (0.73 debt-to-equity) and operating losses have spooked investors, exacerbated by a 22% YTD drop and promoter stake dip signaling waning confidence. Residential launches fell 3% YoY in H1, hit by premiumization trends where luxury (over ₹1 crore) now dominates 41% of sales, sidelining affordable segments down to 27%. Godrej's 215 million sq ft pipeline and green building focus (25% growth in certifications) position it for a rebound, per 14 of 18 analysts rating it "Buy."
5. Oberoi Realty Ltd. (-15% YTD)
Oberoi's 15% decline reflects Mumbai's affordability crunch, with prices up 21% but sales volumes contracting 13%. Rising construction expenses (double global averages in India) have eroded profitability, forcing project deferrals. The firm's luxury mall and office portfolio (e.g., Commerz III) absorbed strong leasing, but residential hesitancy amid high EMIs persists. With FDI inflows at $45.75 billion cumulatively, Oberoi's $22 billion investment hunt could pivot fortunes.
6. Phoenix Mills Ltd. (-13% YTD)
Retail-focused Phoenix is off 13%, as consumer spending hit $1.29 trillion but shifted to e-commerce, curbing physical retail demand. H1 leasing reached 6.4 million sq ft, yet vacancies persist in non-metro malls due to 20-30% energy cost hikes. Phoenix's 25% green-certified portfolio aligns with sustainability trends, potentially boosting values by 10%. Analysts forecast 6.5-7 million sq ft leasing in 2025 if disposable incomes rise.
7. NBCC (India) Ltd. (-5% YTD)
Government-backed NBCC's mild 5% dip is the sector's least severe, buoyed by ₹11.11 lakh crore infra capex. Yet, even here, Q1 sales fell amid 44% revenue drops in peers, tied to execution delays from labor shortages. NBCC's focus on smart cities (100 planned) and redevelopment projects offers stability, with ROE at 8%.
8. Anant Raj Ltd. (-6% YTD)
Anant Raj's 6% slide stems from Delhi-NCR's high land costs, pricing out mid-income buyers. Data center demand (15-18 million sq ft by 2025) provides upside, but residential slowdowns (23% Q1 drop) weigh heavy. Promoter confidence at 75% and low debt signal resilience.
9. Brigade Enterprises Ltd. (-31% YTD)
Brigade's sharp 31% fall, despite 24% revenue growth to ₹5,074 crore, highlights South India's over-supply glut. Q1 net profit plunged 39%, amid 13% sector sales decline. Bengaluru's office boom (90+ million sq ft leasing) and ₹8,000 crore Chennai investments could reverse tides.
10. Aditya Birla Real Estate Fund (-33% YTD)
This fund's 33% drop tracks unlisted asset pressures, with rising costs hitting unlisted developers hard. Equity participation rose to 58% of investments, but overall inflows fell 27%. Birla's industrial pivot eyes 159 million sq ft warehousing demand by 2047.
11. Sobha Ltd. (-21% YTD)
Sobha's 21% decline, with Q1 sales down 58%, reflects Bengaluru's premium shift but affordability barriers. High P/B at 3.7x and debt servicing woes persist, though sustainability focus (net-zero buildings) aligns with 25% green growth.
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