Friday, July 27, 2007

Realty Index Crashes with Dalal Street

As the Bears hug the Indian Stock Markets, taking the BSE Sensex down 549.27 points, or 3.48%, to 15,227.04, BSE Real Estate Index crashed too.

All the 11 stocks in the BSE Realty index were trading in the red, including sector heavyweight DLF. DLF was down 4.39% to Rs 605. The stock had plunged to a low of Rs 578 earlier in the day.

The other major losers were Unitech (down 5.32% to Rs 562), Indiabulls Real Estate (down 5.49% to Rs 565), Parsvnath Developers l (down 5.17% to Rs 367), Mahindra Gesco Developers (down 3.02% to Rs 577), and Ansal Properties & Infrastructure (down 4.62% to Rs 267.40).

In the Realty index, DLF holds the major weightage of 35.16%, followed by Unitech (31.65%) and IndiaBulls Real Estate (16.49%). All other scrips hold weightages between 1% to 3% in the index.

It is time to exit DLF, Unitech and India Bulls Real Estate because all of them are extremely speculative and are quoting at absur valuations of more than 60 forward P/Es.

No comments: