Oberoi Realty, DLF Get Rating Upgrade From Citi Research On Pre-Sales Growth Expectation
Phoenix Mills Ltd. is the top pick of Citi Research in the Indian property sector.
Real estate companies Oberoi Realty Ltd. and DLF Ltd. received a rating upgrade from Citi Research as the brokerage turned less bearish and is now neutral on the residential sector given the correction, partly pricing in the risk to the pre-sales guidance and expectations. Phoenix Mills Ltd. is the top pick of Citi Research in the Indian property sector.
India's property sector has seen a significant price correction since the start of calendar year 2025.
Managements have a positive outlook on demand in this sector. However, Citi Research witnessed a mixed demand outlook in luxury and ultra luxury segment, which is a cause of worry. A correction in prices partly offset some of these concerns.
With respect to the interest rate cut cycle, Citi Research doesn't expect much change to luxury and ultra-luxury segments. Affordable and mid-segment may see a likely increase in momentum.
Other than softness in luxury and ultra-luxury segments, delay in new launches will pose a challenge for the companies in the industry, especially to Oberoi Realty and DLF.
The brokerage upgraded Oberoi Realty to Buy and DLF to Neutral as "implied pre-sales growth expectations are more reasonable post price
correction".
However, it warned that further price correction cannot be ruled out.
Phoenix Mills is appeared to benefit from continuous organic consumption growth of 7–9% in its mature malls and additional new malls. Citi Research has a target price of Rs 1,960, which implies a 24.57% upside from Monday's closing price.
Citi Research upgraded Oberoi Realty to 'Buy' from 'Neutral', while it cut the target price to Rs 1,895 from Rs 2,415 apiece. The current target price implies a 19.67% upside from Monday's closing price.
The brokerage upgraded DLF Ltd.'s stock rating to 'Neutral' from 'Sell'. Citi cut the target price to Rs 750 from Rs 775. The current target price implies a 11.33% upside from Monday's closing price.
The NSE Nifty Realty declined 1.74% to the day's low of 823.10. It pared most losses to trade 0.40% lower at 834.30 as of 10:23 a.m. compared to a 0.09% advance in the NSE Nifty 50 index.
