Godrej Properties, DLF fall up to 5% as Nifty Realty emerges the top sectoral loser

The Nifty Realty Index extended its decline in Monday's session, falling close to 3% and taking its cumulative correction to 17% from the 52-week high. With losses of this magnitude, the index has officially slipped into bear market territory.

Selling pressure was visible across real estate counters, with heavyweights such as Godrej Properties, DLF and Lodha Group stocks emerging among the top laggards.

Shares of these companies dropped by as much as 5%, adding to the sector's drag on the broader market.

The weakness in realty stocks came amid a broader market selloff, with Indian equities trading near the day's low. Benchmark indices were down nearly 1% each, while the Nifty slipped below the 25,700 mark.

Realty and capital market goods stocks led sectoral losses, weighing heavily on overall sentiment.

Among individual names, Keystone Realtors reported mixed operating performance for the December quarter. The Mumbai-based developer posted a 13% year-on-year increase in area sold at 0.46 million square feet in Q3FY26, indicating healthy volume growth. However, value metrics softened, with pre-sales declining 3% to ₹837 crore and collections falling 3% to ₹524 crore, suggesting a possible shift in its sales mix.

Other real estate companies are yet to announce their quarterly business updates.

Despite the sharp correction, some analysts see scope for a recovery ahead. Venugopal Garre of Bernstein expects a potential turnaround in Indian real estate stocks in 2026, upgrading the sector from its earlier 'Underperform' rating and calling it a catch up opportunity after a weak 2025.

Garre pointed out that property cycles typically span six to seven years and, with stock prices having corrected sharply, the sector could be positioned for a rebound as interest rates ease.

He expects another 50 basis point rate cut over the course of the year, which could provide incremental support to housing demand and valuations as borrowing costs continue to moderate.

Market sentiment remained cautious following the sharp sell-off in the previous session as global trade-related uncertainties continued to weigh on investor confidence.

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