Top Real Estate Shares to Watch in 2024

An Overview of the Indian Real Estate Sector

India’s real estate sector has been experiencing significant growth in recent years, with its market size projected to reach USD 518.5 billion in 2024 and expand at a compound annual growth rate (CAGR) of 8.71% to USD 856 billion by 2029. This expansion is being driven by rapid urbanisation, increasing income levels and supportive government policies. The housing segment, in particular, is witnessing growing demand — with sales in major cities like Mumbai and Bengaluru reaching record highs.

The commercial real estate market is also thriving, thanks to the growth of sectors like information technology and e-commerce. Notably, India's largest real estate investment trust, Embassy Office Parks, plans to raise up to $400 million to meet the rising demand for office space from global and local corporations.

This thriving economic segment presents many opportunities for investors who wish to capitalise on the growth potential of realty stocks in India. As the net profits of real estate companies soar, you too can consider including the best real estate stocks in India for the long term in your portfolio. 

Samco Securities can help you with this, with detailed insights from analysts and experts as well as a comprehensive suite of trading tools available at your disposal free of cost. 

Analysing the Real Estate Share Market

The domestic real estate share market has shown notable performance metrics, with the Nifty Realty Index soaring by over 40% in the past year (as on November 14, 2024). This surge is driven by a strong demand for premium housing and commercial spaces in the real estate market. However, challenges persist too. Some leading real estate companies have reported sluggish financial performance due to approval delays affecting new launches.

Overall, however, the sector remains robust, with earnings projected to grow by 27% annually. To capitalise on this expected bullish market, you must know what the best companies on the real estate stocks list are. This article can help you identify the best real estate stocks in India for the long term and understand how to invest in them (and other stocks) easily.

Top 45 Real Estate Companies to Consider

The Indian real estate industry is booming, with more than 40 listed entities operating in the space. If you are planning to gain exposure to this growing sector, investing in the best realty stocks in India is crucial. Here is a comprehensive real estate stocks list along with their latest stock prices and other key fundamentals. 

Let us explore the top 5 stocks in the real estate sector in the country in more detail.

• DLF Ltd.

Based in Gurugram, DLF Ltd. is one of the leading realty stocks in India. The company’s contribution to the development of the country’s urban landscape is unparalleled. With a presence in over 24 cities across 15 states, DLF is the largest entity on the real estate stocks list. 

The company’s product portfolio covers residential, commercial, retail, and hospitality sub-segments of the real estate industry. DLF Ltd. is also one of the few entities with a strong emphasis on sustainability. In fact, it has achieved numerous green certifications, including the LEED Platinum Certification and LEED Gold Certification from the US Green Building Council. This makes the company one of the best real estate stocks in India for the long term. 

Key Fundamental Metrics

• Macrotech Developers Ltd.

Macrotech Developers Ltd., popularly known as Lodha Group, was founded in 1980. It is one of the premier entities in the real estate stocks list. The company is widely known for its luxury residential and commercial constructions in and around Bangalore, Pune, Mumbai, Thane, and  London. Some of its signature developments include The World Towers, Lodha Park, and Palava City, a pioneering smart city near Mumbai. 

Macrotech Developers Ltd.’s strong commitment to enhancing lifestyles and creating iconic landmarks has solidified its position as a trusted name among realty stocks in India. The company’s return on equity (ROE) and return on capital employed (ROCE) are 10.40% and 14.39%, making it one of the best real estate stocks in India for the long term. 

Key Fundamental Metrics

• Godrej Properties Ltd. 

A part of the Godrej group of companies, Godrej Properties Ltd. is another one of the best realty stocks in India. Established recently in 1990, the company has utilised its opportunities well and grown to become the top five in the real estate stocks list in a very short period. 

Based in Mumbai, Godrej Properties Ltd. operates in key cities like Gurugram, Bangalore, Delhi, Mumbai, Noida, and Pune. The company’s product portfolio consists of residential, commercial, and township projects. The debt-to-equity ratio of Godrej Properties is 0.27 and its earnings per share (EPS) is around Rs. 40.29. Such strong financial performance makes the entity one of the best real estate stocks in India for the long term.

Key Fundamental Metrics

• Oberoi Realty Ltd. 

Oberoi Realty Ltd., based in Mumbai, is a leading real estate construction and development company in the country. Due to its premium residential, commercial, retail, social infrastructure and hospitality projects, the company is widely considered to be among the best realty stocks in India.   

Similar to other entities in the real estate stocks list, Oberoi Realty Ltd. also emphasises sustainability by incorporating several eco-friendly measures into its projects. All of the company’s key real estate projects are concentrated in Mumbai and Thane. 

Some of the noteworthy construction projects include Three Sixty West in Mumbai, Oberoi Garden City in Thane, and Commerz in Goregaon East. The company’s strong EPS of Rs. 63.86 and a low debt-equity ratio of just 0.127 places it among the best real estate stocks in India for the long term.       

Key Fundamental Metrics

• Prestige Estates Projects Ltd.

Founded in 1986, Prestige Estates Projects Ltd. is a Bangalore-based real estate developer. The company’s diversified portfolio spanning across residential, commercial, retail, hospitality, and mixed-use categories makes it one of the must-have realty stocks in India. 

Prestige Estates Projects Ltd. is one of the few entities in the real estate stocks list to offer rental projects. As of FY24, the company has around 6 rental projects in several key areas of Bangalore. 

Now that it is expanding to other regions of the country, Prestige’s future growth prospects look promising. Additionally, strong credit ratings of CRISIL DA1+ and ICRA A+ make Prestige among the best real estate stocks in India for the long term.

Key Fundamental Metrics

Factors to Consider While Investing in Real Estate Stocks 

Before you invest in the real estate equity market, it is imperative to understand the companies in the real estate stocks list you are considering. You can consider the following factors to make a more informed decision about your investments. 

• Market Trends and Cycles

It is crucial to understand market cycles to pick the best real estate stocks in India for the long term. Realty stocks in India often follow economic trends and are affected by interest rates as well as government policies. So, you should analyse how these factors impact the supply-demand dynamics of different stocks and plan your investments accordingly. 

• Company Fundamentals

A company’s financial performance is also a crucial metric to consider before investing in entities in your real estate stocks list. You need to look beyond the net profit figures and consider the company’s financial health, debt levels and project pipeline. Strong fundamentals like stable cash flows and efficient management are also key.

• Dividend and Growth Potential

In addition to the financial performance, you must also evaluate the growth potential and dividend payout history of the company. Some of the best real estate stocks in India for the long term offer dividends alongside capital appreciation. So, look for companies that balance steady income distribution and reinvestment in growth projects.

• Regulatory Environment

Regulations like the Real Estate (Regulation and Development) Act (RERA) have brought more transparency to realty stocks in India. Nevertheless, you must assess the regulatory environment, check if the company adheres to these guidelines and see if it has a history of compliance. This can reduce risks when you invest in the real estate equity market. 

Investing in the Real Estate Sector: Benefits and Risks

Like any other segment of the equity market, investing in companies on the real estate stocks list carries both risks and rewards. Let us explore both sides of the coin, so you can prepare for the downsides and leverage the upsides effectively. 

Benefits of Investing in the Real Estate Sector

• Steady Returns and Capital Appreciation

Real estate stocks in India often provide stable returns through dividends and potential long-term value appreciation.

• Diversification

Adding realty stocks in India to your portfolio reduces its overall risk because you can diversify your investments across asset classes.

• A Hedge Against Inflation

The real estate market tends to hold or increase in value during various economic cycles, making it a reliable hedge against inflation.

• Exposure to a Growing Sector

Real estate stocks in India allow you to capitalise on the expanding real estate market without directly owning property.

Risks of Investing in the Real Estate Sector

• Market Volatility

Realty stocks in India are affected by macroeconomic factors like interest rates and economic volatility.

• Regulatory Risks

Changing policies like delays in approvals or amendments in land acquisition laws can impact the companies in the real estate stock list negatively.

• High Debt Exposure

Companies in the real estate stock list that have significant debt may face challenges in low-demand phases. This may affect their stock performance.

• Project Execution Delays

Even the best real estate stocks in India for the long term can suffer from delays in project completion. This may impact revenues and investor confidence.

How to Invest in Real Estate Stocks

You can invest in the real estate equity market through the user-friendly and highly intuitive Samco Trading App. Here is what you need to do to invest in the companies on the real estate stocks list.

• Step 1: Log into your account on the Samco Trading App.

• Step 2: Look for the company you want to invest in from your real estate stocks list.
• Step 3: Choose the ‘Buy’ option. 
• Step 4: Provide the price details and the number of shares you want to buy in the order screen.
• Step 5: Select ‘Quick Trade’ and place your order right away. 

Once your trade is executed, you can monitor your investments ‘Holdings’ section of the Samco Trading App.