Realty stocks soared by as much as four per cent on the Bombay Stock Exchange (BSE) after a less-than-expected hike in key policy rates by the RBI cheered investor sentiment.
The country's largest realty firm DLF surged 3.28 per cent to a high of Rs 327 and Unitech touched an intra-day high of Rs 82.70, up 3.56 per cent on the BSE.
The BSE-Realty index, which comprises of stocks of 14 real estate players, too jumped 2.26 per cent to a high of 3,538.97 points after the Reserve Bank announced rate hikes.
Marketmen said sectors like banking, auto and realty are rate sensitive and had already factored-in an increase in key rates by the RBI on expectations of a higher rate hike by as much as 50 basis points. The moderate rate hike bolstered trading sentiment in the sector.
The apex bank today hiked short-term lending and borrowing rates and the portion of money banks deposit with it by 25 basis points each, in a move aimed at controlling the inflation spiral without choking growth.
The RBI hiked its repo, reverse repo (overnight lending and borrowing rates) to 5.25 per cent and 3.75 per cent, respectively, while the Cash Reserve Ratio, or the portion of deposits banks park with RBI, to 6 per cent.
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The hike in the CRR, which will come into effect from April 24, will absorb excess cash of Rs 12,500 crore from the banking system.
Other realty players trading in the positive zone were Parsvnath Developers (up 2.61 per cent), Sobha Developers (up 3.33 per cent), Omaxe (up 1.83 per cent) and HDIL (up 2.57 per cent). The only stock trading in the negative territory was Orbit Corp, down 1.55 per cent on the BSE.