Shares of 11 real estate companies rose by 0.45% to 10.63% at 11:51 IST on BSE after the Union Cabinet chaired by Prime Minister, Narendra Modi, gave its approval to amendments to the Real Estate (Regulation and Development) Bill, 2013.
Indiabulls Real Estate (up 3.9%), DLF (up 0.45%), Unitech (up 4.39%), Housing Development and Infrastructure (HDIL) (up 5.91%), Orbit Corporation (up 3.43%), Oberoi Realty (up 2.3%), Sobha (up 3.98%), Godrej Properties (up 0.62%), Parsvnath Developers (up 3.02%), D B Realty (up 4.07%) and Puravankara Projects (up 10.63%) edged higher.
The BSE Realty index was up 2.05% at 1,807.36 and was the biggest gainer among the sectoral indices on BSE. It outperformed the Sensex, which was up 0.59% at 28,684.89.
The BSE Realty index outperformed the market over the past one month till 7 April 2015, falling 1.33% compared with 3.17% decline in the Sensex. The index had also outperformed the market in past one quarter, gaining 17% as against Sensex's 5.97% rise.
The Union Cabinet chaired by the Prime Minister, Narendra Modi, yesterday, 7 April 2015, gave its approval to amendments to the Real Estate (Regulation and Development) Bill, 2013 pending in the Rajya Sabha, and approved amendments proposed in the Bill.
The Real Estate (Regulation and Development) Bill is a pioneering initiative to protect the interest of consumers, to promote fair play in real estate transactions and to ensure timely execution of projects.
The Bill provides for a uniform regulatory environment, to protect consumer interests, help speedy adjudication of disputes and ensure orderly growth of the real estate sector. The Bill contains provisions of registration of real estate projects and registration of real estate agents with the Real Estate Regulatory Authority; functions and duties of promoters and allottees; establishment of Real Estate Regulatory Authority; establishment of fast track dispute resolution mechanism through adjudication; establishment of a Real Estate Appellate Tribunal; offences and penalties etc.
These measures are expected to boost domestic and foreign investment in the sector and help achieve the objective of the Government of India to provide 'Housing for All by 2022', through enhanced private participation.
Realty stocks had declined yesterday, 7 April 2015, after the Reserve Bank of India (RBI) in its policy review yesterday, 7 April 2015, kept the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 7.5%. Consequently, the reverse repo rate under the LAF will remain unchanged at 6.5%, and the marginal standing facility (MSF) rate and the Bank Rate at 8.5%. Purchases of both residential and commercial property are largely driven by finance.
RBI had also kept the cash reserve ratio (CRR) of scheduled banks unchanged at 4% of net demand and time liability (NDTL) and continued to provide liquidity under overnight repos at 0.25% of bank-wise NDTL at the LAF repo rate and liquidity under 7-day and 14-day term repos of up to 0.75% of NDTL of the banking system through auctions and continued with daily variable rate repos and reverse repos to smooth liquidity.
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