Nine realty stocks rallied by 0.12% to 10.47% at 14:38 IST on BSE on reports that Mumbai city's civic body recommended a draft development plan proposing a steep hike in the floor space index.
Indiabulls Real Estate (up 10.47% at Rs 62.80), D B Realty (up 10.19% at Rs 51.35), Housing Development and Infrastructure (up 4.95% at Rs 87), DLF (up 3.29% at Rs 127.20), Godrej Properties (up 2.51% at Rs 339), Sobha (up 0.34% at Rs 298), Prestige Estates Projects (up 0.57% at Rs 169), Oberoi Realty (up 0.12% at Rs 285.90) and Unitech (up 0.2% at Rs 4.96) edged higher.
The S&P BSE Realty index was currently up 32.48 points or 2.46% at 1,351.20. It outperformed the Sensex which was down 353.91 points or 1.36% at 25,710.21.
The BSE Realty index had outperformed the market over the past one month till 27 April 2016, gaining 7.12% compared with Sensex's 2.87% rise. The index had also outperformed the market in past one quarter, advancing 9.68% as against Sensex's 6.42% rise.
According to reports, Mumbai city's civic body recommended a draft development plan to raise the floor space index (FSI) in the island city to 2 from current 1.33. In Mumbai's suburbs, FSI will be hiked to 2 from 1. For construction of five-star hotels and commercial development, FSI will go up to 5 from the present 3 to 3.5. For markets and other public amenities, FSI is proposed to be raised to 4, reports suggested.
FSI is the ratio of a building's total floor area to the size of the land upon which it is built and indicates how much a developer can construct on a particular plot of land. Reports suggested that higher FSI will allow builders to construct more offices and apartments, which will boost sales and drive profitability.
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