Realty firms included in the Nifty Realty Index are performing better than other listed real estate companies and have posted a combined revenue of nearly Rs 33,800 crore last fiscal, clocking 10 per cent average annual growth since 2013-14, according to property consultant JLL.
The aggregate revenues of other listed real estate firms have declined, despite strong financial performance by some players like Puravankara and Kolte-Patil, the consultant said.
JLL said the trend reflects consolidation in the market with rising maturity and professionalism post enactment of laws like GST and RERA.
"During the period from FY 2013-14 to FY 2018-19, while revenues of the NIFTY Realty Index companies have grown at a CAGR of 10 per cent to Rs 33,793 cr from Rs 20,753 cr, revenues of other listed real estate companies have declined," JLL India said in a report.
The profit after tax of realty index players improved from Rs 2,362 crore to Rs 4,630 crore during the review period, registering a CAGR growth of 14 per cent.
The revenue share of Nifty Realty Index players rose from 76 per cent to 85 per cent, while those of other players declined from 24 per cent to 15 per cent during the period under review.
Nifty Realty index includes Brigade Enterprises, DLF, Godrej Properties, Indiabulls Real Estate, Mahindra Lifespace Developers, Oberoi Realty, Phoenix Mills, Prestige Estates Projects, Sobha and Sunteck Realty.
Other listed real players include Anant Raj Industries, DB Realty, HDIL Ltd, Kolte-Patil Ltd, Marathon Realty, Nitesh Estates, Omaxe, Parsvnath Developers, Puravankara and Vipul Ltd.
"With rising maturity and professionalism, the real estate sector is gaining consolidation," JLL India said after analysis of the Nifty Realty Index and other listed real estate companies.
The consultant said that higher volumes are driving the growth as prices remained stable.
"Companies listed as part of NIFTY Real Estate Index are gaining revenue and market share, while the other listed real estate companies have been lagging due to operational and financial inefficiencies," it added.
JLL also observed that real estate players with financial discipline have been reducing their debt level by liquidating assets and are also partnering with institutional players to develop projects.
"Players with high standards of corporate governance, professionalism, transparency and accountability and increasing buyer confidence have been able to grow at a faster rate," the report said.
The consultant noted that the introduction of Real Estate (Regulation and Development) Act (RERA), Goods and Services Tax (GST) and other structural reforms have affected those with poor corporate governance.
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