Real Estate Giants Propel Growth with New Launches: A Forecast to FY27
According to a Motilal Oswal report, real estate giants will sustain growth through new launches with a 12% CAGR from FY25-27. The sector's prospects remain robust, though regulatory hold-ups and other factors led to a temporary slowdown. Consolidation is gaining traction, boosting top developers' market presence.
- Country:
- India
Major real estate players are set to maintain their growth momentum, fueled by new launches projected to accelerate at a compound annual growth rate (CAGR) of 12% in the financial years 2025 to 2027, according to a recent Motilal Oswal report. However, delays due to regulatory approvals may push some FY25 launches into FY26, creating a more back-loaded but dynamic pipeline that promises to sustain growth medium-term.
The report anticipates a 21% CAGR in presales and a remarkable 36% growth in collections, reaching Rs 1.5 lakh crore by FY27. This is attributed to timely execution and a solid pipeline. Revenue across major companies is expected to climb by 22% CAGR to Rs 86,100 crore, driven by robust business development and execution efficiency.
Despite a promising start, FY25 saw a downturn, especially in the last quarter, with project launches and home absorption declining in the top seven cities. State and central elections, regulatory delays, and policy changes were significant contributors to this slump. Nonetheless, even as inventory levels rose for the first time in five years to 14.4 months by the end of FY25, absorption continued to surpass new supply, indicating the underlying demand.
The sector is also benefiting from consolidation, with the top 10 developers' market share in launches and absorption witnessing a significant increase over the past decade. This consolidation is poised to advantage leading players, strengthening their footing in the competitive landscape.
(With inputs from agencies.)
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