Despite a recent slowdown after the festive period, the global brokerage remains optimistic, forecasting nearly 25% pre-sales growth in FY26 across its coverage universe.
The Nifty Realty Index has slipped almost 20% from its 2024 peak, and major players including Lodha, Godrej Properties, Prestige Estates, Brigade Enterprises, and Oberoi Realty have been witnessing high volatility in the stock market. However, Jefferies believes Lodha and Godrej Properties are better positioned to sustain steady performance and overcome ongoing sector challenges.
Meanwhile, the real estate sector is bracing for an increase in project expenditure due to new labour regulations. Labour — which typically accounts for 15% to 30% of construction costs — is now expected to become 10% to 15% more expensive, potentially lifting overall development expenses by 3% to 4%.
According to Anuj Puri, Chairman of Anarock Property Consultants, this spike in labour costs will vary across cities and is likely to have a milder impact in Mumbai, where labour makes up around 20%–25% of total construction costs excluding land value. With margins at risk, analysts expect developers to pass these additional costs on to homebuyers, rather than absorb them in their financial statements.