DLF, Godrej Properties: Use dips to buy realty stocks for the long term

Real estate stocks were in limelight on Thursday, after Union Minister of Commerce & Industry asked developers to cut prices and sell inventory rather than wait for the market to bounce back

Real estate stocks came back into the limelight on Thursday after Union Minister of Commerce & Industry, Piyush Goyal, in a webinar with real estate developers a day earlier asked them to reduce prices and sell their inventory rather than wait for the market to bounce back.

“We are trying to see whether we can bring in some consession in ready reckoner (or circle) rates. But if that does not happen, you have to sell the inventory. Unless you reduce your rates, you will be stuck with inventory," said Goyal. READ MORE HERE

At the bourses, NIfty Realty index was among the worst hit in trade - down 0.8 per cent at 11am as compared to a flat Nifty50 index that was hovering around the 10,065 levels.

Here's a check on how to trade real estate stocks given the recent development.

NIFTY REALITY: The volumes have traded “above average” over the past few sessions as the index crossed 180 levels. The trend looks highly promising if the index manages to cross and stay above 200 levels. If that happens, a rally towards 220 and then 228 levels cannot be ruled out. The recent rally has two gap-up closes at Rs 169 and Rs 182, which should act as a support. CLICK HERE FOR THE CHART

Godrej Properties Ltd (GODREJPROP): After crossing simultaneous resistances at Rs 710, Rs 739, and Rs 748 with consecutive positive close, the counter is showing stability and any corrective moves hereafter, may see a jump in buying. The overall outlook looks bullish as volumes have risen on the positive side. Even the MACD  has crossed the zero line upward that suggests buying at lower levels is possible. The positive rally may see the stock head towards its next resistance of Rs 900 levels. CLICK HERE FOR THE CHART

DLF Ltd (DLF): The counter has broken out of a consolidation suggesting a further upside towards Rs 180 levels. That’s said, the resistance of Rs 160 holds a key significance. DLF now needs to close above Rs 160 to attract more buying. That said, Rs 150 remains a support level on closing basis. The overall trend looks promising as volumes have spiked up with MACD rising above the zero line, both indicate a positive strength which is supportive of an upward rally.  CLICK HERE FOR THE CHART

Indiabulls Real Estate (IBREALEST): The stock is attempting to cross 50-days moving average (DMA) placed at Rs 47.15, which it failed to conquer in April 2020.  If this resistance gets conquered, then a rally towards Rs 54 cannot be ruled out. Although, the trend reveals strong bearishness as per weekly and monthly chart, the counter did not break the March low of Rs 36.80, a sign of a mild bullishness. The MACD has made a positive crossover trending toward the zero line. CLICK HERE FOR THE CHART

Oberoi Realty Ltd (OBEROIRLTY): The daily chart indicates a formation of “Double Bottom” in progress with Rs 420 as a breakout level on a closing basis. The volumes have remained stagnant with RSI nearing the overbought range of 70 value. On the positive side, the MACD is on the verge of crossing the zero line upward. With these indications, one can witness mild sell-off, though the support of Rs 365 and Rs 350 remains intact for now. CLICK HERE FOR THE CHART

Sobha Ltd (SOBHA): After witnessing gap down sessions in the month of March 2020, the counter regained momentum around Rs 160 with a strong gap-up that is yet to fill. Subsequently, the gap-up session around Rs 186 led to rally that conquered Rs 200 mark. Overall, the stock looks bullish on the charts so long it holds the support of Rs 186. It seems to be heading towards Rs 240 levels as MACD has crossed the zero line upward. CLICK HERE FOR THE CHART