Realty check: Brigade, Phoenix Mills can rally up to 14%; Indiabulls weak

Among the realty pack, Indiabulls Real Estate trades in a bear grip, while Brigade and Phoenix Mills may see an upside of 14 per cent.

As the world economies grapple with high inflation, global bankers have tightened monetary policies and increased interest rates. This in turn, has spooked the markets as fears of a slowdown in economic growth looms.

The recent jobs data in the US has further substantiated fears of another 75 basis points rate in the next meet. Last month, the RBI hiked interest rates by 50 bps for the third time in a row, taking the benchmark rates to 5.9 per cent. Following which, several banks and non-banking financial institutions have hiked rates on home loans.
 

Despite all these worries, domestic realty stocks continues to perform tracking increasing sales of residential properties across Delhi-NCR, Mumbai Metropolitan Region, Chennai, Kolkata, Bengaluru, Hyderabad, and Pune rose 41 per cent year-on-year (YoY) to 88,234 units, suggested data from ANAROCK. New launches, too, climbed 45 per cent YoY to 93,490 units in these seven cities during the recently concluded quarter.

Despite all these worries, several stocks in the realty space have performed well on the back of healthy sales of residential properties reported by across Delhi-NCR, Mumbai Metropolitan Region, Chennai, Kolkata, Bengaluru, Hyderabad, and Pune. According to ANAROCK, realty sales grew by 41 per cent YoY to 88,234 units in the quarter ended September 2022. 

To understand the current scenario in realty stocks, here’s the technical outlook:-

NIFTY REALTY INDEX

Likely target: 440

Upside potential: 5.50% 

Even as the Realty index declined 13 per cent thus far this year, the trend has not negated the support of the 100-weely moving average (WMA) set at 408. In addition, there is a positive divergence of the Relative Strength Index (RSI) that points to a bullish strength in the index, as per the weekly set-up. 

The broad chart texture indicates some respite for the Realty index, which eventually could test 440-level, its recent peak from where the index took a downward reversal.  CLICK HERE FOR THE CHART

Watch Video: Will worries about rate hikes dent realty stocks? 

Brigade Enterprises

Likely target: Rs 570 (once Rs 521 is crossed)

Upside potential: 9%

When looked at from a broader standpoint, the stock is merely trading in a range of Rs 560 to Rs 400 levels. There is a “Golden Cross” breakout in the daily chart, signaling a positive bias provided the 200-day moving average (DMA) cushion remains protected. The 200-DMA for the stock exists at Rs 483.50. However, the bearish decline of the Moving Average Convergence Divergence (MACD) beneath the zero line suggests downward pressure on the stock. Only an up move above Rs 521, its immediate hurdle (50-DMA), could steer a positive stance for the stock. Above Rs 521, the counter might rally to Rs 570. CLICK HERE FOR THE CHART

DLF Ltd (DLF) 

Outlook: Struggles to defend Rs 357
 

The present state of DLF shares highlights its struggle to hold the 200-DMA support at Rs 357.30. The stock needs to assertively defend this mark, so in turn could gain momentum and cross the barrier of Rs 376, its 50-DMA. The following support comes at Rs 340. A breakout above Rs 376 could garner an upside to Rs 400-mark. CLICK HERE FOR THE CHART

Phoenix Mills Ltd (PHOENIXLTD)

Likely target: Rs 1,700

Upside potential: 14.50%

Shares of Phoenix Mills shares have rallied 37 per cent so far this year and continue to hold ground with a bullish sentiment. The short-term outlook points to a consolidation in the range of Rs 1,480 to Rs 1,300 levels. Any up move over the upper roof of Rs 1,480 would mean the counter is set to claim uncharted territory of Rs 1,700. CLICK HERE FOR THE CHART

Indiabulls Real Estate Ltd (IBREALEST)

Outlook: Cautious beneath Rs 200-WMA

Whenever a stock gaps-down on the weekly chart and negates key averages, the trend for the stock enters in a bear grip. The same is the case with Indiabulls Real Estate.  The gap-down in April 2022 followed by subsequent breach of 200-WMA has forced stock to let go its positive bias. The stock did make an effort to cross its 200-DMA in September 2022, but failed, and the sentiment deteriorated thereafter. The outlook remain cautious beneath the 200-WMA, and for now support exists at Rs 67 - its earlier reversal trough. CLICK HERE FOR THE CHART