The real estate space has been buzzing quite a bit of late. Especially after Parsvanath's IPO and the possibility of DLF coming into the market, at current valuations, is this the time to buy into this space?
For a clearer perspective on the space, C Jayaram of Kotak Mahindra Bank and technical analyst Ashwani Gujral discuss their views on how the space is currently valued.
According to C Jayaram, real estate is clearly seeing the first flush of international money coming into that space.
Going forward, he says that one might find a fair amount of international money coming in through the private equity route and actually going into real estate projects or companies which are not necessarily in the public listed space.
"That means that the entire real estate space would get far greater flows. However, since some of the stocks have already run ahead, I am not sure that those will continue to forge ahead."
With the markets sort of flying, the way they are, there is a whole host of IPOs coming into the market, he says. "Many of the issuances you are now seeing are in a sector which is particularly hot which is real estate."
"You have seen Parsvnath, you probably have seen Sobha Developers, and DLF over a period of time. I think if that is the pace that these IPOs are coming into then the market is absorbing them pretty well " he adds.
From a technical perspective, Ashwani Gujral says that Ansal, Unitech, Mahindra Gesco and Indiabulls cannot really be traded now as they are in circuit.
He says that Peninsula Land hasn't gone up as much. "Keep a stop of about Rs 635-640, and you can probably trade it upto Rs 810."
He says that Unitech has consolidated quite well between Rs 390-400. "The stock is now probably headed to about Rs 550," he adds.
With people coming in and buying these stocks, Gujral cautions that at some point these stocks will start falling in a similar fashion as they have risen, and one has to remember that there are no buyers when these stocks start falling.
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