The real estate sector has had a bull run throughout 2023 and mid-2024. Strong demand momentum, price hikes, and inventory absorption drove the rally.
However, this momentum faded as the Indian economy slowed down by mid-2024.
As a result, the Nifty Realty index fell 33.8% from its 52-week high of Rs 1,157 to Rs 766 in April 2025.
But the rebound has been strong, with the index gaining 31% in just two months. Optimism about continued sales growth amid interest rate cuts fueled the rally.
Cushman & Wakefield estimates that the sector’s contribution to GDP will grow from 7% to 15% by 2030. Increasing urbanisation and rising per capita income are expected to drive this growth.
Now, after the recent rally, real estate stocks have once again become expensive. But some hidden gems remain undervalued.
Here are five undervalued real estate stocks to watch out for.
#1 Embassy Office Parks REIT
First on the list is Embassy Office Parks REIT.
Embassy REIT is Asia’s largest REIT by area. The Blackstone Group and the Embassy Group sponsor it.
The company owns, operates, and invests in rent or income-generating real estate assets. It provides the benefits of a real estate investment, while offering the advantages of an equity investment.
The company owns and operates a 51.1 million sq. ft. (msf) portfolio of 14 office parks in India’s best-performing office markets, including Delhi, Mumbai, and Pune.
Embassy Office trades at a price to equity (PE) multiple of 23. This valuation is lower than the 3-year median of 40 and the industry PE of 37.
It maintained a strong occupancy ratio of around 91% (FY25), indicating robust demand. The strong occupancy helped it grow its revenue 10% YoY in FY25, to Rs 40.4 billion (bn). The net operating income also rose 10% to Rs 32.8 bn.
The company distributed Rs 23 to unitholders (shareholders) during FY25. This translates to a yield of about 6% at the current price of Rs 395.
In addition, its share price has also returned 11% during the period.
Embassy Office Parks Share Price – 1 Year
Looking ahead, it aims to develop 6.1 msf over the next 3 years at attractive yields. Further, around 10% of the existing leases are expected to expire in the next 4 years, resulting in higher rental opportunities.
This, along with new properties, could be the primary driver of profitability, leading to increased distributions to unitholders.
#2 Shriram Properties
Second on the list is Shriram Properties.
Shriram Properties is a South India based real estate development company of the Shriram Group. It focuses on the mid-market and affordable housing categories.
With a track record spanning over two decades, Shriram has established a strong presence in the real estate markets of Bengaluru, Chennai, and Kolkata.
Shriram Properties trades at a PE multiple of 22. This valuation is lower than the 3-year median of 24 and the industry PE of 37.
Shriram Properties’ financials remained muted in FY25. Revenue declined 1.4% YoY to 9.7 bn, due to lower sales volume, while net profit increased 2.5% YoY to Rs 0.77 bn.
Looking ahead, the company is poised for a recovery in FY26 as launches gain momentum. It expects to launch 5-6 msf, with a sales pipeline of over Rs 20 bn in FY26.
Shriram Properties Share Price – 1 Year
Additionally, there is revenue potential of over Rs 14 bn from projects scheduled to be completed during FY26. The company expects sales to grow 44% in FY26. This is likely to drive strong earnings growth.
Unit prices are also expected to rise, which should improve margins and revenue over the next 1–3 years.
The company has a total of 36.4 msf of projects in the pipeline, with an estimated gross development value (GDV) of Rs 97.7 bn, providing strong revenue potential in the medium term.
#3 Ganesh Housing
Third on the list is Ganesh Housing.
Ganesh Housing is a leading residential developer across the mid to higher-income segments. It’s also expanding its presence in commercial retail and townships.
The company has the largest developable land bank of 500 acres in Ahmedabad, located in prominent and potential growth areas, with a development potential of 36-40 msf.
Ganesh Housing trades at a PE multiple of 14. This valuation is lower than the 3-year median of 18 and the industry PE of 37.
Coming to its financials, revenue rose 11% to Rs 993.5 bn in FY25, driven by increased sales volume.
On the other hand, net profit increased 30% to Rs 59.8 bn and margins also improved. It has remained net debt-free for over 11 consecutive quarters now.
Looking ahead, it has two ongoing flagship projects (Million Minds, Malabar Retreat) with a sales value of Rs 13.5 billion.
The company plans to develop about 33 msf of infrastructure and special projects, townships, etc., in the next few years with a total sales value of Rs 173 bn.
Ganesh Housing Share Price – 1 Year
#4 Kolte-Patil Developers
Fourth on the list is Kolte-Patil.
Kolte-Patil is one of the largest residential real estate developers in Pune, with 8-10% market share. It has also recently expanded its presence in Bengaluru and Mumbai.
The company operates across affordable, mid-income, and luxury residential segments through its brands, Kolte-Patil and 24K.
Kolte Patil trades at a PE multiple of 33. This valuation is lower than the 3-year median of 43 and the industry PE of 37.
The company’s sales declined marginally by 1% YoY to Rs 27.9 bn in FY25, due to an 8% drop in volumes. However, receipts and collections remained strong, growing 8% and 18%, respectively.
It also became profitable, with a net profit of Rs 1.1 bn, driven by a fourfold jump in margin. It posted a net loss of Rs 0.7 bn last year.
Kolte-Patil Developers Share Price – 1 Year
Looking ahead, management has guided for long-term presales of Rs 135 bn between FY25-27. It plans to launch 5 msf worth Rs 50 bn on a priority basis.
Additionally, it has 14 social redevelopment projects in Mumbai, of which four are completed, providing revenue visibility.
Geographically, it plans to generate 30% of its sales from newer regions, such as Mumbai and Bengaluru.
Kolte Patil has an ongoing and unsold portfolio of 4 msf, along with an additional 8.5 msf currently awaiting approvals. In addition, it has 23.6 msf of land bank.
#5 Arvind Smartspaces
Fifth on the list is Arvind Smartspaces.
Arvind Smartspaces is the real estate arm of the Lalbhai Group (Arvind). It develops residential projects including villas, apartments, and plots for middle-income and high-income customers.
It also undertakes commercial and industrial projects on a selective basis.
Arvind Smartspaces trades at a PE multiple of 30. This valuation is significantly lower than the 3-year median of 58 and the industry PE of 37.
Coming to its financials, revenue increased 109% to Rs 7.1 bn in FY25, driven by strong volume growth. The net profit increased 133% to Rs 1.2 bn.
Looking ahead, the company plans to launch projects worth Rs 40 bn in Bengaluru, Mumbai Metropolitan Region, and Ahmedabad in FY26.
Apart from this, the company also has an unsold inventory of Rs 14 bn and an unlaunched pipeline of Rs 83 bn. With a strong pipeline, management estimates 25% annual growth over FY25-27.
Arvind Smartspaces Share Price – 1 Year
Conclusion
The real estate sector remains on a strong growth trajectory, as evidenced by the robust recovery over the last few years. The recent interest rate cuts have further bolstered optimism.
That said, a slowdown in sales, high-base effect, and limited price hikes are likely to remain key concerns going forward.
That’s why, instead of relying solely on hype, it’s essential to carefully analyze the company’s fundamentals, including its financial performance, corporate governance practices, and growth strategies.
Happy investing.
Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here…
The website managers, its employee(s), and contributors/writers/authors of articles have or may have an outstanding buy or sell position or holding in the securities, options on securities or other related investments of issuers and/or companies discussed therein. The content of the articles and the interpretation of data are solely the personal views of the contributors/ writers/authors. Investors must make their own investment decisions based on their specific objectives, resources and only after consulting such independent advisors as may be necessary.
