Sector Spotlight: Fireworks in real estate segment propel Nifty Realty - analyst recommends 3 scrips on Dhanteras for gains

Fireworks in stock markets on Monday ahead of Dhanteras and Diwali as broader market Nifty50 and BSE Sensex ended in the green, snapping three-day losing streak. While the former ended up 1.4 per cent or almost 258 points at 17,929.65, the latter closed at 60,138.28 gaining 831 points or over 1.4 per cent.

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All the 15 sectoral indices ended in the green with Nifty Bank, Nifty Auto, Nifty Financial Services and Nifty IT and Nifty Media trading up between 1-2.5 per cent. However, Nifty Realty was the biggest gainer among its sectoral peers gaining as much as 4 per cent from the Friday closing. Taking strength from the October series, this 10-share index took the spotlight today.  

The Nifty Realty Index was trading at 518.80 at the closing time. All 10 shares in the index trade Nine shares were trading with a positive bias with a lone The Phoenix Mills Limited as a loser.  

Macrotech Developers Limited was the top gainer followed by Oberoi Realty Limited and Sobha Limited. They were up 7.6 per cent, 7.10 per cent and 6.7 per cent respectively. 

Technical Analyst Nilesh Jain said that the Nifty Realty index is building up on its ongoing momentum. It witnessed an 11-year breakout on 29 October, Jain said. Jain said the follow-up buying is expected to continue in the real estate stocks. 

Jain, who is Assistant Vice President (AVP), Equity Research Technical and Derivatives at Centrum Broking has picked three stocks from the sector, which he said have high potential over the near to short term period. 

Indiabulls Real Estate Limited: Buy| LTP: Rs 163| Target: Rs 170/185| Stop Loss: Rs 148| Upside 13% 

Jain said that this stock has been an underperformer and said that it can be bought for a short term and long term perspective. The current formation on technical charts is one of morning star which is a harbinger of an upward trend. This stop could be accumulated on dips and at current levels as well. For investors willing to take a log position on this, a target price of Rs 200 and Rs 250 is estimated with a stop loss of Rs 121.  

Godrej Properties Limited: Buy| LTP: Rs 2358| Target: Rs 2600| Stop Loss: Rs 148| Upside 10% 

The shares of Godrej Properties ended with over 5 per cent gains on Monday. The stock closed at Rs 2358 on the NSE. The stock has moved both ways over the last 7-8 trading sessions. The right levels to buy this stock is around Rs 2300. The stocks has been seeing a lot of traction in the futures and options (F&O) markets.  

The stock witnessed a two-week breakout at Rs 2360 on the intraday basis before settling a tad lower. In the process, it also saw a reversal on the RSI (Relative Strength Index)- and indicator of stock movement. A value above 70 suggests an overbought, and the stock is coming out of this situation.  

Oberoi Realty Limited: Buy| LTP: Rs 966| Target: Rs 1050/1100| Stop Loss: Rs 148| Upside 13% 

The shares of Oberoi Realty ended at Rs 966 on the NSE on Monday. It was 6.7 per cent up from the Friday closing price. Buy on decline is advised in this scrip for the price targets of Rs 1050 and Rs 1100. The right levels to buy this stock is Rs 950 and below.