In the latest analysis of India's housing market, Nuvama Research has identified Prestige Estates Projects as its top real estate selection, despite the stock experiencing a notable decline of 23.42% over the past six months. The company, however, boasts an impressive five-year return of 290.91%. In its report dated March 23, 2026, Nuvama expresses cautious optimism, emphasizing that while Prestige Estates remains a strong contender in the sector, significant challenges persist within the broader housing market.
Though the housing sector has shown signs of recovery, particularly with a reported 18% increase in residential sales value across major cities in February 2026, structural issues still plague market dynamics. The demand for luxury housing continues to overshadow more affordable options, which raises concerns about overall housing affordability. Furthermore, sales volume remains soft, prompting Nuvama to advise caution regarding housing stocks. The brokerage highlights that the ongoing trends in luxury real estate may not suffice to sustain long-term market health.
Prestige Estates reported robust earnings for the December 2025 quarter, with standalone revenue reaching Rs 1,129.4 crore and a net profit of Rs 45.8 crore. The consolidated net profit stood at Rs 244.7 crore, benefiting from contributions from subsidiaries and joint ventures. However, the company is not without challenges; ongoing legal battles and tax-related issues, including a land development dispute worth approximately Rs 92.3 crore, pose potential risks. Despite these concerns, management projects that these issues will not have a material financial impact in the near term.
Bengaluru has emerged as the standout performer within the real estate landscape, with Nuvama's data indicating a staggering 42% year-on-year increase in sales value for February. The city's overall demand has surged by 34% year-to-date, and prices have risen by 17%. Despite a tightening unsold inventory of 16 months, indicating that demand is outpacing supply, new launches have seen a slight decline, suggesting that the growth in sales may not be matched by an increase in available properties. As tech-driven markets like Bengaluru, Hyderabad, and Chennai lead the charge in residential sales, Nuvama's analysis underscores the complexities facing the housing sector, particularly in the National Capital Region, where new launches have surged but demand remains stagnant. This duality highlights the necessity for a more balanced approach to real estate development going forward.