Abhijit Chakraborty of Edelweiss Capital is of the view that there could be another 5-10% or maybe even 15% kind of a downside on the large-cap names like DLF and Unitech.

Chakraborty told CNBC-TV18, "What is happening in the real estate sector is that the stock price correction has been very severe and very harsh but the real asset prices are yet to come off. The way stocks have been valued in the past based on NAV and your cash flow projections has to change. I think going forward now one has to start valuing these companies more on price to book rather than calculating your cash flows because you now no longer sure about the realizations that these companies are going to get and the kind of supply that they will be able to bring to the market. So based on the price to book valuations, I think there could be another 5-10% or maybe even 15% kind of a downside on the large-cap names like DLF and Unitech. But having said that what I want to mention here is that we all know that there is going to be an earnings slowdown this year in the corporate India and there is a slowdown in the economy."

He further added, "Most of the stocks if you assume are going to have a very subdued kind of an earnings still the market is in an extremely attractive zone. Right now there is no point in trying to find out how much of the earnings downgrade is there in the price because the E is continuously moving and even if you take a most conservative estimate of earnings, I think the market is still in a zone where you can safely go and buy. But the point here is the liquidity, the financial crisis, the lack of confidence and there is simply lack of buyers. This is something which only the time can take care of. It has to play out in its own due course and only then the market can see any kind of stability and sanity."

Disclosure: It is safe to assume that analyst and his clients may have an investment interest in the above stock/sector.