Realty shares see profit booking on Budget day; Lodha, Godrej Properties decline up to 5% - Here's why

Realty shares see profit booking in trade.

• Nifty Realty index dropped 2% as Budget missed affordable housing support.
• CREDAI expressed disappointment over no concrete measures for affordable housing.
• Budget's infrastructure focus may boost realty sector long-term despite short-term pain.

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Realty shares witnessed profit booking on Budget day, with the sector reacting negatively to the absence of any major policy support for affordable housing.

The Nifty Realty index declined over 2 percent on Friday, erasing all the gains made over the previous four sessions, during which it had risen 2.15 percent.

Industry body CREDAI expressed disappointment over the Budget announcements, citing the lack of concrete measures for affordable housing.

"CREDAI is deeply disappointed that the Budget offers nothing concrete for affordable housing. With the current outdated definition of affordable housing, CREDAI estimates that the segment’s share could decline further from 18 percent to nearly 12 percent of total housing supply. This is a serious warning sign for India’s lower middle class and middle class," CREDAI National President Shekhar Patel said.

Eight of the ten constituents of the Nifty Realty index ended lower amid sharp selling pressure. Lodha Developers and Sobha emerged as major laggards, falling up to 5 percent.

Godrej Properties, DLF, Oberoi Realty and Signatureglobal (India) were among other stocks that declined up to 5 percent.

Meanwhile, some industry players said the Budget’s focus on infrastructure and regional development could support the sector over the longer term.

Gurpal Singh Chawla, Managing Director of TREVOC Group, said the emphasis on funding for Tier-2 and Tier-3 cities was a positive step. He noted that the City Economic Regions framework and continued push for capital expenditure would gradually strengthen real estate fundamentals beyond metro markets, though immediate demand impact may be limited.

The Union Budget 2026 raised public capital expenditure to Rs 12.2 lakh crore and announced the introduction of the Infrastructure Risk Guarantee Fund, reinforcing the government’s focus on infrastructure-led growth.

Industry players said these measures could improve execution visibility and liquidity across real estate segments. Manoj Gaur, Chairman and Managing Director of Gaurs Group, said the Budget’s emphasis on infrastructure and financial stability would help sustain momentum seen in the sector in recent years.

Amit Modi, Director of County Group, said the Infrastructure Risk Guarantee Fund would improve funding confidence and reduce execution risks for long-gestation projects.

ANAROCK Group Chairman Anuj Puri, however, said the Budget provided limited direct relief to the real estate sector, with benefits largely coming through higher capital expenditure and related initiatives in manufacturing, MSMEs, tourism, transport infrastructure and green transition.

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