Prefer housing finance companies: Deven Choksey

Deven Choksey, Managing Director at KR Choksey Shares & Securities told CNBC-TV18, "Very important aspect is the balance sheets of some of the real estate companies. If there is an asset like model which is being continued by some of the companies I think there is confidence level which is relatively higher compared to those companies which are purely working on the land bank kind of situation and trying to make most out of it. As far as the sector is concerned the FSIs are being opened up by the government and that possibly puts the cap on the kind of a land price appreciation that otherwise used to be driving the kind of valuation for the companies which were holding the land assets. According to me that is an area which is going to be more important going forward in the real estate business and that is where I would think that pure asset like model of those companies would make more sense for investors to stay invested with."

"I think selective approach will have to be adopted. Largely we are confident about the residential space vis-à-vis the commercial space even as of now. If one wants to relatively play safe with higher amount of margin of safety I would consider that mortgage based finance companies, the housing finance companies would be a better play for riding this particular upside into the real estate business," he said.