Shares of housing finance companies hogged limelight during the trading session on Tuesday after Nirmala Sitharaman announced a Rs 2.2 lakh crore boost for urban housing, along with Rs 10 lakh crore interest subsidy scheme for urban housing for the poor in her budget speech.
Union Finance Minister Nirmala Sitharaman announced that housing needs of 1 crore urban poor and middle-class families will be addressed with investment of Rs 10 lakh crore in her Budget speech. The government also plans to expand the Pradhan Mantri Awas Yojana (PMAY) by making provision for 3 crore more houses under the scheme, said the FM.
Sitharaman announces a substantial Rs 2.2 lakh crore initiative aimed at making urban housing more affordable. This funding is intended to support various measures and projects designed to ease housing costs in urban areas.
Repco Home Finance surged more than 4 per cent to Rs 560 with a total valuation close to Rs 3,500 crore. Home First Finance Company India also advanced nearly 4 per cent to Rs 1,140 on Monday, commanding a total market capitalization of more than 10,000 crore.
GIC Housing Finance gained more than 3 per cent to Rs 262.70 over its previous close at Rs 256.40. Can Fin Homes and India Shelter Finance Corporation rose nearly 2 per cent each to Rs 864.95 and Rs 754.55, respectively, during the trading session.
Other housing finance companies including Aadhar Housing Finance, Indiabulls Housing Finance, Aptus Value Housing Finance India and LIC Housing Finance were trading flat, marginally changed as of the time of writing this report.
Shares of other smallcap housing ledners including Star Housing Finance Ltd rose more than 5 per cent to Rs 50 on Monday, while microcaps like Manraj Housing Finance, SRG Housing Finnace and Reliance Home Finance was locked in the upper circuit limit.
The Finance Minister's allocation of Rs 10 lakh crore to help 1 crore poor middle-class family buy houses will boost the demand for residential properties, said Divyam Mour, Research Analyst at Samco Securities.
"This funding, along with interest subsidies, will greatly benefit real estate developers and housing finance companies focused on the lower and middle classes, such as Aadhar Housing Finance, Aptus Value Housing Finance, and Aavas Financiers," he said.