Oberoi Realty Stock Plummets 7% Over Disappointing Q3 Results; Realty Index Down 12% in 10 Sessions

The shares of real estate companies, particularly Oberoi Realty, experienced a significant drop on January 20, as the market reacted negatively to the company’s Q3 financial results. This sharp decline pushed the Nifty Realty index down by more than 4 percent to 798.90 by 1:50 PM, making it the top sectoral loser of the day. The index has now fallen for nine out of the past 10 sessions, recording a 13 percent decline during this period. The sectoral index is on track to witness its sharpest single-day plunge since July 2025.

Oberoi Realty reported a consolidated net profit of Rs 622.64 crore for the October-December quarter of the 2026 fiscal year. This represents a marginal increase of 0.69 percent from the Rs 618.38 crore net profit reported in Q3 of FY25, but a significant 18 percent drop from the Rs 760.26 crore net profit in the previous quarter (Q2 FY26). Revenue from operations, while rising 6 percent year-over-year, fell by more than 16 percent quarter-over-quarter to Rs 1,492.64 crore during the quarter under review.

Along with the Q3 results, Oberoi Realty declared a third interim dividend of Rs 2 per equity share for the financial year 2025-2026, with the record date set for January 23. The dividend will be paid to eligible shareholders on or before February 5. Vikas Oberoi, Chairman and Managing Director of Oberoi Realty, expressed optimism about the year ahead, stating, “In 2026, we will continue to actively pursue attractive land opportunities, and we remain optimistic about the year ahead, supported by a strong development pipeline, prudent capital management, and our unwavering focus on creating future-ready projects aligned with long-term market demand.”

Despite the company's positive outlook, JP Morgan remains 'Overweight' on the stock, setting a target price of Rs 2,050 apiece, which implies an upside potential of nearly 24 percent from the stock's previous closing price. However, the brokerage firm noted that the numbers are relatively weak, and if pre-sales numbers continue to disappoint, the stock's outperformance could narrow.

Oberoi Realty shares were the top losers on the index, dropping around 9 percent to trade at Rs 1,510.90 apiece. Other notable losers included Sobha and Prestige Estates, both of which fell around 6 percent. Macrotech Developers (Lodha), Godrej Properties, and DLF also saw their shares drop by 5 percent and 3 percent, respectively. Anant Raj and Phoenix Mills shares fell around 3 percent each, while Brigade Enterprises and Signature Global shares were trading in the red with marginal losses.

The Indian IT sector has seen mass layoffs over the past year, with the trend continuing into 2026. Analysts believe these layoffs have significantly impacted housing demand in key areas, particularly in the luxury segment of urban centers like Bangalore and Hyderabad. Shashank Gupta, Director of RPS Group, noted that IT layoffs are likely the major reason for the low demand in the luxury segment, as they discourage high-income buyers. Mid-to-premium housing sales, which have already dropped 15 percent year-on-year, are expected to continue to be negatively affected as professionals opt to rent rather than upgrade amid job uncertainties.

Shashank Gupta further explained, “The market has whispered to the executives with Nifty Realty down by 20% from the peaks and talking about the disruption posed by the AI, which also indicates that 30% of the IT jobs that are luxury demand would get stifled due to the automation by 2027. The stock corrections that are expected to be around 5-7% are dependent on the RBI rate cuts and policy revamps that could fuel the market by the second quarter of 2026.”

Keshav Mangla, GM Business Development at Forteasia Realty, cited Anarock data to highlight that financial tech layoffs of more than 1 lakh since 2024 have already resulted in a 12 percent drop in demand for Tier-1 cities. This has made it difficult for developers to manage cash flows and has forced them to sell off their inventory.