Realty stocks bleeds, BSE Realty index tumbles nearly 8%

NEW DELHI: Its bloodbath on Dalal Street specially for the realty sector stocks after the market regulator Sebi barred India's biggest real estate company DLF, its chairman K P Singh and five others from accessing stock markets for three years after it found that the realty major flouted the disclosure norms when it forayed in the equity markets in 2007.

The regulatory action stems from the DLF management's failure to disclose material information to investors during the firm's equity offer in 2007 to raise Rs 9,187 crore.

The BSE Realty index which tracks the performance of real estate companies fell 8 per cent or 123 points to 1,437.80 levels. DLF was the major contributor to the index's loss with DLF alone contributing 116 points to the fall.

Other real estae stocks like HDIL, Unitech, Prestige Estates, Godrej Properties, D B Realty, Phoenix Mills and Omaxe were all facing selling pressure.

The Sebi verdict on DLF sends a singular message to not only investors of realty stocks but also to stake holders of companies with shoddy corporate governance practices, ET said in a report.