Bank credit to realty sector nearly doubles in 4 yrs to ₹35.4 lakh cr at end of FY25: Colliers
In a statement on Tuesday, real estate consultant Colliers India said it has assessed the aggregate financials of the top 50 listed real estate companies in India in terms of profitability, gearing and market performance.
"India's real estate sector has continued to exhibit marked improvement in terms of financial health in the post-pandemic era, outperforming other major industries in the economy in terms of critical credit and financial metrics," the consultant said.
Colliers India noted that the sector's access to credit has improved significantly in absolute terms.
"Gross bank credit in India has grown significantly, from ₹ 109.5 lakh crore in FY21 to ₹ 182.4 lakh crore in FY25. Bank credit in the real estate sector has impressively doubled in the same period, from ₹ 17.8 lakh crore to ₹ 35.4 lakh crore," it said, citing RBI data.
The consultant mentioned that the real estate sector now accounts for almost one-fifth of the bank credit deployment in the country, signalling growing lender confidence in the sector.
"Indian real estate sector continues to demonstrate resilience and financial prudence even in the wake of external volatilities," Badal Yagnik, Chief Executive Officer of Colliers India, said.
He said there has been a higher proportion of credit rating upgrades during the last fiscal in the real estate sector compared to upward revisions in other economic sectors.
"The relatively higher credit quality of real estate loans is well supported by underlying strong demand-supply dynamics across multiple asset classes such as residential, commercial, industrial & warehousing, retail, hospitality etc," Yagnik said.
The top 50 listed real estate companies have shown impressive improvements in terms of profitability, cash flow realisation, and balance sheet performance over the last five years.
Around 62 per cent of the top 50 listed real estate firms had higher profitability margins at the end of FY25 as compared to the 23 per cent share in FY21. More than 60 per cent of the leading real estate companies in India have comfortable debt levels, which is reflected in the debt-to-equity ratio of less than 0.5 in FY25.
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