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India's real estate sector has raised nearly INR 400 billion via approximately 30 IPOs since 2021, according to Colliers. In the current year alone, seven IPOs have mobilised nearly INR 76 billion. During this period, bank lending to the sector has doubled, while gross NPAs in construction loans have dropped from 23.5% to just over 3%. Profit margins and balance sheet health among leading developers have also improved sharply. The sector is now attracting equity capital across newer formats such as co-working spaces, hospitality, and SM-REITs, marking a broader investor interest in real estate.
The Indian real estate sector has raised close to INR 400 billion through nearly 30 IPOs since 2021, reflecting a major shift in financial strength and investor sentiment. So far this year, seven IPOs have already generated around INR 76 billion, as per insights shared by Colliers. Advertisement
Over the same period, bank lending to the real estate sector has more than doubled from INR 17.8 lakh crore in FY21 to approximately INR 35.4 lakh crore now making up nearly 20% of overall credit exposure. This increase has been accompanied by a sharp improvement in loan quality, with gross non-performing assets (GNPA) in construction loans declining from 23.5% to just over 3%.
A shift in financial discipline is evident in the performance of the top 50 listed realty firms. Nearly two-thirds of these companies are now recording net and operating margins exceeding 10%, compared to less than one-fourth back in FY21. At the same time, over 60% of them maintain a debt-equity ratio of less than 0.5?indicating lower financial risk and focused deleveraging.
Colliers India CEO Badal Yagnik observed that the sector has become one of the most disciplined and financially prudent in the economy, driven by robust demand and responsible capital deployment.
Credit rating upgrades have also been more favourable for real estate compared to other sectors. In the second half of FY25, around 23% of rated portfolios in the real estate segment received upgrades, while downgrades were negligible. In contrast, the upgrade and downgrade rates across all industries stood at 14% and 6%, respectively.
Importantly, capital market activity has widened beyond traditional developers. IPOs are now being launched by players in co-working spaces, hospitality, and SM-REIT segments, pointing to a diversified investor appetite and growing market depth.
Vimal Nadar, Senior Director and Head of Research at Colliers India, noted that the spread of IPOs across asset classes would help strengthen long-term sectoral resilience and increase investor access to real estate-linked equities.
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