Most real estate stocks surged in the morning trade on Thursday after Municipal Corporation of Greater Mumbai (MCGM) on Wednesday came out with a revised draft development plan which recommends hike in the floor space index (FSI) from the present 1.33 to 2 and in some cases even up to 5.
FSI is a ratio between allowable construction space to the actual space.
Mumbai-based real estate firm DB Realty was trading 12 per cent up at Rs 52.10 in the morning trade (at 10.38 am). Indiabulls Real Estate and HDIL were trading higher by 9 per cent and 5 per cent at the same time. Sobha and Oberoi Realty shares were trading up by 2.5 per cent and 2.4 per cent, respectively.
The benchmark BSE Realty index was trading 2.83 per cent up at 1,356.09.
Shares of Orbit Corporation was trading 7.84 per cent up at Rs 6.60. Orbit Corporation is also a leading Mumbai real estate developer focused on luxury real estate development in South Mumbai.
MCGM commissioner Ajoy Mehta said the new draft plan proposes to hike FSI upto 2 from the current 1.33 in the island city and 1 in suburbs. For construction of five-star hotels and commercial development, it proposes FSI of 5 from the present 3 to 3.5.
In a bid to give a push to affordable housing and townships, it has recommended the FSI of 4 for such projects.
(With agency inputs)