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The residential realty sector is witnessing a K-shaped recovery, said ratings agency ICRA.

As per an ICRA analysis, large listed players are recovering at a much better pace than smaller, unorganised players.

"While the broader market remained 24 per cent below pre-Covid levels on a Y-o-Y basis in Q3 FY2021 and 39 per cent below pre-Covid levels in 9M FY2021, the top 10 listed realty players witnessed a 61 per cent Y-o-Y growth in Q3 FY2021 and 13 per cent growth in 9M FY2021," the analysis report said.

"This disparity in sales growth rates led to accelerated consolidation in the aftermath of Covid-19 and the market share of the top 10 listed realty players has nearly doubled in the current year, increasing from 11 per cent of sales in FY2020 to 19 per cent in 9M FY2021."

According to the report, larger developers have been benefiting from demand consolidation and better credit availability.

In terms of launches as well, the report cited that large players' market share has increased from 11 per cent in FY2020 to 22 per cent in 9M FY2021.

"A gradual unlocking of the economy and pent-up demand has been supporting housing sales. Moreover, the repo-linked lending rate (RLLR) for home loans has touched a historical low."

"This has resulted in improved affordability and has been stimulating house purchases, at least from larger, reputed developers with a strong track-record of timely project completion and quality construction."

Accordingly, attractive discounts, payment schemes have provided further stimulus.

"With the onset of the pandemic, home or holiday-home ownership has also become more important."

"Overall operating cash flows for most developers, including the listed players, are expected to witness moderation in the current financial year, resulting in increased reliance on available liquidity and/or refinancing to meet committed outflows."

However, the larger, organised players have maintained considerable liquidity buffers, and have low levels of leverage, together with high financial flexibility.

These aspects, the report said have provided significant support in managing event-related shocks.

"Thus, most large organised players with established brands, low leveraged balance sheets and adequate liquidity are benefiting from the acceleration in consolidation in the residential real estate segment."

"Range-bound prices and low home loan rates are also expected to further support sales for these players."