BROKERAGE PREFERS DEVELOPERS OVER REITS Morgan Stanley Bullish on DLP, Prestige, Sobha Morgan Stanley sees a strong recovery | residential volumes within the property pent-up demand, significant improveme ability and new launch pipeline. The bro it prefers developers over REITs and is on DLF. Prestige Estate Projects and Sob an underweight rating on Godrej Proper equaiweight on Oberoi Realty. The BSE Realtty index last year Saw an . period of losses compared to the bencaht hit its 52-week low in May while Sensex recovering in March. The BSE Realty ind surged 112% from its 52-week low of 1: May 19 2020. Sensex has recovered ov 90% from its March 2020 lows. Morgan Stanley has downgraded Embassy REIT and Mindspace REIT to equalweight from overweight and cut target price on Embassy REIT by 12%. "Volumes in the mid-income and affordable segments are likely to be better than luxury. We expect volume recovery across metros, including Bengaluru, Greater Mumbai and Gurugram," said Morgan Stanley. Our Bureau DLF CMP (2): 267.55 Target Price (): 299 Potential Gain (%): 11.75 DLPF has laid out plans to launch 35-40 million square foot of new projects which have a revenue potential of 36 000 crore to 40 000 crore Over the next few years, Said Morgan Stanley, raising target price on the stock by 13%. The firm said DLF has altered its strategy to include several middle-income projects in the product mix and Sales will also begin with the start of construction. Morgan Stanley said an improving physical market and demand consolidation should benefit DLF and help double quarterly pre-sales to 1 000 crore In FY22. ESTATE PROJECTS CMP (?): 296.80 | Target Price (): 372 Potential Gain (%): 25.30 Raising target price by 9% Morgan Stanley Said Prestige has a balanced portfolio of residential and commerclal assets. Planned New launches in Bengaluru, Chennai, Noida and Mumbal, atong with ongoing and completed unsold inventory, provide good monetisation visibility and the company's valuations appear inexpensive at a 58% discount to forward net asset value, It said. SOBHA CMP (7): 475.595 | Target Price (7): 573 Potentlal Gain (%): 479.55% Morgan Stanley, which has raised target price on Sobha by 33%, said the company is positioning itself to benefit from upcoming residential demand with its current projects and upcoming new launches. Sobha continues to diversify geographically to non-Bengaluru markets and has a strong contractual business to augment cash flows, sdaid Morgan Stanley. Valuation is inexpensive at 31% discount to NAV the firm said.