Real estate companies looking to launch IPOs will need to scale back their valuation hopes as investors lose appetite for the once red-hot sector.
Surging demand for homes and offices in an economy forecast to grow 9.2 percent in this fiscal year had triggered a spate of listing plans by developers, but rising interest rates, steep valuations, lack of earnings, a market sell-off and the poor performance of recent issues have made investors edgy.

India's biggest real estate firm, DLF Ltd., has applied with regulators for the second time in less than a year to launch a float that could raise about $2 billion for a 10.2 percent stake.

Other developers including Omaxe Ltd., Puravankara Projects Ltd., Housing Development and Infrastructure Ltd., IVR Prime Urban Developers Ltd. and Kolte Patil Developers Ltd. have also filed red-herring prospectuses with the regulator.

Demand for new property issues has been soured by the poor market showing by recent market newcomers.

Shares in Dev Property Development have fallen about 11 percent from their late January issue price after the company raised $267 million on London's secondary AIM platform.

Mumbai-based Akruti Nirman Ltd., which listed last month, and Delhi-based Parsvnath Developers Ltd., which went public in November, both trade below their IPO prices.

Bangalore-based Sobha Developers Ltd. is more than 10 percent above its listing price, but around 40 percent below its high on its first day of trade in December.