Shares of real estate companies today surged as the Reserve Bank of India in a surprise inter-meeting cut has cut the interest rates by 25 bps to 7.75 per cent.

The NSE real estate index gained 2.84 per cent.

According to traders, a lower interest rate will result in cheaper loans and therefore higher sales for property assets.

DLF Ltd soared 3.1 per cent, Unitech surged 4.5 per cent and Indiabulls Real Estate gained 5.2 per cent.