Affordable housing refers to existing and future housing units that come under the Pradhan Mantri Awas Yojana (PMAY), which was launched in 2015.

• The scheme was initially launched with the aim of building 2 crore affordable houses over a period of 7 years for the lower income segment.
• The Union Budget 2024-25 allocated Rs. 2.2 lakh crore for the construction of 3 crore additional houses under the PM Awas Yojana, including PM Awas Yojana Urban 2.0, aimed at benefiting 1 crore urban poor and middle-class families with a total investment of Rs. 10 lakh crore and offering interest subsidies for affordable loans.
• Affordable housing projects were granted ‘infrastructure status’ earlier in Budget 2017, which ensured lower cost of borrowing for developers, thus encouraging them to take such projects.
• These measures were expected to increase the demand for affordable houses and corresponding loans.
• The scheme has had a tremendous influence on other sectors of the economy, resulting in a multiplier effect in terms of generating employment in ~30 occupational categories (e.g., plumbing, masonry, carpentry, etc.). 

This smallcase consists of stocks from segments like housing finance companies focused on financing low and middle income segments, real estate developers constructing affordable houses and cement & building products companies.