Latest Property News on 'Real Estate Trends'

India in Hiring Mode- Hiring on for Real Estate Sector

India continued to be the most optimistic nation in terms of hiring plans for the next three months, driven by strong job opportunities across all sectors including finance and realty sectors, global staffing services firm Manpower said.

According to the quarterly ‘Employment Outlook Survey’, India Inc’s hiring outlook improved by four percentage points for the April-June period compared to the previous quarter. Read More »

Indiabulls to Plan Restructuring of Wholesale Trading Business

Indiabulls Real Estate today said its board would meet on Thursday to discuss restructuring of its wholesale trading business through demerger. In a filing to the Bombay Stock Exchange the company said its board would meet on February 25 to consider a scheme of demerger of its wholesale trading business to Indiabulls Wholesale Services Ltd.

The company had earlier said that the restructuring would unlock value and also streamline the operations and ownership structure of Indiabulls Real Estate. Last week Indiabulls Real Estate had said that its board has appointed advisers and authorised a committee to prepare and present the draft proposal and related documents for the said demerger. Shares of Indiabulls Real Estate were trading at Rs 153.85, up 0.36 per cent on the BSE.

France’s Carrefour Negotiating with Indian Cos for its Indian Retail Venture

French retailer Carrefour (CARR.PA) is in talks with Indian companies for a partnership and expects to start its business in India with cash-and-carry activities, the company told Reuters. The world’s second largest retailer, however, declined to give names of the companies it is negotiating with and also did not confirm whether it was in talks with Future Group, which runs Pantaloon Retail (PART.BO), India’s largest listed retailer.

“Carrefour and some Indian companies have been discussing partnerships but we do not want to comment on any of the company we have been talking to,” Carrefour said in a emailed statement to Reuters. Indian media has speculated on a tie-up between Pantaloon and Carrefour to launch franchise stores in India. Earlier this week, Future Group Chief Executive Kishore Biyani told Reuters that his company was in talks with several overseas retailers but declined to specify whether Carrefour was one of them. Read More »

Orissa Continues to Dominate India Inc’s Investment Plans

Orissa continues to dominate as a leading player in the India Inc’s investment plans in 2009 despite economic slowdown by mopping up a whopping domestic investments worth Rs 2,00,846 crore in the year. Only Gujarat, with Rs. 2,45,352 crore worth of investment plans, registered the highest share in domestic investment plans during January to December, 2009, according to according to the analysis of Assocham Investment Meter (AIM) Study on corporate investments. Andhra Pradesh occupied third position with an investment plan pegged at Rs 1,29,157 crore.

Total investment plans of India Inc increased significantly from Rs 13,80,099 crore in 2008 to Rs 15,94,203 crore in 2009; out of which Gujarat, Orissa and Andhra Pradesh carved out a majority share of 15.4%, 12.6& and 8.1% respectively. “The robustness in corporate investment activity on the Indian soil shows how competently the economy has managed to weather the storm of unprecedented global financial crisis” said Assocham secretary general, DS Rawat. The intensity of corporate investment activity during the period of economic downturn has proved the relative resilience of Indian economy. Mr Rawat however pointed out that the implementation of these investment projects has been hampered by a slew of hurdles. These include, land acquisition problems, bureaucratic inertia, ongoing economic slowdown and depressed export market conditions. “The government needs to address these issues on priority basis in order to realise the fruits of these investments”, he said. Read More »

Real Estate Revival can Boost Connected Industries

When major sectors in the economy do well, it augurs well for several ancillary industries that depend on them. A case in point is the Rs 5,500-crore Indian glass industry, which has shown good growth in the past few quarters driven by an uptick in demand from user-industries such as infrastructure, construction, automobiles, food processing, beverages, pharmaceuticals and cosmetics, among others. The past four quarters have seen a steady growth in the fortunes of glass companies —with some of them swinging to profit. For the industry, FY09 was not particularly favourable. During the first half, when demand was relatively buoyant, companies faced soaring prices of key inputs. And during the second half, when commodity prices stabilised, demand stagnated due to the economic slowdown.

In FY2010, with economy coming back on track and input costs remaining benign, the industry is again witnessing a revival as reflected by the improving financials. Robust growth in automobiles, infrastructure, liquor & other beverages, boom in building and construction have enabled the companies in the glass sector to post healthy results over the past four trailing quarters. Hindusthan National Glass, the market leader in packaging glass, has reported 4% Y-o-Y increase in its revenues and flat growth in profit. With its prime customers in food processing, liquor and pharmaceutical industry registering growth in volumes, the company is already seeing signs of recovery in demand. It’s expecting to close the fiscal with a 75% increase in profit and more than 20% increase in revenues. Asahi India Glass, a major supplier of float and sheet glass to the auto industry, has posted a 8% growth in its consolidated net sales over the past four trailing quarters and significantly reduced its loss to Rs 5.5 crore against Rs 58.3 crore a year ago. With auto sales growing at a healthy pace, the prospects for this company also are bright. Read More »

Real Estate India still has Potential

Rajeev Malik, Head, India and ASEAN Economics, Macquarie Securities Group, gave his views on where to invest money. Well for me personally, real estate in some cases still looks more attractive. At the end of the day, it is very much an individual risk appetite and portfolio requirements as such. Equities would be an important point. Bonds look rather risky in the sense that even if you look at the US, it has already had a pretty good run with the broader dynamics, there, it is difficult to see why yields are not going to go higher, especially with the monetary cycle a few quarters down the line shifting gears.

In India, specifically you come into the broader issue that from a foreign investor perspective, equity markets remain the most open and they have had the best possible run. I also think specifically with equities in India, there is a sizable number of foreign investors who have not had a chance to gain exposure to the extent that they would want for a kind of a secular story and that’s emerging in India, which perhaps might explain why every time you see some correction, 10% or so, it always tends to trigger a bit more buying.

Mumbai Top Real Estate Destinations in Terms of Price Escalation

Property-seekers might think Delhi-NCR has the maximum appreciation potential within a year’s time. However, according to the latest property index released by real estate portal Makaan.com, it’s the Mumbai real estate market which beat all Indian cities in terms of price escalation over a period of 12 months. Mumbai has bucked the economic slowdown by witnessing a whopping 24.7 per cent jump in prices between January and December 2009. During the same period, realty rates in Delhi-NCR rose by 8.8 per cent.

But other emerging residential destinations such as Hyderabad and Bangalore have witnessed a fall of 7.7 and 2.2 per cent, respectively, the index added. However, Pune market gained significantly by 9.9 per cent. The survey revealed that all these five cities — Delhi- NCR, Mumbai, Pune, Hyderabad and Bangalore — witnessed a drop in property prices in the first six months — January to June — due to slump in the market. But the subsequent gain came following the launch of various affordable units. These units have now achieved premium value across India. Read More »

Big TV Collaborates with Real Estate Developers to market DTH services

Anil Dhirubhai Ambani Group company Reliance Big TV today said it has reached deals with real estate developers to market its Direct-To-Home television services in their residential building projects. The company has signed multi-dwelling units (MDU) agreements worth about Rs 20 crore with developers, including Kalpataru, Super Tech, Arihant Builders and Elysium Builders, to target residential and commercial clusters, Reliance Big TV (RBTV) said in a statement.

“The MDU strategy will be an integral part of RBTV’s focus to achieve leadership position in the Indian DTH sector… Such MDU agreements are expected to contribute nearly 15 per cent of its volumes in the circle,” RBTV DTH Senior Vice President Sales Ashutosh Srivastava said. The company is targeting a market share of 40 per cent in the MDU segment within the first year of starting operations, the statement added. Read More »

Real Estate Companies finding it Difficult to Handle IFRS

With the ministry of corporate affairs reiterating its commitment to converge Indian accounting norms with the international financial reporting standards (IFRS), the real estate companies are finding it tough to handle the effects of the implementation of the international standards as it will impact the basis for recognising revenues.

Under IFRS, real-estate accounting is largely based on ‘completed contract method’ wherein revenue is recognised once the project is completed and sold. Under Indian generally accepted accounting principles (GAAP), there is no specific definition of investment property and there are varying practices of classifying such properties. Mostly, the real estate accounting is based on percentage of completion method wherein revenue is recognised as the project is being constructed. The real estate experts are of the view that in a country like India where real estate projects atleast take around 3-5 years for completion, the fair value accounting might become a pain point. The experts are of the view that the government needs to make changes in the income-tax laws so as to not disincentivise tax payers. Read More »

MF Industry has not Invested in Real Estate Commercial Paper - SEBI Data Reveals

The mutual fund industry has not invested a single rupee in the real estate commercial paper in the three months of August to October as Securities and Exchange Board of India (SEBI) mutual fund deployment data shows. This is in sharp contrast to what happened last year. In May 2008, the investment into real estate commercial paper was as high as Rs 7,400 crore which was brought down gradually as the year progressed to Rs 6,600 in June, about Rs 6,500 in July and ultimately to little over Rs 2,300 crore in October 2008.

However, in sharp contrast with October 2009 where there have not been a single rupee that has being invested in commercial paper, clearly, mutual funds have wound down there investments into real estate commercial paper. Another set of interesting numbers that this Sebi Mutual Fund deployment data has thrown us up is that mutual funds parked almost 52.6% of debt AUMs in less than 90 days securities in October 2009. Now it is less than 90 days securities accounting for about 38% of debt AUM in September 2009. Read More »