A SUMMER TRAINING PROJECT REPORT ON

“INVESTORS PERCEPTION ABOUT REAL ESTATE

INVESTMENTS IN NORTHERN INDIA”

Submitted in partial fulfilment of the requirements

For the award of the Degree of

Master of Business Administration

(2018-20)
(Dr. APJ Abdul Kalam Technical University, Lucknow)

By
Gaurav Malik
Roll No. 1809470026
MBA
(GIMT, Greater Noida)

Project Undertaken at
Vardhman Estates & Developers Pvt. Ltd. Janak Puri,
New Delhi

Report Submitted to:

Devendra Malik
(AGM)

1
2
 CERTIFICATE

This is to certify Mr. Gaurav Malik student of Galgotias Institute Of Management

and Technology, Knowledge Park-II, Gr. Noida has completed his training
successfully from 15/06/19 to 30/07/19 in Vardhman Estates & developers Pvt. Ltd.
under AGM (Business Development)Greater Noida.

I wish him bright future ahead

Yours Faithfully,
For Vardhman Estates & developers Pvt. Ltd.

3
 DECLARATION

I GAURAV MALIK hereby declare that the project report entitled “Investors
Perception About Real Estate Investments In Northern India” submitted for the
partial fulfillment of the requirement for the award of MBA is my own work and the
Project Report has not formed the basis for the award of any degree, diploma,
associateship, or other similar titles.

Date:

Place:

4
 PREFACE

The successful completion of this project was a unique experience for me become by
Visiting many place and interacting various people, I achieved a better knowledge
about Investors Perception About Real Estate Investments In Northern India. The
experience which I gained by doing this projects is being submitted which content
detailed analysis of the research under taken by me.

The research provides as opportunity to the student to devote his/her skill knowledge
and competencies required during the technical session. The research is on the topic
“Investors Perception About Real Estate Investments In Northern India”

5
 ACKNOWLEDGEMENT

I take this opportunity to express my profound gratitude and deep regards to my project
mentor Mr. Devendra Malik (AGM) at Vardhman Estates & Developers Pvt. Ltd. for
his exemplary guidance, monitoring and constant encouragement throughout the
course of this thesis. The guidance and help given by him time to time shall carry me
a long way in the journey of life on which I am about to embark.

I would like to thank the management of “Vardhman Estates & Developers Pvt. Ltd.”
for giving me a golden opportunity to work in this esteemed organization. Last but
not the least I place a deep sense of gratitude to my family members and my friends
who have been constant source of inspiration during thr preparation of this project
work.

Name: GAURAV MALIK

Signature:

Date:

6
 TABLE OF CONTENT

1. Executive Summary

2. Introduction

3. Company Profile

4. Study of Competitors

5. Objectives of Study

6. Litrature Review

7. Researh Methodology

8. Findings

9. Conclusions

10. Recommendations

11. Limitations

12. Annexures

13. Bibliography

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EXECUTIVE SUMMARY

8
EXECUTIVE SUMMARY

There has been a rapid growth in the real estate industry in the past few years. In the
residential sector, a growing middle class is enjoying rising income levels. Combined
with smaller household sizes, this demographic change has boosted demand for more
modern housing and home loans. Meanwhile, increasing consumer spending power
has encouraged growth in organized retailing – both feeding off and contributing to
the spear of ‘mall culture’ and the popularity of other large-scale retail property
developments.

In the commercial property segment, strong growth in the services sector –

particularly in the IT and ITES sectors – and corporate growing scale of operations
have led to greater demand for commercial space, including modern offices,
warehouses and lodging space.

Many Developers have substantial plans to increase both their size and geographical
spread. They are also expanding into different kinds of properties, which can boost the
firms’ franchise values and reduce concentration risks. However, managing and
financing such activities can be a challenge, and puts a premium on financial
flexibility, capital access and operational infrastructure.

The project assigned to me has an objective to find and analyze the current scenario of
Real Estate, covering the preferences of current as well as prospective customers. The
major part of the project also analyses the size of investment in various states and
mind set of the customers regarding this as well as the perceptions of customers
towards major leading Real Estate players.

The study was carried out with a methodology, in order to collect as much primary
data as possible. Data was collected by meeting clients and getting their views on real
estate investment in U.P. Lucknow region.
Areas covered in NCR: Gurgaon, Noida and Greater Noida.

9
Once the data was collected, this data was analyzed and various conclusions were
drawn. Agents’ viewpoints on various issues were also taken in order to get a more
insight into the Real Estate.

Following is the analyses done and conclusions drawn:

Plots, Apartments and Rented Offices are the most preferred investment
options in Real Estate people prefer for investment.
The cities that people prefer for investment and anticipate a good return in
those states are:
 NCR
 DELHI
 NOIDA
 LUCKNOW

Delhi is seen as a market of End-Users, rather than investors.

People from all over are interested in investing in NCR, including a good
amount of population of NRIs.
In other states, a declining trend is seen; NCR is into a stagnant state, where
there are least chances of the market going worse in the near future.

Real Estate Scenario In Various States:

RAJASTHAN

General size of investment in Rajasthan

92% of the people responded that the current size of investment in Rajasthan is
Below Rs. 25 lac.

Most Preferred Developer: Omaxe, Ansal API

Preferred Cities: Jaipur, Bhiwadi

10
PUNJAB

General size of investment in Punjab

95% of the people responded that the current size of investment in Punjab is below
Rs.50 lac.

Most Preferred Developer: Ansal API, Emaar MGF

Preferred Cities: Mohali, Amritsar

Uttar Pradesh

General size of investment in Uttar Pradesh.

92% of the people responded that the current size of investment in U.P. is below Rs.25
lac.

Most Preferred Developer: Parsvnath, Omaxe

Preferred Cities: Lucknow, Agra

HARYANA

General size of investment in Haryana

94% of the people responded that the current size of investment in Haryana is below
Rs.50 lac.

Most Preferred Developer: Ansal API, Omaxe

Preferred Cities: Sonepat, Panipat

DELHI

General size of investment in Delhi

11
85% of the people responded that the current size of investment in Delhi is above
Rs.50 lac.
Most Preferred Developer: DLF, Unitech

NCR

General size of investment in NCR

98% of the people responded that the current size of investment in NCR is above Rs.
25 lac.

Most Preferred Developer: Emaar MGF, DLF

Preferred Cities: Gurgaon, Noida

DLF, most preferred developer in NCR, fact remains, DLF, a company for
High-End investors, rather than small investors.

Emaar MGF, one of the biggest developer with huge amount of capital in its
hands, since none of its projects are complete as of now, real estate agents are
still not clear with its position amongst the investors.

Emaar MGF is likely to come big in the near future.

Parsvnath in Delhi has created a place for itself by setting a trend of Metro
Malls.

BRAND NAME and PREVIOUS TRACK RECORD of the company that

counts most for the prospective clients to invest into a particular project. This
is for a reason that projects in Real Estate cannot be accurately forecasted for
success or
failure. So, counting on the Brand name and previous track record is the only
option prospects are left with.

12
People nowadays go for Short-Term investment plans. This is mainly because,
Real Estate is not at a boom, so people, who are interested in investing want to
invest and realize as soon as possible.

INTRODUCTION

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INTRODUCTION

The purpose of this study is to examine the factors that positively influence the
propensity of Indian investors to invest in the real estate market. India is
second largest country in the world after China in terms of population. By 2030,
the population of India is expected to be largest in the world, estimated to be
around 1.53 billion. Because of the large size of population and economic
growth, the Indian real estate sector is booming and the annual demand for
residential buildings in the country is anticipated to grow at a compound annual
growth rate of 52.5 percent .

Sanford indicates that the Indian real estate market is one of the emerging
markets in the less developed economics of countries. India recorded an economic
growth rate of 8.50 percent in year 2010-11 .One of the contributing factors of
high GDP growth rate in India during 2010-11 was the real estate market
.Thus, the real estate market and real estate investors play important roles in the
economic growth of India.

Since the Indian real estate market is one of the emerging markets in the less
developed economics of countries and real estate investors play an important role
in the development of the Indian economy, it is important to understand the factors
that have positive influence on the propensity of Indian investors to invest in the
real estate market. Therefore, the resultant thesis is that the propensity to invest in
the real estate market depends on investment expertise of investors, investors’
knowledge of neutral information, investors’ motivation from an advisor, and
family; the purpose of this study is to explore these relationships among the above
variables.

Commercial and office complexes mushrooming in major Indian metros present a

minefield of opportunities. Over 20 million new housing units required in the next 5
years. The real estate market is projected to grow to $50 billion by 2010 CAGR of
over 30% p.a. is expected over the next five years. Increasing demand for commercial

14
and office spaceespecially from the rapidly growing Retail, IT and Hospitality sectors
and the Urban Infrastructure Renewal mission is expected to give a boost to the
sector.

Other factors include:

 $11.5 billion earmarked over the next five years for 60 cities.
 Investment opportunities exist in almost every segment business ; About 20
million new units expected to be built in five years in office space for IT and
five-fold increase in office space requirement over the next 3 years.
 Commercial space for organized retailing: 200 million sq. ft. by 2010.
 Hotels and hospitality: Over 50,000 new rooms in the next 5 years; Investment
opportunity of over $50 billion in the next five years.

Various Real Estate Investment Options are:

Real Estate Investment Options

Agriculture Land

Residential/Plotted development

Apartments/Villas

Commercial Spaces

Farm Houses

Real Estate Mutual Funds

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AGRICULTURE LAND:

Agriculture Land in India is the most protected area by the State and Central Govt.
Identification of Agricultural Land requires a bit of analysis about the rate and
assessment of future development in the nearby area. Due to fast growing
urbanization and development of infrastructure the price of agriculture land zooms
quickly. Agricultural land can be given on contract to cultivators with sharing of crop
model, to make small but regular tax-free earnings. Rural agriculture land is
completely free from capital gains tax and income from lease out or sale of crop is
also exempt as per the provision of IT Act, 1961.

RESIDENTIAL PLOTTED DEVELOPMENT:

Most state governments have loosened their fists and have implemented land reforms
that make the conversion of agricultural land into residential land much easier. The
process of township development takes a period of about 5 to 10 years. Initially, the
prices of plotted development are quite low which rapidly increases with the pace of
development and with the rise in inflation factor.

APARTMENTS/VILLAS:

As per the assessment made in the Indian Habitat Policy 1998, the demand for houses
in urban area is to the tune of 22 million houses. The gap in demand and supply in
housing stock has thrown big investment opportunities. Booking at the launching
stage and getting the exit at the completion stage ca offer shining returns on
investments. In this process the stamp duty and other taxes can be legally avoided.

16
COMMERCIAL/RETAIL SPACES:

The retail boom in India has fueled huge demand for commercial/shopping spaces.
Many MNC’s and big corporate retailers prefer to take prime commercial properties
on long-term lease basis. The option offers regular returns besides appreciation in
capital value, taking
both the returns together gives handsome return and a wonderful combination of
regular and a wonderful combination of regular and long-term returns.

FARM HOUSES/SECOND HOMES:

Many developers are offering lifestyle with smart returns through farm houses/second
homes. The offer comprises of sale of farm houses at affordable rates with
professional property management giving lifestyle and capital appreciation together.

REAL ESTATE MUTUAL FUNDS:

Securities Exchange Board of India (SEBI) has recently allowed the launch of mutual
funds which can invest in physical property. Many corporates such as HDFC and
IDBI are in the process of launching real estate mutual funds.

FACTS AND FIGURES:

In India Construction is the second largest economic activity after Agriculture.

Investment in construction accounts for 11 percent of India’s Gross Domestic Product
(GDP) and nearly 50 percent of Gross Fixed Capital Formation (GFCF). Construction
accounts for nearly 65 percent of total investment in infrastructure and is expected to
be the biggest beneficiary of the surge in Infrastructure Investment over the next five
years. According to the Economic Survey, India has the potential to absorb US$ 150
Billion of Foreign Direct Investment in the next five years in the Infrastructure sector.

17
The sustained growth and positive outlook for the future has increased focus on
Infrastructure development. Opening of the Infrastructure development to private
players, FDI and increased investment commitments from the govt. has thrown a host
of opportunities for companies in the infrastructure development sector, innovative
projects like the metro Rail and along with the proposed SEZ projects have provided
additional opportunities for the SME’s in the sector.

18
COMPANY PROFILE

19
COMPANY PROFILE

Vardhman is one of the fastest growing professional company with Diverse Business
Portfolio in the Real Estate Industry. We have earned the reputation for creating the
Highest Quality, Architecturally Significant Urban Environments with an unmatched
attention to detail.

Vardhman is undertaking some neo-age projects that creates a successful duo in the
emerging Indian Real Estate Industry. Vardhman has 30 years of experience in
developing Landmark buildings and undertaking World class commercial projects.
Inspired from the glorious past and the upcoming IT Parks, we have planned several
Projects for emerging Corporate as well.

If you're looking for prime locations, quality construction and a long list of standard
amenities, look no further but Vardhman.
Vardhman, one of the fastest growing professional company with Diverse Business
Portfolio in the Real Estate Industry has assigned outdoor promotion duty of their
upcoming projects to Mannat innovative media solutions (MIMS). Vardhman is
undertaking some neo-age projects that create a successful duo in the emerging Indian
Real Estate Industry.

Vardhman has a vast 30 years of experience in developing Landmark buildings and

undertaking World class commercial projects. Inspired from the glorious past and the
upcoming IT Parks, they have planned several Projects for emerging Corporate as
well.

Mannat (MIMS) laid down prominent areas, media tools and innovative ideas to
execute the campaign at a larger scale in Delhi NCR, Ludhiana, Kanpur and
Guwahati. MIMS delivered the best and the beautiful outdoor coverage for Vardhman
by providing highly visible hoardings at major traffic junctions, flyovers and markets.

20
Product Profile:
Projects of Vardhman Developers in GRETAER NOIDA:-

1) ALFA SQUARE a treat to lifestyle:-

“A Premier Property”
Vardhman, Passion for Architecture.

In this project of Vardhman it has:-

Creating New Landmark

 Project launched in December 2010

 In future Greater Noida will be known for a new landmark "ALFA SQUARE"

Hub Destination

 Commercial Space 2,00,000 Sqft.

 Office Space 3,20,000 Sqft
 Multiplex 10,000 sq. ft.
 Hotel Space 1,25,000 Sqft
 Total Area developed by project is 7,00,000 Sqft approx.

Easy to Excess

 The 160 km long Taj Express Way connects Greater Noida to Agra creating more
opportunities for Business activities
 Excellent Infrastructure for Education - Gautam Budh University & Sharda
University with the student population base of more than 2 lakhs.

Great Tourist Spot

 Great Tourist Spot with Night Safari & Formula 1 - to be operational within few
months.

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 Expo Mart & Recreational facilities like Steller, Gymkhana, YMCA, Heritage
Club & Golf Course.
Experience a whole new lifestyle
Creating a new benchmark of urban developments in Greater Noida, Alfa Square is an
Integrated Commercial Project which is redefining standards in leisure, retail and
office spaces. Sprawled in an area of 5 lakh sq.fts. (approx.),it is located near pari
chowk and has a neighborhood that actually defines the spirit of Greater Noida. The
Plot is located on Surajpur-Kasna Road in Alpha Block (Commercial Belt). Apart
From Setting a trend for attracting further investment into this fast growing city,
Alpha Square with its business centers, hotel, high street stores & quintessential
cultural fests will keep those with fine tastes busy in the times to come.

Work & Leisure Spaces Cailored to an Emerging Lifestyle

Vardhman, adding one more feather to its crown, presents Alfa Square, which will
have the ultimate office destination. Spreadacross an area of 2.5 Lakh sq. fts (approx),
the office spaces at Alfa Square will be nothing less than a spectacle. Apart from
signature, luxury and supreme office spaces are a star attraction of the project.

22
2) I-V@lley an ultimate IT destination:-

“Big Dreams”
“Big Ideas”
With Vardhman look no further.

In this project of Vardhman it has:-

Advantages Available

 The Technology component comprises 6, 50, 000 sq. ft in the core of the Park for
IT/ ITES.
 The Housing component comprises 1, 50, 000 sq. ft adjacent to the technology
component and earmarked for the development of residential alternatives.

IT Destination Available

 I-Valley is expected to be one of the IT Parks of its own kind

 Located in the heart of Greater Noida
 I-Valley will catalyze the growth of the Burgeoning Sub-Urban City
 It includes quality business space, reliable solutions & an international business
lifestyle

Offices Space Available

 The office space for a company at I-Valley would be spacious enough to meet the
desire expectations
 It would be having a cozy conference room for companies to take challenging
business decisions.

I-Valley - a world of its own

 I-Valley is self-contained.
 It has state of the art infrastructure & seamless management service.
 Special facilities for recreation and sporting activities.

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3) GALLERIA:-
“Spectacular”
“Easy Commute”
Vardhman, Service you deserve. People you
trust.

In this project:-
Not Just Shopping

 Total space 1,50,000 sq.ft. dedicated to premium shopping with space for more
than 150 shops and showrooms.
 It offers exciting eating options like fast food joints, cafes & specialty restaurants.

Complete Package

 Surrounded with close proximity to main Residential Colonies, Corporate Towers,

Educational Institutions, Hospital & Hotels.
 Internal Feeder for Malls with 2 IT Blocks & 240 Fully Furnished Studio
Apartments.

Impressive Offers

 Galleria is not only impressive in its size but equally impressive in character.
 Created a collection of exclusive experiences through 3 screen multiplexes
 Approved by Greater Noida Authority
 Have Experiences worth Life time

International Class

 The only upcoming international class city of National Capital Region of India.
 Just 20 minutes’ drive form South Delhi, known by its places and buildings.
 Galleria - A World Class Shopping Arcade

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FEATURE:-

 Ideally located in the hub of IT / ITES giants across the globe.

 Maintenance - Free Permanent Exterior Finish.
 High-Speed lifts & Escalators.
 Complete Fire Protection.
 Plush Green Landscaping with Pollution Free Area.
 100% Power Backup.
 Earth Quake Resistant Structure Designed Building.
 Ample Parking Space.

25
4) VEDIC SUITES taste & class- A class apart:-
“Start Packing”
“Tempting Value”
Vardhman, Experience Luxury in Greater
Noida.

In this project:-
Studio Apartments

 Project launched in December 2013

 Located opposite to Sharda University near to Knowledge Park-3
 Studio Apartments booking going on fast speed

Total Area Developed - 10Lacs

 Fully Furnished Studio Apratments

 Area of each Unit Plan is 600 sq. ft.
 Total Area is 15,00,000 sq.ft

Special Amenities

 Studio Apartment with Tiled Kitchen Floor, Bright Living Room, Designer
Bathroom, Air Conditioning Throughout, Wired Satellite Televisions
 Surround-Sound System Installed, Luxury Fitted Wardrobes, Fitted with Alarm,
Solid, etc.

Essence of Satisfaction

 Three Words are enough to capture the essence of satisfaction GYM 24x7
SECURITY RESTURANTS.
 Other amenities like Mini Market, Jogging Tracks, Swimming Pool, Conference
Rooms, Landscape & Water Bodies

26
5) SPRINGDALE sec-3 Dharuhera:-
“Leafy Neighborhood”
“Modern décor”
Vardhman colorful places to live and play.

In this project:-
Only Prime Location

 Project launched in December 2011

 Located at the prime location in Dharuhera, Haryana.
 Phase 1 sold out
 Construction almost complete

Colorful Living

 Total Area Developed 8 acres

 550 Flats
 All Facilities of School, Club, Swimming Pool, Landscape & Jogging Tracks
 The project is near Repotted Schools like DPS, Modern Public School, etc.

Urban Lifestyle

 Springdale is the residential project of Vardhman

 It offers Smart Architecture which simple means more Space & Privacy
 It is a perfect ascent to the relaxed urban lifestyle that awaits you inside your new
beautifully designed apartment home.

Census Town- Dharuhera

 Dharuhera is the fastest growing census town in the state of Haryana, India
 New Industrial Hub & Residential Suburb of NCR
 Indira Gandhi International Airport is just 48 kms away from the project

27
28
STUDY OF COMPETITORS

29
STUDY OF COMPETITORS

Competitors:

 DLF
 JAYPEE
 SUPERTECH
 AMARPALI
 UNITECH
 OMAXE
 ELDECO
 ANSALS

 PARSVNATH DEVELOPERS

DLF:

DLF presently has its land bank in 31 different cities, through with a small presence
(less than 100 acres) in 20 of these. In addition to 574 mn Sq. ft. land bank, DLF has
23 super luxury hotel sites, a golf course and clubs.

Too large dependence on Gurgaon:

The total land bank of 10,225 acres is highly skewed in favors of Gurgaon. DLF has
approximately 72 percent of its total land bank in Gurgaon (46 percent) and in
Kolkata (23 percent) together.

DLF has a total debt of Rs. 94.5bn and an outstanding amount of Rs. 55.4bn towards
land Rs. 94.5bn and cost. Of the total debt of Rs. 94.5bn, 75 percent is on a floating
rate basis which is a risk in a rising outstanding land interest rate environment. DLF
had capitalized Rs. 1.1bn out of the total interest charge of cost is Rs. 2.8bn for FY06
and estimated the interest charge for FY10 would be Rs. 5.4bn, on a conservative
basis, as interest rates have gone up by roughly 150 percent in the last nine months.

A total of 10,255 acres translates into 574mn. Sq. ft. of saleable area, the total 574mn
sq. ft. involves the development of plots of 46mn sq. ft., residential apartments of
377mn sq. ft. DLF is of the opinion that its present land bank is sufficient for the next
10-11 years. Out of 574mn sq. ft., DLF has a total of 46mn sq. ft. under development
as of 30 November 2006, between FY07-09 with 9m sq ft under residential; 26m sq ft
under commercial and 11m sq ft under retail development.

30
Snapshot of DLF past and future developments plans

Plan for year

Development Completed In Progress Planned 2008-09

Plots 195 - 46 -

Residential 17 9 375 69.8

Commercial 6 26 62 48.2

Retail 2 11 45 31.7

UNITECH:

The Rs. 1600crores Unitech Group is one of the Major Township Planning and real
estate development companies in India and has a diverse business portfolio of heavy
construction, leisure and entertainment projects, hospitality business and residential
property developments.

After playing second fiddle to DLF in Gurgaon, the low-profile Unitech Group is
gradually asserting itself in the real estate market of the national capital region. In
May 2006, in an upset of sorts, Unitech got the better of DLF by grabbing 345 acres
of prime land in Noida for whopping Rs. 1582 crores. Unitech has a land bank of
10500 acres whose breakdown is shown below and its future plans are of 500m sq ft
for the year 2008-09 for which they need huge amount of funding.

Unitech Builder plans to use the Noida land to make 4000 top-of-the-line apartments
priced at Rs. 2 crores (Rs. 20 million) each. The investment required to build this
dream residential project: Rs. 3000 crores (Rs. 30 billion). Besides inking this mega
deal, Unitech has been on a land-buying spread across the country - from Gurgaon to
Kolkata, Kochi, Hyderabad and Chennai - to establish a pan-Indian presence. In the
last few months, the Group has created a land of over 8,000 acres.

PARSVNATH DEVELOPERS:

Parsvnath developers announced that they would invest Rs. 1600 crores over the next
three years to construct a metro station cum shopping mall near the Commonwealth
Games Village in the National Capital. The metro station cum shopping mall is spread
over 7.3 acres and about 3.65lakh sq. ft. of retail space would be developed. This will

31
be the 12th mall which the Parsvnath will develop at metro stations, owned by Delhi
Metro Railway Station Corporation, a building operator transfer basis.

Parsvnath projects cover saleable area of 134 million sq. ft, including owned land
development rights; this does not include land owned in SEZ business. Ongoing
projects are spread over 17 states and 46 cities.

Development &
Upcoming No. ofSaleable Construction Total CostTotal Cost
Projects Projects Area Land CostCost in Rupees in US$

Residential 31 32.88 1344.9 3978.32 5323.3 1183

Commercial 21 4.91 795.68 800.12 1595.8 354.62

Integrated
Township 21 86.06 1121.0 7405.8 8526.8 1894.8

IT Park 4 6 4.55 915 919 204

DMCR 6 1.46 276.64 260 536 120

Hotels 17 2.69 247.31 627 875 200

Total 100 134 3790 14000 18000 4000

OMAXE:

It started in 1987 as a vision, to realize the dreams of millions across the length and
breadth of our country, is today an ISO 9001:2000, D&B 5A2 rated organization that
proudly boasts of over a 100 successfully completed projects under its belt. At
OMAXE we believe that our spectacular performance, extra-ordinary growth and
spotless track record over the past 19 years are proof of the infinite possibilities that
lie within us.

It is the belief that puts OMAXE in the forefront of this multi-billion industry as a
pioneer with an unshakeable reputation for delivering what is unconceivable for
others. It also beckons us to continue realizing the dreams of million into reality.

OMAXE, one of the India's fastest growing Real Estate developers, has registered its
presence across the country with a healthy mix of projects that range from well

32
planned office spaces to international standards townships, group housing, state of the
art malls, commercial complexes, multiplexes, theme malls, resorts, hotels, service
apartments etc. The company has also diversified into IT parks, bio-technology parks,
SEZs etc.

Today, OMAXE enjoy a reputation of being one of the India's premier Real Estate
Developers with an indelible focus on customer satisfaction. This feat has been
achieved through the adoption of quality system standards that integrate technological
and design innovations with a strong technical base to provide state of the art real
estate options.

At OMAXE, the human mind and spirit continue to be our most precious resource and
a critical ingredient in the spectacular success of our endeavors. Today OMAXE
boasts of over 800 qualified men and women who are successfully turning their
dreams, and dreams of million into reality.

Having registered phenomenal start based on the successful acquisition and

implementation of a large number of highly challenging and hugely varied projects,
all in a short span of under two decades, OMAXE today enjoys the reputation of
being North India's fastest growing Real Estate Developer.

Thus, the company having to compete with big competitors still stands out unique and
different owing to its incredible features, experiences and team work. It always works
for the benefits of its customers and to give them quality products at affordable prices.

33
OBJECTIVES OF STUDY

34
OBJECTIVES OF STUDY

1. To identify the scope of investment in various states, especially in Delhi,

NCR.

2. To identify the current trend of Real Estate, in areas across Delhi, NCR.

3. To identify the reasons of investment in various states.

4. To identify the reasons of people for not investing in various states.

5. To identify the preferences of investors.

6. To evaluate the effectiveness of major real estate players.

35
LITRATURE REVIEW

36
LITRATURE REVIEW

The real estate market in India has become so huge that to get every thing or anything
specific within one roof is easy and difficult at the same time. With the kind of
commercial and residential property available –on rent/lease/ ownership one has to
refer to portals or good companies dealing in various listings. Generally typical real
estate listing would necessarily include the following heads.

Properties Area Wise-

Separate sections of residential and commercial nature

Within this are included partnership, brokerage, requiring agents, and direct deals
with builders. The property rates of each area are usually determined every two three
years unless in a particular area shoots up due to construction or upcoming prestigious
piece of property (i.e. a five star hotel, IT corporate park, shopping mall or multiplex).
In such areas the rents and buying properties do increase because of job opportunities
and close residential facilities.

Property Evaluation

Many old properties may not be in very good condition. But they still are valuable.
Why? Mostly because they can be refurbished or rebuilt entirely. This is why they
usually fetch a good price. But one cannot depend only on brokers or agents or
property owners to evaluate the land. Sometimes the owner is greedy and expects a
bigger price, sometimes an agent in between quotes a higher price so that it benefits
him, sometimes the buyer may be just rich and may not have rival bidders or
competitors so quotes a fancy pricey according to his choice.

But now the industry has attained a level of professionalism and valuers who have
correct knowledge and are impartial are used to assess the property. Even if it has to
be handed over from one brother to another the valuer needs to correctly assess the

37
worth of the property. Usually a lawyer does the valuation so that a stamp of legality
can be given to the property and no disputes rise thereafter. A known property valuer
will charge a good amount to the job.

Property Managers/ Property Brokers/ Property Agents etc

Dealing with one person who knows the entire property inside out is important.
Usually when an agent shows the property to a prospective client he knows the
property manager dealing with it. He normally deals on behalf of the owner.

He looks after the property and keeps in good shape till it is sold to the next owner.
Brokers and agents now all over India have associations. So certified ones and those
registered with the respective associations will definitely not cheat you when you are
buying property.

Even if there are disputes it can be challenged or sorted out through the right
channels. Real estate listings usually give area wise contacts of brokers and agents
listed with them. So even if one does not knowon a portal provides the details.

PropertyConsultantsandDesigners

Now consultants are available for giving a better view of the industry in general. They
are aware of the rules, laws and regulations, which affect builders and buyers both.
Each consultant specializes in various kinds of property. For example proerty
consultant dealing with industrial properties knows what environmental laws and
rules about violating them. He can help the owners to be on the right side of the law.
Some consultants deal exclusively in townships, residential areas and are aware of the
rules that govern them. A good consultant will always be an asset for the builder he
works for.
Designers are usually required by architects or by individuals who need homes to be
designed. Some firms employ designers, some of them free lance or some do just
renovation work. Depending on the need they are listed too. They also deal with
people with knowledge of Vastu and Feng Shui-both applications are in vogue with
clients.

38
Help in buying or selling property

Sometimes an individual may want to sell his business and home and relocate to
another place. Real estate listings allow the person to choose various methods of
disposal for the same.

Home Loans

Sometimes one falls short of a required amount or needs nearly 75% of the loan to
buy a house or an office premise. Generally people apply for home loans. There are
many financial institutions, banks, private persons, and organizations, which lend
money to fulfill dreams. It is easy to obtain a loan if all paperwork is complete.

Today in India private bank HDFC and ICICI Bank and State Bank of India are the
largest lenders to their customers all over the country. They are also giving loans to
NRIs to invest in property in India.

NRI Real Estate Services

Right from choosing the property, availing loans, evaluating, filling forms online,
property management etc all services can be used. Real estate listings have the entire
database for the same.

Some real estate listings are also likely to include details and contacts of leading
architects, builders, news on upcoming projects, engineers, building materials and
news and articles which are likely to affect buying and selling decisions.

A regular monitor or a property watch is kept for any changes of rates in any zones.
Some also feature overseas properties and help in getting information to get there. A
real estate listing becomes popular with every new additional thing that will
eventually help the client.

The real estate market in India has become so huge that to get every thing or anything
specific within one roof is easy and difficult at the same time. With the kind of
commercial and residential property available –on rent/lease/ ownership one has to

39
refer to portals or good companies dealing in various listings. Generally typical real
estate listing would necessarily include the following heads: Designers are usually
required by architects or by individuals who need homes to be designed. Some firms
employ designers, some of them free lance or some do just renovation work.
Depending on the need they are listed too. They also deal with people with knowledge
of Vastu and Feng Shui-both applications are in vogue with clients.

Sales Promotion at different Level and different programme

One of the most difficult marketing decisions facing companies is how much to spend
on promotional John Wanamaker, the departmental - store magazine, said, "I know
that half of my advertising is wasted but I don't know which half."

Thus it is not surprising that industries and companies vary considerably in how much
they spend on promotion. Promotional expenditures might amount to 30-50% of sales
in case in cosmetics industry and only 10-20% in the industrial equipment industry.
Within a industry, a low and high spending companies can be found.How do
companies decide on their promotion budget? There are mainly four methods of this

Affordable Method:

Many companies set the promotion budget at what they think the company can afford.
One executive explained this method as follows : "Why, it’s simple. First I go upstairs
to the controller and how much they can afford to give us this year. He says a million
and half. Later, the boss comes to me and asks how much we should spend and I say
‘Oh about a million and half."

It is a method which is uncertain one and makes long term planning difficult.

40
Percentage of Sales Method:

Many companies set their promotion expenditures at a specified percentage of sales.

Accordingly the sales is set on the basis of sales. In this a specified sales percentage is
decided for the promotional budget Advantages of this method :

First, its use means that promotional budget vary with what a company can afford.

Second, it encourages the management to think in terms of the relationship among

promotion costs, selling price, and profit per unit,

Third, it encourages the competitive stability to the extent that competing firms spend
approximately the same % of their sales on promotion.

Inspite of the advantages, the % sales method has little to justify it. Its reasoning is
circular: It views sales as the determiner of the promotion rather than as a result. It
leads to budget setting by availability of funds rather than by marketing opportunities.

Competitive Parity Method:

Some companies set their promotional budget to achieve share-of-voice parity with
other competitors. Two arguments are made in support of competitive parity method.
One is that the competitors expenditure represents the collective wisdom of the
industry. The other is that maintaining a competitive parity helps prevent promotional
wars.

Neither argument is valid. There are no grounds for believing that competition knows
better what should be spent on promotion.

Objective and Task Method

The objective & task method calls upon marketers to develop their promotion budgets
by defining their specific objectives, determining the task that must be performed to
achieve these objectives, and estimating the cost of performing these tasks.

41
Deciding on the promotion mix:

Companies face the task of distributing the total promotion budget over the five
promotional tools:

• Advertising

• Sales Promotion

• Public Relations and Publicity

• Sales Force

• Direct Marketing.

Whatever method a company adopts for promoting its product it must be from above
mentioned method.

Sales Promotion
Promotion is the final element in the marketing mix. After the nature of product is
decided, its price fixed and the methods of distribution decided, the manufactures has
to take effective steps in meeting the consumers in the markets. In the present
consumer oriented markets it is the duty of manufacturers to know what is required by
the consumer. It is also their duty to make the customers know where, when how and
at what prices. The products would be available.

Meaning of Promotion
The term promotion is the term and includes mainly three
type of sales activity :

42
1. Mass impersonal selling methods (Advertising).

2. Face to face personal selling (Salesman ship).

3. Activities other than personal selling and advertising such as point of purchase
display (P.O.P.) show and exhibitions, demonstrations and other non securing selling
efforts. This form of activity is called ‘Sales Promotion’.

There are two types of promotion blends:-

1. Pull Blend.

2. Push Blend.

Both of these are closely related to the channel of Distribution.

1. A pull blend is one in which mass impersonal, sales efforts are given the greatest
emphasis. The purposes of pull blend to pre-sell to the final consumers. So that they
demand the product at the retail level of distribution. The firm adopting this strategy
would spend more on advertising and sales promotion rather than in personal selling.
These efforts pull down the product from the manufacturer.

2. A push blend emphasizes personal selling. Naturally firms adopting this method
develop a strong sales force at both the distributor and the dealer level. This method
would tends to push the product through the channel of distribution.

Promotion and Selling

The term promotion is very often used as a synonym for selling. But selling is a
narrow term which includes only transfer of title or personal selling. Promotion on the

43
other hand is broader in its outlook and includes a variety of activities used ultimately
for increasing sales volume.

Promotion and Sales Promotion

Similarly the terms sales promotion can not be taken to mean what is commonly does.
Sales promotion, is only a part of the promotion. Basically promotion is an "exercise"
in information persecution and influence. Promotion has come to mean the over all
coordination of advertising selling, publicity and public relations. Promotion is a
helping function designed to make all other marketing activities more effective and
efficient. But sales promotion as such helps only the selling activity still, there exit
same difference of opinion on the real connection of the term sales promotion.

Acc. to A.H.R. Delons :-

"Sales promotion means any step that are taken for the purpose of obtaining or
increasing sales".

Acc. to W.Q. Kelly Opines :-

"Muddled misused misunderstood that is sales promotion Acc. to him the field of
sales promotion as a marketing activity is still vaguely defined and organized.

Sales Promotion and Advertising

There is no universally accepted distribution between these two terms. To same
advertising includes all forms of mass media communication directed towards
influencing the end consumer. Sales promotion on the other hand, includes the form
of mass communication directed towards information and influencing the channel of
distribution (e.g. distributors, retailers etc.). Hence a price of product literature
distributed by retailers in sales promotion. These sales promotion merges on one side
in to advertising and on the other in to personal salesman ship. It is concerned with

44
the dissemination of information to whole salers, retailers, customers (both actual and
potential, and to the salesman).

Sales promotion is concerned with the creation. Application and dissemination of

material and techniques that supplement advertising and personal selling. Sales
promotion makes use of direct mail, catalogues, trade shows, sales contests,
premiums, samples, windows displays and other aids. Its purpose is to increase the
desire of salesman, distributors and dealers to sell a certain brand to make consumers
more eager to buy that brand. Personal selling and advertising do include prospects to
make these decisions. Sale promotion provides an extra stimulus.

Objective of Sales Promotion

1. To increase sales directly by publicity through media which are complementary to

press and poster advertising.

2. To disseminate information through sales man dealers etc. So as to insure the

product getting in to satisfactory use by the ultimate consumer.

3. To attract new consumer.

4. To face the competition effectively.

5. To help salesman in selling more to the retailers and consumers.

6. To check seasonal decline in sales. Generally speaking sales promotion involves

rendering the following services:-

(a) Services to dealers.

(b) Services to own salesman.

Sales Promotional at different levels

1. Sales promotion at Dealers Level :-

It may include various schemes some of which are discussed here.

45
 (i) Advertising Materials:-

The advertising material prepared by the company such as store signs, banners, shelf
signs, board etc. are distributed to sub dealer for display purposes this is in fact a
method of advertising.

(ii) Store Demonstration:-

In the promises of the whole saler or the retailer the products sales personnel will
conduct special demonstration for the companies product. A personal demonstration is
good to introduce a new product at its peculiar advantage can be high lightened and
the consumer’s doubt clear. It can be used to restimulate an old product. A good
demonstration with a great dealer of action will draw heavy crowds in to the store and
will attract attention to the product.

(iii) Special Display and Shows:-

These are in seasonal in character but could be arranged in an elaborate manner and
for all the products of an company. Usually these are arranged along with trade fair
and exhibition. Besides effecting sales these shows impress the company’s name
generally on the public.

2.Sales promotion at consumer’s level

The various schemes of sale promotion at Consumer’s Level may include.

(i) Coupons (A Chit of Stated Value):-

These are given directly to the consumer these coupons are in most cases kept inside
the package. The consumers many receive a price reduction of the stated values of the
coupon at the time of purchase. The retailer receives reimbursement for the value of
the coupon form the manufacturer. Coupons act as a short run stimulus to the sale of
the product, since they are directly tied with the purchase of the item. They encourage
the retailer to stock the product.

46
What is important is that a coupon offer does not spoil the named price of the brand
nor does it un pair the margin of the dealers. But it is not easy to measure the
effectiveness of a coupon offer. One over knows how many customer would have
bought the product without the incentive. It is also difficult to find out how many
customers were held after the coupon offer expired.

(ii) Price-off-offer (Also known as bargain offer price packs):-

This offer is intended to stimulate the sales during a slump season. In this method the
customer is offered a reduction from the printed price list. It is also used when a
substitute for competing product enters the market.

Many experts on sales promotion fed that ‘Off Schemes’ are among the weaker and
less desirable methods of promotion. These can be trade resentment particularly when
the retailer raises the price to retain his margin. Secondly that is not conductive to
building up brand loyalty. Consumers may simply shift to the products that offer this
scheme.

(iii) Samples:-

In the hope of converting a prospect into a customer a sample (Some quantity of the
product) may be given. This helps the consumer to verify the real quality of the
product.

Various pair manufacturing companies offer this method. For developing brand
loyalty this method is quite useful. Sampling is a fast method of demand creation
because one knows the result as soon as the consumer has had time to use the sample
and buy the brand.

Disadvantage of Sampler:-

Offering sample in quit expensive. There is the cost of producing samples. The
distribution costs are also high. Sample have to be mailed to potential customers or to

47
be distributed through retail shops. There are also problems when the real product
does not resemble the sample supplied.

(iv) Money Refund Offer:-

An offer usually stated on the package is that manufacturers will return with in a
stated period part or all of the purchaser’s money if he is not completely satisfied with
the product.

(v) Trading Stamps:-

A premium in the form of stamps is given by the sellers to consumers while selling
goods. The number and value of stamp that the buyer receives depends on the values
of the purchase. These stamps are redeemable through premium catalogues at the
stamp redemption centres.

(vi) Buy-Back Allowance:

This an allowance following a previous trade deal not offer a certain amount of
money for new purchases based on the quantity of purchases on the first trade deal. It
extends the life of a trade deal and helps to prevent part deal sales decline. It greatly
strengthens the buyer’s motivation to co-operate on the first deal.

(vii) Premium:-

There are various forms of premiums provided by the manufacturer as sales

promotional devices:-

(a) Coupons are supplied for effecting price reductions.

(b) Factory in pack premium these are popular in the case of Body food and Tin food
items, Spoons, Cups, Measuring, Glass etc. and such other items are packed with the
product in the box itself. Factory in pack premium are particularly goods for product

48
meant for children. The Bianca Toothpaste packs contain animal shape toys. These are
very attractive and qutie popular among the children.

(c) Self Liquidating Premiums :-

The cost of the premium is collected from the buyer himself. But when the buyers
pays for it he has to pay only a considerably low price for the premium. This is
possible for the manufacturer purchases the items in bulk at a premium and his cost
per unit as is substantially low.

Other Steps by Manufacturer for Promoting Sales

Dealers can be helps in different ways :-

1. Communicating Market News :-

Often this service is reciprocal the manufacturer may acquaint his dealer with the fact
relating to his production and prices while the dealer may familiarize him in return
with the information bearing on charges in the consumer's demand, their like and
dislike complaints and criticism, substitutes etc.

2. Inviting to Sales Conference and Convention:-

The gestures of regard and respect pave the way for better relation and co-operation.

3. Offering Reasonable Terms of Sale:-

Of all the forms of encouragement, the monetary incentive evokes immediate

response. Hence every producer must offer the most responsible terms of sale such as
longer periods of credit and higher rates of descants.

4. Supplying suitable packages and useful things.

5. By furnishing them with sales literature and display materials.

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Aggressive Selling

Meaning:-

Goods are produced for market. Manufacturers have to make efforts to sell all they
produce. When the manufacturers uses various sales efforts to obtain increased sales
volume for his product it is called aggressive selling or offensive selling. The sales
efforts which a manufacturer makes to retain his customers i.e. to protect his already
established market against against his competitors is termed as defensive selling. In
contrast to this aggressive selling is concerned with the sales efforts made with the
express objective of selling more by expanding the market for the product of the
selling firm.

Aggressive Selling and Defensive Selling :-

Aggressive selling is based on the answer to the question how much does the firm
gain (in term of sales with profit) by using this method defensive selling is based on
consideration as to how much the firm will lose if it does not use this method increase
of sales can be obtained from two sources:-

1. New customers if the market is expending.

2. From the competitors i.e. those consumers who were purchasing similar product of
competition firms, if the market for the product is static.

Acc. to H. Whitehead :-

"In case of an expanding market all the firm may stand to gain by following the
methods of aggressive selling but if the market is static manufacturer of a new market
will have to be much more aggressive to capture the established market of
competitors".

50
When Aggressive selling is resorted ?

Usually manufacturer of a new product has to do aggressive selling :-

1. When the product has been improved.

2. When the manufacturer’s product is supervisor in quality to the product of the

established competitor.

3. When the total market for the product or line of product to expanding.

4. If the manufacturer’s share of the market is comparatively small.

5. If the manufacturer has unused production capacity with heavy investment in plant
and equipment he will like to develop the demand for his product rapidly so that
demand for his product is equal to the optimum production capacity of his plant.

6. When primary demand for a product must be created and provision must be made
in the channel of distribution to educate consumers regarding the new product and to
instruct them in its use.

Method of Aggressive Selling:-

Sales promotion efforts use for aggressive selling may be divided in two classes.

1. Trade Promotion.

2. Consumer Promotion.

1. Trade Promotion:-

Under trade promotion methods special incentives are offered to the trader to buy
products of the firm. Such incentive may take one or more of the following firm :-

51
(a) Cash Allowance:-

A definite percentage of discounts is allowed on the purchase of given unit of a

product.

(b) Extra Product:-

Instead of giving any cash allowance extra product is given with each unit of product
ordered. For instance if a box normally contains 20 Cakes of Soap, special box
contains 25 cakes may be made and sold at the same price as that of the box of 20
cakes.

(c) Gifts :-

Various gifts are awarded in return for an order of a particular magnitude.

2. Consumer Promotion:-

Under consumer promotion method special incentives are offered to the consumers to
buy the firms product. The more prominent amongst such incentives are as following.

(a) Coupons:-

A coupon of a giving value is sent to the consumer. By presenting this coupon to the
retailer consumers can purchase a particular product mentioned on the coupon at a
reduced price. The retailer sells the products mentioned. In the coupon to such
consumer (consumers presenting the coupons) under and agreement with the
manufacturer at a price lower than the user retail price. Thus the consumer get the
benefit of reduced price to the extent of the value of the coupons.

(b) Self Liquidating Offers:-

Under this system, the firm offers an article at an attracting price if the consumer send
a given sum of money accompanied by a given number of box tops from the packages

52
of a particular product the benefit to the consumer is that he receives the articles at a
bargain price.

(c) Bargain Packs:-

Under this system a product is sold at a reduced price for a short period Bargain pack
method encourages new consumers to try the product. It is also helpful in obtaining
large displays in the shops.

(d) Sampling :-

The method involves giving the product or a small quantity of the product to a
consumer free with the hope that the customer will be favourable impressed with its
actual use and will eventually become a regular purchaser of the product.

A firm selling new product or an extensively improved product finds this methods
useful. Also a firm whose market is hold by competitors whose free sampling almost
expensive.

The above mentioned methods may be reinforced by adopting.

(i) Direct method of selling through.

(ii) Offer of door to door selling.

(iii) Hire purchase and installment payment methods of selling and by forming
combination.

Other Methods of Aggressive Selling:-

(i) Employment of ‘Missionary Salesman also known as Promotional Salesman’.

These salesmen call upon retailers and aggressively promote a product.

53
(ii) Instead of using wholesalers, the firm may develop its own sales force to call
directly on retailers.

(iii) The firm may follow a compromise method by employing a manufacturer’s

agent and giving him a large enough commission to encourage him to sell product
intensively and aggressively.

(iv) New territory exploitation sales promotion has a particularly important role in
developing the company’s product in new territories.

(v) Increment and promotions.

(vi) Letters to dealer and Customer.

In fact, an ingenious sales manager can devise any number of incentives schemes for
promoting the sales volume.

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RESEARCH METHODOLOGY

55
RESEARCH METHODOLOGY

Any activity done without an objective in a mind cannot turn faithful. An objective
provides a specific direction to an activity. Objectives may range from very general to
very specify , but the should be clear enough to point out with responsible accuracy
what researcher wants to achieve through the study and how it will be helpful to the
decision maker in solving the problem. Each research study has its own specific
purpose. It is like to discover to question through the application of scientific
procedure. But the main aim of our research to find out the truth that is hidden and
which has not been discovered as yet.

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 RESEARCH DESIGN

On the basis of theoretical study a research has many types. All of these are
distributed on the nature of research. Some of there are like

o Descriptive and analytical

o Qualitative and Quantitative

o Conceptual and Empirical

o Applied and Fundamental

o One Time Research

Our research is based on descriptive, qualitative and quantitative

research.

Descriptive Research :- Descriptive research includes surveys and facts finding

enquires of different kinds. The major purpose of Descriptive research is description
of the state of affairs as it exists at present. Researcher has no control over the
variables of this type of research.

Qualitative Research: - In our research we need comparison between different

stage and different condition. So this based on all qualitative data in short, Qualitative
research is especially important in the behavioral science where the aim is to discover
the underline motives of human behavior. Though suc research we can analyses
various factors which motivate to people to behave in particular manner or which
make people like or dislike a particular thing.

Quantitative Research:- Quantitative research is based on the measurement of

quantity or amount. It is applicable to phenomena that cab be expressed in terms of
Quantity. So we can use it in our research for collection of all the numerical data.

57
 SAMPLING TECHNIQUES

“Sample Design is a definite plan for obtaining a sample from a given population. It
refers to the technique or the procedure the researcher would adopt in selecting items
for the sample”

SOURCES OF DATA COLLECTION METHOD

PRIMARY METHOD

1) Face to Face interview

2) Questionnaires.
3) Telephonic Survey.
4) Survey through E-Mail.
5) Survey through Reference.

SECONDARY METHOD

1) Magazines on Property.
2) Internet sites on Property.
3) Internet websites of popular property developers of India .

4) DATA COLLECTION TOOLS

Our research is based on qualitative & Quantitative research.

5) METHOD OF DATA COLLECTION

58
 With the help of the questionnaire, interview schedule and study of data from
research carried out on Real Estate marketing Sector.

Statistical Tools:- it is sample percentage method.

ANALYTICAL TOOLS USED

Marco-economic Overview

The Indian economy currently stands among the world's fourth largest growing
economy in terms of purchasing power parity and holds the distinction of being a key
contributor to Asia's balance of payment surplus. India's GDP is estimated to be the
third largest in the world by2020. India is also considered the second most attractive
country in theworld for Foreign Direct Investment (FDI). Forex Reserves (excluding
gold and SDRs) stood at US$157.25 billion at the end of July 2006. India now holds
the fifth largest stock of reserves among the emerging market economies and the sixth
largest in the world.

59
The performance of the country has been consistent and steady over the past three
years with an average annual growth rate of 8%. The growth trend is being led by
positive movements across sectors in agriculture, manufacturing and services.

60
In recent years, the broad based growth in services sector has been a principle driver
of the GDP growth. Business services (including Information Technology (IT) and IT
Enabled Services), communication services , financial services, hotels and restaurants
and trade(distribution) services are among the fastest growing service sectors. India’s
share in the world market for IT software and services (including BPO) increased
from around 1.7% in 2011-12 to 2.3% in 2012-13 and an estimated 2.8% in 2014-15.

The proportion of manufacturing in the GDP has remained stable at around

25%, however, the growth rate of manufacturing has increased over years, from 2.7%
in 2001 to 9.0% in 2013 against the growth rate of 2.3 % and 9.8% in agriculture and
services respectively. Manufacturing Industries like textiles, automobiles, cement,
steel, petro chemicals, Infrastructure (civil aviation, roads, and ports), electronics
,beverages and tobacco products have been the prime drivers in India’s Industrial
growth.

REAL ESTATE SCENARIO IN INDIA

61
The size of the Indian real estate market is estimated at USD 12billion and it is
currently growing at rate of about 30% annually. Real estate lending by banks has
increased by 3.78 times in the last two years, forming 18% of the total bank credit.
Strong and improved economic growth, proactive policy initiatives like relaxation of
FDI in construction and availability of finance (institutional and retail) has driven the
demand for real estate across all sectors - Commercial, Residential, Retail and
Hospitality. Also, there is an increased focus towards development of Special
Economic Zones (SEZ) in India.

The last few years have seen Indian market mature through regulatory reforms
(rationalization of stamp duties, reform of urban land ceilings ), improving products in
terms of quality and technology, changing tenant profile (MNCs, and respect for
tenancy laws), and improving management and maintenance models (enhanced

62
product life-cycles and sustained project / real estate yields). Although the initial real
estate boom was concentrated in places like Bangalore and the National Capital
Region of Delhi (including Gurgaon ), more recently the geographical spread has
widened. There has been a significant shift in real estate market from metros to its
suburbs and to tier II and tier III cities. Lease rentals and occupancies have been
picking up steadily and there is an increasing demand for quality infrastructure across
various segments of the real estate sector.

Commercial Real Estate

The demand for new office space in India has grown from an estimated 3.9
million sq. ft in 1998 to over 16 million sq. ft in 2004-05.70% of the demand for
office space in India is driven by over 7,000Indian IT and ITES firms and 15% by
financial service providers and the pharmaceutical sector. Cumulative demand for
office space in India overthe next two years (2006-08) is estimated to be in excess of
45 million sq. ft. The Indian IT-ITES Industry, estimated at USD 36.3 billion in
2006has grown at a CAGR of 36% over the last decade and by 2008, is expected to
account for over 7% of India’s GDP and 30% of foreign exchange inflows. In 2005
alone, IT/ITES sector absorbed a total of approx 30 million sq. ft and is estimated to
generate a demand of 150million sq. ft. of space across major cities by 2010. South
Indian cities like Bangalore, Chennai and Hyderabad along with NCR (National
Capital Region) continue to attract the major share of IT/ITES and business
investment. However, secondary cities, like Pune , Chandigarh, Indore, Kochi and
Kolkata are now emerging as the new preferred destinations for these companies due
to their cost and infrastructure advantage

63
Residential Real Estate

64
 The residential property market in India constitutes almost 75% of the real
estate market in terms of value. Low per capita housing stock, rising disposable
income coupled with easy availability of finance from the housing finance companies
and banks are driving demand in this sector. Also, Average age of housing loan
borrowers has decreased to30- 35 years from 40- 45 years a few years ago, indicating
a young erbuying threshold. The housing sector is currently growing at 30-35% per
annum. A proportion of demand is also being driven from investors who view housing
as an attractive investment option as compared to mutual funds and stocks. The
demand for housing is geographically wide spread with townships being built in both
the metros and the tier II and III cities. In India, there is a housing shortage of 19.4
million units out of which 6.7million are in urban areas alone. This translates into
very high opportunities for investors in the residential sector

Retail Real Estate

The Retail industry in India continues to be dominated by individuals mall

format stores with floor space of less than 500 sq. ft. Total number of retail outlets is
estimated to be around 12 -15 million, indicating are tail density of 12-14 outlets per
1,000 people, which is one of the highest in the world. The retail sector in India is
currently estimated at USD 230 billion. The current size of the organized retail
activity is USD 7billion, which is a mere 3% of the total retail market. The retail
sector is witnessing a growth of 5-7% per annum; however the organized retail Is
poised to grow at a rate of 25% - 30% per annum and is expected to be worth over
USD 30 billion by the year 2010, thereby increasing the share of organized retail
activity from the current level of 3% to 15% in the coming decade

65
Hospitality Real Estate

Hospitality industry in India is growing at an annual rate of over8%. The

number of foreign tourists’ arrivals (a major driver of hospitality industry) in the
country increased to approx. 4 million in 2005. Over 55%of the total demand for
hotels in the country is generated by for eignlei sure tourists and business travelers
(domestic and foreign). A large proportion of lodging demand in commercial cities
such as Bangalore, Mumbai, Delhi etc. comes from business travelers.

This category also accounts for the major proportion of demand for five star or
five star deluxe hotels. However, against the total current supply of 96,000 rooms,
five star category accounts for just a quarter of the supply. With the expected growth
in demand for rooms at 18%, another 65,000 – 80,000 hotel rooms will be needed till
2010. This demand supply gap is expected to result in high level of activity in
construction of hotels. The established brands in this sector such as Asian Hotels,
Indian Hotels, ITC, Le Meridian etc are in expansion mode with many new players
such as Accor Group, Marriot, Choice, I H G Group keen to establish their footprint

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Special Economic Zones

The upcoming realty trend in India after multiplexes and mega housing projects
are the Special Economic Zones (SEZ). Currently, 28SEZs are operational in the
country, including those converted from Export Processing Zones (EPZ) to SEZ.
Approx. 189 proposals have already been granted approval since the SEZ Act, 2005
came into force .These include SEZs in various segments such as multi-product,
Information Technology, Bio-technology, Gems and Jewellery , Textiles and
technology intensive industries. Both developers and corporate have shown
tremendous interest in developing SEZs in the country. Reliance Industries, for
instance, is planning a 25,000 acre SEZ in Gurgaon and is also the main partner in
twin SEZs coming up at Navi Mumbai and Maha Mumbai, with a combined size of
35,000 acres.

The Adani group is also setting up an SEZ at Mundra, covering30,000-35,000

acres, and it proposes to invest Rs 7,300 crore on infrastructure. Other corporate who
are in process of setting up SEZs include TCG Refineries of the Chatterjee Group
(SEZ refinery at Haldiain West Bengal), Suzlon Infrastructure (hi-tech engineering
products and services near Coimbatore in Tamil Nadu, Udupi in Karnataka and
Vadodara in Gujarat), Hindalco (aluminum SEZ at Sambalpur in Orissa), Genpact (IT
SEZ at Bhubaneshwar in Orissa, Jaipur in Rajasthan and Bhopal in Madhya Pradesh),
Vedanta Alumina ( aluminum SEZ at Orissa). Seeking the permission for SEZs are
also a number of real estate developers, including DLF, Ansals, Omaxe, Parsvnath,
Shipra Estate and Sunny Vista Realtors

FDI in Real Estate

With the opening of the sector for 100% FDI under automatic route, the real estate
sector is estimated to capture about 18-20% of the total FDI coming to India in 2005-
06. The FDI in Real Estate is expected to have a favorable multiplier effect on the
economy. As an indicator, for every rupee spent on construction, an estimated 75-80%
gets added to the GDP. The spill-over effect of this initiative can also be witnessed in
important sectors like the cement and construction industries, where the key players
are expanding capacity to meet the soaring demand. With the relaxation of the FDI

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limit, the country saw an influx of global real estate developers like Dubai-based
Emaar Properties (the largest listed real estate developer in the world) – which
enetered India in a joint venture with Delhi based MGF Developments.

Growth and leverage to higher India growth

The real estate sector is developing rapidly in India. The demand side has robust and
sustainable macro drivers across all segments.

Residential:

Accounting for more than 70% of the sector in terms of space, residential segment
growth is driven by urbanization and the migration of households up the income
curve. According to the National Council of Applied Economic Research estimates,
the number of urban house holds earning more than INR 500,000 (about US$12,000)
should more than double to 7.6m in 2006-10.

Commercial:

Rapid growth in IT/ITES services (manpower in the sector has doubled in the past
three years To 1.6m) is the main driver of Grade A commercial office space demand
.Jones Lang LaSalle, a property consultancy, estimates that the absorption of office
space in the top seven cities in India was 31.1m square feet in 2006.

Retail:

According to CRIS INFAC, the penetration of organized retail into the overall market
will increase from 3.5% in 2005 to 8% in 2010, the reby driving the demand for mall
space.

Hospitality:

According to CRISIL, the number of 5-star rooms is expected to grow by60% in the
next four years with foreign tourist arrivals growing at 10%CAGR

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Structure Of Real Estate

The real estate industry has historically been fragmented and Opaque, but this is
changing:

Penetration of mortgage finance:

Mortgage disbursals grew by 38% in FY2001-06 and have be comean integral

part of the buying process. This has helped reduce the unaccounted “cash component”
of transactions.

Entry of foreign capital:

Regulations governing foreign capital in the sector have been relaxed,

motivating developers to become transparent and improve corporate governance.

Change in legislation:

In many states, strict laws like the Urban Land Ceiling Act (which defines
ceiling of land holdings in urban areas) have been repealed or modified.

Consumer preferences:

Consumers are now willing to pay premium prices for better amenities and a
good brand. In response, most of the bigger developer sare scaling up geographically,
which necessitates rigorous systems and processes

MUMBAI REAL ESTATE

Mumbai is no way behind when it comes to a talk on property. The Mumbai

real estate is in its growth orbit and attracts investors from major multinationals in the
recent times. Such is the potential of the city's infrastructure that it is known to be
spearheading most cities as far as property market is concerned. With Mumbai serving
as the entertainment city, even the organized retail sector here is fast flourishing.
Purchasing real estate in Mumbai requires a significant investment, and each piece of

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land in the city has unique features, so the property market in Mumbai has evolved
into several different fields. Having the potential to leverage high returns, a large
number of real estate projects are financed everyday in Mumbai. NRIs can shop for
property in the city with the expectation of attaining an investment good, or with the
purpose of utilizing it as a consumption good, or both. Mumbai is also the fashion
capital of India, so it is one of the foremost cities to be hit by the retail buzz. With the
opening up of the retail market, there has been a growing demand for retail properties
in Mumbai. This has created a viable market for mall space and other retail stores and
showrooms. These retail stores and malls are either owned by a business group or
leased for hefty prices as the demand is high. The property prices as well as the
increase in rental values in Mumbai owe much of its credit to the large scale
investments in the commercial sector. Mumbai has always been the hot favorite for
most of the corporate sector to have their headquarters in the city. And with increasing
investments by MNCs in the IT, ITES and the BPO sector, there has been a growing
demand for office space; which have consequently created an imbalance in demand
and supply for residential properties. The rental values in Mumbai have also in high
corresponding to that in other metros. Even India’s leading conglomerates have taken
up commercial space here. The state administration has already shifted wholesale
commodity markets to Navi Mumbai. So, you have endorsements from different
segments that Navi Mumbai’s commercial real estate is much sought after,” he says.
Suresh Haware, MD, Haware Builders concurs.

“Even at the ‘nano’ end of the commercial real estate spectrum, demand is
high,” he says. It is the small offices and shops’ segment that have witnessed the
highest demand at Haware Builders’ commercial projects in Navi Mumbai, he reveals.
Today, industrial units in Navi Mumbai are relocating to locations in Raigadh district
and commercial is the latest buzzword in Navi Mumbai’s real estate scenario, says
Vijay Gajra of the Gajra Group. “Commercial options in Navi Mumbai span a huge
price band. Growth of the residential segment in Navi Mumbai, prior to that of the
commercial segment, actually works out in favour of the end-user today, as manpower
resources are easily available,” he points out. “Commercial real estate in Navi
Mumbai comes at competitive prices vis-à-vis other options in the Mumbai

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metropolitan region (MMR), with the added advantage of being located in a well-
planned city,” adds Gajra.

IT/ ITeS SEZs and businesses that have anything to do with rail/road transport
and logistics or shipping, are proving to be the next big segment in Navi Mumbai’s
commercial spectrum, shares Mayur Shah, honorary secretary, MCHI. Ramneek
Bakshi, principal of global property consultants, LJ Hooker, points out that MNCs
view India within the parameters of the ‘Brazil, Russia, India, China’ (BRIC)
equation.

“When they look at India as a business entity, Mumbai takes prime position.
When they start looking out for space, Navi Mumbai, which forms the third level of
real estate pricing, is attractive for MNCs looking to set up shop in the Mumbai
region,” he explains. At the Norwegian consulate in Mumbai, George Mathew,
honorary consul general, concurs, “If you look at real estate pricing trends in the
MMR, Navi Mumbai fits the bill on many counts. However, the clincher is the price
efficiency and developed infrastructure that Navi Mumbai provides,” he concludes.

Appreciations

The hike in demand as well as supply and appreciation in capital values are
attracting good attention from overseas investors. The Mumbai real estate has become
a reflective of the high growth in Indian property market. There has been an increase
in real estate value across micro markets in Mumbai as well.

Mumbai is looked upon as one of the most organized and transparent property
market in India. With cash components and transactions shooting up in the last two
years, the city has gained much popularity among the investors, both domestic and
international. The investment market has been thriving with excellent returns going
high over the past few years. The real estate boom and an upsurge in development
activities in major parts of Mumbai have led to a rise in investment prospects in
commercial and residential sector.

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 Known locations like Bandra-Kurla Complex (BKC) and Lower Parle have
seen appreciations in commercial spaces falling under the category of Grade A. The
occupancy levels in other preferable locations like Andheri West and Nirman Point
also increased in the current year and are believed to have marked the rise by 90-
95%.Another mark appreciation is in regard to commercial properties in Mumbai, and
is prevailing in the city's micro markets barring a few exceptions.

NRI Real Estate trends

Major property developers in Mumbai, underpinned by the vastness, scope,

success and scale of progress in the city are now transforming developing properties
into strong retail bases. Then of course, the government permitting foreign direct
investment (FDI) up to51% in retail trade has also brought about major moves in
retail industry.

The demand for property whether commercial or residential, is very high in

Mumbai. There has been steady demand for consecutive years and has resulted in an
increase in the yield rate. New real estate projects in Mumbai are always in queue to
be launched by private as well as by government. This encouraged overseas investors
especially Non Resident Indians (NRIs) to make significant investments in Mumbai
properties with an excellent accessibility across the globe, the city of dreams, Mumbai
has emerged as an ultimate destination for most people. As per property surveys, one
can sell any property and get a price which is fairly good. Within the real estate
industry, it is believed that such periods come in cycles and bring an apt time to cash
upon.

What makes real estate in Mumbai so exciting are an ongoing demand and the
proposed projects that are to be executed in approaching years. Builders always have
special offers and attractive schemes in store for end consumers. Capital Values of
quality apartments, in well-maintained old buildings and upcoming projects, in South
and South Central Mumbai, have gone through the roof.

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Agency

Agency is that branch of the real estate business which engages the attention of
the greatest number of persons who are concerned with the business, and in that
respect it is of prime importance. It is divided into two parts, brokerage and
management.

A broker is a person who for compensation, usually proportioned to the value

of the subject-matter, brings about transactions between principals. Brokerage has two
divisions according to the kinds of business which usually engage the attention of the
broker. The sales broker is a broker who devotes his time and attention to the bringing
about of the sale or exchange of real property. A loan broker is one who gives his
attention to the obtaining of loans upon the security of real property. One man may
practice both branches of the business, or a specialist may devote himself to either of
these branches.

Management, the second branch of agency, is the operation of deriving income

and caring physically for real estate structures. It concerns itself not only with the
deriving of income, but with the keeping down of expenses and the care in making
expenditures. It is popularly known as "Agency."

VISION

“Benchmarking our services in terms of People, Pace & Passion to be the best in the
Industry.”

MISSION

“To provide creative solutions, by customizing our services to suit the

requirements of our clients. To encourage & facilitate our team to
reach its optimal potential combining its diverse strengths to provide
total customer satisfaction.” Background They started as a journey by a single
individual with a desire to excel has now become an organization which is serving the
needs of the real estate industry in the country today.

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 Alliance today has the best talent on its board of directors who are professionals
in real estate, finance, accounting and taxation striving to render the best of services to
its clients. Alliance today has given shape to and has structured some of the most
complex and landmark transactions for reputed clients they add value to your
properties through their experience and expertise, with their wide network of clients
and contacts all over India and global arena. They assist everyone in identifying
opportunities and the right partners to compliment their capabilities.

Projects Handled-

Little World Mall:

They had sole mandate to lease the mall which started in October2007in
Kharghar. Complete project was completed by them with good anchors and brands as
listed below:

Aditya Birla more, Archie’s, Levis, Levis Signature, Max Life Style, Adlabs, The
Raymond Shop, Reid & Taylor, Welspun, Thomas Scott ,Connections, Koutons,
Planet M, The Mobile Store, Homes & Apparels, Lilliput, Carmicheal House, Kittens,
Thomas Scott, Gini & Jony, La Diamond, Nice Looks, Dosa Plaza, China Land,
Chopking, IndianTadka, Moti Mahal, Café Energise, Café Bollywood, Kwality Swirls
Juice Zone, Namrata Cup Corn .Curries and Parathas, etc.

City Center Mall:

They have leased Operational Mall on Palm Beach Road, Vashi. Thelist of brands
which we introduced to this mall are: Levis, Roop Sangam, Kittens, Gini& Jony,La
Diamond, And Design,Adora, M&B Shoes, Black berry, Weekender, Infancy, Timex,
GKB Opticals, Black Berry, ITC John Player, Unistyle, Adidas, Nike, Spykar, Lee
Cooper, Ruff Kids, L effect, Live In, Lovable, Dominoz , Nice Looks, Top Corn, Café
Coffee Day, Ameoba Game Zone, Stone age Restaurant.

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Other Individual Projects Handled :

Brokerage deals:

¤ Crystal Mall- Bandra & Mumbai Times Café

¤ Reliance & Maithili Signet at Vashi.
¤ Kstar Mall –Chembur Aditya Birla More
¤ Fantasia Mall-Inox (Multiplex)

Bank Finance:

¤ Arrangement for Akshar Developers from Axis Bank

¤ Arrangement for Well-wisher Constructions from Axis Bank
¤ FDI investment for Little World Mall.

Quality Objectives

 Continuous improvement in the quality of services.

 Prompt response to customer complaints
 Strong property data bank.
 Aggressive follow up & due diligence.
 Panel of associates for legal, finance, market research, investment.

Overview

Alliance Property Services is professionally managed company Having presence in

Mumbai, India in the following activities:

1. Real estate –Sale and lease.

2. Lease of retail outlets in malls and High street.
3. Joint ventures with developers.

4. Leasing and sale of entire properties with High Value clients, Builders, Investors,
Private equity, Venture capital, Foreign Direct Investors.

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5. Franchising in retail and other spheres.

6. Arranging attractive investment proposals/ideas for investors.

7. Holding real estate/franchising /retailing /financing expositions and Exhibitions in

all towns and cities.

8. Finding investors for local developers and Builders.

9. Underwriting entire projects for marketing, investments and Execution

Corporate Real Estate Services

Transactions for all kinds of properties across the country including:

 Residential
 Office
 Commercial
 Retail & Shopping Malls
 IT Park
 BPO/ Call centre
 Hotel & Resorts
 Leisure & Entertainments
 Hospitals

 Multiplex es
 Indus trial
 Institutional.

Advisory Services:

 Investment Advisory Services

 Third Party Due Diligence & Service Management
 Feasibility Analysis
 Lease & Utility Audits
 Relocation Studies

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 Property Valuation & Tax Consulting
 Site Selection Modeling Analysis & Strategic Planning
 Merger and Acquisitions
 Joint Venture, Collaborations, Franchise

Foreign Direct Investment (FDI)

Allied Services:

 Valuation and Land Appraisal

 Tenant / Purchaser Representation
 Research & Feasibility Studies
 Project Management
 Bank Finance: Preparing project and feasibility report, Bank Turnkey Financing
Solutions

Value added Services

1. Turn Key Projects: Lessoning for Approval

a) Central Govt. of India

b) State Govt. of India

c) Local Govt. and Municipal Corporations

2. Joint Venture with Best Indian Realtors for Multinational Companies.

3. Office Buildings and Houses for Company Management.

4. Project Management Consultancy Services.

5. Design, Architect, Marketing, etc.

6. Local Assistance for Site Development / Construction.

7. Global Partnership with leading realtors overseas for Indian Realtors.

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After achieving a reasonable success in Mumbai and Navi Mumbai, they are now
planning to have branches and associate offices in all cities.

SELLING & MARKETING DEPARTMENT

The ultimate aim of the Real Estate Marketing is to increase the demand for a
particular type of property and to increase the price so that the seller of the property
owns the highest amount of profit for himself. The Real Estate marketing is needful
also to make the Real Estate project work and make it familiar among the public as
much as possible. Most of the Real Estate sellers keep an amount intact just for their
Real-Estate Marketing and on that basis they choose certain Real Estate Marketing
Agents and give them the responsibility to sell their property off with as much profit
as possible. If the seller’s budget is big enough then he can go for renowned Real
Estate Marketing agency and for those with small budgets the smaller agencies are
also available. Most of the big Real Estate owners who want to sell their properties
prefer to go for big marketing agencies as they have better ways to promote one’s
properties and have able agents who can find the right kind of agents working for
them who have better contacts and have better ways to popularize the real estate
property.

A good Real Estate Marketing Agency always puts special emphasis on the
right kind of information that one needs before starting Real estate Marketing and for
that the agency normally conducts some kind of survey to gather the right kind of
information. Later the Real-estate marketing Agency depending on that report
develops their ways of marketing. Nowadays a lot of Real estate marketing is done
through the help of the Internet. One can have various websites that do marketing for
different real estate properties for a certain amount of money. One also needs to make
the website precise and filled with to the point information. The Real estate Internet
Marketing is a very simple process and is cheaper in nature as well. Although one
needs to keep the demands and the reasonable amount of price in mind.

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I was functioning under operational projects of Alliance Property

Services for Harare’s Commercial Projects namely -

 Centurion Commercial & Shopping Complex, Nerul

 Vashi InfoTech Park, Vashi
 Haware Infotech Park, Vashi
 Fantasia Mall, Vashi

In marketing, Promotional strategies were used namely -

 News paper advertisements,

 Visual media ads in local cable channels

 Direct Marketing(door-to-door) in commercial complexes and

 Through www.iproperty.com

Business cards can either by a waste of paper or an effective bridge between a

prospect and their potential as a long-term client. So, follow-ups of all the business
cards that were dropped in at the site office were done on a daily basis.

Brokers & agents were also approached to get their clients for the deals. Telephone
& Email follow-ups also formed a part of my job. There was face-to-face interaction
with the customers for the sale of shops/offices by convincing them to buy.

Customer Database was also maintained considering various heads like- Date of
purchase, Shop/Office no., Name of the customer, Area of the shop/office in sq.ft.,
Total value of Shop/office in Rupees, Total Received(cash/cheque) and Balance
amount

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ADVANTAGE FOR REAL ESTATE AGENT:

10-Year Tax Holiday

The finance Ministry has announced a 10-year tax holiday for developers of Industrial
parks set up from April 1, 2006 to March 31,2009. According to the Industrial Park
Scheme 2008 notified by the Central Board of Direct Taxed (CBDT), the industrial
park developers will be eligible for 100% tax deduction which is to be provided for
10consecutive assessment years out of 15 years after the commencement of
operations of such units. The developers will be free to choose the 10consecutive
years for the purpose of availing themselves of the tax holiday.

Price Variations in India

There are unbelievable variations in the prices of real estate sector in the past. Which
mainly affect to the sale of business. Mainly there are two causes for the same:

 Per Capita Income

 GDP at Market Price

Per Capita Income

As depicted by fig. 2 per capita income is increasing in India, which has increased the
purchasing power of the people. Due to this over the last year (2006-07) houses prices
have raised by 10-90% and commercial property prices by 10-30% in different area of
India. Correlation .996 is found between PCI and real estate prices. Thus there is a
positive correlation between per capita income and real estate prices.

GDP at Market Price

GDP, the indicator of the national growth, from the past 2-3 years is increasing by
6.5% to7.5%. Every rupee spend on the construction add to nearly 60% of GDP. As
shown by the figure the GDP has increased from the 2463324 crore to 3529240 crore

80
from 2002-03 to 2005-06, so it indicates that how the spending on the construction
sector helps the real-estate prices to increase.

Clear Title

90% of the lands in India do not have clear title. The ownership is unclear, thereby
creating a scarcity of land. This is due to poor recordkeeping and outdated complaint
processes. All updated records must be computerized to increase transparency in land
ownership. And special fast track courts must be set up to clear all legal land disputes
in a short period of time.

Stamp Duty & Registration

The cost of transferring land titles must be reduced from rates of 10%stamp duties to
reasonable levels of 3 to 5%; similar to prevailing rates in developed countries. This
will encourage sellers to pay stamp duties, instead of trying to cheat the government,
thus increasing the revenue for the country. The high duties have also encouraged
unaccounted money being used in most real estate transactions in India. The
registration procedure should also be made transparent and simple so that corruption
can be minimized.

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Building Codes, Standards & Permissions

There are several building guidelines and standards in various cities and states,
however they are neither followed by the developers nor implemented by the
authorities.

Development and Planning

In India development and planning concerned with real estate sector is not up to the
mark. The city or state authorities must use professionals to plan and execute all
development plans for cities and towns, with future development in mind. This must
be done without political compulsions. This will allow proper zoning within cities and
towns, green areas and other infrastructure systems to fall into place as the
development plans unfold.

Present Scenario in India

India’s house prices are now falling!

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After more than three years of spectacular house price rises, India’s property market
continues its downward trend, mainly due to high interest rates on home loans and
slower economic growth.

Residential property prices are now falling in most cities in real terms (given India’s
high inflation, it is important to distinguish nominal price rises from real price rises).
Nominal house prices rose in 13 cities (out of the 26 cities covered by National
Housing Bank (NHB) Residex figures) during the year to Q1 2014, while the
remaining 13 cities have seen their nominal house prices fall. But when adjusted for
inflation, house prices actually fell in 21 cities, whereas only 5 cities experienced
price increases.

In New Delhi, house prices fell by 1.49% during the year to end-Q1 2014. When
adjusted for inflation, house prices in the capital city actually dropped 7.82% over the
same period. During the latest quarter, house prices increased 1.53% (2.81% in real
terms). The highest annual house price increase was in Surat at around 17.86%
(10.28% in real terms) y-o-y to Q1 2014. It was followed by Chennai, which had a
12.58% price increase (5.34% in real terms), and Nagpur, which had a 10.43% price
rise (3.33% in real terms).

Meerut registered the largest price drop in Q1 2014, plunging by 13.61% (-19.17% in
real terms). It was closely followed by Ludhiana with a 13.17% drop (-18.76% in
real terms) and Vijayawada with a 13.04% drop (-18.63% in real terms). Other
struggling Indian cities include Jaipur (-9.82% nominal, or -15.62% in real
terms), Coimbatore (-7.61% nominal, or -13.55% in real terms), Indore (-7.18%
nominal, or -13.15% in real terms), Chandigarh (-5.67% nominal, or -11.74% in real
terms) and Kochi (-4.49% nominal, or -10.64% in real terms). Despite this, the Indian
property market is expected to experience a post-election boost. Newly-elected Indian
Prime Minister Narendra Modi is expected to revive the slowing economy and the
struggling property market.

Local real estate experts are optimistic on the future of the Indian property market:
"We have a huge expectation from the new government as Modiji has demonstrated
good governance in Gujarat. We expect efficiency in approval process and easier bank
funding which are the two major concerns for the industry," said Lalit Jain of realtors
apex body CREDAI.

"The formation of a stable government not dependent on coalition partners will

hopefully mean faster decision making and economic reforms. If GDP growth picks
up, one of the early beneficiaries would be the real estate industry," said Anshuman
Magazine of CBRE South Asia.

"We are optimistic about the reform and changes this government will bring in to
boost the economy. For the real estate in particular, we firmly believe that the sector
will be given industry status this time which will ease all fund inflow," said Parsvnath
Chairman Pradeep Jain.

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India’s economic growth was 4.6% in the first quarter of 2014, after 4.6% in Q4 2013,
5.2% in Q3 and 4.7% in Q2, according to the Ministry of Statistics and Programme
Implementation.

The economy is expected to expand by 5.4% in 2014.

Previous annual GDP growth rates were 4.4% in 2013, 4.7% in 2012, 6.6% in 2011,
and 10.3% in 2010, based on figures from the International Monetary Fund(IMF).
Real estate prices in India (as elsewhere) tend to be strongly boosted by high GDP
growth, which puts money in buyers’ pockets. Along with interest rates, GDP growth
is more important than any other factor for property prices.

India’s housing boom era

From 2002 to 2007, house prices in India rose rapidly. Strong economic growth and
urbanization supported house prices, as did inadequate infrastructure in city centres,
lack of

planning and antiquated land laws. From 2005 to 2007, the economy grew at 8.9% per
annum, making it one of the world’s fastest growing, following on from 7.6% per
annum growth from 2003 to 2004.

The price increases were accompanied by interest rates which fell to as low as 7.5%
from early 2004 until 2005. By 2006 mini speculative boom had been set off, and
residential properties in Mumbai cost 100 times the average annual income.
Developers’ capital rapidly grew as their stock prices increased, and they used it to bid
high prices for huge plots of land, making it relatively easy to sell properties at very
high prices.

During the world economic downturn in 2008 demand for luxury housing fell 50%.
House prices in Delhi fell by as much as 13.08% during the year to H2 2009.
Developers refocused on building low-income homes. But India’s economy quickly
rebounded, and house prices soon started rising again – supported by the
accommodative central bank.

India’s rupee and inflation crisis

The dramatic appointment as RBI governor of Raghuram Rajan, former chief

economist for the International Monetary Fund, came in a situation of near-crisis.
On August 28, 2013, the Indian rupee had crashed to a record low of around 68.825
per US$. The depreciation made India’s economic confidence drop sharply by 7
points to 53% in August 2013, according to research firm Ipsos. Causes included:

The strong USD, aggravated by the Fed’s decision to reduce Quantitative Easing;

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Slowing economic growth in India, rising inflation, volatility in the equity market,
causing massive withdrawals of international investment
A large current account deficit and fiscal deficit
The price of crude oil

In defending the country’s currency, the RBI had spent around US$ 17.23 billion
worth of foreign exchange reserves during the year to September 6, 2013, leaving the
reserves at
around US$274.81 billion. Planning Commission Deputy Chairperson Montek Singh
Ahluwalia assures public that India has adequate amount of foreign exchange reserves
to defend its currency.

Given two years of rupee depreciation, it was expected that exports would be boosted.
But though there was an 11.6% y-o-y increase in exports in July 2013, the effect was
limited, with rising import prices having a severe effect on Indian industry.

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“Exports are unlikely to get any significant boost,” according to Indranil Pan, chief
economist at Kotak Mahindra Bank. “Any benefit [from the weak rupee] will be
offset by the fact that there is a huge inflation problem in India, and the cost of
manufacturing is very high for local companies.”

Inflation was allowed to rise significantly during 2007-1010, and more recently has
risen worryingly again. India’s huge fiscal and current account deficits do not help.
The current account deficit in 2012/2013 soared to a record high of US$ 88.2 billion
or around 4.8% of GDP. The government aims to reduce it to US$ 70 billion this year.
The fiscal deficit was 4.9% of GDP in fiscal year 2012/2013.

The Reserve Bank of India (RBI) has in recent years tended to accommodate
inflation, phased by the perplexing combination of high inflation and weak economic
growth. The RBI’s stance has been extraordinarily lax, leading the prestigious Indian
Financial Express to talk of The rudderless Bank of India.

For example, the RBI reduced its key (repo) interest rate by 0.25 percentage points to
7.25% in May 2013, the third consecutive rate cut implemented this year. Amazingly,
the pressure from business has been for even lower rates. Agencies such as the
Federation of Indian Chambers of Commerce and Industry (Ficci), Confederation of
Indian Industry (CII), Associated Chambers of Commerce and Industry of India
(Assocham), and India Inc,
all urged the RBI to announce a rate cut in the upcoming monetary policy review on
September 20, 2013.

Rajan took office on 4 September 2013. A day after he took office, the rupee reversed
its decline and on 19 September hit a one-month high of 61.77.
On 20 September the RBI released its first quarterly review on Rajan’s watch,
announcing an unexpectedly hawkish 25% increase in the key (repo) rate to 7.5%.
Measures taken by the RBI on 20 September included:

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An increase in the key (repo) interest rate of 0.25% to 7.5%. The local market was
shocked and stocks fell – but what is surprising is how moderate Rajan’s
‘hawkishness’is, given that:

The RBI also eased liquidity through a reduction in the marginal standing facility
(MSF) rate, at which banks borrow from the central bank, by 0.75% to 9.5%.

The RBI reduced the minimum daily maintenance of Cash Reserve Ratio (CRR) from
99% of the requirement to 95%, a move aimed at inducing liquidity into the system.

The message was simple: (a) controlling inflation is top priority; (b) it must not be
pursued at the cost of killing the banking system.

Small mortgage market in India

Indian buyers usually pay for apartments before construction has been completed.
Many buyers do not take out mortgage loans. As a result, the ratio of housing loans to
GDP is very low. In 2012, housing loans in India were only around 4.14% of GDP.
The leading mortgage lender is the Housing Development Finance Corporation
(HDFC) followed by the State Bank of India (SBI). Total housing loans in India were
around INR 4,033.78 billion (US$ 63.36 billion) in 2012, up by 12.3% from INR
3,590.67 billion (US$ 56.40 billion) a year earlier.

Interest rates at major banks and financial institutions range from 9.95% to around
11.10%, while fixed-rate mortgages are at 11.50% to around 13%.

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The loan to value (LTV) ratio of most Indian homes should not exceed 80%,
according the RBI. However, according to RBI’s Master Circular dated July 1,
2013, as of June 21, the following LTV ratios are now maintained by banks:

CATEGORY OF LOAN LTV RATION (%)

(a) Individual Housing Loans
Upto ` 20 lakh 90
Above ` 20 lakh & upto ` 75
80
lakh
Above ` 75 lakh 75

(b) CRE – RH NA

Despite reforms since 1991, India’s mortgage market is held back by problems: Banks
prefer to lend to middle and high-income sectors, leaving limited financing options
for low income individuals. The government has a huge influence on major domestic
banks, discouraging initiative. There’s no proper legal framework for foreclosures
titling problems are rampant.

Low rental yields

Rental yields are relatively low in India. Smaller apartments have higher yields than
their bigger counterparts, based on the Global Property Guide research of April
2013.
South Mumbai has higher rents than in New Delhi and Bangalore. Monthly rents
range from €21.95 to €27.05 per sq. m. Rental yields range from 2.28% to 2.44%,
lower than the 2.64% average recorded last year.

In New Delhi, apartments can be rented at around €7.13 to €8.94 per sq. m. Yields are
also low at around 1.92% to 2.75%. However, the average New Delhi yield for this
year (2.38%) was actually an improvement from last year’s average of 1.93%.

Bangalore has higher rental yields as compared to South Mumbai and New Delhi.
Gross rental yields range from 3.75% to 3.97%. Apartment rents in Bangalore are
cheaper, at €3.32 to €3.44 per sq. m.

From Q4 2012 to Q1 2013, according to Colliers:

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Rents in Mumbai fell in almost all micro-markets by 1% to 4%, except in Bandra,
Colaba, Cuffe Parade, Juhu, and Santacruz.

In Delhi, rents for premium residential properties were stable, with a marginal
downward pressure in some micro-markets.

Bangalore had an increase of around 1% to 9% of rental values in almost all micro-

markets, while rents remained stable in areas such as Airport Road, Cooke Town and
Indiranagar.

Rents in Chennai rose by 4% to 5% in most micro-markets.

Increases in rents were also observed in Gurgaon (3% to 6%) and Kolkata (2% to
5%).

Rents in Noida and in Pune remained unchanged in almost all micro-markets.

Bangalore’s rental market growth may be due to migration from other cities. This
reflects to the 35,000 residential units launched in 2012 and 8,100 units in Q1 2013,
according to the recent Knight Frank India Residential Research Report.

On the other hand, Mumbai may be suffering from lack of demand. "Some
transactions in Mumbai may be taking place at 5-10% lower than last year's rentals,"
according to executive director for residential business at Cushman & Wakefield
India, Shveta Jain India’s rental market is hindered by problematic laws protecting
tenants. The laws are generally poorly conceived and ineffective, making
implementation difficult. Although they are gradually being replaced by more market-
oriented laws, the rental market’s full potential is yet to be realized.

Cities with rent controls generate lower yields. Mumbai rents in houses with sitting
tenants are frozen at their 1947 levels, due to the Maharashtra Rent Act of 1999, an
extension of the Bombay Rent Control Act of 1947. Delhi also has rent controls.

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Stronger economic growth, rupee depreciation

After two years of below 5% growth (4.4% in 2013 and 4.7% in 2012), the Indian
economy is expected to grow more strongly for the remainder of 2014, with
the International Monetary Fund (IMF) forecasting a full-year GDP growth rate
of 5.4%. India’s economy expanded by 4.6% in the first quarter of 2014, according to
the Ministry of Statistics and Programme Implementation.

High inflation is one of India’s major problems, standing at 8.28% in May 2014.
Inflation is expected to slow slightly to 8% this year, after average annual inflation of
10.3% from 2008 to 2013, according to the IMF.
In June 2014, the Reserve Bank of India (RBI) kept its key interest rate
unchanged at 8%. The RBI is expected to keep the key rate on hold at the third
consecutive meeting in August 2014, according to HSBC.

The Indian rupee (INR) continues to slide, following two years of sharp depreciation.
In July 31, 2014, the rupee depreciated to a three-month low of INR60.55 against the
U.S. dollar, on capital outflows after the US Fed trimmed its monthly bond buying
programme by another US$10 billion by end-July 2014. Moreover, high demand for
the U.S. dollar from importers and the weakness in local equities also pulled the
Indian rupee down against the U.S. dollar.

In defending the country’s currency, the RBI spent around US$ 17.23 billion worth of
foreign exchange reserves during 2013, leaving the reserves at around US$274.81
billion. Planning Commission Deputy Chairperson Montek Singh Ahluwalia assures
public that India has adequate foreign exchange reserves.

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Modi brings hope

Right after Narendra Modi’s election victory, there was widespread optimism about
India’s economy and employment outlook. Modi has pledged to reduce inflation and
eradicate corruption. The new PM also vowed to step up investment and clear
regulatory hurdles for businesses.

Modi also pledged to reduce India’s fiscal deficit to 4.1% of GDP this year, from
4.5% in 2013 and 4.9% in 2012.

"After two consecutive years of sub-5% growth, the change in government is

significant given the [Bharatiya Janata Party] BJP's economic emphasis, stability in
composition and decisive governing structure," said Rohini Malkani of Citigroup
India.

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FINDINGS

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FINDINGS:
1. Customers have a short history of real estate investment but are currently
increasing their allocation to the real estate, more so than equities, debt and
commodities.
2. Legal and regulatory risk, hard to determine the best opportunities and risk of
poor professional advice are given as the main reason for real estate investing.

3. Despite of developers investing their large part of funds on entertainment

centers like shopping malls, multiplexes etc. large part of customers prefer to
invest in residential projects such as plots and group housing.

4. Residential property is gaining as an attractive mode of investment of middle

class people leading to growing demand.

5. The most important factors influencing the real estate asset allocation decision
are statistical estimates of risk and return, advice from external consultants and
long term historical performance.

6. Despite of billion of money spent on brand advertising, customer's rate brand-

strength as a weak influence at best on their purchase decisions.

7. With the shifting of more and more companies and offices to the suburbs,
growth in the suburban residential real estate market has been witnessed.
Lavish townships with good quality construction replete with luxurious
amenities and facilities are now coming up.

8. At present, Noida and Greater Noida are places of Huge Investment where
Returns are high as compared to other cities. It is becoming the hub mainly for
Commercial Investments with good returns especially for IT/ITES spaces.

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CONCLUSIONS

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CONCLUSIONS

The real estate market in Northern India especially in Delhi, NCR region has
tremendous potential and a cut throat competition has already started among the
developers to seize this opportunity. The city offers some distinct advantages which
are not present in other cities. The city is one among the greatest real estate playing
cities where huge investments are attracted with larger returns and has high potential.
Besides, improving infrastructure in terms of road networks, good educational
institutions, organized retail, creation of employment opportunities by the public and
private sector companies are additional factors. Also availability of land at affordable
prices and being a metro city, has led private developers to venture into the market. It
is because of these reasons that a study into the perceptions and expectations of the
people of Delhi regarding the present real estate scenario assumes importance.

An effort has been made to provide a clear view about Real Estate and its present state
in DELHI NCR region with special reference to Noida & Greater Noida. The projects
of Vardhman depicts some unique qualities which is quite different from other real
estate players and for this reason, large amount of investors are attracted from all over
India.

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SWOT ANALYSIS:

STRENGTHS:

 Brand Name- within 30 years, the company has created a brand image of its
own well equipped in the market.
 Widely spread Network of Dealers & Suppliers- its contacts and networks are
spread over India.
 A loyal customer base- its strong base lies in its customer service where it
provides numerous benefits to customers.
 Strong Management- it has a very stable and strong management force which
controls the activities and functions of the organization.
 Strong Branding- it’s branding is done largely to create goodwill in the
market.
 Efficient Channel- the channels of the company are spread over India with big
contacts and associates.
 Strong customer base- its important strength is loyal to customers and
committing to what the company promises.
 Loyal employees- its employees are loyal in all departments and do not
provide false information to anyone.

WEAKNESSES:

 Improvement required on networking for small customers as even they are

important to the company.
 Less Brand Value- it still has to create more brand value through Advertising.
 Not enough Manpower- the most important drawback of the company is its
lesser manpower and for this reason, most of the official work gets delayed.

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OPPORTUNITIES:

 Specialty products are expected to improve to depict it different from its

competitors.
 High profit margin is expected as the company has projects which should yield
large amount of returns.
 Emerging Markets & Expansion- It should emerge strong in the market and
expand at a faster rate to grow at a larger rate.

THREATS:

 Competition in the market- there is immense competition in the market which

is a great threat to the company in the near future.

 Macro Economic changes- the economy of real estate changes frequently. As a

result, the company may face problems.

 If new capacity additions announced earlier go on stream, there could be an

over-supply situation in the market which can put pressure on margins.

 Other Competitors- there are many other big and small competitors in the
real estate market which could harm the company’s market position.

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RECOMMENDATION

98
RECOMMENDATION
1. . Investors have a great amount of hope from the company. Although, there
are delays in some Projects, even then, investors feel secured in investing in
Vardhman’s projects.

2. Clients often face problems with the company follow-up and allotment.

3. In the view of real estate agents, Vardhman is the best service providers.

4. Circle rates of Plots must go up. Government should control the non-
committed trend of upcoming builders. With prices of property,
infrastructure should also grow.

5. Bank Loan Interest rates must go low for the survival of real estate.

6. People are not too keen to invest outside NCR, and block their money for
long term.

7. There should be no hidden costs, and everything should be crystal clear,

which poses a great influence on building brand image.

8. Developers should come up with timely projects. Companies should keep

constant correspondence with its customers. There should be a commitment
of prices by the company.

9. Pre-Launching is a major problem, thereby customers feel cheated by the

Developers/Agents.

10. In Delhi, in some places like South Delhi, there is a high demand of floors,
than its supply.

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11. A significant reason for people to not invest outside NCR, is that there are
still good options left in NCR.

12. It is noted that there is a good amount of scope on Gomti Nagar Extension
Lucknow, as the foresight of the agents see many colonies flourishing on
the highway.

13. It is seen that there is a great demand for 2 & 3 BHK Apartments in
Lucknow, but lack of supply.

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LIMITATIONS

101
LIMITATIONS

# Due to limitation of time a sample size of only 50 respondents

chosen.

# The Survey was carried through Questionnaire and the questions

were based on perception.

# The Sample for research was chosen only from a limited area.

# Some of the respondents may be biased in giving responses.

# Complete data was not available due to company privacy and

secrecy

# This conclusion and recommendation made are based on a very

less experience of researcher in this field.

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ANNEXURE

103
ANNEXURE

A. At what value you consider category of homes?

Under ` 200,000 (condos)
`200,000-` 250,000
` 251,000-` 350,000
` 351,000-` 500,000
` 501,000- ` 750,000
` 751,000-` 1,000,000
` 70,000,00-` 3,0000,000
unlimited

B. How many number of bedrooms you want?

1-2
3-4
5 or more

C. What size of area you prefer?

Average Tract size
1/4 - 1/2 acre
1/2 - 1 acre
1 - 5 acres
5 or more acres

D. Would you like to investigate this type of neighborhood (check all

that apply)?
Urban
Suburbs
Town
Mountain Area

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E. What will you consider?
only single family homes
villa and penth house
both of the above

F. Would you like to sell your present home before considering the
purchase of another home? If yes, what is your selling pricein
Rs.?
200,000-250,000
251,000-350,000
351,000-500,000
501,000-750,000
751,000-1,000,000
1,000,000-1,500,000
Over 2,500,0000
I do NOT need to sell my present home before purchase.

G. Did you need a new home?

Immediately
In 90 days
In 6 months
Within a Year

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BIBLIOGRAPHY

106
BIBLIOGRAPHY

BOOKS:

Kothari C.R. - “Research Methodology” New Delhi Tata McGraw Hill in (95-102)

Philip Kotler – “Marketing Management“ - Analysis, Planning Implementation and

Control.

JOURNALS/ MAGAZINES:

Corgel, John B., Halbert C. Smith, & David C. Ling, Real Estate Perspectives.

Howard, John A. and Jagdish N. Sheth, The Theory of Buyer Behavior. Wiley, 1969.

Urbany, Joel E., Peter R. Dickson, and William L. Wilkie, Buyer Uncertainty and
Information Search, Journal of Consumer Research, September 1989, 16, 208-215.

WEBSITES:

www.vardhmans.com
www.RealtyTimes.com
www.realestatesncr.com
www.indiaproperty.com

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