esr real estate | Business Process Outsourcing | Retail

Summer Training Project Report On

Submitted to


In partial fulfillment of the requirements For the degree of Master of Business Administration (2009-2011) Of Punjab Technical University

Submitted by DEEPAK BANGA


Today with humility and folded hands I am thanking Almighty from the depth of my heart for these blissful moments and for giving me such situations and atmosphere which is helping me in my mental growth and is a way towards success. So, I must preface my report by expressing sincere and deep gratitude to those who made it possible for me to complete my thesis work. This is my privilege to thank Mr. V.K. Deewan, Director CMTR Kharar, for his concern and encouragement. I owe a deep sense of gratitude to my guide Mr. Arun Kumar Sharma, CMTR for the inspiration, valuable suggestion and guidance which made this report possible. I am obliged of this focused guidance. His total cooperation and excellent directions have made me indebted to him for lifetime. I owe my thanks to Board of directors (HR deptt.)Ind Swift MR. R.S.Dhaliwal for allowing me to do my project in their company. I want to express my thanks to my Company guide of Ind-Swift Mr. Prassandeep (Assistant Manager) who gave his valuable time and thought us many valuable things which will help me in the long career ahead of me and Mr. Mohit Sharma ( Marketing Executive) for cooperating me in my training. I would like to thank Mr. Dharamvir insan (Accounts Department - Ind-Swift). Who gave me the opportunity to complete my SIP in Ind-Swift Company. I love to acknowledge, CMTR, Kharar, for providing me an opportunity to perform the research activities and an environment for my all- rounded growth.

Executive Summary


1.1 Introduction Of The Company 1.2 Company’s Milestones 1.3 Operations Of Company 1.4 Manufacturing Locations

Chapter 2



2.1 Industry Profile 2.2 Macro-Economic Overview 2.3 Real Estate Scenario In India 2.4 Technological Environment 2.5 Issues Concerning In Real Estate 2.6 Political Environment 2.7 Government Initiatives 2.8 New Projects ________________________________________________________________ ________ Chapter 3 RESEARCH METHODOLOGY 36-48

3.1 Objective Of The Study 3.2 Scope Of The Study

3.3 Research Design 3.4 Data Collection Method ________________________________________________________________ ________ Chapter 4 DATA ANALYSIS AND ITERPRETATION

4.1 Respondents Profile

________________________________________________________________ ________ Chapter 5 CONCLUSION AND RECOMMENDATIONS

5.1 Conclusion 5.2 Limitations 5.3 Recommendations ________________________________________________________________ ________ BIBLIOGRAPHY ANNEXTURE

whilst going steadily and surely.COMPANY PROFILE BRIEF PROFILE OF IND SWIFT GROUP Ind Swift Group. As the . Its strength in organic synthetic chemistry resulted in the company emerging as the pioneer for a number of products both in the National and International markets. a legendary forename in the world Class Pharmaceutical Industry who has broaden its horizons by plucking profound & sparkling footprints on multifarious diversified fronts. Ind-Swift Laboratories Ltd. The group has established a strong reputation as innovators in the Indian pharmaceutical industry. COMPANY HISTORY . India. scripting a success story filled with enviable milestones and pioneering breakthroughs and has subsequently emergent as a group with an annual turn over of 1000 Crore. went public in 1997 and concentrated on the manufacturing of Active Pharmaceutical Ingredients (API). It has been promoted by Ind-Swift Limited in joint venture with the Punjab State Industrial Development Corporation Limited (PSIDC).IND-SWIFT Ind-Swift Laboratories is a part of the Ind-swift Group and is based at Chandigarh.

The company has been promoted by Shri Anil Kumar Jain.77 lakhs. Ind-Swift Laboratories limited (ISLL) is based at Chandigarh and is a part of Ind-Swift group. The company is expanding its activities by setting up facilities for manufacture of formulation (tablets and capsules). In July'89 the Company got its project for manufacture of injectables and trading of pharmaceutical products appraised from Haryana Financial Corporation (HFC) which was implemented in December'90 for a total cost of 49. the company employs current Good Manufacturing Practices (cGMP) also. Ind-Swift Laboratories Ltd.06. Over a short period of time. Ind-Swift Laboratories Ltd. National. Dist. It was incorporated as a limited company on built up vast skills in the area of research and development. dividend paying company engaged in formulation of injectables and opthalmic products at Panchkula. To leverage its quality commitment.12. has emerged as a respectable and dependable supplier of Bulk-Actives in more than 40 countries. it began establishing a presence in the highly regulated markets of the world.1986 and was granted certificate of commencement of business on 15. has informed that their Company has been awarded the achievement award for the Best Performing Company in Category E by the .1986. Ind-Swift Ltd. is an existing profit making. Ind-Swift Laboratories Ltd. The company's shares are listed on the Mumbai. 1605. Ambala (Haryana). reported a turnover of Rs. This includes a responsible commitment to the environment. Gopal Munjal & Associates. 76. Dr.20 million and a profit after tax of Rs. which are recognized and accepted in the stringent regulated markets. Not only are the company's plants built as per USFDA. quality systems as well as matters relating to regulatory compliance.92 million in 2003-2004. Ludhiana and Delhi stock exchanges. Shri Sanjiv Rai Mehta. the Company has drawn out a long term strategy of emerging as a powerful force in the regulated markets as drugs worth over US$ 80 billion goes off patent during this decade.

those units got USFDA approval and got the process patents for Clarithromycin for US and allied markets and further five more patent drugs await clearance for the moment. Ointments. spread over an area of 12. Liquids & Dry Syrup (all latest formulations with a marketing network. carried out at 3 different state-of-th-art units approved by USFDA and E. with manufacturing capacities confirming to stringent TGA/MHRA approvals. Manufacturing of Pharmaceutical finished dosage are carried out at 7 state-of-the art manufacturing facilities which are second to the none are duly certified and approved by WHO GMP. 00. Ind Swift entered into bulk drugs with its own Research and Development facility and laboratories at Derabassi. A joint venture with Iran has also been signed for the manufacturing of Clarithormycin with construction underway and will start operations by the end . Company’s API section has spread over an area of 7 Lac sq. ft. capsules. 000 sq. as pharmaceutical business model is one of India's largest manufacturer of high growth multi segment pharmaceutical finished dosage forms and API's (Active Pharmaceutical Ingredients).Express Pharma Pulse for the year 2004 Ind Swift Ltd has informed that the Company has launches a new Marketing Division under the name 'Resurgence' for Anesthesiology. Injectable. ft. Oncology and Surgery Segment ORGANISATIONAL STRUCTURE-IND SWIFT GROUP Ind Swift group. possessing an installed capacities of 3 billion units comprising tablets. Later on.U regulatory authorities with a marketing network spread over in 40 countries viz. Europe/USA/Middle East possessing 2 patented molecules with 11 molecules in offing It possesses 50% exports percentage.

.2008. and remains the only feat of its kind in the country. Govt..5 billion... • • • A well accepted expertise in NDDS. with a market size of US$ 300 million. in India and the world over. Another patent for Fexofenadine ODT with a market size of US$ 2.. A US patent for Claire OD.. Development of 10 new molecules with a market size of US$ 6 billion. facilities and talented pool of scientists and Researchers. By taking giant strides on roads less traveled. • Ind Swift's efforts and achievements in taste masking of macro ides was India's first. of India) and is equipped with state-of-the-art equipment.. It also offers complete support to international partners for preparing and filing dossiers for finished dosages. Company’s R & D's Achievement . R & D (Research & Development) Ind Swift is known for it's reverse engineering ability with highly focused R & D capabilities (duly approved by Department of Science & Technology.. IndSwift has become one of India's fastest growing pharmaceutical companies. The R &D department is also involved in creating international opportunities and alliances for CRAMS business. contributing significantly to the Company's profitability. The company has offices and supplies pharma drugs not only in India but overseas as well.

Its pioneering R & D efforts have led to the creation and introduction of blockbuster drugs like: • Atrovastatin – One of the most effective cholesterol lowering drugs with an estimated market size of US$ 12 billion. 50 offices in India. Anti depressant. Neurophen forte.infective. Nitazoxanide – a wonder. • • • • Ind-Swift has strategic R&D and manufacturing alliances with companies in the United Kingdom. Arthrill – an herbal wonder for the treatment of Arthritis. In formulations front. 35 by IMS/ORG in Pharmaceutical industry & possess a portfolio of 650 products with presence in high growth therapeutic segments of Cardiology. Turkey and Iran. Anaproct – an ayurvedic product providing relief from piles within 24 hours with no allopathic cometitor. Ind Swift proud of its multifarious achievements viz. It is an honour to add here that Company is among the top 500 fortune companies of India and have been ranked at No. a composition of Isoprene Hel. Anti. Pioglitazone – an anti-diabetic drug ranked among the first five in its Therapeutic segment. Neurology & Oncology with a nation wide distribution network comprising 1200 marketing professional working with 12 marketing divisions. Suprox SR. . The company today stands second in the north in pharmaceutical sector. a composition of Ibuprofen & Acetaminophen.e. sustained release tablets was first time launched in India in tablet form. one of its kind anti-diarroheal with a market of US$ 6 billion. Another formulation i. 3000 super stockists and stockists. Mouth dissolving tablets technology was introduced for the first time in India by Ind Swift. Ind Swift is the company to give this composition to the country for the first time. anti-allergic. Diabetology.

Another project for Injunction moulding has also been proposed. Aluminium collapsible tubes. ADI (Drug Index). Agrovet and . Ltd” with its illustrious and infomercial journals as “Pharmabuzz”. of course a society with 2 bedroom /3 bedroom flats and penthouses owing a mystique which is exemplary in itself which not only reflects a diversified transformative spell to infrastructures front but a unique state of art with the best of specifications also. In infrastructures.Company’s sparkling footsteps on diversification front are as under mentioned:Infrastructures: Ind Swift has radianced up in infrastructures business in the name and style of “Ind Swift Infrastructures and developers Ltd. Not only this it further proposes to come up with a stationary unit for which the building has already been constructed. Lami tubes and PET bottles. Media & Publication: Ind Swift has focused up in media & publication sector under the name “Ind Swift Communications Pvt. The total plan will increase Mansa's sale by 200%. “Trendz”. mono cartons etc is undertaken and now will add a new feather in ISL's cap by launching a separate unit for PE. 40 crore. Publishing & Packaging’s: Ind Swift by virtue of its strong business acumen has also put a step in the field of publications also in the name and style of Mansa Print & Publishers Ltd's which has hovered over the industry within a very short span by coming up with Aluminum Division in 2007 wherein the manufacturing & printing of various type of packaging material viz. Both these plants have a total layout plan out of Rs. Ind Swift plans to be emergent with motels & Resorts project in the upcoming phases. and has come up with a multi crore project named “Regalia Towers”.

and is a unique state of art with the best of specifications also. faculty. The institute will be operational from current session year 2008-2009 with an intake of 60 students in the field of Pharmacy and Nursing each.further proposes to come up with General magazines and having world class infrastructure. To initiate with. Company has instituted six months Industrial Training Courses in Pharmaceutical Sciences. Software Development: Ind Swift has also entered into IT & software with their initial projects of developing web portals. software & ERP systems development. Its initial portals which are already on air are OTC mart. Company’s sparkling footsteps on diversification in Education front are under-mentioned:- Swift Institute: Company’s Swift Institute is exclusively diverse from the plenteous private educational institutions cropping up in North India. Swift Fundamental Research Education: SFRE (Swift Fundamental Research Education ) is a society made under the banner of Ind Swift which has recently laid an another step on the diversification spree and has forayed up with a Pharmacy college at Rajpura with the name & style of “Swift School of Pharmacy”.com. Company has been ranked as the pioneers in this part of the country having a solid pharmaceutical industrial background to come up with company’s own Pharmacy & Nursing institute. website development. laboratories and other facilities. painting & With this new venture of IND SWIFT. in the first year by virtue of its high . search engines for Operator Level Training which has enabled the 10th or 10+2 students to start a career in the booming Pharma industry & until now company has already trained and placed more than 400 students at Ind Swift which Company feel contributes a lot to the skilled manpower starving & ayurvedaherbs. buysweethome. doctorsonline.

Swimox. Management. Other brands introduced by company during the year are Topclav 625. Another division launched by company is “Animal Health Care” which is an absolutely new concept with outsourced marketing and has proved out to be an individual profit center. Cirrholiv which has proved out to be a remedy in Hepatitis and other liver disorders. In Generics. Schools of Dentistry. Apart from struggling uphill for the current range of products company’s Ethical marketing have introduced those products during the year which are monopolistic in nature viz. Oxo. Ayurveda Physiotherapy and Medical Technology and finally a Medical College with its functioning operational by 2010-11 under the budget of Rs. Hotel Management. Company emerged as the 2nd rank Pharma Generic company and has attained the fame of featuring its few brands (Amyclox. the division projects to achieve a business objective of 10 crores with impressive contribution to ISL and possesses a strategy of adding up few other specialty products in the existing range of personal health care & Academic Body model series. Emtee 25 and Timcol Eye Drops. General Management. Domestic Marketing: The company's new division “diagnosis” dealing in medical equipments & devices thereby focusing personal health care was launched in December 2007 and has reflected promising performance & is growing leaps and bounds from the first month of its launch which has given utmost confidence to the company to get the aggrandized sales and contribution not in the current year but in the forthcoming years as well. Architecture. Swiflox . Engineering. 250 Crore with a specific target on Medical Tourism.resourcefulness and know-how and will provide quality education to one and all. aspiring Company’s careers manifest to in be the imminent field with of Pharmacy. Not only this.

and Cafzone (already achieving the sales growth over 25 crore) as the top brands in Generics. These divisions have launched 20 products in the fastest growing segments viz. . Anti-AIDS. Dr J K Kakkar & Mr K M S Nambiar. Diabetology. clinical trials for Ist. etc. IInd and IIIrd phase. Super Speciality Division and Healthcare Division. In 2002 Company has informed that it has restructured its Board by inducting three professional Directors on its Board. Anti-Viral. Company's brand Swimox has been enlisted among leading brands in ORG IMS and Amyclox leads the que among top 300 brands of the industry. Cardiology. Ltd with Ind Swift Ltd. In 2001 the Company has launched two new divisions. and toxicologial studies. ACHIEVEMENTS OF COMPANY In 2000 company set up a unique R&D centre having facilities for bioequivalence studies. Neurology. Annual growth for the company during the year is 36.73%. • Allottement of 1227375 equity shares to Promoters & other Bodies corporates upon the conversion of their preference shares into equity shares. In 2003 High Court approves the scheme of amalgamation of Swift Formulation Pvt Ltd and Mukur Pharmaceutical Company Pvt. The three new Directors are Dr R S Bedi. The Company's Board is gradually shifting from a closely held Board to professionally held Board.

Delhi & Jaipur Stock Exchanges.50.000 zero coupon warrants to the promoters of the company convertible into equity shares on or before March 31. 2004.6 million equity shares at a premium of Rs 80 per share to the promoters as well as other investors Issuance of 350000 zero coupon fully convertible warrants to the promoters Increase in Authorised share capital of the company from Rs 100 million to Rs 150 million Delisting of equity shares from Ahmedabad. RESEARCH & DEVELOPMENT . • Ind Swift Ltd ties up with Lupin Ltd for a Co-marketing pact to launch Nitazoxanide.50.000 zero coupon warrants to the promoters of the company convertible into equity shares at any time within 18 months but not before April 1. • • Allotment of 12. Oncology and Surgery Segment. Allotment of 3.000 zero coupon warrants to the bodies corporate convertible into equity shares on or before March 31.• Out come of board meeting Issuance of GDRs aggregating up to US $ 20 million Preferential issue of up to 1. 2004.50. an anti-diarrhoeal / anti-helmintic drug for the first time in India under the brand name Netazox and Nizonide respectively • Ind-Swift Laboratories Ltd. 2004. has informed that their Company has been awarded the achievement award for the Best Performing Company in Category E by the Express Pharma Pulse for the year 2004 • Ind Swift Ltd has informed that the Company has launches a new Marketing Division under the name 'Resurgence' for Anesthesiology. In 2004 Company Allotted 3.

Till date two major contracts were signed an have been delivered. NEW MANUFACTURING FACILITIES: Apart from its existing plants in tax exempted zone of J&K and Baddi. conceptualization of new molecules (and therefore a nmber of product combination have been developed and are ready to be launched by company’s marketing divisions). R&D is emphasizing on a major area which is cost Reduction. Company's R&D is involved in creating international opportunities and alliances for CRAMS (specially contract Research) to make it contribute 30% of profits. is for soft Gelatin Encapsulation with an annual capacity of 36 Crore and will not only make us almost self sufficient in soft gelatin manufacturing but will unquestionably dedicated a bit of spare capacities for contract manufacturing as .Looking at the current scenario where the pharmaceutical majors are engaged in the advancement of R & D. stability data profiling. Novel Drug Delivery Systems. To strengthen the CRAMS business to the exquisite level. Company has been competent enough to work out on non infringing processes. company has successfully commissioned another Manufacturing facility at the same tax exempted zone and green plains of Baddi during the year. Apart from this. unique combinations/NDDS of single molecule are around the corner and awaiting launch by this year. Company is hopeful to attain more contracts on product development and stability data profiling. dossiers. By virtue of the hard endeavors of R&D all through the year. This new manufacturing facility inaugurated in August 2007. Apart from this. company is tying up with various academic institutes. More than 5% of total revenues have been planned to spend on the company's R&D and the same will be continued in the forthcoming years as well. duly certified and approved by WHO GMP. Company is applying invincible efforts to get approvals for a Bio-equivalence centre which will further strengthen the basket of R&D.

Haryana and Jammu and Kashmir. and accreditations with ISO 14000 series standard. These new facilities will augment the company's efforts to tap the regulated markets and strengthen the company's growing CRAMS business which is expected to accounts for 30-40% of its bottom line over the next four years. Company's manufacturing unit at Parwanoo has also been upgrades as per WHO Standerds. ft of newly constructed plants with state of the art facilities for manufacturing all types of dosage forms.000 sq. The locations are environmental pollution free and together offer approx. Company's Global Business Unit (GBU) at Derabassi has got MHRA & TGA approval. Ind swift's multipurpose. . EU. MHRA. Company has been certified for ISO 9000:2001 also during the year. The facilities are built according to current guidelines of USFDA.well. 5. multilocation manufacturing set-ups are spread across the lushgreen plains of northern Indian states viz Himachal Pradesh. Excellence in Manufacturing A unique and unmatched excellence in pharmaceuticals manufacturing with highest reliance of product quality attributes is our corporate strength. and WHO.00.

is residential space and the rest comprise office. built-up infrastructure and construction – development projects as well as abolition of Service Tax on the construction . Almost 80 % of real estate developed in India. Real estate companies would also do well to maximize their own performance and operational efficiency. The future of the real estate sector in India is going to be guided by two important factors. including high-end technology consulting. This figure is growing at a pace of 30% for the last few years. This double-digit growth is mainly attributed to the off shoring business. hotels and hospitals.INDUSTRY PROFILE Real Estate Industry in India: The size of the real estate industry in India is estimated by FICCI. namely suitable amendments in the Foreign Direct Investment (FDI) guidelines in townships. call centres and software programming houses which in 2003-04. shopping malls. is estimated to have accounted for more than 10 million square feet of real estate development. to be around US$ 12 billion. housing. This is the ideal time to invest in the country as policy makers have begun to emphasize on developing adequate infrastructure for the country.

One Rupee invested in this sector results in 78 paise being added to the GDP of the State. A unit increase in expenditure in this sector has a multiplier effect and the capacity to generate income as high as five times. If the economy grows at the rate of 10% the housing sector has the capacity to grow at 14% and generate 3. A fast growing area is the I. only in I. can be gauged from the fact that it is the second largest employer next only to agriculture and its size is close to US $ 12 billion and grows at about 30% per annum. Five per cent of the country’s GDP is contributed by the housing sector. of space will be required every year till 2008. if the abolition per se is not possible then drastic modifications in the existing Service Tax norms is the need of the hour. ft. which is also now gradually shifting to North India. Chennai. The drop in interest rates from 11. enabled services especially in the cities like Bangalore.T.2 million new jobs over a decade.enabled services along with the BPO boom. Furthermore. Estimates worked out show that 42 million sq. In the next three or four or five years this contribution to the GDP is expected to rise to 6%. as an engine of the nation’s growth. The . Conversely. this sector has witnessed a spurt in demand not just in residential property but also in commercial property. The Real Estate Industry has significant linkages with several other sectors of the economy and over 250 associated industries. and I. at a lower interest rate provide for a higher loan. Hyderabad and Pune.T. The importance of the Real Estate sector.T.5% to 9.industry especially the housing sector. The same EMI would.T. This Sector is already overburdened with taxes.25% combined with a reduction of 15% in real estate rates has resulted in an increase in purchasing power of 33%. any further imposition of taxes in any form would adversely affect the growth of this sector of the economy. and I.

ft. Real estate involves then purchase. The industrial sector grew at the rate of 10. In 2005 alone. buyers etc.9 million sq.higher loan used to purchase a home at a lower price would enable the customer to purchase more square feet. 70% of the demand for office space in India is driven by over 7. ft.3 billion in 2006 has grown at a CAGR of 36% over the last decade and by 2008. tenants. of space across major cities by 2010. and development of land. The main players in the real estate market are the landlords. sale. ft in 1998 to over 16 million sq. estimated at USD 36. residential and non-residential buildings. ft and is estimated to generate a demand of 150 million sq. Chennai and Hyderabad along with NCR (National Capital Region) continue to attract the major share of IT/ITES and . The activities of the real estate sector encompass the housing and construction sectors also.8 percent was seen by the manufacturing sector. builders.000 Indian IT and ITES firms and 15% by financial service providers and the pharmaceutical sector. ft in 2004-05. real estate agents. developers.8 percent in 2006-07 out of which a growth of 11. is expected to account for over 7% of India‘s GDP and 30% of foreign exchange inflows. The Indian IT-ITES Industry. Commercial Real Estate The demand for new office space in India has grown from an estimated 3. Cumulative demand for office space in India over the next two years (2006-08) is estimated to be in excess of 45 million sq. IT/ITES sector absorbed a total of approx 30 million sq. South Indian cities like Bangalore.

like Pune. Also. Chandigarh.35 years from 40. Average age of housing loan borrowers has decreased to 30. Indore. However. Residential Real Estate The residential property market in India constitutes almost 75% of the real estate market in terms of value. rising disposable income coupled with easy availability of finance from the housing finance companies and banks are driving demand in this sector. indicating a younger buying threshold. secondary cities. The demand for housing is geographically widespread with townships being built in .45 years a few years investment. 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. Low per capita housing stock. Kochi and Kolkata are now emerging as the new preferred destinations for these companies due to their cost and infrastructure advantages.

This translates into very high opportunities for investors in the residential sector. there is a housing shortage of 19.7 millionaire in urban areas alone. In India.4 million units out of which 6.both the metros and the tier II and III cities. Rental Trends in India .

Rental values in cities like Delhi and outskirts are witnessing an increase of 20-25%. continued tax exemptions on such prompts people to buy property. those with the ability to buy a flat among the middle-class are thinking twice.Recent trends of rental properties in India are conspicuous potential that by is the being immense realized today. Though the interest rates on home loans. . Real estate agents are devoting themselves to negotiations for rented homes than ever.

Even PG hostels and working women’s hostels. It will facilitate low risk and less worry on maintenance.In residential segment. 45 lakhs from Rs. and Mumbai etc. Increased demand for independent houses or paying guests occurs mainly in the metros like Delhi. are considered safe and can be availed of on an individual or sharing basis mean big business. The real estate rental trends in commercial sector are momentous as the key tendency among the investors is to rent a commercial space instead of buying. where the corporate sectors rent independent houses for their senior executives. Gurgaon. 15 lakhs a couple of years back. The demand for more capital appreciation in the wake of rising prices coupled with home loan rate hike has dampened the buying spirit. Commercial rentals . A paying guest or PG accommodation in India is a convenient arrangement. This has in ways propelled demand for rental property in India. the capital value or cost of flats has almost doubled in cities like Gurgaon where prices went up to Rs.

The consumer spending in India has increased by an impressive 75 per cent in the last four years and will quadruple in the next 20 years. Of the 12 million retail outlets present in the country. nearly five million sell food and related products. For those considering regular rental returns rather than capital appreciation. By 2015. which is the fifth largest retail destination globally. commercial lease agreements specify a 15% escalation in the real estate rental in every three years which is a good enough yield. BPO spaces. shops and showrooms are an integral part of the commercial rentals in India. which is one of the highest in the world. the retail sector is projected to overtake the USD 650 billion mark. Buying good space in high quality development and leasing it to a good brand is a wise investment decision. At a time when the Indian consumer space is undergoing a . Organised retail segment would see an investment of USD 70 billion by 2010. is expected to touch an estimated 35 million square feet by end 2008 in the top seven cities in India.000 people. mall space. Total number of retail outlets is estimated to be around 12 -15 million. from a meagre one million square feet in 2002. Mall space.Issue 24 (2009) has the distinction to be an excellent option.ft. Retail Real Estate The Retail industry in India continues to be dominated by individual small format stores with floor space of less than 500 sq. and organised retail will cross the USD 130 billion mark. The Indian retail market. indicating a retail density of 12-14 outlets per 1. Usually. Scope Of Real Estate And Retail In Ahmedabad 16 Globsyn Business School – Ahmedabad. mall space 246 International Research Journal of Finance and Economics .including corporate office space. was ranked second after Vietnam as the most attractive emerging market destination for investment in the retail sector. It gives returns higher than that received with office space and much higher than the rental returns from residential space.

The established brands in this sector such as Asian Hotels. Hospitality industry in India is growing at an annual rate of over 8%. A large proportion of lodging demand in commercial cities such as Bangalore. However. Choice. These include SEZs in various segments such as multi- . 189 proposals have already been granted approval since the SEZ Act. another 65. The number of foreign tourists‘ arrivals (a major driver of hospitality industry) in the country increased to approx. Indian Hotels. Over 55% of the total demand for hotels in the country is generated by foreign leisure tourists and business travellers (domestic and foreign). five star category accounts for just a quarter of the supply. Marriot. Hospitality Real Estate is very important in terms for revenue generated from it. against the total current supply of 96. and Delhi etc. 2005 came into force. India has always been a tourist place for foreigners and they have visited India for its rich and diverse culture. including those converted from Export Processing Zones (EPZ) to SEZ. Approx. Special Economic Zones The upcoming realty trend in India after multiplexes and mega housing projects are the Special Economic Zones (SEZ). Mumbai.metamorphosis.000 – 80. consumer space is getting slowly but surely better defined. with increasing spending power and changing purchase habits.000 rooms. comes from business travellers. Currently. This demand – supply gap is expected to result in high level of activity in construction of hotels. 28 SEZs are operational in the country.000 hotel rooms will be needed till 2010. Hospitality Real Estate For India. ITC. With the expected growth in demand for rooms at 18%. Le Meridian etc are in expansion mode with many new players such as Accor Group. This category also accounts for the major proportion of demand for five star or five star deluxe hotels. IHG Group keen to establish their footprint. 4 million in 2005.

Both developers and corporate have shown tremendous interest in developing SEZs in the country. covering 30. Parsvnath.300 core on infrastructure. Omaxe. Bio-technology. Suzlon Infrastructure (hi-tech engineering products and services near Coimbatore in Tamil Nadu. Gems and Jewellery. Information Technology. Hindalco (aluminium SEZ at Sambalpur in Orissa). Ansals. Other corporate who are in process of setting up SEZs include TCG Refineries of the Chatterjee Group (SEZ refinery at Haldia in West Bengal). Vedanta Alumina (aluminium SEZ at Orissa). with a combined size of 35.product. Shipra Estate and Sunny Vista Realtors. is planning a 25. Udupi in Karnataka and Vadodara in Gujarat).Ahmedabad setting up an SEZ at Mundra. Reliance Industries. The Adani group is also Scope Of Real Estate And Retail In Ahmedabad 17 Globsyn Business School . and it proposes to invest Rs 7. Genpact (IT SEZ at Bhubaneshwar in Orissa.000 acre SEZ in Gurgaon and is also the main partner in twin SEZs coming up at Navi Mumbai and Maha Mumbai. Jaipur in Rajasthan and Bhopal in Madhya Pradesh).000 acres. for instance.000 acres. . Seeking the permission for SEZs is also a number of real estate developers.000-35. including DLF. Textiles and technology intensive industries.

India leads the pack of top real estate investment markets in Asia for 2010.ECONOMIC ENVIRONMENT Current Scenario The real estate sector in the country is one of great importance. lenders. According to the report of the Technical Group on Estimation of Housing Shortage. The study is based on the opinions of over 270 international real estate professionals. according to a study by PricewaterhouseCoopers (PwC) and Urban Land Institute. which provides an outlook on Asia-Pacific real estate investment and development trends. developers. brokers and consultants.53 million houses during the Eleventh Five Year Plan (2007-12) provides a big investment opportunity. . The report. including investors. points out that India. Residential properties are viewed as more promising than other sectors. property company representatives. a global non-profit education and research institute. released in December 2009. are good real estate investment destinations. Mumbai. While. Delhi and Bangalore top the pack in the hotel 'buy' prospects as well. an estimated shortage of 26. in particular Mumbai and Delhi.

According to the data released by the Department of Industrial Policy and Promotion (DIPP). it cannot be ignored that the office market is picking up with the economy. multiplex. housing and real estate sector including cineplex. integrated townships and commercial complexes etc. However. . it is expected that the real estate companies will experience decline in the first quarter of financial year 2010-11.8 billion in the fiscal year 2009-10. attracted a cumulative foreign direct investment (FDI) worth US$ 8. Since the sales of residential properties are diminishing gradually these days.4 billion from April 2000 to March 2010 wherein the real estate and the housing sector witnessed FDI amounting US$ 2.

it is expected that in the June quarter. Latest Real estate research India has estimated a revenue increase to $102 billion from $14 billion in the next decade. Unitech’s net profits had a growth of just 1%. As per the data of last year. the gross margins of DLF were 49% and had a growth of only 4%. which tells the tale of this booming industry. there has been an increase in the mass consumption. For instance.As per the data collected by leading stock brokerages show. A stock analyst with a Mumbai-based brokerage said that as compared to the June quarter of financial year 2010. the numbers look somewhat flat in this financial year. the trends are changing the consumption pattern of luxury goods and corporate houses with great purchasing power are also entering into the retail field of real estate. As per real estate studies India. Similarly. . the realty companies will undergo around a 20% growth in the net profit and a growth of 38-40% in net sales. The real estate market in India is yet in a nascent stage and the scope is simply unlimited. there had been a net profit of over 80% which certainly brings the conclusion that market has experienced a decline in sales and profit. An unhindered growth for the next twenty years is almost sure. Future Scenario Indian real estate companies have picked up really fast in the last few years. the average growth rate returns is 30%. As per recent Indian Real Estate research. It does not resemble a bubble that will burst. This is because the outsourcing business in India is going in great guns and this entails a huge demand for commercial buildings and urban housing besides improvement in infrastructure.

K. healthcare facilities. looking forward to make a foray thus stepping up the demand for real estate. a price index for the housing market to track price movement must be incorporated. logistics hubs and commercial and residential complexes. and Germany should be imitated and explored. Another impediment that can be eased on the discretion of government is the existing tax laws and other complex regulations relating to multidimensional real estates such as industrial parks and SEZs (Special Economic Zone). Vision India Real Estate Pvt Ltd.U. Reliance etc. Bharti. Sebi's (Securities Exchange Board of India) recent harbinger of permitting real estate mutual funds in both private and public sector will go a long way in attracting funds from small investors who emphasize on certain return. retail malls. RITES (Real Estate Investment Trusts) of the type introduced in U.7 million over the next three years in seven small cities in West Bengal.S. Tripura and Rajasthan. is planning to develop logistics parks in Bengaluru and Chennai. The money would be used to build integrated townships. According to former Planning Commission Advisor Tarun Das. • Realty major Ansal Properties & Infrastructure Ltd plans to invest about US$ 330. with an outlay of US$ 110 million .. The government must ensure that there is no shortage of funds.8 million over the next three years on expansion of its existing integrated townships and to develop a group housing project in Haryana • Integrated property development and asset management company. New Projects • Shristi Infrastructure Development Corporation will invest US$ 444. hospitality and sports facilities.The organised retail market in India is also accelerating with players like WalMart.

investors and end-users alike have begun to reconsider the market.9 million along with its partners • Vision India Real Estate. a closely-held business group in the US. This will be the first joint development project for the US Company that is proposing to invest US$ 100 to US$ 200 million over the next three years on projects. cash flows of realty players have also improved. • Real estate firm Supertech will invest US$ 880. By Q3 of FY 2009. non-core asset sales and banks reconsidering lending to the realty sector. Attracted by correcting values. with an investment of about US$ 268. suggests that the sector is likely to see a demand growth in the long-term. Conservative Real Estate Sector in a Growth Economy With signs of economic stabilization and moderate global economic growth forecasted for 2009-10 and beyond. players are still cautious in their approach and rightly so.• Tata Housing is planning to launch about 10 new residential projects in both affordable and luxury segments in 2010-11.5 million for developing 15 realty projects across North India in the next three years. QIP’s. the housing industry has seen an increase in demand due to the continuing effect of the stimulus package unveiled by the government in the . especially in the logistics arena. accelerating activity in the Indian realty sector. Although overall demand for real estate saw a decline in 2009. an improving economy backed by strong fundamentals. is investing US$ 5 million in Gem Group’s upcoming residential project in Chennai. With return of liquidity in recent months via FDI. Most banks have gone for aggressive interest rates to capture the market share. property markets in India have exhibited signs of revival from the second quarter of 2009. However.

latter half of 2008-2009. The price correction has been good for the industry. diplomats along with becoming a nucleus of NRI's. Apart from this pollution and unhygienic living . Chandigarh has been amongst the first few planned cities of India and it is also the state capital of both Punjab and Haryana. There are ample signs to signify a more positive outcome for 2010. Experts believe that real estate in India is one sector that is backed by so much internal demand. REAL ESTATE IN CHANDIGARH The residential real estate market is witnessing a shift in buyer preferences The dawn of 2010 was wrapped in the bright hues of optimism and revival for the real estate sector in the country. The current growth of real estate can be attributed to comfortable interest rates and launch of many projects in the affordable segment coupled with positive buyer sentiments. After the first quarter the residential market seems to be recovering fast and there is a flurry of activity in metros as well as in Tier II and III cities all over the country among the buyers as well as developers. and organizations are expected to manage tightly and efficiently. it is not possible for it to slump entirely. The strategies adopted and executed by real estate players would differentiate who would survive and flourish. This has made this city a vital area for expatriates. The ominous clouds of slowdown of the past 18 months were surely revealing their silver lining for this sector. Several new housing projects have been launched keeping the steep demand in mind. all the constructions here had been at par with environmental norms. Since Chandigarh had been a well planned city.

Recent developments in Chandigarh properties segment are worth noticing. and thus many more property users and home seekers to Chandigarh.200 per sq yard. They have few choices as there are not many sellers in the markets as of now.conditions are not entertained and all the builders here had to adhere to these factors. Nano City is a commercial and residential project in Chandigarh and will be completed by 2010. too. Delhi-based developer Parsvnath has bought 38% stake in Sabeer Bhatia's Nano City Project. there are more investments pouring in the segment and on the other side property buyers and sellers are not very enthusiastic about property transactions. Property sellers in Chandigarh see this as a temporary phase and are holding on to their land assets. Chandigarh properties have been witnessing tremendous growth and this happened in spite of restrictions on the construction here. They hope that real estate prices will increase in next six months and this is when they will make profits. say that Chandigarh Property Prices are nominal still. however. is witnessing a similar trend. Chandigarh . On one hand. Property buyers. Market sources say that Bhatia is already scouting IT clients to open offices in his Nano City. This is almost 20% decline in prices when compared to corresponding quarter last year. Property brokers in Chandigarh say that real estate values have stagnated. The booming real estate sector here has provided for benefits for both potential buyers and also for the property developers. Chandigarh real estate is witnessing testing times. Property prices for plots in suburban areas like Baltana and Kharar have stooped down to as much as Rs 100 . This will bring more employment. Chandigarh's property segment. The overall. economic recession has caused stagnation in the country's real estate segment. The Chandigarh real estate market is expected to grow with the rise of demands in the northern sector.

Chandigarh's planned development has always been hailed as a model for other north-Indian cities. Like any other city. The Chandigarh Housing Board (CHB). the government agencies are also promoting small time local property developers to institute projects in the region. About 8. is concentrating on mass housing projects. However. if more multinational companies set up their bases here. Omaxe. The CHB has started construction of 160 houses in Sector-26 East (Bapu Dham) for low-income households. this situation is changing now. this expansion doesn't come at the cost of present infrastructure.700 houses have been announced on 90 acres of land in Sectors 53. considering the middle-income group as the potential user base. have given more scope for expansion of the real estate sector and more options for buyers. Besides this. The Amarisis. 4. The city has witnessed some promising projects from leading real estate developers like DLF. Hence the real estate prospects of the city have never been affected by these developments. The Board recently announced the construction of around 13. Expansion of the city to districts and other areas.has also been the hub to some IT sectors and this industry is also expected to grow here.260 houses have been planned on 42 acres in Sector 63 under a general housing scheme. Parsvnath. Along with this. This is in consortium with the new housing policy which lays emphasis on providing affordable housing. The consumer base for most of the private builders is the urban-rich population or the NRIs. the Union Territory is bracing up its infrastructure to keep pace with the changing times.000 houses will be built in Dhanas and Maloya-I for the middle income group. Chandigarh too is faced with the constant expansion of the city limits. The property rates for the commercial sectors are expected to grow. However. Ansals API and Emaar MGF. Another 2. the chief civic authority responsible for all the housing related activities in the region. Venus .000 new housing units under different categories in the city. 54 and 55. Now.

it seems that Chandigarh will soon become a dream destination for the middle-income group. in the recent report released by the International Institute for Environment and Development. and sufficient availability of land are some of the factors that make Chandigarh properties an attractive Investment instrument. Furthermore. are witnessing positive in view of extending world-class facilities to these techno-giants. the capital values and rentals in the commercial property segment have been consistently rising in the past 3-years. The city has been positioned at number four among the fastest growing cities in India. the flourishing local economy of Chandigarh augurs well for nearly all the segments of real estate i.91 per cent since year 2000. the city of Chandigarh is popular as a sophisticated property market of the northern India. . and the segment is far more active than the end-user segment. Kwality buildtech are prominent among these players. and IT Park in Mohali. residential. DLF has set up its Infocity within the CTP zone. and commercial. retail. due to oversupply. Decent connectivity. Meanwhile. All in all. also holds the distinction of achieving a yearon-year growth rate of 7. Industry veterans also claim that Chandigarh real estate is largely an investor driven market. Definitely. Most of the projects by such group are in affordable category. Growth Lately. low operational costs. Chandigarh real estate caught the attention of IT Engines: and ITeS companies with the development of 375 acre Chandigarh Technology Park (CTP) at Manimajra. though a bit of slowdown is noticed in the residential real estate. This capital city of Punjab. The projects brought state-of-the-art infrastructure and facilities equivalent to those available in the cyber cities of Bangalore and Hyderabad. a state which enjoys one of the highest per capita incomes in the country. north-east part of Chandigarh. Withstanding to its reputation of India's first planned urban development. The city promises affordable accommodation and a good quality of life to its citizens.

0007.ft.300-2. all the sectors in Chandigarh have common SCO format commanding a capital value of around Rs. under mega projects scheme. the demand for housing is expected to rise in the region. Currently. Quoted lease rentals are around Rs.200 -2. commercial properties offering Grade A office space to the clients are in demand. in the industrial area.5. per month for the ground floor and Rs.2. At present. a mall-cum-multiplex in Sector-17 and another with a built up area of around 150. These projects offer retail space at a rate of Rs. With developments on a fast growth trajectory. The capital values at Sector 17 and 19 are recorded at Rs 10-11. ft a month.750/sq.3. Other sectors command a price of Rs. however. ft. per month for first floor.400/sq.300-4.ft. a number of hotels in mall developments are also in the pipeline.700/sq. 17 and 22. command the highest values. Rental & Capital Values Knight Frank reports that the prime residential locations in Chandigarh.ft. for flats while residential developments in Dera Bassi have capital values of Rs.ft.1. are quite moderate at Rs 6-7 per sq.300-2.000 sq.90-180/sq. per month. And with . while the same hovers from Rs 20 to Rs 35 at Sector no.120-180/sq.25-40/sq.ft. Grade-A developments comprising malls are coming up in Zirakpur. However. for plots and Rs.ft. which include sectors 4 to 10. Within Chandigarh.2.000/sq. two new projects are under construction currently.ft. ft. at Sector 22.ft.ft. Dera Bassi and Mohali.6. the same.750/sq.000 per sq.ft.000 /sq. with changing trends. rentals at Sector 19 are floating at Rs 90 per sq.Property Values and Rentals: With the foray of IT and ITeS majors in Chandigarh. ranging between Rs. Zirakpur has a price range of Rs. Retail space supply in Chandigarh is restricted due to strict building bye-laws.500-10. On the commercial front.

Kailash Colony and Hauz Khas. stabilization is envisaged which will encourage transaction rate.90/sq. per month while the capital values are approximately Rs.000 acres in Gurgaon. which was completed in 1949.9. It has a 62-year track record of sustained growth. We developed some of the first residential colonies in Delhi such as Krishna Nagar in East Delhi. MAJOR PLAYERS DLF The DLF Group was founded in 1946. The first and foremost project of DLF was the late 1940s project of the development of 21 urban colonies in and around Delhi. Since then we have been responsible for the development of many of Delhi’s other well known urban colonies.ft. with 17 msf of projects under rentals of Rs. The rentals here average to about Rs. DLF City is spread over 3.ft. With correction in the market. Greater Kailash. and has pan India presence across 30 cities. the centre for banking. DLF has 216 msf of developed area under homes and residential plots. The only exception is Sector-9.25-35/sq. Other business . In the last six months. The company has approximately 238 msf of completed development and 423 msf of planned projects.750/sq. there has been a correction in the residential property market in Chandigarh. per month. The company has land resource of 92 msf for office and retail development. The development business at present has 391 msf of development potential with 25 msf of projects under construction. financial and telecom services.ft. including South Extension. it has a development potential of 12 msf for its hotel business.

Tamil nadu (33MW). RAHEJA Established in 1956. Raheja Constructions and K.2 MW). Raheja Corp. L. K. Currently the group owns wind farms in the states of Gujarat (150 MW). Raheja Corp.5 MW wind power project in Elavanthi and Panapatti. the Mumbai-based K. with a diverse product portfolio. Raheja is the Chairperson of K.7 MW. Raheja Hospitality are part of G. 34. The wind power projects in the states of Gujarat and Karnataka are already registered for carbon credits at UNFCCC and generating over 3 Lakh CERs (Certified Emission Reductions) annually. DLF has initiated its wind power portfolio in March 2008. 2. 150 MW wind power project in Kutch. Tamilnadu.7 tonne of CO2 emissions on annual basis. 3. has made a successful transition from a real estate company to a business corporation.L. K. Raheja's conglomerate. Rajasthan (34. 4.5 MW). 11.2 MW wind power project in Gadag. 33 MW wind power project in Osisan and Ratan Ka Baas. These projects reduce about 4. and Karnataka (11. The group has been in its core business of construction and . Project Locations 1. Gujarat. Rajasthan.Wind Power Projects by DLF DLF group is the largest owner of wind power plants in India with an installed capacity of 228. C. Karnataka.

It has shouldered the responsibility to provide education and improve health standards of members of the society through Educational Institutes and Hospitals. self contained 'township development'. The Group has also joined hands with APIIC. thereby paving a way for others to follow. K. Amongst all its activities. RINA development for over 5 decades now.Raheja Corp a leading real estate developer in the country has chosen to be at the forefront of being environmentally responsible albeit volantarily. Hyderabad.Raheja Constructions has successfully completed about 2000 projects within India of Residential. The company has decided to have their projects as LEED [Leadership in Energy and Environmental Design ] certified GREEN BUILDINGS. the group has also pioneered the concept of self-sufficient. Parsvnath Developers Limited is also the first real estate developer to be certified to Integrated Management Systems (IMS) comprising of ISO 9001:2000. to which it belongs. ISO 14001:2004 and OHSAS 18001:1999 certification by the Italy-based. ft. Industrial and Commercial kind. the Group has never left the society out of focus. to develop an IT Park at Cyberabad. will house the IT and ITES industry. Over its 40 plus years of experience in this fields. Global Certification Organization. Business Areas Currently. Parsvnath Developers has marked its presence in 50 cities and 17 . Parsvnath Parsvnath Developers Limited is one of the leading real estate companies in India. The upcoming facility with built up area of 4. K.5 million sq. This in turn would bring down the annual energy consumption of any building by 15-20%.

consisting of 8 residential and 2 commercial. The projects are estimated to cover over 200 million square feet across all real estate verticals of India.states in India. hotels. shopping malls. hotels and SEZ projects across all industry verticals in India. Parsvnath Developer's ongoing 100 projects include integrated townships. Omaxe Plaza (Ludhiana). Business Areas Omaxe's ventures in the real estate business include developing integrated townships. group housing. Park Plaza (Indirapuram). Omaxe Arcade and NRI City Centre (Greater Noida). multiplexes.2 million square feet of . resorts. IT parks. biotech parks and SEZs. Major Projects At present. group housing. Major Projects Omaxe Limited has so far completed and delivered 10 projects. shopping malls. and Citadel and Pearls Omaxe (Delhi). It boasts of being one of the most widespread real estate developers in India. it parks. wedding mall (Patiala). wedding mall and House 2 Home (Gurgaon). covering approximately 4. Some of Omaxe Group's major commercial ventures include Omaxe Plaza. wedding mall (Agra). commercial complexes. Omaxe Established in 1987 as Omaxe Builders to undertake civil construction and contracting business.

with projects spreading across 30 towns in nine states of India.area. with all on time deliveries. TECHNOLOGICAL ENVIRONMENT Issues Concerning to the Real Estate Sector . At present.360 Crore. valued at Rs. the company has over 100 million square feet of area under development.

In expectations of higher profits in short run.With the rapid growth in real estate. some challenges may emerge in the way of taking India to the higher growth trajectory. these new comers are mushrooming and affecting the credibility and reliability of the system. the strengths of the concerned company to manage the increased size and geographical spread.  Mushrooming of smaller players The recent real estate boom has seen players without track record and credibility. Under the circumstances. there is not a large degree of transparency in sharing of data across the industry.  Soaring land prices .  Regional reach of existing players Most of the real estate developers in India have regional focus where the conditions are most suitable to them. As a result. most of the developers are coming forth with significant expansion plans irrespective of their historical performances and size of the projects undertaken. There are very few players in the country having a pan-India presence. In the absence of regulatory framework. The challenge for real estate developers is to move ahead in the value chain and expand in other areas of the country as the boom in the real estate encompasses almost the entire country. their ability to execute projects within time and cost and ability to arrange capital are the important issues which need to be addressed  Majority of market belonging to unorganised segment The Indian real estate sector is highly fragmented with the unorganised segment comprising of small builders and contractors accounting for a majority of the housing units constructed.

which makes cash advances at different stages of construction. sand. adverse price changes in any of the raw materials directly affect the bottom lines of developers. around two years back. land cost as a percentage of total project cost was around 25-30% in tier I cities. As the revenues from sale of units are predetermined. A significant challenge that real estate developers face is dealing with adverse movements in costs. gravel and paints. wood.  Appreciating Rupee Indian currency has appreciated by almost 12% on a year-on-year basis. Further appreciation of rupee from the current levels will see topline as well as bottomline of IT companies nosedive sharply. bricks. In other words. The land prices have risen tremendously since the past two years forcing many real estate developers to change their strategy of rapid expansion to other geographies. such as cement. The real estate sector is dependent on a number of raw materials. For example. the total amount of revenue from a project is predetermined and the realisation of this revenue is scattered across the period of construction.  Increasing raw material prices Construction activities are often funded by the client. which has now increased to around 60-65% in recent times. Rising rupee severely hurts exporters and IT companies. Interest rates however have shown signs of increasing in recent months and most of the leading financial institutions have . steel. These might force IT companies to put on hold their expansion plans thus putting pressure on demand for commercial as well as residential space.Soaring land prices and price resistance from buyers are narrowing investors’ margins significantly.  Interest rates One of the main drivers of the growth in demand for housing units is the availability of financing at low rates.

Improvement in regulatory framework is required with respect to modifications in antiquated land laws. After the recent hikes in home loan rates. adoption of uniform valuation practices and improvement in accounting quality.000 for 5-7 year period. This has lead to transparency and disclosures related issues as also corporate governance issues by the real estate companies as well as the financers. The Government may offer subsidized rate for loans up to Rs150. acombination of prepayment and staggered differential payments.  Regulatory opaqueness Real estate demand in India is good however several regulatory hurdles exist. setting up of reliable industry wide database. includes increasing the tenure of Equated Monthly Installments for existing customers. single window clearance and computerization of land records.recently raised interest rates on housing loans. inter alia. there are ownership issues because of too little computerization of land titles. This trend of rising interest rates could dampen growth in demand for housing units. Registration Charges and Capital Gain Taxes lead to high incidence of cash transactions. This. The Government is working on a plan to offer housing loan to urban poor at a subsidized rate of around 7% per annum. financing institutions are devising ways for smooth recoveries of passed-on costs. setting up of minimum quality standards of registration of builders. Similarly. For example the Land Ceiling Act in various states lead to problems in consolidation of land banks and this in turn leads to routing of numerous transactions through shell companies. duty rationalization. . Significant Stamp Duty. The Government may consider an easy financing scheme for the rural population as well at a later stage. Though few banks have reduced their rates on housing loans in the past one month the rates are still higher to have any substantial positive impact on the real estate sector. Rising interest rates have impacted the installment to income ratio in a big way especially the advances which were floated about a year back. etc.

POLITICAL ENVIRONMENT Government Initiatives The government has introduced many progressive measures to unlock the potential of the sector and also to meet the increasing demand levels. in addition to a host of other issues. . All of these factors are tempering investors’ appetites for Indian real estate.All these issues will go a long way in building mutual trusts amongst the real estate community. bureaucratic red tape and the absence of title insurance. The concerns continue to run high about the regulatory opaqueness for real estate ventures.

4 million last year Road Ahead According to the Confederation of Real Estate Developers' Associations of India (CREDAI).8 million in 2010-11 Scheme of 1 per cent interest subvention on housing loan up to US$ 21.153 announced in the last Budget has been extended up to March 31.4 million to US$ 215. built-up infrastructure and construction development projects through the automatic route. the affordable housing segment is set to play an important role in India's real estate sector in 2010 on the back of substantial demand.3 million to US$ 1. housing. 2011 and US$ 151 million has been earmarked for this scheme for 2010-11 • • • US$ 274 million has been allocated for Rajiv Awas Yojna.• 100 per cent FDI allowed in townships. ." Confederation of Real Estate Developers' Associations of India (CREDAI) Chairman Kumar Gera said in January 2010. the Finance Minister made the following announcements with regard to the real estate sector: • Allocation for urban development were increased by more than 75 per cent from US$ 660.17 billion in 2010-11 Allocation for housing and urban poverty alleviation were raised from US$ 183. subject to the provisions of Special Economic Zones Act 2005 and the SEZ Policy of the Department of Commerce • FDI is not allowed in Real Estate Business In the Union Budget 2010-11.576 where the cost of the house does not exceed US$ 43. subject to guidelines as prescribed by DIPP • 100 per cent FDI is allowed under the automatic route in development of Special Economic Zones (SEZ). as compared to US$ 32. "Affordable housing will be a key factor in driving the sector and we have already started working on progressive solutions in this area for effective and customised implementation of such projects.

the burden imposed will definitely undermine the benefits. shall also be covered. However. 2010 is expected to be a positive year for the real estate sector. . India Budget 2010-11. In addition. the India budget 2010-11 has brought a mixed bag for this sector. it seems service tax will not be applicable if the full payment is made after completion of the construction. other services provided by the builders to prospective buyers such as providing preferential location or external or internal development charges (excluding vehicle-parking space) etc. The revival is expected to be driven by infrastructure growth. The burdens and benefits for the real estate sector are as follows: The burden: o Widening of Service Tax net: Real Estate Developers will have to pay service tax on transactions where consideration is collected from prospective buyers prior to completion of construction. a mixed bag for real estate sector: NIREM IDS National Institute of Real Estate Management (IDS NIREM) believes that contrary to the popular demand of and expectation for huge impetus to the housing and real estate sector. some benefits have been extended to housing and real estate sector. which in turn.Moreover. the India budget 2010-11 has brought a mixed bag for this sector. can accelerate real estate activities both in the residential as well as commercial spaces. Though. IDS National Institute of Real Estate Management (IDS NIREM) believes that contrary to the popular demand of and expectation for huge impetus to the housing and real estate sector.

20 Lakhs. MAT may affect the companies executing such projects. Extension of deadline for completion of pending housing projects by one year without losing tax holiday u/s 80-IB. Excise Duty on Cement: Excise duty ion cement has been increased which will increase the cost of construction and it is expected that per unit cost for prospective buyers will also increase. This may have negative effect on to the properties bought or to be bought solely for investment purpose. This along with along with increase in the tax slab rates for individuals should provide the necessary demand boost for low-cost housing. o extension of investment linked deduction benefit to convention centres located in the NCR of Delhi extended from the present 31st March.Renting of immovable properties is also under service tax net and the definition of 'renting of immovable property service' has been clarified as well as widened to cover rent of vacant land under contract for undertaking construction of buildings or structures for business purposes. 10 lakhs and where the cost of the property is under Rs. o Extension of 1% interest subsidy on housing loans upto Rs. o Relaxation in norms for built-up area of shops and other commercial establishments in such eligible housing projects and o Increased budgetary allocations for urban development and housing schemes. 2011. 2010 to . However. The benefits: Some emphasis has been given to promote housing in general such as: o o Extension of Interest subvention scheme upto March 31.

the Confederation of Real Estate Developer's Associations of India (CREDAI) is the umbrella organization for the organized real estate developers/builders in India. Role of Government in India Real Estate Investment: CREDAI was established in 1999. Gujrat.the Indian government has approved a FDI of 100% which has given a boost to the Real Estate Companies. Chattisgarh. retail space development market is continuously booming with various activities. representing over 60% of the organized private state/cities in the country. CREDAI's member roster comprises 20 state/city level associations spread over across 18 states of India. Jharkhand. Kerala. The states included in the CREDAI membership are Andhra Pradesh. Delhi-NCR. Another important aspect is that very clearly the Finance Minister took pragmatic approach instead of populist measures. The list below provides the name of the best Real estate Companies in India. Overall. . where-in it is not possible to meet the demands of each individual sector. Infrastructure development. this budget will have mixed affect on the Indian real estate sector. Real Estate market in India has developed remarkably in the past few years. Himachal Pradesh. The potential of the Indian property is proved by the growth of the major real estate companies of India.31st July. looking at the overall economic scenario. residential complex. commercial real estate. Madhya Pradesh. 2010 (for purposes of deduction u/s Section 80-ID of the Incometax Act). In the India real estate sector. Karnataka. which is a good sign of a growth orientated government. Goa. People from all parts of the globe are interested in buying the Indian property. However. we also need to consider that the budget was presented against mutually conflicting objectives.

enabling slum rehabilitation and low income/low cost housing. The different laws governing real estate are 1. on behalf of developers/builders across India. seeking the housing finance/home loans. Opened the FDI market in the real estate sector. Rent Control Acts 6. • Encouraged the adoption of fast track mechanism by the local government authorities. Rajasthan. 1976 4. Property Tax 7. some of which are: • • Abolishment of the ULC Act. Stamp Duty 5.Maharastra. Orissa. Indian Urban Land (Ceiling And Regulation) Act. 1973 . and to the builders/developers. Indian Registration Act. Indian Transfer of Property Act 2. • • • The Indian government has been playing a proactive role in the India Real Estate Investment and thereby promoting investors to invest in Indian real estate market. Initiated proactive policies for the IT and IT based services. Introduced URIF ULIF funds to persuade the state government and cities to draw out effective reforms in the real estate infrastructure. The organization solicited income tax concession to the property purchasers. Punjab. Foreign Exchange Regulation Act. Tamilnadu. undertaking the residential housing projects. Moreover. Uttar Pradesh and West Bengal. in the form of property tax concessions. CREDAI lobbies with the government authorities in order to ensure formulation of constructive policies. etc. 1908 3.

• Foreign Role in India Real Estate Investment: The liberal government policies have facilitated the expansion of the foreign involvement in the India Real Estate Investment sector. Some of the important foreign investors in the Indian real estate market are like• • • • • • • • • • Emmar Properties Laing O'Rourke (LOR) Morgan-Stanley Real Estate Vancouver-based Royal Indian Raj International Corporation (RIRIC) Indonesia-based Siputra Selim group US-based Warburg Pincus Blackstone Group Broadstreet Columbia Endowment Fund California Public Employees' Retirement System (CalPERS) RESEARCH METHODOLOGY . the nonresident Indians have played a very important role in transforming the Indian real estate market. At present.

Sign up to vote on this title
UsefulNot useful