PUNE RESIDENTIAL

REAL ESTATE REPORT

About A ASK Group

ASK group has a heritage dating back to 1983. It is a diversified Financial Services group renowned for its strong research infrastructure and investment advice. Our group is accredited with having launched the Portfolio Management Services (PMS) in India.

Our group, which pioneered the concept of equity research in India, is today a leader in the areas of portfolio management and investment advisory services and manages the portfolios of some of the most affluent families in India. With two and half decades of presence in capital markets, ASK group has been a true believer in the India growth story and over the years has grown hand-in-hand with its clients across the globe. Integrity, Reputation & Relationship with clients are the critical pillars on which the group has based its foundation. These values testify a distinctive corporate culture. ASK group manages assets of more than US $1 Bn for its clients in Equity PMS, Wealth Advisory and Real Estate PMS. ASK Property Investment Advisors ASK Property Investment Advisors (ASK PIA) is a venture of the ASK group set up to manage and advise real estate dedicated funds. This initiative of the group rests on the backbone of extensive investment and asset management expertise backed by a strong research focus. The real estate team has over ten decades of cumulative experience and comprises some of the best professionals with risk management, corporate lending, real estate advisory, construction and asset management experience.

Funds Under Management: ASK Group had raised US$ 75 mn (Rs 3260 Million) under tough market conditions (March 2009-December 2009) and has committed 90% till date. The capital has been committed in seven residential projects covering four cities- National Capital Region (NCR), Pune, Bangalore and Chennai. ASK Real Estate Special Opportunities Fund has so far raised Rs. 625 crore ($125 million) for its second real estate fund and is targeting Rs 1,000 crore by March 2012. ASKPIA has also announced its first investment in Mumbai from its second real estate fund.

Pune Residential Real Estate
December, 2011

Key conclusions
Ÿ Pune’s population has seen a gradual shift

towards higher proportion of Service professionals
Ÿ Improving income profile driven by IT,ITES, Bio-

Technology & Engineering to improve affordability
Ÿ Annual requirement of houses to remain in the

range of 45,000-55,000 per year over next two years
Ÿ Real estate prices expected to remain

firm/marginally rise with low vacancy levels and steady absorption trends

IIndex
Ÿ Pune

Ÿ Indian Real Estate Sector – An Overview

Ÿ Demographic and economic profile Ÿ Housing demand estimation and outlook Ÿ Supply situation and pricing outlook Ÿ Micro – market wise analysis Ÿ North-East region Ÿ North-West region Ÿ South-East region Ÿ South-West region Ÿ Pune Central region Ÿ Upcoming Supply trends

Indian Real Estate scenario

Real R estate GDP grew at higher pace than overall GDP
Real estate GDP growth higher than overall GDP
11.0 10.8 10.1 10.5 8.9 9.5 9.6 8.4 9.3 7.1 8.0 5.9 5.4 5.0 5.8 7.5 6.8 8.5

Rising FDI equity investment in Housing and Real Estate
Rs. crore 16,000 14,000 12,000 30,000 8,000 6,000 4,000 2,000 2,121 5,149 2,043 8,749 12,621 13,586

9.0

8.3 8.5

8.6

per cent

7.0

3.0

3.8 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 (QE) (RE) GDP at constant prices Real estate GDP 1

2006-07

2007-08

2008-09

2009-10

2010-11

2011 (Apr-Sept)

Note 1 includes Real estate, ownership of dwellings & business services Real estate GDP growth for 09-10, 10-11 are estimated based on GDP growth QE- Quick Estimates, RE-Revised Estimates Source: MOSPI (Ministry of statistics and programme implementation)

Note : Annual data is for financial year (Apr-Mar) Source: Department of Industrial Policy & Promotion, RBI

Ÿ Investments in Real Estate led to higher growth rate as compared to overall GDP Ÿ FDI in Real estate led to strong inflow providing additional funds to developers; however FDI flows showed signs of slowdown during 2010-11 Ÿ High GDP growth led to rising incomes during 2002-03 to 2007-08, however recovery post 2008 global financial crisis has been anemic

Strong S demand led to high loan disbursal and rise in prices
Trend in Housing loans
Rs. crore 70,000 60,000
200 300 250 Index

Trend in Residential Real estate prices

50,000
150

40,000
100

30,000 20,000 10,000 0 Mar-03 Mar-04 Mar-05 Mar-06 Mar-07 Mar-08 Mar-09 Mar-10 Mar-11 (Apr-Oct) 2011
50

0

Note: Data relates to select 47 banks accounting for 95% of total non-food credit given by all scheduled commercial banks Source: RBI annual reports

Note: H1: Jan-Jun; H2: Jul-Dec; Q1: Jan-Mar; Q2: Apr-Jun; Q3: Jul-Sep; Q4: Oct-Dec Source: National Housing Bank - Price Index

Ÿ Housing loan grew at CAGR of 75% during 2002-03 to 2005-06; Rising real estate prices, interest rates and economic slowdown led to

decline in subsequent years with recovery starting from 2009-10
Ÿ Growth in residential demand (end user and investment) led to sharp rise in real estate prices

CCurrent Scenario…. Regulatory Changes
Ÿ Regulatory measures introduced by RBI since November 2010 and National Housing Bank in 2011: Ÿ Cap on LTV (Loan to Value) to 80% Ÿ Increase in risk weight for loans more that Rs.75 Lacs to 125% : Higher provisioning is likely to lower further loan disbursement Ÿ Increased Standard asset provisioning to 2% for teaser loans Ÿ Increased provisioning from 1 to 2 percent with respect to Real estate loans Ÿ NHB has raised the provisioning requirement for doubtful assets up to 100% & asked to set aside 0.4% of the total outstanding "standard"

loans as a buffer
Ÿ Public sector banks have been given a strong message from the regulator after the recent exposure of a scam between an intermediary and

public sector housing finance company
Ÿ Increase in Minimum Capital Adequacy ratio for deposit-taking non-banking financial companies (NBFCs) from 12 per cent to 15 per cent Ÿ Focus on monitoring of end-use of funds given to the developers Ÿ Home loan for the third house to be treated as commercial property Ÿ To attract higher risk weight of 100% compared to 50% for residential real estate Ÿ Draft Real Estate (Regulation and development) Bill 2011 introduced for suggestions Ÿ The Land Acquisition, Rehabilitation and Resettlment Bill introduced in 2011

CCurrent Scenario…. Positives
Ÿ Planning Commission expects India’s GDP growth of 8.5-8.7

per cent during the 12th Five Year Plan period (2012-17) Ÿ Domestic demand, Large growing young population, robust consumption and investment rates
Ÿ Prospects of rise in salaries and improvement in affordability Ÿ Ramp-up in hiring by IT /ITES sector expected in 2012-13 Ÿ Infosys to hire 23,000 engineers (plans to hire local

overseas staff) Ÿ TCS plans to add around 45,000 employees
Ÿ Incentives for affordable housing projects introduced in

Union Budget 2011-12 Ÿ Existing scheme of 1% interest subvention has now been extended to Rs 15 lakh for house costing up to Rs 25 Lakh

IImpact on the Real Estate Sector
Ÿ Rise in interest rates by 350 bps since March-09 and

requirement for higher contribution (LTV at 80%) by the home buyer has resulted in further deferral of demand
Ÿ Despite rising incomes and jobs, home seekers waiting for

prices to decline
Ÿ Stringent norms to delay availability of funds to real estate

developers; strict monitoring of end-use of funds by Banks
Ÿ Higher provisioning requirement to lock up funds and restrict

credit to the Real estate sector
Ÿ Tightening liquidity forcing developers resorting to high cost

funds; developers with severe liquidity crunch likely to offer waiver on other charges, stamp duty etc..
Ÿ Global financial stress may impact job hiring outlook which

may be a cause of concern in the short term

Pune Real Estate

Pune P Urban Agglomeration
Ÿ Population-5.7 mn (Est.) 2011- includes area of PMC, PCMC,

Khadki and Pune cantonment
Ÿ Leading education hub with 150 plus colleges Ÿ IT/ITeS, Engineering, Auto& Auto components and Forging

are the key industries
Ÿ Pune district has per capita income of Rs 111,637 in 2009-10,

second highest in Maharashtra

Note: PMC-Pune Municipal Corporation area, PCMC- PimpriChinchwad Municipal Corporation

Proposed Metro Line Proposed Metro Stations PMC Boundary Cantonment Area Existing Highways/Expressways Existing Secondary Roads Railways Line River / Canal Proposed High Capacity Bus Route Proposed Bus Rapid Transit City Bus Station Railway Station

Source : Propequity, ASKPIA

Existing / Proposed Airport

Pune P City -Demography
Location map of Pune city
Key Facts of Pune City Area Total Population (2001) Total Population (2011) (Est.) Decadal Growth Rate Density (2011) Literacy Rate (2001) Per Capita Income (INR) (2009-10) Workforce Participation Rate (Census 2001) Sex Ratio (1000/males) Major Industries 430 Sq.Km. 25,38,473 40,95,340 61.3% 9,524 Persons/Sq.Km. 71% 1,11,637 34.08% 922 Females IT/ITeS, Bio-Technology Auto, auto ancillary and Engineering

Source : Census of India, State economic survey

Pune P City – Profile and Connectivity
Connectivity Details - Pune International Airport - Able to handle an average of 125,000 passengers per month - Well connected to all major Indian airports within two hours flying time - One of the main stations on the Central railway for trains that travel to Mumbai - Connected to Pimpri-Chinchwad by local trains - Daily express trains connect Pune to all major stations - National Highway 4 (NH 4) connects it to Mumbai, Bangalore, Sangli and Kolhapur - NH 9 to Solapur and Hyderabad, NH 50 to Nashik

Ÿ Pune- Cultural capital and leading centre of education in Maharashtra Ÿ Well established manufacturing base of Auto, Auto-Ancillary , Forging and sugar

By Air

industries
Ÿ Leading region in IT/ITeS sector with more than 1,000 units operating in the STPI Ÿ Pimpri-Chinchwad is a major industrial hub and is one of the biggest industrial zones in
By Rail

Asia.
Ÿ Major software companies in Pune include Accenture, Infosys, IBM India, Persistent

Systems, Wipro, TCS, Cognizant, Symantec, Tech Mahindra and Syntel
Ÿ Leading companies in the manufacturing sector include Bajaj Auto,Telco, Kinetic

By Road

Engineering,Thermax,Bharat Forge, Mercedes-Benz India , Volkswagen, Lupin Labs, Suzlon

Air Connectivity International Pune National Pune - Delhi, Mumbai, Chennai, Ahmedabad, Bangalore, Goa, Kolkata - Dubai, Frankfurt and Singapore

Source : ASKPIA, Propequity

Pune P City –Key Infrastructure Initiatives
Projects Pune city Integrated Road project Description Ÿ Construction of 9 railway over bridges, 2 river over bridges, 15 flyovers Ÿ The project cost is estimated to be Rs. 260 crore Ÿ Flyovers at Hadapsar Saswad, road widening at Baner Road, Flyover at University, Wakad Aundh Road widening
Ÿ Flyover at Chinchwad- Chaphekar Chowk Ÿ Flyover joining Nashik Phata & Chakan

Development Agency

Status

MSRDC

Ÿ Construction of Flyovers completed, Kharadi Bypass

road widening nearing completion

Flyovers

PCMC

Ÿ Work of flyover in progress Ÿ Work on Nashik Phata & Chakan flyover began in

March-10

Ÿ Two metro routes being planned in first phase

Metro Rail

Ÿ The Metro Corridors planned within Pune would reduce road traffic and

improve connectivity within various regions, which are currently not easily accessible.
Ÿ It would benefit both Pune and Pimpri-Chinchwad by reducing the

PMC

Ÿ Project approved by State Govt in Feb-11

90 feet Ring Road project

congestion on major arterial roads and improving connectivity within the city Ÿ It will be a major link connecting the software parks development in the east and north east of the city Ÿ Connectivity to areas like Undri, Pisoli, Katraj,Kondhwa Budhruk
Ÿ Subway have been planned to avoid congestions at Highway junction

PMC

Ÿ Project approved by Municipal Corporation in March-11

Old Mumbai-Pune Highway Widening project

Ÿ MIDC areas of Talegaon, Chakan (location for proposed international

airport)

MSRDC

Ÿ All work completed

Source : Propequity, ASKPIA

Shift S in demographic profile in last 2 decades
Regions (Population) PMC PCMC Pune cantonment Khadki cantonment Total Decadal growth rate Source: Pune CDP, Pune Metro Rail report 1971 8,56,105 98,572 77,774 65,497 10,97,948 1981 12,03,363 2,51,769 85,986 80,835 16,21,953 48% 1991 16,91,430 5,20,639 82,139 78,323 23,72,531 46% 2001 25,38,473 10,06,417 1,01,723 98,090 37,44,703 Decadal Growth Rate 50% 93% 24% 25% 58% 2011P 40,95,340 14,77,986 1,06,925 1,03,106 57,83,357 Decadal Growth Rate 61% 47% 5% 5% 54%

Ÿ 1991-2001 - An era of manufacturing led population growth in PCMC area due to growth in Auto and Auto ancillary industry Ÿ 2001-2011 – Ushered IT/ITeS led growth with setting of STPI in Hinjewadi Ÿ New regions – Kharadi, Baner emerged as IT Hubs Ÿ PCMC region witnessed relocation of companies for operational efficiencies

The demographic profile of Pune saw a gradual shift towards higher proportion of Service professionals with higher income range compared to the Working class profile of the 1990’s

IIT industry growth propelling high rise in incomes
Per capita income at current prices
Rupees
1,20,000 1,00,000 80,000 59,992 60,000 40,000 20,000 52,811 36,090 41,144 49,058 20,000 71,073 64,238 30,000 96,541 74,027 1,11,637 60,000 50,000 40,000

Rs crore

Pune share in IT exports
70%

65%

59% 55% 52% 48% 55% 55%

58%

60%

60%

55%

10,000

50%

45%
2005 - 06 2006 -07 2007 - 08 2008 - 09 Provisional Est. 2009 - 10 Preliminary Est.

03 -04

04 - 05

05 - 06

06 -07

07 - 08

08 -09

09 - 10 % share

10 - 11E

Pune District

Maharashtra

Pune STPI

Maharashtra

Source: Maharashtra Economic survey

Source: Industry , STPI

Ÿ Per capita income much higher than State due to strong economic growth primarily from IT/ITeS industry Ÿ Increasing growth of IT /ITeS industry has provided strong growth in job opportunities in past few years

Demand estimation approach and outlook

Stable S growth in population will moderate demand for houses
Census data based on growth expected in households and houses (Population) PMC PCMC Pune cantonment Khadki cantonment Total Number of households Average Household Size(per Household) Incremental Households in a decade Annual requirement for Houses - (Assuming equal absorption) Note: The average household size is assumed to decline with growth in nuclear families Source: CENSUS, RITES, PMC and ASKPIA 2001 25,38,473 10,06,417 1,01,723 98,090 37,44,703 8,28,890 4.5 2011P 40,95,340 14,77,986 1,06,925 1,03,106 57,83,357 14,45,839 4 6,16,949 61,695 2021P 52,41,758 17,78,293 1,12,394 1,12,182 72,44,627 20,12,396 3.6 5,66,557 56,656

Ÿ Annual requirement for houses expected to grow annually by 56,000 units based on population estimated as per Pune development plan Ÿ Growth in population expected to moderate on higher base

O space absorption indicate sustained hiring Office
Estimated employment based on Office space absorption Quarter Jul-Sep-08 Oct-Dec-08 Jan-Mar-09 Apr-Jun-09 Jul-Sep-09 Oct-Dec-09 Jan-Mar-10 Apr-Jun-10 Jul-Sep-10 Oct-Dec-10 Jan-Mar-11 Apr-Jun-11 Office space absorption (sq. ft) 2,252,600 612,000 596,950 832,450 1,123,100 1,304,600 1,782,300 984,400 1,120,550 1,356,100 1,448,825 1,994,625 Estimated employee addition 30,035 8,160 7,959 11,099 14,975 17,395 23,764 13,125 14,941 18,081 19,318 26,595 65,465 67,233 46,154 (9 months) Annual addition

Note: Average office space has been assumed to be 150 sq ft per employee with 2 shifts Source : Propequity, ASKPIA

Ÿ Existing employment leading to an estimated need of 45,000 houses annually Ÿ Office space availability of 11 mn sq. ft. during next two years indicate a potential requirement of 47,000 houses leading to sustained

demand for houses (rental or owned houses)

Trend T in sales registration in line with demographic growth
Trends in registation of Sale agreement
Units
10,000 9,000 8,000 7,000 6,000 5,000 4,000 78,948

Ÿ Residential new homes registration agreements estimated to be

45,000 in 2009-10 and 50,000 in 2010-11 Ÿ Sharp recovery in demand in 2009-10 has been sustained in 2010-11

{
{
71,601 Jul -09 Oct -09 Jan-10 Apr -10 Jul -10 Oct -10 Jan-11 Apr -11 42,485 Apr -08 Jul -08 Oct -08 Jan-09 Apr -09

{
2,000 1,000 0

3,000

New Home registrations estimated to be around 63% - of total sale agreements

Note : Sale agreement data includes – Land sale, commercial sale and residential sale (New homes & Re-sale). Registration of property is with a lag of 3-6 months Certain months are considered inauspicious for any new purchases ( 15 day before Dashera ~ Sept-Oct period ) depending on Hindu calendar Source: Stamp duty Registrar, Maharashtra

Shift S in income profile to reflect in demand for houses
Income profile and Property cost affordabilty Particulars Gross annual Income per employee Person earning per family Monthy Gross Income of family Obligations (Tax, monthly exp) % Income available for EMI (Rs per month) Term in years Rate on interest EMI for Rs 1,00,000 Loan eligibilty (Rs lakh) Loan to value Property cost (Rs Lakh) Manufacturing Sector Working class 3,00,000 1 25,000 58% 10,500 20 10.75% Rs. 1,015 10 80% 13 Executive level 6,00,000 1 50,000 58% 21,000 20 10.75% Rs. 1,015 21 80% 26 Entry Level 3,00,000 2 50,000 58% 21,000 20 10.75% Rs. 1,015 21 80% 26 Services sector Middle Level 12,00,000 2 2,00,000 58% 84,000 20 10.75% Rs. 1,015 83 80% 103 Senior Mangtt. Level 25,00,000 2 4,16,667 58% 1,75,000 20 10.75% Rs. 1,015 172 80% 215

Note : 1. Gross annual income for manufacturing and services sector have been sourced from primary sources 2. Obligation percent has been based on loan norms followed by private sector banks 3. Rate of interest has been assumed to be constant across loan slabs 4. Floating rate of interest is as of December, 2011

Shift in income profile with higher proportion of service professionals to result in change in Pune real estate market in terms of preference for apartment size and facilities

Key K Conclusions
Ÿ Based on the two approaches projected demand for houses will be :
Demand estimation Houses

Demographic
Commercial space Source: ASKPIA

56,000
47,000

Ÿ Estimated new home registrations at 50,000 is line with above estimations; we expect demand to grow at an average of

50,000 units annually
Ÿ Shift in income profile to result in change in demand profile of houses as more service professionals are added to existing

population- the mix of service professional is expected to be 65% of the working population

Pune City Residential supply –Trends and outlook

Supply S – Real Estate Landscape
Ÿ Pune has estimated - 468 builders; 296 builders registered with CREDAI, Pune Ÿ Builders bound by code of ethics to promote highest standard of promotion, development and construction activities Ÿ Integrated township projects like - Magarpatta, Blue-ridge, Nanded city, IVEN township, Megapolis, KUL Ecoloch and

Amanora on outskirts
Ÿ Applicable FSI in the PMC and PCMC limits is 1.0. In addition a TDR of 0.6 is given for PMC and 0.4 for PCMC area

PuneP Key Regions And Micro-markets
North-West Region Akurdi Aundh Baner Baner- Pashan Bhosari Chinchwad Hinjewadi Kalewadi Nigdi Pashan Pimple Saudagar Pimpri Rahatani Sus Road Wadgaon Wakad North- East Region Airport Road Kalyani Nagar Kharadi Koregaon Park Lohegaon Nagar Road Parvati Vadgaon-Sheri Vimannagar Vishrant Wadi Wagholi Yerawada

North -West
Central Pune Bund garden S.B. Road Shivajinagar University road Deccan Shanivar peth Tilak road Prabhat Road Karve Road Station Road

North- East

Pune Central

South-West Region Bavdhan Dhayari Erandwane Karve Nagar Kothrud Sinhagadh Road Sinhagadh Vadgaon Budruk Warje

South – West

South- East

South-East Region Camp Fursungi Hadapsar Kondhwa Manjari Mundhwa NIBM Road Salisbury Park Sholapur Road Undri Wanowrie

Source : ASKPIA,Propequity

High H absorption of existing stock and new launches indicate sustained demand growth
60000 50000 40000 30000 20000 10000 0 2008 2009 2010 2011 2012 2013 2014

Units

Trend of Supply - Absorption in Pune
per cent 20% 18% 16% 14% 12% 10% 8% 6% 4% 2% 0% 2,000 0 10,000 8,000 6,000 4,000 16,000 14,000 12,000 12,667

Quarterly Trends of New Project Launches
Units
14,586

9,144 6,724 8,100 7,983

10,718 8,061

3,022 4,539 3,593 3,510 1,370

3,589 1,506

Supply

Absorption

Cumulative Availability %

Note: The analysis is based on year of completion of the projects. Absorption figures are at present levels. Source : Propequity, ASKPIA

Source : Propequity, ASKPIA

Ÿ Low cumulative availability of 19% till 2014 indicates healthy absorption trends Ÿ Increase in projects launches and low availability indicate healthy demand trend

0 Q4 08 -2 00 8 Q1 -2 00 8 Q1 -2 00 9 Q2 -2 00 9 Q3 -2 00 9 Q1 -2 01 0 Q2 -2 01 0 Q3 -2 01 0 Q4 -2 01 0 Q1 -2 01 1 Q2 -2 01 Q3 1 -2 01 1

8 00 -2

-2

00

8

Q1

Q2

Q3

-2

Supply S in tandem with demand……..
Fresh Supply 24,159 units in Jan-Jul 2011
4 BKH 2.2% 5 BKH 0.3% 1 BKH 14.0% 3 BKH 33.9% 2 BKH 49.6%

Total Absorption - 27,175 units in Jan-Jul 2011
4 BKH 2.3% 5 BKH 0.3% 1 BKH 13.6% 3 BKH 32.7% 2 BKH 51.1%

1 BHK 2 BHK 3 BHK 4 BHK 5 BHK

1 BHK 2 BHK 3 BHK 4 BHK 5 BHK

Source : Propequity, ASKPIA

Note: Absorption includes units launched in previous years Source : Propequity, ASKPIA

Segment-wise supply-absorption has been balanced leading to stable movement in prices; Higher absorption number has lowered the existing stock levels

Region-wise analysis

NNorth-East Pune
Ÿ Location of Airport in the region was

conducive for growth of Commercial office driven by IT parks
Ÿ Leading IT parks in the region are

Pancshil, Raheja, EON
Ÿ Widening of Nagar Road improved the

connectivity and led to higher office space demand
Ÿ Premium areas of Pune like Boat club

North - East

road, Koregaon park and Kalyani nagar are located here

North- East Region Airport Road Kalyani Nagar Kharadi Koregaon Park Lohegaon Nagar Road Parvati Vadgaon-Sheri Vimannagar Vishrant Wadi Wagholi Yerawada

Source : Propequity

Supply S in upcoming areas with high absorption
Trend of Supply - Absorption in North East Pune
9000 8000 7000 6000 5000 4000 3000 2000 1000 0 2008 Supply 2009 2010 Absorption 2011 2012 2013 2014 Units per cent 20% 18% 16% 14% 12% 10% 8% 6% 4% 2% 0% 0 Q3 07 Q4 07 Q1 08 Q2 08 Q3 08 Q4 07 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 1,500 1,000 500 1,031 773 367 279 236 760 853 2,000 2,098 1,416 1,381 1,295 1,229 1,953 1,204 3,000 2,500

Trend of New launches in North East Pune
Units
2,694 2,511

Cumulative Availability %

Note: The analysis is based on year of completion of the projects. Absorption figures are at present levels. Source : Propequity, ASKPIA

Note :Q1-Jan-Mar, Q2-Apr-Jun, Q3- Jul-Sep, Q4- Oct-Dec Source : Propequity, ASKPIA

Ÿ This region accounts for 14% of Pune’s supply with overall vacancy at 18% Ÿ These region with elite residential localities has lower quantum of launches, however new regions are witnessing higher launches in past

6 mths
Ÿ Proximity to airport, SEZ space and connectivity to other parts of city has led to growth of commercial space in this region; Residential

demand growth is thus expected in region like Kharadi which has larger land parcels and comparatively lower rates in the region

Stable S to steady price rise scenario expected during 2012
Rs per sq ft 7,250 6,500 5,750 5,000 4,250 3,500 2,750 2,000

kalyani nagar

Kharadi

Vimannagar

Source : Propequity, ASKPIA

Ÿ Region witnessed steady appreciation in prices except weakness during Q4,2009 Ÿ Prices are expected to remain stable in premium areas, while they will rise in upcoming areas

Price P trends in micro-markets
Weighted average prices (Rs. per sq. ft) Quarter Q3-2007 Q4-2007 Q1-2008 Q2-2008 Q3-2008 Q4-2008 Q1-2009 Q2-2009 Q3-2009 Q4-2009 Q1-2010 Q2-2010 Q3-2010 Q4-2010 Q1-2011 Q2-2011 Q3-2011 Source : Propequity,ASKPIA Kalyani Nagar 5,085 5,182 5,341 5,558 5,802 5,926 5,843 5,830 6,126 6,471 6,741 7,150 6,929 6,400 6,500 6,750 6,750 Kharadi 2,946 3,116 2,972 3,049 3,020 3,001 3,298 3,363 3,135 3,211 3,270 3,073 3,423 3,694 3,857 4,022 4,069 Vimannagar 2,981 3,122 3,685 3,744 3,783 3,660 3,436 3,419 3,464 3,418 3,406 3,655 3,743 3,975 4,745 5,054 5,100

North-West Pune N
Ÿ Pimpri-Chinchwad and Hinjewadi are the

two main growth corridors of the region
North-West Region Akurdi Aundh Baner Baner- Pashan Bhosari Chinchwad Hinjewadi Kalewadi Nigdi Pashan Pimple Saudagar Pimpri Rahatani Sus Road Wadgaon Wakad

Ÿ Hinjewadi- started in 1998 has ushered

the IT growth in Pune region
Ÿ Prominent IT players like Infosys, TCS,

North -West

Wipro, IBM have set up centres at Hinjewadi

Source : Propequity

Region R with highest supply share at 45%
Trend of Supply - Absorption in North West Pune
Units 30000 25000 20000 15000 10000 5000 0 2008 Total Supply 2009 2010 2011 2012 2013 2014 per cent 12,000 20% 18% 16% 14% 12% 10% 8% 6% 4% 2% 0% 4,000 2,000 2,164 0 Q3 07 Q4 07 Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 1,008 1,645 6,000 4,775 3,814 3,142 2,129 2,394 3,245 3,054 8,000 6,558 4,258 4,784 6,937 7,722 10,000 Units 9,863

Trend of new launches in North West Pune

Total Absorption

Cumulative Availability %

Note: The analysis is based on year of completion of the projects. Absorption figures are at present levels. Source : Propequity, ASKPIA

Note :Q1-Jan-Mar, Q2-Apr-Jun, Q3- Jul-Sep, Q4- Oct-Dec Source : Propequity, ASKPIA

Ÿ North-West region accounts for highest share of supply at 45 % - main region being PCMC and IT hub of Hinjewadi Ÿ The region has low vacancy level at 19% due to growth in new residential areas with upcoming IT locations Ÿ Saturation of residential area in the existing IT belts will lead to development of areas with better connectivity and proximity to offices -

Residential demand in the region to see strong growth in regions like Baner and Wakad

Stable S to steady price scenario expected during 2012
Rs per sq ft 6,000 5,500 5,000 4,500 4,000 3,500 3,000 2,500
1 1 01 -2 Q2 Q3 -2 8 8 8 8 9 9 9 9 0 0 7 7 0 0 01 00 00 00 00 00 00 00 00 01 01 00 00 01 01 -2 -2 -2 -2 -2 -2 -2 -2 -2 -2 -2 -2 -2 -2 -2 01 1

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Aundh

Baner

Hinjewadi

Q3

Q4

Pimple Saudagar

Source : Propequity, ASKPIA

Ÿ Prices have been in affordable range for middle income groups Ÿ Region is expected have continued demand; prices to remain firm in 2012

Q1

Price P trends in micro-markets
Weighted average prices (Rs. per sq. ft) Quarter Q3-2007 Q4-2007 Q1-2008 Q2-2008 Q3-2008 Q4-2008 Q1-2009 Q2-2009 Q3-2009 Q4-2009 Q1-2010 Q2-2010 Q3-2010 Q4-2010 Q1-2011 Q2-2011 Q3-2011 Source : Propequity,ASKPIA Aundh 4,262 4,300 4,405 4,591 4,778 4,667 4,671 4,687 4,680 4,875 4,839 4,857 5,019 5,323 5,539 5,784 5,825 Baner 3,463 3,466 3,448 3,776 3,934 3,944 3,838 3,222 3,516 3,566 3,613 3,768 3,824 3,974 4,045 4,175 4,443 Hinjewadi 3,462 3,465 3,370 3,364 3,454 4,000 3,768 4,049 3,689 3,578 2,661 2,775 3,053 3,126 3,041 3,266 3,301 Pimple Saudagar 2,682 2,787 2,897 3,093 3,182 3,151 2,871 2,868 2,955 3,146 3,304 3,536 3,554 3,664 3,934 4,089 4,169

South-East Pune Sa
Ÿ Magarpatta- the integrated township

project changed the profile of the region
Ÿ NIBM region has witnessed growth due

to better educational facilties
Ÿ Higher migrant population has led to

demand growth in less preferred locations
South-East Region Camp Fursungi Hadapsar Kondhwa Manjari Mundhwa NIBM Road Salisbury Park Sholapur Road Undri Wanowrie

South- East

26% of Pune’s supply expected in the region
Trend of Supply - Absorption in South East Pune
16000 14000 12000 10000 8000 6000 4000 2000 0 2008 2009 Total Supply 2010 2011 Total Absorption 2012 2013 2014 Units per cent 20% 18% 16% 14% 12% 10% 8% 6% 4% 2% 0% 0 Q3 07 Q4 07 Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 1,000 2,000 2,569 1,896 1,747 3,000 2,632 3,049 1,774 1,649 922 384 1,271 4,000 Units 3,115 2,571 2,561

Trend of new launches in South East Pune
3,544 3,197 2,869

Cumulative Availability %

Note: The analysis is based on year of completion of the projects. Absorption figures are at present levels. Source : Propequity, ASKPIA

Note :Q1-Jan-Mar, Q2-Apr-Jun, Q3- Jul-Sep, Q4- Oct-Dec Source : Propequity, ASKPIA

Ÿ One of the upcoming regions with the success of integrated township model-Magarpatta, leading to improved profile of the region Ÿ Vacancy of 18% for projects launched indicate healthy demand trend Ÿ Quantum of new launches has been improving in past three quarters

High H absorption to drive prices
Rs per sq ft 4,300 4,100 3,900 3,700 3,500 3,300 3,100 2,900 2,700
1 1 01 -2 Q2 Q3 -2 8 8 8 8 9 9 9 9 0 0 0 7 7 0 01 00 00 00 00 00 00 00 00 01 01 01 00 00 01 -2 -2 -2 -2 -2 -2 -2 -2 -2 -2 -2 -2 -2 -2 -2 01 1

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q3

Q4

Hadapsar

Kondhwa

NIBM Road

Source : Propequity, ASKPIA

Ÿ High absorption to result in increase in prices as eastern corridor is preferred over other regions

Q4

Q1

Price P trends in micro-markets
Weighted average prices (Rs. per sq. ft) Quarter Q3-2007 Q4-2007 Q1-2008 Q2-2008 Q3-2008 Q4-2008 Q1-2009 Q2-2009 Q3-2009 Q4-2009 Q1-2010 Q2-2010 Q3-2010 Q4-2010 Q1-2011 Q2-2011 Q3-2011 Source : Propequity,ASKPIA Hadapsar 3,210 3,360 3,206 3,324 3,210 3,199 3,123 3,016 3,029 2,894 3,078 3,023 3,090 3,261 3,636 3,972 3,963 Kondhwa 3,191 3,256 3,608 3,581 3,752 3,216 3,190 2,915 3,022 2,832 2,938 3,119 3,299 3,371 3,468 3,572 3,630 NIBM Road 3,349 3,460 3,619 3,593 3,459 3,332 3,612 3,420 3,172 3,282 3,498 3,580 3,695 3,686 3,880 4,141 4,020

South-West Pune S
Ÿ Region has concentration of Banks, Insurance

and other service sectors offices
Ÿ Nanded city – New township project could

change profile of the area

South-West Region Bavdhan Dhayari Erandwane Karve Nagar Kothrud Sinhagadh Road Sinhagadh Vadgaon Budruk Warje

South – West

Source : Propequity

15% of Pune’s supply expected in the region
Trend of Supply - Absorption in South - West Pune
6,000 8000 7000 6000 5000 4000 3000 2000 1000 0 2008 2009 2010 2011 2012 2013 2014 0% 0 Q3 07 Q4 07 Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09 10% 5% 20% 4,000 15% 3,000 1,980 2,000 1,000 1,011 529 220 Q4 09 Q1 10 Q2 10 2,030 1,557 1,416 1,174 1,290 927 676 Q3 10 Q4 10 Q1 11 Q2 11 1,270 951 2,274 Units per cent 25% 5,000 4,352 Units 5,204

Trend of new launches in South West Pune

Total Supply

Total Absorption

Cumulative Availability %

Note: The analysis is based on year of completion of the projects. Absorption figures are at present levels. Source : Propequity, ASKPIA

Note :Q1-Jan-Mar, Q2-Apr-Jun, Q3- Jul-Sep, Q4- Oct-Dec Source : Propequity, ASKPIA

Ÿ 85% of the expected supply has been absorbed with very low vacancy in near term Ÿ New launches have been consistent with the exception in Q2’09 due to launch of Nanded city township project

New N regions to witness price appreciation in 2012
Rs per sq ft 7,000 6,500 6,000 5,500 5,000 4,500 4,000 3,500 3,000 2,500 2,000

Bavdhan

Kothrud

Sinhagad Road

Source : Propequity, ASKPIA

Ÿ Upcoming regions of Sinhagad road, Vadgaon budruk, Dhayari to see appreciation in prices in 2012

Price P trends in micro-markets
Weighted average prices (Rs. per sq. ft) Quarter Q3-2007 Q4-2007 Q1-2008 Q2-2008 Q3-2008 Q4-2008 Q1-2009 Q2-2009 Q3-2009 Q4-2009 Q1-2010 Q2-2010 Q3-2010 Q4-2010 Q1-2011 Q2-2011 Q3-2011 Source : Propequity,ASKPIA Bavdhan 3,122 3,246 3,306 3,334 3,380 3,389 3,110 3,268 3,284 3,323 3,383 3,588 3,793 3,956 4,095 4,273 4,435 Kothrud 3,901 4,105 4,379 4,458 4,417 4,799 3,748 3,874 3,737 3,960 3,953 4,195 4,441 4,852 5,063 6,496 6,436 Sinhagad Road 2,915 3,236 3,253 3,293 3,297 3,517 3,606 3,517 3,518 3,420 3,519 3,721 4,221 4,383 4,216 4,383 5,893

Central C Pune
Ÿ The oldest and central most part of Pune Ÿ Known for Historical monument like

Shaniwar Wada

Central Pune Bund garden S.B. Road Shivajinagar University road Deccan Shanivar peth Tilak road Prabhat Road Karve Road Station Road

Pune Central

Source : Propequity

Less L than 1% of Pune’s supply expected in the region
Trend of Supply-Absorption in Central Pune
1400 Units 1200 1000 800 6% 600 4% 400 200 0 2009 Total Supply 2010 Total Absorption 2011 2012 Cumulative Availability % 2% 0 Q3 07 Q4 07 Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 0% 1,000 0 0 0 0 30 16 0 0 0 0 0 0 0 0 2,000 per cent 12% 10% 8% 6,000 Units 5,000 4,000 3,000 540 1,216

Trend of new launches in Central Pune

Note: The analysis is based on year of completion of the projects. Absorption figures are at present levels. Source : Propequity, ASKPIA

Note :Q1-Jan-Mar, Q2-Apr-Jun, Q3- Jul-Sep, Q4- Oct-Dec Source : Propequity, ASKPIA

Ÿ Being the prime region it has almost full absorption ; mostly resale transactions are prevalent in the area Ÿ Scarcity of space has led to very less launches; exception has been due to launch of Damodar VI project in Q2,2009

Central C Pune region will continue to command premium
Rs per sq ft 15,000

13,000

11,000

9,000

7,000

5,000
1 1 01 -2 Q2 Q3 -2 8 8 8 8 9 9 9 9 0 0 7 7 0 0 01 00 00 00 00 00 00 00 00 01 01 00 00 01 01 01 1

-2

-2

-2

-2

-2

-2

-2

-2

-2

-2

-2

-2

-2

-2 Q4

Q1

Q2

Q3

Q4

Q3

Q1

Q2

Q4

Q1

Q3

Q4

Shivajinagar

Source : Propequity, ASKPIA

Ÿ Region to command premium due to its central location and scarcity of supply, hence expect prices

to appreciate

Q2

Deccan

Q3

Q1

-2

Price P trends in micro-markets
Weighted average prices (Rs. per sq. ft) Quarter Q3-2007 Q4-2007 Q1-2008 Q2-2008 Q3-2008 Q4-2008 Q1-2009 Q2-2009 Q3-2009 Q4-2009 Q1-2010 Q2-2010 Q3-2010 Q4-2010 Q1-2011 Q2-2011 Q3-2011 Source : Propequity,ASKPIA Deccan 8,600 8,600 8,600 8,600 8,600 8,600 8,000 10,666 11,199 11,199 13,000 13,000 13,000 15,000 15,000 15,000 15,000 Shivajinagar 10,000 10,000 10,000 10,000 10,000 7,688 8,520 8,613 9,417 9,125 8,250 8,750 8,750 11,000 11,000 11,000 11,000

Supply S trend in Pune region
Trend in Region-wise supply (% Share) Region North-East North-West South-East South-West Pune Central Total Units 2008 14% 43% 29% 14% 0% 21,588 2009 12% 44% 25% 19% 1% 30,669 2010 16% 41% 23% 18% 2% 29,605 2011 12% 41% 32% 13% 3% 47,206 2012 16% 48% 25% 10% 0% 52,374 2013 14% 44% 20% 22% 0% 30,279

Note: The analysis is based on year of completion of the projects. Source : Propequity, ASKPIA

Ÿ Large share of supply in North-west region is expected to result in saturation of Residential space Ÿ However regions with connectivity to city could see potential for growth- regions like Balewadi, Wakad and Baner will

continue to see growth and price appreciation
Ÿ Eastern corridor – Which includes regions in South and North east are expected to be preferred locations due to proximity to

airport, improved connectivity and competitive real estate rates
Ÿ Regions like Hadapsar, Kharadi and Airport Road are expected to see residential growth

Research Team R
MR. RAMAN IYER Director – Asset Management E-mail ID: riyer@askinvestmentadvisors.com

MR. DEEPAK RATHI Vice President - Asset Management E-mail ID: drathi@askinvestmentadvisors.com

MR. JITESH KARLEKAR Senior Research Analyst E-mail ID: jkarlekar@askinvestmentadvisors.com

Disclaimer D
Ÿ This document is being communicated to you solely for the purposes of providing our views on current market trends. This document is being communicated to

you on a confidential basis and does not carry any right of publication or disclosure to any third party. By accepting delivery of this document each recipient undertakes not to reproduce or distribute this presentation in whole or in part, nor to disclose any of its contents (except to its professional advisers) without the prior written consent of ASK Property Investment Advisors, who the recipient agrees has the benefit of this undertaking. The recipient and its professional advisers will keep permanently confidential information contained herein and not already in the public domain.
Ÿ This document is not an offer, invitation or solicitation of any kind to buy or sell any security and is not intended to create any rights or obligations. Nothing in this

document is intended to constitute legal, tax, securities or investment advice, or opinion regarding the appropriateness of any investment, or a solicitation for any product or service. The use of any information set out in this document is entirely at the recipient's own risk.
Ÿ ASK Property Investment Advisors does not accept any responsibility for any errors whether caused by negligence or otherwise or for any loss or damage incurred

by anyone in reliance on anything set out in this document. The information in this document reflects prevailing conditions and our views as of this date, all of which are subject to change. In preparing this document we have relied upon and assumed, without independent verification, the accuracy and completeness of all information available from public sources or which was provided to us or which was otherwise reviewed by us. Past performance cannot be a guide to future performance.
Ÿ No reliance may be placed for any purpose whatsoever on the information contained in this document or on its completeness. The information set out herein may

be subject to updating, completion, revision, verification and amendment and such information may change materially.
Ÿ The analysis / interpretation of data is purely the work of ASK Property Investment Advisors Ltd. and does not necessarily reflect PropEquity views as the market.

ASK PROPERTY INVESTMENT ADVISORS PVT. LTD.
Bandbox House,1st Floor, 254- D, Dr. Annie Besant Road, Worli, Mumbai - 400 025. Tel: (91) 22-6652 0000 Fax: (91) 22-2498 5665

Sign up to vote on this title
UsefulNot useful