INDUSTRY ANALYSIS ON REAL

ESTATE

Submitted By:
I. Rishika Agrawal (SWOT Analysis)
II. Sandeep Kumar (Porter 5 forces)
III. Sanjeev Kumar (Porter 5 forces)
IV. Saurabh Anand (PESTEL)
V. Saurabh Kr Yadav (PESTEL, PPT)
 Introduction
 Real Estate is one of most globally recognized sector.
 The growth of real estate will have a cascading effect on ancillary industries.
 The realty sector is the second largest employer in India after agriculture.
 Real estate attracted around Rs 43,780 crore (US$ 6.26 billion) in investment
in 2019.
 It comprises of four sub-sectors:
1. Housing
2. Retail
3. Hospitality
4. Commercial
 Financial Performance
 According to the data released by DPIIT, construction is the fourth largest sector
in terms of FDI inflow.
 Combined annual sales in this sector grew at 6.4% in last 5 years. Annual net
profit declined by NAN% in last 5 years.
 Housing sales reached 2.61 lakh units in 2019 across seven major cities.

Past, Present, & Future

 In the past the intended listed market was governed by small provincial players
which led to low level of intelligibility.
 The older things underwent a transformation with sectorial development and at
present the real estate industries dynamics replicate prospects quality.
 Currently due to the ongoing pandemic this sector is under a lot of stress.
 Real estate in India is expected to have market size of US$ 1 trillion by 2030.
 Analysis Techniques
PESTLE Analysis
Real estate sector is one of the most globally recognized sectors. The current size of
the real estate market in India is already USD 120 billion dollar and this will grow to
USD 650 billion by 2040. The real estate sector is contributing 7 percent to the
country’s GDP and it’s share expected to double by 2040.The industry employs 55
million people now and this number will rise to 66 million as it grows.

 POLITICAL ENVIRONMENT
 Infrastructure projects like smart cities project, SEZs
 Five Industrial Corridor, Six Mega Ports
 HOUSING FOR ALL by 2022
 PMAY(Urban)
 ECONOMICAL ENVIRONMENT
 Government decision to allow 100% FDI into Real Estate Market
 Waiver of service tax on affordable housing
 Introduction of GDP
 Change in Arbitration norms for Construction Companies

 SOCIAL ENVIRONMENT
 Rapid Urbanisation
 Favourable Age Group
 Increasing number of Middle Class
 Increasing Per Capita Income

 TECHNOLOGICAL ENVIRONMENT
 People are using Internet for booking renting and buying property online.
 Some of the top players of the web based real estate companies are: 99Acres,
Magic tricks, Housing, OLX homes
 Adoption of Blockchain Technology for faster and safer money transfer
 ECOLOGICALENVIRONMENTAL
 Real Estate has triggered various Environmental concerns
 The carbon concentrates in the atmosphere is increasing YoY basis
 The Indian government has put in place several regulation to control pollution

 LEGAL ENVIRONMENT
 Real Estate (Regulation and Development) Act [RERA]
 Rehabilitation and Resettlement Act
 Interest subsidy for first home buyer 2016
 ‘Benami Properties Act

SWOT Analysis
SWOT Analysis helps in understanding the Strength, Weakness, Opportunities,
and Threats of a Business Organization.
 STRENGTHS
 The real estate documents can be used as collateral
 Investment in real estate property is one of the safest investments
 Used to hedge inflation risk and store good wealth

 WEAKNESS
 Not a Liquid Asset-Real estate isn’t liquid asset
 Requires large capital investment
 Limited Supply-Land being a natural resource is a limited one

 OPPORTUNITIES
 New sectors offer great potential
 Technological advancement and demographic shift

 THREATS
 Seasonal Demands may affect prices
 Economic Slowdown
 PORTER’s Five forces Model
Porter’s five forces of competition Position Analysis was developed as a simple
framework for assessing and evaluating the competitive intensity and attractiveness
of a market.

 Competitive Rivalry
Competition in any industry is good for consumer and bad for
Manufacturers/Suppliers.

 Threats to new entrants

It is not so easy for someone to just go out and enter into this sector because
the cost incurred in machinery and plant installation is very high.

 Threats of Substitute
It is difficult to come up with a substitute to this product as there is no
alternative/options are available.
 Bargaining power of buyers
The bargaining power of buyers seems pretty high because the options
available to buyers is more than the demand.

 Analysis of India’s real estate market:

 Infrastructure development is fundamental when it comes to boosting country

economy.

 During pandemic unemployment rate in India has been increased thus reducing
purchasing power and this will negatively impact the real estate sector because
people are less inclined to spend on flats and houses.

 Unfortunately, after the economy reopens, both the willingness and ability to
shop in physical stores will likely be limited, adding to the struggles that many
retailers were already facing before the pandemic. And this will affect negatively
in the opening of new retails shop that is going to affect negatively to real estate
sector.
 CONCLUSION
The Indian real estate industry, which is currently worth about US$ 12 billion,
plays a significant role in contributing to the economy of the country. The various
analysis done on the Real Estate Sector shows the different aspects of the
advantages which this industry contributes in the economy and also the loop holes
which need to be worked upon.

SOURCES
 https://www.dsllp.com/content/The%20Real%20Estate%20Philosopher%20-%20Porter'
s%20Five%20Forces%20in%20the%20Real%20Estate%20World.pdf
 https://www.ibef.org/industry/real-estate-india.aspx
 Niti Aayog
 99 Acres
 Disruption in real estate in India research paper