Professional Documents
Culture Documents
September 2014
Capri Global Capital Limited
CONTENTS
CONTENTS
Macro Economic
Performance
Residential
Segment
Overview
Developments
Key
Appendix
8%
7%
6%
5%
5.70%
4%
3%
2%
1%
0%
Q1 2012-13
Q2 2012-13
Q3 2012-13
Q4 2012-13
Q1 2013-14
Q2 2013-14
Q3 2013-14
Q4 2013-14
Q1 2014-15
As the political impasse gave way to a strong decisive mandate to the Modi-led government, the trend of declining economic activity witnessed in last two
years was reversed. Economic growth revived to surpass industry expectations during the April-June quarter of 2014-15;
Growth revival was led by resurgence in manufacturing sector which grew by 3.5% (after experiencing contraction in the past two quarters), with overall
industrial growth at 4.2% vis--vis -0.4% in Q1 2013-14;
A stable Government with an incremental reformist approach has led to revival in business sentiments. Investments rebounded in April June 2014-15,
with gross fixed capital formation registering a 7% growth (highest in the past 24 months) vis--vis 2.8% contraction during in the same quarter last year; &
Going forward, for a sustained momentum in economic activity, provision of a conducive policy environment focused on reducing supply bottlenecks in the
system would be critical.
USD bn
60
Metallurgical
Industries
5%
50
40
30
20
10
Chemicals
(excluding Fertilizers)
6%
Power
6%
Drugs &
Pharmaceuticals
8%
Computer Software
and Hardware
9%
Telecommunications
11%
Construction
Development:
Townships, Housing,
built-up
Infrastructure
16%
Services Sector**
27%
Automobile Industry
7%
2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15*
Improved investor sentiment on account of stable central leadership coupled with a revival in growth has led to increased foreign investment in recent
months. Total FDI inflows during April-June 2014-15 were USD 11 bn vis--vis about USD 9 bn witnessed during the corresponding period in 201314;
Resonating with the momentum in overall investment flows, the FDI flows for construction development increased y-o-y by 68% during April-June
2014-15; &
Going forward, the momentum of FDI flows is expected to be sustained as the Government focuses on improving the business environment. Few
measures include increased foreign investment limits in defense and insurance sectors to 49% coupled with relaxation of FDI norms in real estate
(built-up asset and capital conditions relaxed).
** Services sector includes Financial, Banking, Insurance, Non- financial/ business, Outsourcing, R&D, Courier, Tech. Testing and analysis
Source: Department of Industrial Policy and Promotion and CGCL Research
USD mn
120
100
6
80
4
60
40
2
20
0
0
-20
-2
-40
-4
-60
January
February
Morch
April
May
June
Revival in business sentiments during the last two months of Q2 2014 (on the back of a decisive political mandate in general elections) was reflected
in institutional investments too ~ Net Foreign Institutional Investments (FIIs) (both debt and equity) in May and June stood at over USD 11 bn;
Reflecting the overall market, investments in realty stocks also witnessed increase during May and June 2014 ~ listed developers such as Oberoi
Realty, Omaxe, amongst others, witnessed an increase in FII shareholdings (as a percentage of total shareholding) in recent months; &
Increase in foreign investments have had a positive impact on the Rupee movement as well vis--vis major global currencies.
Source: Securities and Exchange Board of India, National Securities Depository Limited and CGCL Research
INR/USD
54
55
56
57
58
59
60
61
62
63
64
1/1
1/15
1/29
2/12
2/26
3/12
3/26
4/9
4/23
5/7
5/21
6/4
6/18
7/2
7/16
7/30
8/13
8/27
Month/Day
Post a volatile period in 2013, the Indian Rupee has largely been range bound in first eight months of 2014, appreciating by around 2% during the
period; &
Going forward, the Rupee is expected to remain range bound with factors such as pro-reform Government policies expected to strengthen the Rupee,
while concerns over capital outflows on possible increase of interest rates by the US Federal Reserve may weaken the Rupee.
27,500
2,250
25,000
2,000
22,500
1,750
20,000
17,500
1,500
15,000
1,250
12,500
10,000
7,500
1,000
750
5,000
500
1/1
1/15
1/29
2/12
2/26
3/12
3/26
4/9
4/23
5/7
5/21
6/4
6/18
7/2
7/16
7/30
8/13
8/27
Overall, during the first eight months of 2014, Sensex and Realty Index increased by 26% and 17% respectively ~ The Realty Index has
underperformed the overall Sensex, owing to a decline witnessed in past two months on the back of poor performance of indexs major players such
as DLF and Unitech, which have witnessed legal setbacks in the months of July and August.
12%
10%
8%
6%
4%
2%
0%
CPI (IW)
Repo Rate
Credit Costs ~ Repo and Reverse Repo (%) and Inflation ~ CPI (%)
Retail inflation eased in the first half of 2014 to below 8% levels (the short term target set by RBI), as the Central banks tight monetary policy in the
past 15 months have yielded results coupled with slower annual increments in fuel and cloth prices;
However, despite sub 8% levels, the Central bank kept the repo and reverse repo rates stable in 2014 on account of concerns remaining over
possibility of inflation heading north over monsoon deficit in conjunction with the Central banks focus on ensuring continued trend of lowered
inflation levels as growth picks up; &
Unchanged repo and reverse repo rates left banks with limited room for reduction of lending rates, which led to continuance of higher funding costs
for the real estate sector.
Source: Ministry of Statistics and Programme Implementation, Reserve Bank of India and CGCL Research
Overview|H1 2014
Overall Supply (units)
200,000
180,000
#112,797 units
37% decline vis--vis H2 2013
Number of Units
160,000
Supply share
in H2 2013
140,000
120,000
100,000
73% 70%
80,000
Supply share
in H1 2014
30% 27%
60,000
40,000
20,000
0
H2 2013
Supply (units)
H1 2014
Top 3 cities
Other 4 Cities
65% 63%
Absorption
share in H1
2014
140,000
#103,040 units;
23% decline vis--vis H2 2013
120,000
100,000
37% 35%
80,000
60,000
Number of Units
Absorption
share in H2
2013
40,000
20,000
0
Top 3 cities
Other 4 Cities
H1 2014
Absorption (units)
H2 2013
Subdued economic environment since past two years, high inflation and interest rates, coupled with rising inventory levels led to restrained demand-supply activity;
Despite a decline in new launches, overall unsold inventory levels increased by more than 10% during the review period. The increase was led by NCR which
observed an increment in its unsold stock by approximately 8%;
Demand-supply activity was primarily focused on affordable housing segment during the review period, with preference for projects offering 2 and 3 BHK
configurations; &
The weighted average price in five of the top seven cities witnessed subdued appreciation during H1 2014, amidst pressures owing to high unsold inventory levels.
Appreciation in MMR and Pune was primarily skewed due to launches above the prevailing base sale price in the city coupled with decline in new launches.
Notes: *Top 3: MMR, NCR and Bengaluru; Other Four: Chennai, Pune, Hyderabad and Kolkata
Source: PropEquity and CGCL Research
11
Delhi-NCR
Kolkata
Hyderabad
Bengaluru
MumbaiMMR
Chennai
Pune
H1 2014
Supply (New Launches): 28,008 units
Absorption: 27,774 units
Weighted Avg. Launch Price: INR 8,324/sft
Demand-Supply Activity
Half Yearly City Level Supply (units)
75,000
67,500
Number of Units
60,000
Average Supply
24%
52,500
45,000
45%
37,500
30,000
22,500
15,000
31%
7,500
0
H1 2011
H2 2011
H1 2012
H2 2012
H1 2013
H2 2013
H1 2014
Thane
Mumbai
Navi Mumbai
60,000
52,500
18%
37,500
30,000
20%
22,500
62%
15,000
7,500
Thane
Navi Mumbai
Mumbai
0
H1 2014
H2 2013
H1 2013
H2 2012
H1 2012
H2 2011
H1 2011
Owing to dampened sentiments of previous seven to eight quarters, the demand albeit subdued, continued to be led by end users vis-a-vis investors in the
MMR, with the former focusing on affordability which led to dominance of cost effective peripheral locations in Thane and Navi Mumbai, while Western
suburbs led within the core Mumbai city (on back of proximity to commercial hubs and better connectivity to other parts of the city);
As unsold inventory levels remained high along with impending elections both at the Centre (May 2014) and at the State (Oct 2014), developers continued to
discount with approximately 50% reduction in new launches in H1 2014, focusing primarily on mid and high end segments in peripheral locations of MMR; &
Some of the projects launched included Runwal Eirene by Runwal Group, Acropolis Ph-III by Arkade Group, Godrej City by Godrej Properties, Western Heights
by Adani Group, Transcon Auris Ivorine by Transcon Developers, amongst others.
Source: PropEquity and CGCL Research
14
Number of Units
45,000
Average Absorption
H1 2014*
H2 2013
8,324
6,195
213.76
213.53
9,000
250
200
7,000
Price (INR/sft)
6,000
150
5,000
4,000
100
3,000
2,000
50
1,000
0
H1 2011
H2 2011
H1 2012
H2 2012
H1 2013
H2 2013
H1 2014
Unsold Inventory
As decline in new launches outpaced the decrease in absorption, the demand-supply gap for the region reduced during the review period, which in turn led to
only marginal increase in unsold inventory levels during H1 2014; &
The weighted average price of new launches witnessed an increment of 34% during H1 2014 in MMR, as Mumbai city (having higher prices than average
MMR base sale price) had a larger share in new launches during the review period (31% in H1 2014 vis--vis 21% in H2 2013).
Notes: The base data for the analysis incorporates row houses/villas, Independent floors/low rise and Plots
Source: PropEquity and CGCL Research
15
8,000
Location
45%
55%
Top10 Locations
Others
3,191
1,530
1,484
1,224
931
913
902
42%
58%
901
781
730
Top10 Locations
Location
17%
83%
Lodha Group
Runwal Group
Godrej Properties
Sugandhi Builders
Rashmi Housing
Kalpataru
Rustomjee Group
Raunak Group
Panvelkar
Shreenath
Enterprises
Top 10 Developers
Launched
Units
Location
Neral (N. Mum)
Dombivali (Thane)
Panvel (N.Mum)
Virar (W) (Thane)
Andheri (W) (Mum)
Dahisar (E) (Mum)
Worli (Mum)
Powai (Mum)
Sector 37 Kharghar
(N.Mum)
Majiwada (Thane)
2,196
1,332
1,312
1,268
833
786
784
761
730
708
Others
Absorbed
Units
2,332
524
346
261
251
210
201
191
177
39%
61%
164
Others
Notes: The base data for the analysis incorporates row houses/villas, Independent floors/low rise and Plots
Mum - Mumbai; N.Mum - Navi Mumbai
Source: PropEquity and CGCL Research
Launched
Units
Location
Top 10 Developers
Runwal Group
2,132
Vijay Group
2,000
Lodha Group
1,012
Godrej Properties
890
Hiranandani
720
Soham Developers
700
Arkade Developers
634
Adhiraj Constructions
600
Wadhwa Group
590
559
Others
16
H1 2014
Supply (New Launches): 27,190 units
Absorption: 13,960 units
Weighted Avg. Launch Price: INR 4,124/sft
Demand-Supply Activity
Half Yearly City Level Supply (units)
80,000
Number of Units
70,000
23.2%
60,000
Average Supply
0.4%
50,000
41%
40,000
10.9%
30,000
1.1%
20,000
23.5%
10,000
0
H1 2011
H2 2011
H1 2012
H2 2012
H1 2013
H2 2013
Faridabad
H1 2014
Ghaziabad
Greater Noida
Gurgaon
New Delhi
Noida
60,000
23.7%
Average Absorption
1.3%
40,000
42.0%
30,000
13.7%
20,000
0.8%
10,000
18.5%
Faridabad
Ghaziabad
Greater Noida
Gurgaon
New Delhi
Noida
0
H1 2014
H2 2013
H1 2013
H2 2012
H1 2012
H2 2011
H1 2011
High interest costs coupled with sluggish economic activity in the past 24 months meant residential traction in NCR continued to remain tepid during H1 2014
as both investors and end-users adopted a cautious approach. Absorption witnessed a decline of approximately 51% vis--vis H2 2013 ~ more than 65% of
the sales were accounted by Greater Noida and Ghaziabad (primarily in mid segment) followed by Gurgaon (with traction in both mid and high end projects);
As the region remained a supply laden market, developers remained hawkish towards new launches and focused on completion of existing projects ~ new
supply declined by 25%, with units primarily being released in mid end segment in Greater Noida and Ghaziabad and in high end segment in Gurgaon; &
Key projects launched included One India Bull by IREL (Indiabulls), Oasis by Godrej Properties, Enviro City by Lotus Greens Developers, amongst others.
Source: PropEquity and CGCL Research
18
Number of Units
50,000
H2 2013
4,124
3,842
182.34
169.13
4,500
200
4,000
180
160
3,500
140
Price (INR/sft)
3,000
120
2,500
100
2,000
80
1,500
60
1,000
40
500
20
0
H1 2011
H2 2011
H1 2012
H2 2012
H1 2013
H2 2013
H1 2014
Unsold Inventory
The demand-supply gap for NCR was maximum during the review period, as a steep decline in absorption outpaced decline in new launches, thus leading to
an increase of approximately 8% in unsold stock in H1 2014 ~ more than 46% of the unsold inventory was accounted by Greater Noida followed by
Ghaziabad and Gurgaon at approximately 19% and 17% respectively; &
The weighted average price of new launches witnessed a moderate increment of 7% during H1 2014, as Gurgaon (having higher prices than average NCR
base sale price) had a relatively larger share in new launches during the review period (23% in H1 2014 vis--vis 13% in H2 2013).
Notes: *an increase in price and a decline in unsold inventory taken as positive and vice versa
Source: PropEquity and CGCL Research
19
NCR Residential
46%
Top 10 Locations
1,055
1,030
943
705
704
679
532
500
278
270
Top 10 Locations
22%
78%
Top 10 Developers
51%
49%
Others
Location
Prateek Buildtech
Amrapali Group
Vatika Group
Mahagun
Supertech Limited
Wave Infratech
Jaypee
Gaursons India
Oasis Group
Godrej Properties
Launched
Units
Location
Absorbed
Units
Location
54%
Others
Yamuna Expressway
(Gr. Noida)
Pratap Vihar (Gzb.)
Sector 1 (Gr. Noida)
NH-24 Bypass (Gzb.)
Sector Omicron-1
(Gr.Noida)
Tronica City (Gzb.)
Sector 16B (Gr. Noida)
Tech Zone IV
(Gr. Noida)
Sector 5 (Gurg.)
Sector 129 (Noida)
2,500
2,188
1,622
1,610
1,150
1,038
1,000
978
950
900
Absorbed
Units
450
391
374
332
324
320
308
273
236
231
Others
Notes: The base data for the analysis incorporates row houses/villas, Independent floors/low rise and Plots
Gzb - Ghaziabad; Gr. Noida - Greater Noida; Gurg - Gurgaon
Source: PropEquity and CGCL Research
Launched
Units
Vihaan Developers
2,000
Prateek Buildtech
1,388
Gaursons India
1,246
Vatika Group
1,175
Magnum Group
1,038
Agarwal Developers
1,000
Amrapali Group
980
Mahagun
924
Bayaweaver
900
IREL (Indiabulls)
888
Location
42%
58%
Top 10 Developers
Others
20
H1 2014
Supply (New Launches): 23,613 units
Absorption: 23,370 units
Weighted Avg. Launch Price: INR 4,556/sft
Bengaluru
Demand-Supply Activity
Half Yearly City Level Supply (units)
40,000
Number of Units
35,000
30,000
6%
Average Supply
25,000
27%
50%
20,000
15,000
1%
10,000
16%
5,000
0
H1 2011
H2 2011
H1 2012
H2 2012
H1 2013
H2 2013
H1 2014
Central
North East
North West
South East
South West
30,000
8%
25,000
20,000
44%
34%
15,000
10,000
1%
Central
North East
5,000
13%
North West
South East
South West
0
H1 2014
H2 2013
H1 2013
H2 2012
H1 2012
H2 2011
H1 2011
Led by steady demand from IT workforce, the Bengaluru residential market remained most resilient during H1 2014, with the decline in sales at 5%, being the
smallest across top seven cities;
Owing to high unsold stock, developers remained cautious with subdued new launches, primarily in mid and high end segments. Some of the projects
launched included Republic of Whitfield by DivyaSree Developers, Purva Palm Beach by Puravankara, E City Town II by GM Infinite dwelling, amongst others; &
Proximity to commercial hubs and affordable price points led to continuance of attractiveness of peripheral locations such as Electronic City, Whitefield, Hennur
Road, Sarjapur Road, Marathahalli, Hebbal, KR Puram, amongst others, across North East and South East micro markets of the city.
Source: PropEquity and CGCL Research
22
Number of Units
Average Absorption
H2 2013
4,556
4,239
87.13
86.89
5,000
100
4,500
90
4,000
80
3,500
70
3,000
60
2,500
50
2,000
40
1,500
30
1,000
20
500
10
0
H1 2011
H2 2011
H1 2012
H2 2012
H1 2013
H2 2013
H1 2014
Unsold Inventory
Steady demand coupled with fewer launches led to reduction in demand-supply gap, which in turn led to a marginal increase in unsold inventory levels
during the review period; &
Despite slowdown in launches, the weighted average price of new launches witnessed a moderate increment of 7% during H1 2014, as developers factored
in increase in input costs.
Notes: *an increase in price and a decline in unsold inventory taken as positive and vice versa
Source: PropEquity and CGCL Research
23
Price (INR/sft)
Bengaluru Residential
Location
44%
56%
Top10 Locations
Whitefield
Electronic City
Sarjapur Road
Sarjapur
Hosur Road
K.R. Puram
Haralur Road
Bannerghatta Road
Kanakpura Road
Hennur Road
2,764
2,206
1,171
947
789
736
683
631
618
607
29%
71%
Others
Top10 Locations
Location
21%
79%
Top 10 Developers
Prestige Group
DivyaSree
Puravankara
Shriram Properties
Provident Housing
Prabhavathi
Builders
DS-Max Properties
Sobha Developers
Indya Estates
Dreamz Infra
Launched
Units
Location
Electronic City
Hoskote
Whitefield
Gunjur
Sarjapur Road
Hennur Road
Haralur Road
Yeshwantpur
Thanisandra
Binnypet
2,176
1,613
1,465
1,211
1,204
1,091
1,080
840
721
703
Others
Absorbed
Units
970
840
819
509
467
45%
55%
396
390
336
328
327
Others
Notes: The base data for the analysis incorporates row houses/villas, Independent floors/low rise and Plots
Source: PropEquity and CGCL Research
Launched
Units
Location
Top10 Developers
Others
GM Infinite Dwelling
1,400
DivyaSree
1,300
Prestige Group
1,211
Shriram Properties
Mahaveer Reddy
Structures
1,096
980
900
Shapoorji Pallonji
703
Esteem Group
700
Puravankara
651
Assetz
449
24
H1 2014
Supply (New Launches): 7,209 units
Absorption: 9,476 units
Weighted Avg. Launch Price: INR 4,997/sft
Chennai
Demand-Supply Activity
Half-yearly City Level Supply (units)
25,000
30%
Average Supply
15,000
10,000
6%
64%
5,000
0
H1 2011
H2 2011
H1 2012
H2 2012
H1 2013
H2 2013
H1 2014
North East
North West
South East
South West
20,000
15,000
Average Absorption
38%
48%
10,000
5,000
13%
1%
0
North East
North West
South East
South West
H1 2014
H2 2013
H1 2013
H2 2012
H1 2012
H2 2011
H1 2011
The overall macro economic condition impacted the Chennai market too, with end users delaying purchases, while developers focused on completion of
existing projects. Consequently, a decline of 12% and 14% was witnessed in supply and absorption respectively during H1 2014;
Availability of land parcels, affordability, proximity to IT hubs coupled with improving connectivity owing to under construction metro network remained key
drivers for demand-supply activity in peripheral locations of South West and South East Chennai. The 12-15 km Old Mahabalipuram Road (OMR) stretch in
South East including Semmancherry, Thiruporur, Thuraipakkam, Kelambakkam, Egattur, Indiranagar, Perungudi remained most active; &
Key projects launched included Eden Park Ph II (Almond-Marigold & Peach) by L&T Properties, Serene by Mantri Developers, amongst others.
26
Number of Units
Number of Units
20,000
H1 2014*
H2 2013
4,997
4,358
42.18
44.45
6,000
50
40
35
Price (INR/sft)
4,000
30
3,000
25
20
2,000
15
10
1,000
0
H1 2011
H2 2011
H1 2012
H2 2012
H1 2013
H2 2013
H1 2014
Unsold Inventory
In the past one year, the city based developers have responded prudently to the subdued demand levels in the region by holding on to new launches.
Consequently, demand led supply by more than 2,000 units in both H2 2013 and H1 2014, thus leading to a 5% decline in unsold stock in past 12 months; &
An increase of 15% in weighted average price of new launches during first six months of 2014 is primarily on account of launch of projects in higher budget
segments and in part due to decreasing unsold stock.
Notes: The base data for the analysis incorporates row houses/villas, Independent floors/low rise and Plots
Source: PropEquity and CGCL Research
27
45
5,000
35%
65%
Top10 locations
Padur (OMR)
Perumbakkam
Porur
Ambattur
Siruseri (OMR)
Padappai
Tambaram
Sholinganallur (OMR)
Kelambakkam (OMR)
Chromepet
74%
26%
Top 10 Locations
Others
Location
22%
78%
Top 10 Developers
Others
Arun Excello
Foundations
L&T Properties
VGN
Pdotg Constructions
Amarprakash Group
Ruby Builders
Step Stone
Mahindra Lifespaces
Jain Housing &
Constructions
TVH Builders
Launched
Units
Location
GST Road
Siruseri (OMR)
Sriperumbudur
Pallavaram
Tambaram
Arasankazhani (OMR)
Padur (OMR)
Chembarambakkam
Sholinganallur (OMR)
Manapakkam
860
712
636
552
458
383
357
350
288
258
Others
Absorbed
Units
2,332
524
346
261
251
210
201
191
177
164
Notes: The base data for the analysis incorporates row houses/villas, Independent floors/low rise and Plots
Source: PropEquity and CGCL Research
Launched
Units
Location
34%
66%
Top10 Developers
860
L&T Properties
712
Vijay Shanthi
548
Ruby Builders
538
BSCPL Infrastructure
383
TVH Builders
357
Vishwakarma(Chennai)
284
Tata
250
Isha Homes
216
Mantri Developers
168
Others
28
H1 2014
Supply (New Launches):15,366 units
Absorption: 17,241 units
Weighted Avg. Launch Price: INR 5,547/sft
Pune
Demand-Supply Activity
Half-yearly City Level Supply (Units)
40,000
22%
30,000
Average Supply
25,000
31%
20,000
18%
15,000
10,000
5,000
29%
0
H1 2011
H2 2011
H1 2012
H2 2012
H1 2013
H2 2013
H1 2014
30,000
21%
25,000
Average Absorption
20,000
42%
15%
15,000
10,000
5,000
22%
North East
North West
South East
South West
0
H1 2014
H2 2013
H1 2013
H2 2012
H1 2012
H2 2011
H1 2011
At an overall level, with the background of a cautious environment, the citys residential market witnessed sluggish activity during H1 2014, as both supply and
absorption declined by 50% and 19% respectively;
The North West micro market has led the demand-supply activity in recent years; however, as prominent locations of Wakad and Hinjewadi (being commercial
hubs) in the micro market lead to saturation, the focus has shifted to adjoining areas of Ravet, Punawale, Moshi, amongst others offering units at lower price
points. Besides these, locations such as Hadapsar, Handewadi Road, Phursungi, Bavdhan etc. in Southern micro markets of the city have been witnessing
increasing interest owing to proximity to SP Infocity (IT Park) and Mumbai-Pune Highway; &
Key projects launched included Dream City by DS Kulkarni Developers, Stargaze by Kolte Patil Developers, Presidio by Prithvi Edifice, amongst others.
30
Number of Units
Number of Units
35,000
H1 2014*
H2 2013
5,547
4,229
79.23
81.80
6,000
90
70
Price (INR/sft)
4,000
60
50
3,000
40
2,000
30
20
1,000
80
5,000
10
0
0
H1 2011
H2 2011
H1 2012
H2 2012
H1 2013
H2 2013
H1 2014
Unsold Inventory
Unsold inventory levels declined by more than 2% during H1 2014, as decline in absorption was corresponded by a sharper decrease in new launches by the
developers; &
The weighted average price increased by 31% during H1 2014, primarily skewed on account of new launches above the prevailing base sale price in the city.
The increase was further accentuated owing to rising input costs materials coupled with a steep decline in new launches.
Notes: The base data for the analysis incorporates row houses/villas, Independent floors/low rise and Plots
Source: PropEquity and CGCL Research
31
41%
59%
Top 10 Locations
Wagholi
Moshi
Wakad
Dhanorie
Chakan
Hadapsar
Talegaon
Undri
Hinjewadi
Ambegaon budruk
1,177
986
792
792
618
600
570
515
509
485
35%
Others
17%
83%
Top 10 Developers
Others
65%
Top10 Locations
Location
Kolte Patil Developers
Pride Housing
Maple Group
Darode Jog
Kumar Properties
D.S. Kulkarni Developers
Aksha Group
Kumar Urban
Development
Goel Ganga
Development
Shivtara Properties
Launched
Units
Location
Wagholi
Hadapsar
Dhanorie
Kondhwa Road
Kharadi
Bavdhan
Pirangut
Moshi
Lonikand
Undri
1,460
1,132
1,000
856
694
650
650
600
376
340
Others
586
496
301
286
275
213
204
47%
53%
184
175
171
Notes: The base data for the analysis incorporates row houses/villas, Independent floors/low rise and Plots
Source: PropEquity and CGCL Research
Launched
Units
Location
Absorbed
Units
Top10 Developers
Others
D.S. Kulkarni
Developers
1,044
Pride Housing
1,000
Darode Jog
872
703
Rohan Builders
550
Prabhavee Group
450
Prithvi Shelters
450
Saarrthi Group
376
Mantri Developers
306
Gulmohar Builders
300
Paradigm Construction
300
32
H1 2014
Supply (New Launches): 3,421units
Absorption: 6,010 units
Weighted Avg. Launch Price: INR 3,114/sft
Hyderabad
Demand-Supply Activity
Half-yearly City Level Supply (units)
15,000
Number of Units
18%
10,000
Average Supply
17%
57%
5,000
8%
0
H1 2011
H2 2011
H1 2012
H2 2012
H1 2013
H2 2013
North East
H1 2014
North West
South East
South West
10,000
Average Absorption
8,000
6,000
19%
60%
4,000
2,000
12%
North East
North West
South East
South West
0
H1 2014
H2 2013
H1 2013
H2 2012
H1 2012
H2 2011
H1 2011
Political uncertainty over the long standing demand for formation of the new State finally ended in H1 2014, however, this had marginal impact on the real estate
activity during the review period, as buyers remained in a wait and watch mode to understand how the division process would transpire going forward. Consequently,
both supply and demand remained subdued during the first six months of 2014;
The western micro markets (owing to proximity to commercial hubs) led demand-supply activity followed by locations in Eastern region (on back of improving
connectivity due to upcoming Phase I of metro line). Locations that were most active included: Miyapur, Gachibowli, Kondapur, Tellapur (North West); Manikonda,
Toli Chowki, Kokapet (South West); Nagole, LB Nagar (South East); &
Key projects launched included Akash Lake View by YSK Infra Projects Limited, Sulakshana by TNR Estates, Trendset Rhythm by Trendset Builders, amongst others.
Source: PropEquity and CGCL Research
34
Number of Units
9%
H2 2013
3,114
3,375
31.69
34.28
4,000
37.00
3,500
36.00
35.00
Price (INR/sft)
3,000
34.00
2,500
33.00
2,000
32.00
1,500
31.00
1,000
30.00
500
29.00
28.00
H1 2011
H2 2011
H1 2012
H2 2012
Hyderabad Residential
H1 2013
H2 2013
H1 2014
Unsold Inventory
Unsold stock in the city declined by more than 7% during H1 2014, as decline in absorption was corresponded by a sharper decrease in new launches by the
developers as they continued to focus on project completions; &
The weighted average price of new launches decreased by about 8% during H1 2014, as new launches were primarily focused in cost effective peripheral
locations which had average pricing below the city level average base sale price.
Notes: The base data for the analysis incorporates row houses/villas, Independent floors/low rise and Plots
Source: PropEquity and CGCL Research
35
45%
55%
Top 10 Locations
Manikonda
Miyapur
Patancheru
KPHB
Kondapur
Chandanagar
Kompally
Gachibowli
LB Nagar
Tellapur
29%
21%
79%
Top 10 Developers
Others
71%
Top10 Locations
Others
Location
Krushi Realtors
Mahindra Lifespaces
Aparna Constructions
& Estates
Aditya Constructions
Prajay Engineers
Syndicate
Rajapushpa Properties
Rashmi Realty
Builders
Praneeth Developers
Legend Estates
Trendset Builders
Launched
Units
Location
Kokapet
LB Nagar
KPHB
Hi-tech City
Suchitra Circle
Gopanapalli
Miyapur
Nagole
Lingampally
Kondapur
426
257
256
253
216
205
198
180
165
140
Others
Launched
Units
Location
Absorbed
Units
Mahindra Lifespaces
256
Armsburg Properties
216
Vertex Homes
Sivaa Shakthi
Constructions
216
Muppa Homes
205
163
126
TNR Estates
197
Mahanagar Homes
180
125
108
107
101
Tripura Constructions
Jain Srikar
Constructions
165
Trendset Builders
140
250
240
206
183
Notes: The base data for the analysis incorporates row houses/villas, Independent floors/low rise and Plots
Source: PropEquity and CGCL Research
40%
60%
Top 10 Developers
Others
210
36
157
H1 2014
Supply (New Launches): 7,990 units
Absorption: 5,209 units
Weighted Avg. Launch Price: INR 3,969/sft
Kolkata
Demand-Supply Activity
Half-yearly City Level Supply (units)
15,000
Average Supply
10,000
65%
18%
5,000
3%
3%
0
H1 2011
H2 2011
H1 2012
H2 2012
H1 2013
H2 2013
H1 2014
Central
North East
North West
South East
5%
South West
Outskirts
24 Parganas
10,000
7%
8,000
Average Absorption
6,000
54%
22%
4,000
2,000
10%
3%
3%1%
Central
North East
North West
South East
0
South West
Outskirts
24 Paraganas
H1 2014
H2 2013
H1 2013
H2 2012
H1 2012
H2 2011
H1 2011
Post a period of stagnation, the residential real estate market in Kolkata showed initial signs of recovery during H1 2014, as new launches witnessed increase
of about 45% vis--vis H2 2013. Launches were primarily focused in mid-end segment across peripheral locations in Eastern and Southern micro-markets
including New Town, Rajarhat, Garia, amongst others (on back of proximity to major IT/ITeS such as Sector V, Salt Lake coupled with ongoing infrastructure
developments including widening of Rajarhat Expressway, metro expansion, amongst others);
However, demand continued to remain restrained as end-users that primarily drive sales in the city continued to postpone their investment decisions; &
Key projects launched included Siddha Nation by Siddha Group, The RainForest by Mounthill Realty, PS Srijan Ozone by PS Group, amongst others.
38
Number of Units
Number of Units
6%
H1 2014*
H2 2013
3,969
3,923
29.06
26.28
35,000
4,000
30,000
3,500
25,000
Price (INR/sft)
3,000
2,500
20,000
2,000
15,000
1,500
10,000
1,000
5,000
500
0
H1 2011
H2 2011
H1 2012
H2 2012
H1 2013
H2 2013
H1 2014
Unsold Inventory
Unsold stock in the city increased by more than 10% during H1 2014 (highest increase across leading seven cities), as demand remained sluggish while new
launches were greater during the review period; &
The weighted average price of new launches remained almost stable during the review period, as new launches were primarily in the mid-end segment in the
cost effective peripheral locations with launch prices close to the prevailing base sale price in the city.
Notes: The base data for the analysis incorporates row houses/villas, Independent floors/low rise and Plots
Source: PropEquity and CGCL Research
39
4,500
Location
43%
57%
Top10 Locations
Rajarhat
Garia
Barasat
Narendrapur
Sonarpur Road
Madhyagram
Behala
Howrah
Uttarpara
Amtala
1,676
253
220
160
158
138
132
132
111
106
Top 10 Locations
43%
57%
Top10 Locations
80%
20%
Others
Location
Ideal Developers
Mounthill Realty
Tata
Siddha Group
Vibgyor Group
Team Taurus
Eden Group
Srijan Realty
Magnolia
Infrastructure
BGA Realtors
Launched
Units
Location
Rajarhat
Beliaghata
BT Road
Baruipur
Dum Dum
Garia
Howrah
Sinthi
Narendrapur
Kaikhali
2,779
500
477
364
305
272
267
193
167
150
Others
Absorbed
Units
410
211
209
164
159
113
101
85
Siddha Group
40%
60%
85
83
Others
Notes: The base data for the analysis incorporates row houses/villas, Independent floors/low rise and Plots
Source: PropEquity and CGCL Research
Launched
Units
Location
Top 10 Developers
1,434
Vedic Realty
560
Mounthill Realty
400
Dhoot Group
377
PS Group
291
Merlin Group
234
Tata
225
Nestwood Estates
197
Trident Group
193
Arrjavv
184
Others
40
Key Developments
Capri Global Capital Limited
Budget 2014-15
Negatives
Positives
Not ideal but certainly a forward looking budget for the sector...
Norms eased for FDI in real estate built up area and capital conditions relaxed1
Focus on affordable housing with proposed Mission on Low Cost Affordable Housing within the NHB in
conjunction with INR 4,000 crore allocation to the Board for FY15
Development of 100 smart cities in India headway for the concept achieved with INR 7,060 crore
allocation in FY15
Increase in income tax deduction limit under 80C for repayment of principal on housing loans2. Further,
deduction limit on interest payment for housing loan enhanced3
Provision of incentives for REITs coupled with pass through status for taxation
Emphasis on infrastructure and manufacturing sector with several policy announcements. Further, banks
can now extend long-term loans for infrastructure projects without any priori requirements such as CRR,
SLR and priority sector lending norms
Hospitality segment to benefit from tourism enhancement measures creation of world-class convention
centres (through PPP mode); and introduction of e-visa services in nine international airports in India over
the next six months
Absence of industry status for real estate or infrastructure status to affordable housing
Lack of forward looking statement on Real Estate (Regulation and Development) Bill
42
Built up area reduced from 50,000 sqm to 20,000 sqm, while minimum investment limit decreased from USD 10 million to USD 5 million); 2 Limit
increased from INR 1 lakh to 1.5 lakh; 3 Limit increased from INR 1.5 lakh to 2.0 lakh
43
Notes: 1investments to be restricted to 10% of REITs assets value; 2MBS-Mortgae Backed Securities; 3comapnies listed on recognized stock exchange in India having minimum 75% of their operating income
from real estate activity ;*Detailed provisions for related party transactions, valuation of assets, disclosure requirements, etc. are provided in regulations
Appendix
Micro-market Classification
Micromarkets
City
MMR
NCR
Bengaluru
Chennai
Pune
Key Locations
Mumbai
Cuffe Parade, Lower Parel, Mahalaxmi, Prabhadevi, Walkeshwar, Worli, Wadala, Ghatkopar, Mulund, Chembur, Andheri, Bandra, Borivali,
Goregaon, Kandivali, Sewri, Parel
Thane
Nalasopara,Vasai, Virar, Dombivali, Kalyan, Ambernath, Badlapur, Karjat, Manpada, Ghodbunder Road
Navi Mumbai
New Delhi
Gurgaon
Noida
Gr.Noida
Noida Extension, Sector Alpha, Chi, Pi, Sector Beta, Yamuna Expressway
Ghaziabad
Faridabad
Central
North East
North West
South East
Electronic City, Hosur Road, Koramangala, Marathalli, Old Madras Road, Sarjapur Outer Ring Road, Sarjapur Road,
South West
North East
Egmore, Tondiarpet
North West
Ambattur, Anna Nagar, Korattur, Kolathur, Mogappair, Nungambakkam, Perambur, Poonamallee, Kilpauk,
South East
South West
North East
North West
Aundh, Akurdi, Baner, Nigdi, Kiwale, Wakad, Pimpri, Hinjewadi, Balewadi, Bhosari, Ravet, Tathawade
South East
Mukund Nagar, Karvenagar, Pisoli, Kondhwa, Salisbury Park, Lulla Nagar, Hadapsar
South West
45
Micro-market Classification
City
Hyderabad
Kolkata
Micromarkets
Key Locations
North East
North West
Samajiguda, Begumpet, Jubilee Hills, Banjara Hills, Ameerpet, Kukatpally, Madhapur, Kondapur, Gachibowli, Miyapur, Nizampet, Nallagandla,
Chandanagar,Kompally, Bachupally
South East
South West
Central
Alipore HO, Ballygunge, Camac St. Elgin Road, Esplanade, Gurusaday Road, Park Street, Rawdon Street, Ultadanga
North East
BT Road, Jessore Road, Kankurgachi, lake town, Paikpara, Rajarhat, Salt lake, Sinthimore, VIP Road
North West
South East
EM Bypass, Garia, Jodhpur Park, Kasba, Queens Park, Ras Behari Avenue, Santoshpur, Tollygunge
South West
Outskirts
24
Parganas
46
List of Abbreviations
Abbreviation
Full Form
Abbreviation
Full Form
Bn
Billion
MBS
BSE
MMR
CPI
Mn
Million
CRR
NCR
DDT
OMR
GDP
PPP
GST
RBI
FDI
REIT
FII
SEBI
IT
Information Technology
SeZ
ITeS
SLR
MAT
Y-o-Y
Year on Year
47
Key Contacts
Viswajit Srinivasan
Ashish Khanna
Ashish is responsible for leading the in-house real estate research function of the
organization, coupled with analytics and business development support for
wholesale debt funding opportunities. In his prior assignments, Ashish has
worked with International Property Consultancy firm, CBRE and a Delhi-based
infrastructure research company and has worked on various Indian and global
research assignments spanning across real estate, transport, gas and urban
infrastructure segments.
48
About Us
Capri Global Capital Limited (CGCL) is a leading Indian Non-Banking Finance Company (NBFC) operating since 1997. The
company is registered with Reserve Bank of India (RBI) and listed on both the Bombay Stock Exchange (BSE) and the National Stock
Exchange (NSE). At CGCL, we are proud of our lineage and have since inception, achieved significantly commendable milestones
as we move towards our objective of strengthening our position as Indias leading NBFC.
Erstwhile known as Money Matters Financial Services Limited (MMFSL), the company, in October 2012, entered into a strategic
alliance with Capri Global Capital (CGC), a part of Capri Capital Partners LLC (CCP), a Chicago based USD 3.7 billion fund in
real estate and structured equity investments. As per the arrangement between MMFSL and CGC, the name of MMFSL has been
changed to Capri Global Capital Limited (CGCL) w.e.f. 24th July, 2013.
As part of our business activities, CGCL is predominantly focused into Asset Financing and Lending business. The Wholesale
Lending Business segment provides specialized and holistic solutions to Indian corporates helping them build and grow their
businesses with initial funding, mezzanine financing, acquisition financing etc. We focus on products in the structured credit space
backed by adequate collaterals and cash flows to build a secured and quality wholesale lending portfolio.
As part of the diversification and growth plans, in 2012 CGCL forayed into SME and Retail Lending Business with special focus on
Priority Sector Lending. The division focuses on generating supreme quality asset book spread across multiple locations where the
MSME clusters exist.
Prior to 2012, CGCL offered financial solutions related to Debt Advisory Service and has to its credit transactions close to INR
50,000 crore in debt advisory space during FY2009 to FY2011. In October 2010, CGCL successfully completed a Qualified
Institutional Placement (QIP) and raised INR 445 crores thereby foraying into Asset Financing and Lending business. We successfully
attracted investments from Wellington Management Company LLP, Morgan Stanley, Fidelity, Goldman Sachs, etc.
CGCL has the requisite skill set to provide specialized knowledge and expertise, and deliver financial solutions to a range of clients
across the industry spectrum that include power, steel, ports, roads, financial services, auto, telecom, textiles, hospitality, retail and
real estate. Our thrust is our intellect, having a total experience of over 250 man-years from diverse backgrounds such as Banks,
Financial Institutions, Investment Banking firms, Private Equity funds, large Corporate/s (ICICI, Axis, Standard Chartered Bank,
Deloitte, Barclays Bank, Reliance Capital, CB Richard Ellis, Knight Frank, Jones Lang LaSalle among others).
49
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Disclaimer: The information presented in this document is in summary form and is therefore intended for general interest and understanding only. We at CGCL confirm that information contained herein, including projections, has
been obtained from reliable sources. While we do not doubt their accuracy, we have not yet verified them and make no guarantee, warranty or representation about them. It is not intended to be a substitute for detailed research or
the exercise of professional judgment. Nether CGCL nor any other member of the CGCL subsidiaries can accept any responsibility for loss occasioned to any person acting or refraining from action as a result of any material in this
publication. On any specific matter, reference should be made to the appropriate advisor. Also, this information is offered entirely for use by CGCL clients and professionals and all rights to the material are reserved and cannot be
reproduced without prior written consent.
50