Analysts say prices may stagnate or decline in the next three months. Almost 70 per cent of the brokers who participated in the poll believe prices will be flat or negative in the period and even Diwali is unlikely to lift the mood in the property market.
Real estate companies such as Unitech, Peninsula Land, HDIL and Future Capital, the financial services arm of Future Group, are in talks with investors including some leading private equity funds for raising investments for their projects, after the collapse of Lehman Brothers, whose third party fund had promised investments in these property companies' projects, according to industry sources.
Recently, IT czar Azim Premji bought a 10 per cent stake in Subhiksha through his personal investment arm for nearly Rs 230 crore, valuing the retailer at Rs 2,300 crore. Premji's firm purchased this stake from ICICI Venture. However, this time around, Subhiksha promoters are expected to issue fresh equity to investors and expect the valuation to be around Rs 3,800 crore, sources said.
The group, which employs nearly 26,000 employees, plans to cut employee costs by one per cent, or Rs 65 crore (Rs 650 million), in the current year by redeploying people in its various businesses and reducing new hirings. "Instead of external hiring, we have redeployed a part of our people resources from our mature businesses to the new ventures," Future Group CEO Kishore Biyani said.
Companies that earlier took 36 months on housing projects are now completing them in around 30 months by boosting efficiencies and using modern technology. Commercial project developers are going a step further, completing projects in 17 months instead of 24. In some instances, mainly in smaller commercial buildings, developers are trying to cut down the project completion time to a mere 9 months.
Caisse manages nearly $155 billion of pension and insurance funds in Canada and North America while Ivanhoe has 70 shopping centres in Canada, the US, Europe and Latin America, totalling 46 million sq ft.
The regulator has also cancelled the licences of three packagers providing services to Subhiksha for violating the packaging rules. The warehouses are based in Bhiwandi, which is on the outskirts of Mumbai.
Property developers, consultants and brokers have seen a 40 per cent decline in enquiries from home buyers over the last three months.
The drive to cut costs is becoming critical as key input costs - steel, cement and labour - that account for 40 per cent of project costs have escalated 50 per cent over the past year.
Unitech, the country's second-largest property developer, is planning to raise nearly $1 billion (Rs 4,200 crore) in the current financial year from private equity players for its hotel, commercial and retail projects across the country.
For such bonanzas, prospective home buyers have a downturn to thank. Property sales have fallen 15 to 20 per cent countrywide over the last six months, owing to rising home loan rates. This has pinched the cash flows of developers, already reeling under higher borrowing costs and a range of anti-inflationary measures that restrict their flexibility to raise funds.
ETAM, the French lingerie brand that has a joint venture with Kishore Biyani's Future Group, recently pulled out of Palm Beach Galleria mall in Navi Mumbai, together with six other retailers such as grocery chain Foodland Fresh and Manoranjan sarees.
Unitech, the country's second largest property developer, has raised $300 million (nearly Rs 1,290 crore) from international investors for its $600 million global property fund.
Housing Development and Infrastructure, country's third largest listed realty developer, has forayed into entertainment, power, oil & gas and broadcasting, among others, either directly or by acquiring stake. The company recently acquired a 51 per cent stake in Broadcast Initiatives, promoted by Sri Adhikari Brothers. Sarang Wadhawan talks about his company's plans and projects in an interview with Business Standard.
Food and grocery retailer Subhiksha has taken the acquisition route to list its shares on the stock exchanges. The company wants to avoid an initial public offer in view of the turbulence in the capital market.
A day after the Reserve Bank of India (RBI) raised the benchmark repo rate and cash reserve ratio (CRR), leading property developers said they are mulling hiking prices of apartments and focusing on the affordable housing segment to counter the impact of a high interest rate regime.
Welspun USA's e-commerce plans comes at a time when only 3-5 per cent of home textile sales in the US is ordered over the Internet. The New York-based company is targeting the mid to upper end of the American home textile market, pegged around $15-17 billion. A couple of established retailers such as JC Penny have built the online retail model over the last decade.
After Singapore, Indian property developers such as Indiabulls Real Estate and Phoenix Mills among others are looking at London, German and Australian stock exchanges to list their property trusts there.
The UK's Marks & Spencer (M&S) has plans to position itself as a mid-market mass retailer in India and is eyeing a chunk of its revenues from India in the next few years. M&S has severed its partnership with Planet Retail and has entered into a deal with Reliance Retail. Its existing stores will be absorbed in the current partnership eventually. M&S will be positioned as a mid-market retailer in India. It chose Reliance as it moves quickly in its line of businesses.
Gagan Banga talks about how one of India's largest NBFCs still retains the financial discipline of a start-up.
© 2025 Rediff.com - Investor Information - Advertise with us - Disclaimer - Privacy Policy - Sitemap - Feedback - About us - Terms of use - Grievances