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Real Estate Round Up - 06 May to 09 May, 2013

India Infoline News Service | Mumbai |

DLF launches institutional placement programme for 8.1 crore shares, according to reports. The pricing is yet to decided. DLF promoters have to cut stake to comply with SEBI norms, reports stated.

Top Stories 

Godrej Properties Q4 net profit at Rs532mn

Godrej Properties, a leading national real estate developer, announced its results for the quarter and full year ended March 31, 2013. Commenting on the financial performance of Q4 and FY2013,. Pirojsha Godrej, MD and CEO Godrej Properties, said, “I am pleased to share that FY2013 was a year of strong growth and continued momentum in our business with revenues, bookings and net profit growing significantly by 28%, 71% and 41% respectively. We continued our new business momentum from last year by adding eight new projects in FY13. These include five redevelopment projects in Mumbai, meaningfully expanding our presence in this important market. Further, we have built considerable launch momentum this year with 13 successful launches across the country including Mumbai, NCR, Bangalore, Pune, Ahmedabad and Kolkata. We have ended FY13 with a stronger financial and operational foundation and look forward to striving towards improved performance in the years ahead.”

The company announced that the board of directors at its meeting held on May 9 has approved the issue of equity shares of the face value of Rs 10 each to the existing equity shareholders of the company on a rights basis ("Rights Issue") aggregating upto Rs. 700 Crores, subject to all applicable statutory and regulatory approvals. The terms and conditions of the Rights Issue, including the rights entitlement ratio, the issue price, issue size, record date, timing of the issue and other matters shall be decided by a committee of Board constituted for this purpose (Rights Issue Committee) in consultation with the lead manager to the Rights Issue;

The board has considered the sub division of equity shares of nominal value Rs 10 each into two equity shares of nominal value of Rs 5 each of the Company, which had been approved by the Board on March 23, 2013 (but could not be given effect to for reasons set out in the notice dated May 06, 2013 sent to the stock exchanges). The Board approved the sub-division of Authorised Capital of Rs. 117,00,00,000 comprising of equity shares of Rs. 10/- each into 23,40,00,000 (Twenty Three Crore Forty Lakh) equity shares of Rs. 5/- (Rupees Five only) each, subject to the approval of the Members. Such approval will be obtained, and other required steps to give effect to the sub-division will be sought, after the completion of the proposed Rights Issue; and approved the re-appointment of Mr. K. T. Jithendran as Executive Director for a period of three years w.e.f. May 17, 2013.

No housing bubble building up: RBI

Reserve Bank of India Governor D Subbarao on Monday said there is no housing bubble building up in the country. Speaking in teleconference with analysts, Subbarao said that liquidity conditions to be less uncomfortable over the next few months due to declining government cash balances and the reducing gap between deposit and credit rates.

RBI does not intervene in forex markets to manage liquidity, Subbarao added further.

On Friday, the RBI cut the repo rate by a 0.25% for the third time since January but said there is little room for further policy easing, and left the cash reserve ratio, or the proportion of cash banks need to park with the RBI, unchanged.

DLF launches IPP for 8.1 cr shares: Reports

DLF launches institutional placement programme for 8.1 crore shares, according to reports. The pricing is yet to decided. DLF promoters have to cut stake to comply with SEBI norms, reports stated.

MagicBricks PropIndex up 3% in Q1'13

The world is evolving, so is consumer demand. A globetrotting, well-read consumer is looking for value for money in his investments, and real estate forms a substantial part of his investment portfolio. Assessing this consumer demand was the crux of discussion at the Real Estate Dialogue (ReD) event held by Magicbricks.com on the launch of the Second Anniversary issue of its industry watch – PropIndex.

The latest PropIndex report highlights that despite global slowdown and domestic policy paralysis, the last two quarters have witnessed some positive policy boosts and consequent response by industry. This has impacted consumer sentiment and delivery of housing products. This is reflected in the 3% rise in the National Property Index, an indicator of some optimism in the market. Read more...

Infocus Stories

Maha a/c for lion’s share of O/S invst in realty: ASSOCHAM

The state of Maharashtra accounts for maximum share of about 20 per cent in the total outstanding investments worth over Rs 14 lakh crore attracted by the real estate sector across India as of March 2013, apex industry body ASSOCHAM said.
However, the new investments in realty sector in Maharashtra have plummeted by over 55 per cent during 2011-12 and 2012-13, according to a investment related real estate sector specific analysis carried out by The Associated Chambers of Commerce and Industry of India (ASSOCHAM).
Maharashtra has attracted outstanding investments worth about Rs three lakh crore in the real estate sector as of March 2013 but the new investments in the sector dipped from over Rs 16,000 crore to just over Rs 7,000 crore during the course of last one year (2011-12 and 2012-13), highlighted the ASSOCHAM analysis. Read more...

Domestic News

Godrej Properties board to consider rights issue

With reference to the earlier announcement dated April 30, 2013 regarding Board meeting on May 09, 2013, inter alia, to consider and approve the (1) Audited Financial Results of the Company for the quarter and year ended March 31, 2013 (2) Recommendation of dividend, if any, for the financial year ended March 31, 2013, to be paid subject to shareholders’ approval in the ensuing Annual General Meeting, Godrej Properties Ltd has announced that at the meeting of the Board of Directors of the Company to be held on May 09, 2013, the Board will consider the issue of equity shares of the Company on a rights basis.

Sahara seeks equity, debt investment: Reports

The Sahara Group is planning to bring equity and debt investment into its businesses. The company has been ordered by the country’s Supreme Court to repay billions of dollars it raised from millions of small investors in outlawed bonds.

Sahara also reported that it has paid back most investors and its total liability is less than the Rs. 51.2bn ($948.85mn) it has deposited with the regulator. Earlier the market regulator has accused Sahara of failing to comply with the court order and has sought approval to arrest Roy and two other Sahara directors.

Omaxe to launch offer for sale

The promoters of real estate developer, Omaxe are planning to launch an Offer for Sale (OFS) shortly to comply with the SEBI’s minimum public shareholding norms. The promoters of Omaxe will have to dilute nearly 15% of the promoters stake through the OFS route.

The promoters are confident of the proposed OFS within the deadline stipulated by SEBI and have appointed Antique Capital Markets Private Limited and Ernst & Young Merchant Banking Services Private Limited to advise them on the stake sale, which is expected to conclude prior to the June 2013 deadline set by SEBI.

Dharavi slum dwellers protest govt apathy

Asia’s largest slum Dharavi has encountered with few basic infrastructure based problems. To channelized suppressed hostile feeling and to collectively raise a voice against GOVT. Dhavari’s residents have united under Dharavi Bachav Andolan. Our demand of 400 sq.ft. Residence is practical and viable alternative by taking into consideration about current situation. On the contrary government’s policy appear to be capricious, government did not bother to win the confidence of the residuals rather than doing so, it has more concern about a wellbeing of developers and builders which is simply ridiculous. As a result of which Dharavi Bachav Andolan has decided to make their protest more strong by showcasing black flags.

Government had created a draft for the redevelopment of Dharavi but failed to take consent of Dharavi’s residuals therefore local are not in a position to accept this draft of redevelopment. To fulfill the demands for the welfare of Dharavi many ways have been adopted to shake the government eg. rail roko, a march from Dharavi till Mantralay, strike etc. but it left no impact on the decisions of the government, still they (govt) are on the side of builders and developers. Least worried about upliftment of Dharavi’s local people and extensive support to fill the pockets of MLAs, MLCs, MPs etc. with proven vested interests are as clear as fiber glass. Read more…

PBEL Property plans to invest Rs15bn: Reports

Real estate firm PBEL Property Development has reportedly said that it is planning to invest Rs. 15bn over the next 2-3 years. "So far, PBEL has invested close to Rs. 2.50bn in Chennai and intends to invest additional Rs. 15bn in multiple phases over the coming years", PBEL Property Development India MD Surya Reddy was quoted as saying.

PBEL City Chennai, on the Old Mahabalipuram Road (IT Corridor) would be spread on 42 acres and would have sports and fitness amenities, among others, report said. The township offers apartments ranging between 1,033 sq ft and 1,733 sq ft.

International News

Moody's: China property outlook stable

Moody's Investors Service says the outlook for China's property market remains stable, but sales growth will slow. Those developers focused on the mass-market will enjoy the strongest level of sales. They include China Overseas Land & Investment (Baa1 stable), China Vanke Co (Baa2 stable), Longfor Properties Company (Ba1 stable), Country Garden Holdings Company (Ba3 positive) and Shimao Property Holdings (Ba3 stable).

"Moody's stable outlook reflects our expectation for around 10% year-on-year growth in the value of residential property sales over the next 12 months, in line with the average seen in 2012, but down from the high levels seen during January-March 2013," says Kaven Tsang, a Moody's Vice President.

"Our view is that urbanization and favorable mortgage financing for first-time home buyers will continue to support demand and sales volume, while new guidelines issued by the central government in February to further clamp down on investment demand will slow price increases," says Tsang. Read more...

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