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The ‘five sources’ for making profits in the real estate sector were discussed for about 6 hours at the ‘Dainik Bhaskar Real Estate Conclave- 2024’ on Wednesday. On the theme ‘India: The next wave of growth in real estate’, renowned giants of the real estate sector shared ideas for making profits with developers from across the country.
The real estate sector has seen a CAGR growth of 38% in the last three years and this sector gives the government an annual revenue of Rs 2 lakh crore. The fact that developers can get a 2% benefit in interest rates due to corporate governance was highlighted in this conclave.
Mistry said- demand for commercial real estate will increase in small cities
Former vice chairman and CEO of HDFC Keki Mistry expressed the possibility of increasing demand for commercial real estate in tier 2 and tier 3 cities. He explained corporate governance in detail. He explained its big advantage and how it can provide a benefit of 2% on interest rates.
Expressing hope that interest rates will be reduced by 0.25% in the near future, he said that the government should again start the Credit Linked Subsidy Scheme (CLSS) for buying a new house by the middle income group (MIG). He said that about 3 thousand other different industries of the country are dependent on this industry.
Former HDFC Vice Chairman and CEO Keki Mistry speaking at the conclave
Kotak Mahindra Asset Management MD said- ready to give money to consumer brands
Nilesh Shah (Group President and MD, Kotak Mahindra Asset Management) said- The current development cycle of the real estate sector is expected to last long. On the consumer side, the demand for premiumization products is more and that of mass-market is less. Stand-alone projects will also sell a lot. Mass-market value base will remain.
The demand for premium size products will depend on branding, because today consumers are ready to pay for brands. He said that the borrowing cost of developers can be reduced by 2% if their branding is done correctly and the way to redress consumer complaints is effective.
Ananya Tripathi of Brookfield Group, Navneet Munot, MD, HDFC Asset Management, Nilesh Shah of Kotak Mahindra Asset Management discuss funding options.
HDFC MD Navneet Munot said – Developers should think big HDFC MD Navneet Munot said – The market of a Bhujia making company is Rs 18 thousand crores and there is talk of listing of another company at Rs 70-80 thousand crores. So the market of those who are building buildings is going to be even bigger. Therefore, all developers should think big.
He said that the buyer of a flat gets a loan at the rate of seven to eight and a half percent whereas the builder finds it difficult to get a loan even at the rate of 15 percent. This gap needs to be bridged.
The founder of Sideways Consulting said- keep your brand strong
Abhijeet Avasthi, founder of Sideways Consulting, said – If the developers keep their brand strong, then it is already in the minds of the people that when I buy a house here or wherever I have an office, there will be something good there. If the brand is good then people are also happily ready to spend more money.
Lodha Ventures Chairman said- Transparency is important in consumer governance Lodha Ventures Chairman Abhinandan Lodha said- Like corporate governance, we have used transparency and technology in consumer governance and in the last two and a half years we have sold goods worth 5 thousand crores by plotting them, but we have not done any barfi cut profiteering anywhere. This is the reason that we have sold plots to the megastar of the century Amitabh Bachchan but we have never met him in person.
Along with this, he told that we first understood the destination of the area and then developed it and sold its concept. Before doing this, we answered 5 questions that come in the mind of the customer. This includes questions like what will happen to the approval, what will happen to the finance, what will happen to the re-sale, who will build it and are the builders not the wrong people?
Abhinandan Lodha of Lodha Ventures, Deepak Goradia of Dosti Group, Tariq Ahmed of Prestige Group and Girish Agarwal, Director, Bhaskar Group in the Learnings from Renowned Names session at the Conclave.
Dosti Group chairman said – there is a lot of potential in the market
Deepak Goradia, Chairman and MD of Dosti Group said, “We have built and sold 3800 units and now we expect a growth of 40% in the coming time. This is because there is a huge potential in the market. The real estate sector has seen a CAGR growth of 38% in the last three years.”
Prestige Group CEO said- worked in South India, now focus is on the West
Tariq Ahmed, CEO of Prestige Group, said – Our group moves forward with financial discipline. We have worked a lot in the cities of South India and Bangalore. We have also worked in Mumbai. Prestige Group is keen to work in other cities of Maharashtra including Ahmedabad, Jaipur, Indore in the future. Apart from this, we are also going to enter the tier 2 cities of Western India.
Ananya Tripathi of Brookfield Real Estate said- Tier 2 cities will be Tier 1 tomorrow
Ananya Tripathi of Brookfield Real Estate Group said – Tier 2 cities are seeing good growth. Employment is also being created on a large scale there. The city which is being called Tier 2 today, will become Tier 1 in the future. Grade-A assets are important for institutional capital investment. For this, there should be demand first.
Niranjan Hiranandani said- understand the demand of the market, then make the design
Niranjan Hiranandani of Hiranandani Group suggested to the developers from across the country that they should first study and then design the house. It is very important to understand the demand of the market. Where there is demand for one room flats, one BHK flats should be built. He suggested to the developers to think about the long term and focus on improving the infrastructure.
Niranjan Hiranandani, co-founder and managing director, Hiranandani Group
The real estate sector gives an annual revenue of Rs 2 lakh crore to the government
Girish Agarwal, Director of Dainik Bhaskar Group, said- The market size of Indian real estate is about Rs 40 lakh crore. It contributes about 7.3% to GDP. This sector is number-2 in providing employment in the country. Research shows that the real estate sector is growing at 11% per annum. This sector gives a revenue of Rs 2 lakh crore to the government annually through stamp duty and registration.
During the panel discussion of leading developers like Vikram Bharwad (Ahmedabad), Sanjay Gupta (Jaipur), Devendra Chouksey (Bhopal), Abhishek Jhaveri (Indore), Anand Singhania (Rajpur) and Pratik Mittal (Chandigarh), a good suggestion came up that such workshops should be held in all the cities of the country.
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