Professional Documents
Culture Documents
LTD.
Project Title
___________________________________________
BY:
BHARTI GUPTA
PGDBM-III
SECTION-A
ROLL NO.11
NDIM
Acknowledgement
I feel indebted to all those persons and organizations that have provided
help directly or indirectly in successful completion of this study.
At the end, ANSAL API, was a great experience to work in, where I feel, the
dedication of its employees is one of the vital factors of its success.
Executive Summary
Real estate is a 12$ billion (revenue) industry in India. There has been a
rapid growth in the industry in the past few years. In the residential sector, a
growing middle class is enjoying rising income levels. Combined with smaller
household sizes, this demographic change has boosted demand for more
modern housing and home loans. Meanwhile, increasing consumer spending
power has encouraged growth in organized in organized retailing – both
feeding off and contributing to the spear of ‘mall culture’ and the popularity
of other large-scale retail property developments.
Many Developers have substantial plans to increase both their size and
geographical spread. They are also expanding into different kinds of
properties, which can boost the firms’ franchise values and reduce
concentration risks. However, managing and financing such activities can be
a challenge, and puts a premium on financial flexibility, capital access and
operational infrastructure.
The project assigned to me has an objective to find and analyze the current
scenario of Real Estate, covering the preferences of current as well as
prospective customers. The major part of the project also analyses the size
of investment in various states and mind set of the customers regarding this
as well as the perceptions of customers towards major leading Real Estate
players.
The study was carried out with a methodology, in order to collect as much
primary data as possible. Data was collected by getting the questionnaires
filled from Real Estate Agents across Delhi and NCR.
Areas covered in Delhi: North, East, West, South and Central Delhi.
Areas covered in NCR: Gurgaon, Indirapuram, Vaishali
Once the data was collected, this data was analyzed using Microsoft Excel as
a tool and various conclusions were drawn. This analysis is depicted in the
form of various charts and graphs. Along with the questionnaires, Agents’
viewpoints on various issues were also taken in order to get a more insight
into the Real Estate.
Preferred Cities
Jaipur, Bhiwadi
PUNJAB:
General size of investment in Punjab
95% of the people responded that the current size of investment in Punjab is
below Rs.50 lac.
Preferred Cities
Mohali, Amritsar
U.P.
General size of investment in U.P.
92% of the people responded that the current size of investment in U.P. is
below Rs.25 lac.
Most Preferred Developer
Parsvnath, Omaxe
Preferred Cities
Lucknow, Agra
HARYANA:
General size of investment in Haryana
94% of the people responded that the current size of investment in Haryana
is below Rs.50 lac.
Preferred Cities
Sonepat, Panipat
DELHI:
General size of investment in Delhi
85% of the people responded that the current size of investment in Delhi is
above Rs.50 lac.
NCR:
General size of investment in NCR
98% of the people responded that the current size of investment in NCR is
above Rs. 25 lac.
Preferred Cities
Gurgaon, Noida
• DLF, most preferred developer in NCR, fact remains, DLF, a company
for High-End investors, rather than small investors.
• Emaar MGF, one of the biggest developer with huge amount of capital
in its hands, since none of its projects are complete as of now, real
estate agents are still not clear with its position amongst the investors.
• 74% respondents: Own funds that people use for investing into a
particular project.
1. Company Profile
2. Product Portfolio
3. Introduction to Real Estate
4. Real Estate as an Investment Option
5. Research Methodology
6. Findings & Analysis
7. Conclusions & Suggestions
Bibliography
Questionnaire
COMPANY PROFILE
VISION OF ANSAL API
IDENTITY
The color Red stands for RAJA/REGAL. It stands for passion, heat,
energy, dynamism & purity. It exhibits group’s rich heritage.
Black occurs when an object absorbs all the other colors. Black is
significant to the group as it represents the proposed amalgamation
of all group companies into “Ansal API”, thereby creating the new
and vibrant Sushil Ansal Group.
The Slogan, Building Lifestyle since 1967, encapsulates the Group’s heritage
and vision in creating a better life for Indians in various sphere like- homes,
offices, places of entertainment, hotels, shopping malls & educational
institutions.
After four decades of spectacular growth Ansal API is at a stage where the
company has acquired immense experience, consolidated and established
assets- physical and intellectual and at the same time retained youthful
energy & zeal. With foundations entrenched in the solid bedrock of technical
expertise and financial stability its pinnacles are rising new heights with
foresight and innovations for future requirements of resurgent India.
The new "Ansal API" identity, is the first communicator of this phase of
resurgence, excellence and modernity. The rectangular shape signifies
solidity, cohesiveness and strength, the red colour stands for passion, heat,
energy, dynamism & purity and the black colour signifies the proposed
amalgamation of Ansal Township and Projects Limited into Ansal
Properties and Infrastructure Limited. The slogan, ' Building lifestyles
since 1967', encapsulates their heritage and vision in creating a better life
for Indians in various spheres like - homes, offices, places of entertainment,
hotels, shopping malls and educational institutions.
It is said that actions speak louder than words and nothing highlights this
adage better than Ansal API's effort to give something back to the society
of which they are a part. Ansal API believes that today's children are
tomorrow's leaders and in order to hone their young minds, Ansal API has
forayed into the education sector with schools like the Chiranjiv Bharati
School at Palam Vihar and Sushant Lok, premier institutions like the Ansal
Institute of Technology and the Sushant Schools of Art and Architecture.
Ansal API in its endeavour to fulfill its duties to payback in form of green
cover for the society have created manmade verdant ambiance at projects
like the Aravali Retreat, Pushpanjali Farms, Satbari Farms.
Ansal API plans to create an ambiance of peace and tranquility for the
people who have served their duties and are now in their dusk of life to relax
and enjoy their retirement by building old age homes.
Touching every facet of modern lifestyle with its signature of excellence,
Ansal API has changed the skyline of India with its versatile portfolio of
residential complexes, educational institutions, hotel and hospitality
avenues, shopping malls, farmlands and IT parks amongst others. With its
deep-rooted foundation of ethics and values, Ansal API continues to
conquer new horizons, thus pioneering and identifying new vistas of growth
for the real estate sector.
PRODUCT PORTFOLIO
1. COMMERCIAL
2. TOWNSHIP & GROUP HOUSING
3. RETAIL/MALLS
6. EDUCATION
7. FACILITIES MANAGEMENT
INTRODUCTION TO REAL ESTATE
Real estate is a 12$ billion (revenue) industry in India. There has been a
rapid growth in the industry in the past few years.100% FDI is allowed in real
estate development subject to minimum scale norms of either: 25 acres in
case of serviced plots or integrated townships; or 50,000 sq. mtrs. of built-up
area for construction development projects.
$11.5 billion earmarked over the next five years for 60 cities.
Investment opportunities exist in almost every segment business ;
About 20 million new units expected to be built in five years in office
space for IT and five-fold increase in office space requirement over the
next 3 years.
Commercial space for organized retailing: 200 million sq. ft. by 2010.
Hotels and hospitality: Over 50,000 new rooms in the next 5 years;
Investment opportunity of over $50 billion in the next five years.
Agriculture Land
Residential/Plotted development
Apartments/Villas
Commercial Spaces
Farm Houses
Agriculture Land in India is the most protected area by the State and Central
Govt. Identification of Agricultural Land requires a bit of analysis about the
rate and assessment of future development in the nearby area. Due to fast
growing urbanization and development of infrastructure the price of
agriculture land zooms quickly. Agricultural land can be given on contract to
cultivators with sharing of crop model, to make small but regular tax-free
earnings. Rural agriculture land is completely free from capital gains tax and
income from lease out or sale of crop is also exempt as per the provision of
IT Act, 1961.
Most state governments have loosened their fists and have implemented
land reforms that make the conversion of agricultural land into residential
land much easier. The process of township development takes a period of
about 5 to 10 years. Initially, the prices of plotted development are quite low
which rapidly increases with the pace of development and with the rise in
inflation factor.
APARTMENTS/VILLAS
As per the assessment made in the Indian Habitat Policy 1998, the demand
for houses in urban area is to the tune of 22 million houses. The gap in
demand and supply in housing stock has thrown big investment
opportunities. Booking at the launching stage and getting the exit at the
completion stage ca offer shining returns on investments. In this process the
stamp duty and other taxes can be legally avoided.
COMMERCIAL/RETAIL SPACES
The retail boom in India has fueled huge demand for commercial/shopping
spaces. Many MNC’s and big corporate retailers prefer to take prime
commercial properties on long-term lease basis. The option offers regular
returns besides appreciation in capital value, taking both the returns
together gives handsome return and a wonderful combination of regular and
a wonderful combination of regular and long-term returns.
Many developers are offering lifestyle with smart returns through farm
houses/second homes. The offer comprises of sale of farm houses at
affordable rates with professional property management giving lifestyle and
capital appreciation together.
The sustained growth and positive outlook for the future has increased focus
on Infrastructure development. Opening of the Infrastructure development to
private players, FDI and increased investment commitments from the govt.
has thrown a host of opportunities for companies in the infrastructure
development sector, innovative projects like the metro Rail and Sky Bus,
along with the proposed SEZ projects have provided additional opportunities
for the SME’s in the sector. While majority of the infrastructure development
projects are given out by the government Agencies, the private sector is also
actively participating through development projects like SEZs and
commercial construction.
• Offices
• Shopping malls
• Retail outlets
• Industrial warehouses
• Banks
• Financial institutions
• High net worth individuals
• Real Estate Mutual Funds
What are the procedures to be followed before investing
in real estate?
INVESTMENT NEEDS
After Tax
Liquidity ROI
Tax
Safety Implication
Convenience
To Invest
INVESTMENT OPTIONS:
The following are the major options available to the investors:
PO/Bank/Govt.Securities
PO/Bank/Govt.Securities
Bonds/Debentures
Bonds/Debentures
Bullion(Gold/Silver)
Bullion (Gold/Silver)
Shares/MutualFunds
Shares/Mutual Funds
RealEstate
Real Estate
All the options have different features with respect to various factors
having implication on investment decision making. The following Chart
depicts the analysis of features of various options at a glance:
Comparative Features of
Investment Options
30
25
20 % from
15
10 % to
5
0
PO/Bank/govt.s
Bullion(Gold/
Bond/Deb.
Real Estate
Shares/Mutual
silver)
Fund
ec.
REAL ESTATE AS AN INVESTMENT TOOL WITH
SPECIFIC REFERENCE TO RAJASTHAN
Rajasthan at a glance
The Interest rate factor has a direct relationship with the pricing of the
immovable property. Future properties are discounted by the market at a
particular rate of discounting factor to calculate the present market value,
when the discounting factor reduces by few points, the prices of immovable
property increases many fold as the present value of the future property
gets increased.
The following chart shows the present value of Rs.1000 after 1 to 15 years.
The chart clearly shows that present value of Rs.1000 after 15 years
discounted @ 20% is Rs. 65, while if the same is discounted @ 10% the
present value comes to Rs. 239, it is amazing to note that 50% (from 20% to
10%) curtailment in interest rates increases the present value from Rs. 65 to
Rs. 239 reflecting a jump of 267%. This dynamic works in future property
pricing.
Year 2000
Present Value (PV) in the year 2000, of Rs. 50.00 lacs in years 2015 was
50.00 lacs×0.065* = 3.25 lacs ** approx
*
%/ 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Nyrs.
10% 909 826 751 683 621 564 513 467 424 386 350 319 290 263 239
20% 833 694 579 482 402 335 279 233 194 162 135 112 093 078 065
*Discounting factor of Rs.1 after 15 years @20% p.a.
**The same was the approx. then prevailing price.
Year 2006
Present Value (PV) in the year 2006, of Rs. 50.00 laces in years 2015 was
50.00 lacs×0.424* = 21.20 laces ** approx
The property industry is also wrestling with oversupply in certain areas, such
as in India’s commercial property sector, which may lead to rent reductions
and value drops. Meanwhile, property firms must also cope with a reduction
in customer advances on new construction, increasing land values (making
acquisition and development deals tougher), rising interest rates since 2005,
and increased difficulty in arranging capital. The latter is exacerbated by
rising interest rates and property prices, which have encouraged banks to
become more selective in granting loans as they try to preserve asset
quality.
Moreover, the Reserve Bank of India (RBI) has increased risk weighting for
real estate exposure, which has served to curtail direct lending to this sector.
The property business in India also faces political risks. These risks may
come in various forms, but include the stalling of decisions over acquisitions
or planning permission during elections, while some approvals have even
been rescinded following elections and changes to state governments.
Project Title:
2. To identify the current trend of Real Estate, in areas across Delhi, NCR,
Rajasthan, Punjab, U.P., Mariana.
Type of Data
The data collected is Primary data and Secondary data which is both
quantitative and qualitative data, which was further analyzed in order to
draw conclusions and suggestions.
Data Collection
Data was collected by visiting Real Estate Agents across Delhi and NCR and
getting the questionnaires filled through them. Five areas of Delhi were
covered, being, North, East, West, South and Central Delhi. Areas covered in
the NCR region were Gurgaon, Indripuram, Vaishali, Vasundhra.
• Effective implementation
• Conducive policies
• Get an Image Makeover
STRENGTHS
1. Long experience in creation of world class assets at competitive schedules and costs
2. Experience in setting up of power projects and distribution of electricity to over 5 million
consumers
3. Strong project management and execution expertise
4. REL is ranked amongst India’s top 25 listed Private Co. in terms of financial parameters
including assets, sales, and profit and market capitalization.
5. Most valuable power company with a market capitalization of over Rs 10,000 crore
6. Group contributes nearly 16,000 million units of power to over 25 million consumers in
Mumbai, Delhi, Orissa and Goa across an area covering 1, 24,300 Sq. Kms.
7. Brand Equity and Brand name.
8. Governmental Supports through grants.
9. Internet usage drives down distribution costs.
WEAKNESSES
1. Financial losses.
2. Increase in wages and salaries.
3. Increase in debt to cover the operating expenses.
4. The acquired distribution circle is in bad state in terms of technology, investments and
consumers.
OPPORTUNITIES
1. Northern region has looming power deficit due to which economic growth is hampered,
which discourages further investments by corporate and industrial investors.
2. The challenges for power reforms in distribution in various states are vast and the private
sector participation in distribution has huge potential. Even if one state in India opens up
this sector every year, this will be a value creating opportunity for the customer and the
state.
3. Decline in interest rates.
THREATS
CONCLUSIONS
1. Investors have a great amount hope from ANSAL API. Although, there
are delays in some ANSAL Projects, even then, investors feel secured
in investing in ANSAL API projects.
2. Clients often face problems with the company follow-up and allotment.
3. In the view of real estate agents, Unitech & DLF are the best service
providers.
4. Circle rates of Plots must go up. Government should control the non-
committed trend of upcoming builders. With prices of property,
infrastructure should also grow.
5. Bank Loan Interest rates must go low for the survival of real estate.
6. People are not too keen to invest outside NCR, and block their money
for long term.
10. Tough for small developers, due to frauds by companies like OSB, etc.
14. In Delhi, in some places like South Delhi, there is a high demand of
floors, than its supply.
15. A significant reason for people to not invest outside NCR, is that there
are still good options left in NCR.