Commercial realty, retail see buoyancy in credit flow
Bank credit to commercial real estate, a sector under regulatory scanner, rose by 14.9 percent in the 10 months ended January, as against a fall of 4.4 percent during April 2009-January 2010, according to Reserve Bank of India (RBI) data.
Mohali’s 5-star hotel project in limbo
Investors are shying away from investing their money in the Punjab Government’s ambitious multi-crore project – a five-star hotel cum international convention centre – in Mohali’s Sector 62. Not being able to find takers in the past, the authorities are once again inviting bids for the project.
Launched three years ago in 2008, the project is still hanging fire due to disinclination of the investors seeing fewer benefits in return. “The private players are shying away from setting up the project,” a senior official of Punjab Infrastructure Development Board (PIDB) said, requesting anonymity.
India budget will spur investment: US chamber
The Economic Times
A leading US trade association has praised India’s budget, saying it sets forth clear parameters that will spur and sustain greater investment in the country’s infrastructure sector.
“The sheer confidence this budget represents is worthy of our praise,” said Ron Somers, president of the US- India Business Council (USIBC) that represents about 400 US companies and seeks better commercial ties with India.
Infra push to attract more PE funds
Reghu Balakrishnan & Katya B Naidu, Mumbai
The government’s recent initiatives, those in the Budget proposals being the latest, on the infrastructure industry are expected to help attract good investment into the sector, especially from private equity (PE) companies.
Budget boost for low-end realtors
Many real estate developers across India who do not have a presence in the affordable housing segment may foray if the “investment linked deduction“ offered by the government on investment in the sector is substantial.
“We are waiting for the details of the specific notified scheme, as affordable housing is the need of the hour,“ said Kamal Khetan, chairman, Sunteck Realty, a Mumbai-based company that is primarily in to high-end real estate. At present, there is a demand of 24 million houses in the country and the deduction, in to affordable housing will accelerate investments in the segment said industry trackers.
Authority favours cheap housing
Hindustan Times (Delhi edition)
The Noida authority says the civic body is all for cheaper housing project. For group housing schemes (in sectors such as 76, 74,75 and 78), the figure has gone up from 700 to 1,650. About 37 percent of the total land in Noida has been marked for residential purpose.
Realtors see ray of hope
Hindustan Times (Delhi edition)
Real estate players in Noida feel the annual budget could have been more considerate towards the sector but the government’s move to announce the interest subsidy of 1 percent on housing loans of up to Rs 15 lakh for units not costing more than Rs 25 lakh will encourage builders to go for budget housing projects. The government, till now, gave the subsidy for loans up to Rs 10 lakh in case of houses costing not more than Rs 20 lakh.
Loans to real estate cos up 20% in Jan
The Financial Express
Even as real estate sector is seeing a sharp drop in transactions and rising debt, banks lent over Rs 450 crore to the sector in January alone; a 20% rise year-on-year. The total outstanding has risen to Rs 1,05,884 lakh crore. Loans to the commercial real estate sector grew nearly 20% year-on-year in January, according to Reserve Bank of India data. In December 2010, loans had grown 20.4% year-on-year.
Bank of India, executive director, BA Prabhakar said, “Recent developments in the real estate sector has made banks cautious in disbursing fresh loans and it will not be easy for developers to get financing. However, our portfolio is performing well.”
Meanwhile, lending by commercial banks to individuals for buying homes, cars and consumer durables has seen a 15.8% rise in January 2011, according to RBI data. Banks had turned cautious in 2009-10 after being saddled with non-performing loans (NPAs) as the repayment capacity of customers was hit following the economic downturn. But they seem to be re-entering the market.