Finolex Industries Selling Pune Land To Raise 4 Billion Rupees

Finolex Industries Ltd., India’s biggest maker of pipes made of polyvinyl chloride, surged to its highest in almost three years after the company said it expects to raise about 4 billion rupees ($86 million) selling land.
The company revived its plan to sell 78 acres (31 hectares) of industrial land after an increase in real estate prices, said P. Subramaniam, chief financial officer, said in an interview. Finolex had in 2008 proposed selling the property, he said.
The land sale will help Finolex improve its cash flow, said Tejas Doshi, vice president of equity research at Sushil Financial Services Pvt. The company, which reported a 67 percent drop in profit in the three months through June, also plans to spend 800 million rupees to build a new factory, Subramaniam said by phone today.
The land sale will help “improve the balance sheet,” Mumbai-based Doshi said. “It will also help their expansion plans.”
Finolex will raise 500 million rupees by selling non- convertible bonds to build the plant and will fund the balance from its profit, Subramaniam said. The company hasn’t “finalized” the land sale yet, he said.
Source

The Real Estate Dynamics Of Satellite Towns

The immediate impacts of satellite town formation – and the primary advantages – would be an at least partial decongestion of the central city and a rise in property valuations in the satellite town.
The appreciation rate would depend on what kind of infrastructure has been/is being put in place in the satellite town, and what other market drivers it features.

Price Dynamics

Since appreciation is of paramount interest from an investment point of view, this aspect deserves amplification. Property prices are a function of demand and supply. Demand is created by a suitable combination of market drivers such as employment potential, infrastructure and overall quality of living.
If a satellite town offers these in sufficient magnitude, and if there is sufficient connectivity to the main city by means of road and rail, this new area can often put a slight downward pressure on property prices in the more centralized regions while showing a steady upward trend on its own property price graph.
This, however, happens only under optimum conditions, which must be created by meticulous town planning and proactive local Government support.

The Downside

Of course, living in a satellite town is not everyone’s cup of tea. There would be a perceived disadvantage for those use their home in the satellite town to travel to their workplace in the central city, especially if the necessary degree of road/train linkage has not been created.
Also, buying a home in a satellite town can lead to a sense of isolation and general dissatisfaction if the location does not feature the kind of social life and entertainment that would be seen as necessary lifestyle quotients.
Some central city dwellers would choose to move to such satellite towns in response to the available relief from city-related stress and cheaper property rates. However, the majority of metropolitan inhabitants would choose not to relinquish their foothold in the main city.
Many satellite towns coming up today are of greater interest to migrant populations rather than core city inhabitants, and local developers tend to zero in on this population while planning their projects.

Developers’ Delight

A classic example of best-scenario satellite town planning would be the Pimpri-Chinchwad Municipal Corporation (PCMC) of Pune, which is an industrial hub in its own right.
Within the PCMC area, Pradhikaran has emerged as the location of choice for mid-to-high level management staff working in the various surrounding industries, and various local development have recognized and focused on this potential.
Areas such as Navi Mumbai and Pune’s PCMC are planned developments that have their own social infrastructure as well as distinct resident profiles social character.
If satellite townships have been meticulously masterminded by the relevant town planning authorities, they will incorporate their own economic drivers such as employment opportunities, social infrastructure and lifestyle quotients.
Simply put, such a combination of factors opens up a new growth area for the real estate market. Under suitable circumstances, office, retail and residential property will work in tandem to create a symbiotic growth pattern.
Moreover, once such a satellite town is established, it tends to attract various industries specific to the available workforce, further boosting this pattern. The overall effect is one of economic diversification of a possibly congested metro into new directions. This naturally spells nothing but good news for the region’s real estate market.
Author: Subhankar Mitra is AVP – Strategic Consulting, Jones Lang LaSalle Meghraj, the largest real estate consultancy in India.

Prominent Satellite Towns + Benchmark Property Rates

Pune:
Rupees
PCMC under aegis of PCNTDA(Pimpri-Chinchwad New Township Development Authority)
2000-2800/sq.ft
Mumbai:
Navi Mumbai
3000-3500/sq.ft
Kalyan/Dombivili
2200-2700/sq.ft
Vasai/Virar
2000-2200/sq.ft
Delhi:
Ghaziabad
3000-4000/sq.ft
Faridabad
3000-5000/sq.ft
Guragon
3500-5500/sq.ft
Greater Noida
2500-3500/sq.ft
Bangalore:
Yelahanka
2800-3200/sq.ft.
Devanhalli (Villas)
3 to 9 Cr.
Chennai:
Sriperumbadur (proposed as satellite town)
2000-2200/sq.ft
Siruseri (proposed as satellite town)
2500-2800/sq.ft
Kolkata:
Rajarhat
2000-2500/sq.ft
Kalyani/Batanagar
1800-2200/sq.ft

(Rates are indicative only and may vary according to projects and location dynamics)

Kamat Hotels India Ltd To Divest Four Sites To Reduce Debt

This fiscal, KHIL will focus largely on expanding its hotel portfolio in Mumbai and Pune, which are owned properties. The company’s brands include The Orchid, VITS, Lotus Resorts and a heritage property in Pune christened Fort Jadhavgadh.
In Pune, the company is putting up 400 rooms between its two brands, The Orchid (200 rooms) and VITS (200 rooms) at Balewadi. A 120-key VITS hotel is already operational, with the balance rooms to be opened in a phased manner.
Read the rest of the article here.

How To Increase Your Home’s Resale Value

Most of us know exactly what we want from our future residence – the look, the facilities, the accessories, etc. This does not mean, however, that a home which meets all these requirements is ideal.
To judge whether a new residence will be a real asset in the long run, we must consider many variables. Paying attention to these will not only ensure maximum comfort and convenience during actual use, but also maximum resale value in the future.
Mrunal Duggar of Homebay Residential, Jones Lang LaSalle Meghraj, gives tips on how to make the most out of selling your home.
Read the rest of the article, Maximise resale value.

RBI To Track Realty Prices

Stepping up its vigilance mechanism to monitor volatility in real estate prices and ensuring transparency in property transactions, Reserve Bank of India (RBI) has called for collection of real estate property price data (sale/resale) directly from banks and housing finance companies.
It has recommended that this be done at transaction level from top 13 centres in the country: Greater Mumbai, Chennai, NCR Delhi, Bangalore, Hyderabad, Kolkata, Pune, Jaipur, Greater Chandigarh, Ahmedabad, Lucknow, Bhopal and Bhubaneswar.
The recommendations come following need for finding realistic measure of aggregate house price in order to understand the behaviour of house price and their influence on country’s economy.
Read the rest of the article, RBI steps up move to track realty prices.