arin_12

Unitech Became the defaulter in Repaying loan amount for Greater Noida Project.

wiseman

Hello Arin,

Not doubting your report. But which media reported this? How big is the project? What will be the penalties?

Does this mean that Unitech has run completely out of money? Or that it is just conserving cash by dumping projects that are running bad? Important to know since, if a big firm like Unitech can go belly-up, we may be at the edge of a cliff with many other smaller and weaker RE firms rushing towards the cliff.

This is very interesting. I remember HSBC first reporting their substantial losses relating to RE in US in 2006. At that time people thought it was a one-off kind of thing. Though it is now forgotten, it was the Dam-breaker.

This report in Unitech is likely to be our RE Dam-breaker. Now people who are at risk will go hammer-&-tongs to check if their builder is solvent.

Thanks for the report.

cheers

Raj

Is this the realty bubble bursting at last? Reports say, many other Developers may default. Read this extract from IBN Live, Oct 23, 2008.

arin_12

Hi Wiseman,
Hope you got the answer. By the way I have seen in CNBC-TV18.
:p
I wish these chor/looter (Real Estate Dev) comes to the street.
One more news is that In bangalore a 14 storied building crashed like a playing card. And it is developing by some leading developer in country.
Tower ‘C' of Prestige Shantiniketan from Prestige Group. This is the one of the most exp residential complex in Bangalore...

http://timesofindia.indiatimes.com/B...ow/3634380.cms

wiseman

Dear Arin,

Yes I got the answer. Of course, I was in no way doubting the report by yourself or anyone else .

But please note that it still remains a rumor with no statement by the company OR the recipient of the payment. Officially, that is. Although one may argue that the public is already so disgusted by all thats happening that they would rather believe the rumor than the officials. So, importantly, the damage is done with companies like Purva, etc crashing so badly.

People must have thought me completely MAD a few months ago when I started talking about 50% - 80% fall. But that is where the value is (its not definitely in talking big about how prices will keep on going up forever)!

The terrible crash in stocks yesterday (1075 points on Sensex on a base of 9750 is HUGE in percentage terms) is again an indicator of where the market thinks the real economy will be 6 months down the line.

2 days back Nandan Nilekani (who is otherwise a quiet, unassuming achiever) came up with a statement that he will repent having said later on. He said that Indian IT will not see any pink slips. Imagine, he is saying this when we already know of pink slips being given clandestinely in the form of non-performance (NP). I get it. Infosys is changing the color of the slip to blue (the mood of the market now) and maybe black later when market mood reaches there)!!!

To this my question is, if so many people were non-performing, then shouldn't you be sacking the managers and HR staff who hired all these NPs and paying them huge salaries for these years without knowing they were NPs? Wh is incompetent here? The NPs who were hired OR the management which hired them? This is nothing but pure opportunism and use-and-throw culture.

Today DLF chairman says that many fly-by-night operators will go out of business. One must be careful about what they say in these fearful times, lest it come back to bite them!!!

The building crash in Bangalore is characteristic of the fact that the business cycle is turning. Now whether justified or not, you will find people concentrating on the BAD news more than the good, just like they focused on good news during bullish times. Human nature.

This gives us an opportunity - at least people like me, who saw it coming, refrained from buying OR selling when prices werre high. We wait for the huge drops and when bottom is reached, maybe buy the 5 crore property for only 1 crore. And see it go back to 5 crore in only a few years later?

More gyan as things develop.

cheers

arin_12

Pink/Blue Slip what ever it is ...
I am into this Industry and I know how the NP's are covered by their dearer manager one. There is many more case like this. Ondemand Company does not see fake/geniune person. And when time comes they will be sacked first. I rem in 2002-03 Comp wants only MCA/BE to get an interview but in 06-07 any degree IT Comp used to take people. As per me there is big chunk of people are working in this IT sector with out a knowledge even dont know to speek in English.

Crashing the Building will tell how the Company is reliable. How the Construction work done to this complex. I think by now the price of the flat is goin 30% discount.

People are more alerted to invest in the Real Sector market becos no one wanna take a risk much in this poor condition. The price hike is just a play game from the Builder and the politician. But one day surely they has to pay.


Thanks
-- Arindam --