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ATS Kocoon, ATS, Sector 109, Gurgaon

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ATS Kocoon, ATS, Sector 109, Gurgaon

Last updated: May 27 2019
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  • Re : ATS Kocoon, ATS, Sector 109, Gurgaon

    Originally posted by vb2309 View Post
    In ur calculation the following requires some attention :

    1. According to you All 100 Per cent inventory is sold on Day 1 at 4300 DP.
    2. According to you there are no CLP sales where only 30 per cent comes in at booking. CLP plan should be available to us on formal launch.
    3. You have calculated TOTAL area and included revenue from Towers given to Chintels.
    4. On what basis have you assumed cost of construction to be just around 2100 sq ft as there are costs for common amenities , super area etc too..please visit ATS GREENS VILLAGE to see the club house, pool, Maintinance offucevetc part from basement car parks etc along with other amenities...every thing adds up.
    5. You have nt assumed any marketing cost.
    6. You have conveniently taken out 40 per cent tax on profits .....40 percent tax is no smalll number
    7. What about the cost of money for 540 Crores? 540 crores .
    8. What about csts of Administration, management and normal well known over heads?

    And to be honest, it is great tat ATS makes some profit, only a profitable company delivers good results.

    All good reality companies should target a 30 per cent gross margin to make atleast net margin of 18 per cent which is industry norm in developed areas where land is expensive .

    Please make adjustments on above Eight points .....interesting read.

    Thnx
    VB
    very well sirji...Great Write up!!

    Comment


    • Re : ATS Kocoon, ATS, Sector 109, Gurgaon

      Thanks vb2309, I was about to respond but you have highlighted the overly simplistic assumption specially point no. 1. If this was the case no builder would ever have to raise money from market. DLF, Unitech and other builder's debt condition is no secret.
      HDFC Reality is apparently putting in 200 Cr for one of these projects. I bet the returns expected would be way better than "lending rates to realtors".
      As I said the cost of raising capital probably is the next biggest expense (after spending for land and development) dwarfing their administrative and other costs.

      BTW to your point no. 4, the per sqft rate does accounts for common area development as well (entire total cost/sale-able sq ft.).



      Comment


      • Re : ATS Kocoon, ATS, Sector 109, Gurgaon

        It seems its more lucarative to be investing with PEs and REITs !!

        Definately more transparent, safer and a lot liquid !!

        Comment


        • Re : ATS Kocoon, ATS, Sector 109, Gurgaon

          I have given 3 cheques to Chintels to book 4350.

          Comment


          • Re : ATS Kocoon, ATS, Sector 109, Gurgaon

            Originally posted by vb2309 View Post
            In ur calculation the following requires some attention :

            1. According to you All 100 Per cent inventory is sold on Day 1 at 4300 DP.
            > The CLP price is even higher at 4700-4800, a builder does not loose profits due to CLP. Whether you use 4300 DP or 4800 CLP it does not matter.

            2. According to you there are no CLP sales where only 30 per cent comes in at booking. CLP plan should be available to us on formal launch.
            > Same as above.

            3. You have calculated TOTAL area and included revenue from Towers given to Chintels.
            > Since all costs are also shown to be borne by ATS, hence given the revenues to ATS as well. It does not matter in margins calculation how the profits are shared between ATS, chintel or xyz. BTW what really is the payment for Chintels for? I thought ATS owns the land ?

            4. On what basis have you assumed cost of construction to be just around 2100 sq ft as there are costs for common amenities , super area etc too..please visit ATS GREENS VILLAGE to see the club house, pool, Maintinance offucevetc part from basement car parks etc along with other amenities...every thing adds up.
            >Super area already included in flat area, sikkaji has pointed that out.

            5. You have nt assumed any marketing cost.
            > Agree but it is going to minimal cost. Anyways ATS does not use brokers also i heard.

            6. You have conveniently taken out 40 per cent tax on profits .....40 percent tax is no smalll number.
            >Margins are compared before taxes as a practise across industries, since taxes are paid by everyone and nothing can be done about them. Paying 30% tax on 400-500% profits should not be an issue or would investors be asked to pay taxes on behalf of ATS even then


            7. What about the cost of money for 540 Crores? 540 crores .
            > The investment on part of ATS is 140 cr only. Rest comes from buyers in advance. Whether DP or CLP is not of much relevance.

            8. What about csts of Administration, management and normal well known over heads?
            > So the 'Royal' -> 2000+ psf construction cost doesn't cover these costs, that could be sad?
            > If you are talking political/DTCP bribes then at 60 cr this is covered by 6 months delay in construction to 3.5 yrs.

            And to be honest, it is great tat ATS makes some profit, only a profitable company delivers good results.

            All good reality companies should target a 30 per cent gross margin to make atleast net margin of 18 per cent which is industry norm in developed areas where land is expensive .
            > I made things simple to show the margins - a lil expenses here and there would not change things from the current figures.

            Please make adjustments on above Eight points .....interesting read.
            > Margins like these are not sustainable in the longer run. To maintain these margins you need to control inventory and to do that you need to maintain landbanks and that interest outgo is bleeding the DLFs and UNITECHs dry today. If you think the RE firms value loyalty over their survival and will not lower rates just save some skins in the game then its a risk to ponder upon.
            This is like betting where you have the least information, the industry is opaque and liquidity rules. It takes just 5-10 months to prove an excellent RE invesment done 30 years back to be a wrong investment. Look at USA, Dubai, Spain, Greece, UK, Japan.

            Thnx
            VB
            Did u get a chance to compare the RE rates of USA with India? You might just be pleasantly surprised

            Comment


            • Re : ATS Kocoon, ATS, Sector 109, Gurgaon

              Originally posted by treo55 View Post
              Did u get a chance to compare the RE rates of USA with India? You might just be pleasantly surprised
              I disagree with your analysis And responses.
              MOST of These are incorrect.

              Your very assumption of selling all flats on day one at DP is false and baseless.

              If this was true then every Tom Dick and Harry would be a big real estate builder.

              At CLP the inflow is 30 per cent , as u said Liquidity. Profit on DP OF 4300 and CLP 4800 is a different matter.
              Thanks for the response any way.

              Cheers
              VB
              Nothing Surprises Me

              Comment


              • Re : ATS Kocoon, ATS, Sector 109, Gurgaon

                Originally posted by sikkaji View Post
                Thanks vb2309, I was about to respond but you have highlighted the overly simplistic assumption specially point no. 1. If this was the case no builder would ever have to raise money from market. DLF, Unitech and other builder's debt condition is no secret.
                HDFC Reality is apparently putting in 200 Cr for one of these projects. I bet the returns expected would be way better than "lending rates to realtors".
                As I said the cost of raising capital probably is the next biggest expense (after spending for land and development) dwarfing their administrative and other costs.

                BTW to your point no. 4, the per sqft rate does accounts for common area development as well (entire total cost/sale-able sq ft.).



                Sikka Ji

                I agree...have called it out again.
                Thanks for supporting point 1 and detailing point 4.

                Cheers
                VB
                Nothing Surprises Me

                Comment


                • Re : ATS Kocoon, ATS, Sector 109, Gurgaon

                  Dear all,
                  Can someone tell which area/road this news is referring to? Is it near to the proposed Dway or ATS project. I cound not find Bazgera on google maps.

                  10 illegal structures razed in New Palam Vihar - Hindustan Times

                  Regards

                  Comment


                  • Re : ATS Kocoon, ATS, Sector 109, Gurgaon

                    Originally posted by beowulf View Post
                    Dear all,
                    Can someone tell which area/road this news is referring to? Is it near to the proposed Dway or ATS project. I cound not find Bazgera on google maps.

                    10 illegal structures razed in New Palam Vihar - Hindustan Times

                    Regards
                    these were newly built structures of PRoperty brokers in that area , some offices as big as 2000 sq yds

                    Basically No new construction awas allowed in this area and they were given notices 8 months back , when they didnt listen to it , neither files for a stay THis was bound to happen , and those structures are big ones....On the main Fatak road going to delhi Bsf chawwla camp

                    Comment


                    • Re : ATS Kocoon, ATS, Sector 109, Gurgaon

                      Good approach ...intentions are clear..HUDA acts

                      Originally posted by amit.bhalla View Post
                      these were newly built structures of PRoperty brokers in that area , some offices as big as 2000 sq yds

                      Basically No new construction awas allowed in this area and they were given notices 8 months back , when they didnt listen to it , neither files for a stay THis was bound to happen , and those structures are big ones....On the main Fatak road going to delhi Bsf chawwla camp
                      10 illegal structures razed in New Palam Vihar - Hindustan Times

                      HUDA is in the correct mode
                      Nothing Surprises Me

                      Comment

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