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Builders & Real Estate Bulls Theory Proved Wrong

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Builders & Real Estate Bulls Theory Proved Wrong

Last updated: November 1 2016
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  • Re : Builders & Real Estate Bulls Theory Proved Wrong

    ICICI Pru AMC exits Pune township project

    NEW DELHI, JUNE 11:
    ICICI Prudential Asset Management Company’s (AMC) real estate portfolio management service (PMS) said it has divested investment in Kumar Urban Development (KUL) Ecoloch, a township project in Pune.

    The PMS, a part of ICICI Prudential’s AMC, had invested Rs 47.5 crore in the 105-acre integrated township in Pune developed by realty firm KUL, a release said.

    The portfolio had generated a gross internal rate of return (IRR) of about 27 per cent.

    >> If ICICI got 27% IRR, why exit ? Or are they seeing something bad ahead, hence the exit ?

    Business Line : Markets News : ICICI Pru AMC exits Pune township project
    If you are happy, you are successful.

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    • Re : Builders & Real Estate Bulls Theory Proved Wrong

      "A report in December by real estate brokerage firm Jones Lang LaSalle India said only $3 billion worth of exits have been recorded in the Indian real estate sector, as opposed to $13 billion of committed investments since 2005."

      Excerpt from :
      IDFC Real Estate Investments plans to raise $500 mn fund - The Economic Times

      That tells you a very powerful story. Only 20% of PE money has exited in 7 years. Hedge fund and PE money looks for high returns ~ 30-40% YOY. If the returns were there, they would have exited. Smart money does not languish in low yielding assets - because there is an opportunity cost for money too.

      The 200% price rise in certain pockets of Indian RE market where maybe one sucker bought an overpriced property does not tell you the entire story. Builder/investors can quote you obscene prices without losing anything. Whether those prices see any real volume transactions is something you and me will come to know only through News channels. And trust me, there is no good news out there. All builder stocks are getting hammered in the markets - most of them are close to their all time lows. Don't pooh pooh these indicators. If the outlook for RE was that rosy, DLF would be trading close to its all time highs.

      Comment


      • Re : Builders & Real Estate Bulls Theory Proved Wrong

        Originally posted by realacres View Post
        NEW DELHI, JUNE 11:
        ICICI Prudential Asset Management Company’s (AMC) real estate portfolio management service (PMS) said it has divested investment in Kumar Urban Development (KUL) Ecoloch, a township project in Pune.

        The PMS, a part of ICICI Prudential’s AMC, had invested Rs 47.5 crore in the 105-acre integrated township in Pune developed by realty firm KUL, a release said.

        The portfolio had generated a gross internal rate of return (IRR) of about 27 per cent.

        >> If ICICI got 27% IRR, why exit ? Or are they seeing something bad ahead, hence the exit ?

        Business Line : Markets News : ICICI Pru AMC exits Pune township project

        I earlier read that ICICI got good profits and hence they booked it. Not sure any other reasons.

        Comment


        • Re : Builders & Real Estate Bulls Theory Proved Wrong

          DLF seems like its going from bad to worse - beginning to shed non core assets. The distressed sales of core assets cant be far.

          DLF seeks shareholders' approval to sell wind power unit - The Economic Times

          Comment


          • Re : Builders & Real Estate Bulls Theory Proved Wrong

            I don't know, but if this is hint of slowdown's effect, this will affect the other industries as well. So though RE might be stable on prices or reduced a bit, people wil not be thinking to purchase before thinking of securing own savings.

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            • Re : Builders & Real Estate Bulls Theory Proved Wrong

              Originally posted by JumboHulk View Post
              I earlier read that ICICI got good profits and hence they booked it. Not sure any other reasons.
              Or is it like - they took all that builder could rob from buyers in terms of booking and initial progress cost. Obviously they would have bought at low rate, so booked profit. Now they would want to earn at buyer's risk by giving home loans.

              Now builder will have a new org to finance so he can keep constructing slabs They, too, would be looking for huge pie of the cake !!

              Builder will keep taking huge pie to keep running luxurious elephants consuming tons of diesel and kids guzzling tons of cola/pizza/what not.

              Politicians, govt employees, agents etc. already got their pie all along the way.

              What is left is used to construct poor quality, delayed flat dumped on buyer's head.

              So many mouth to be fed. And people still keep making funny arguments to justify that RE price are in line with input costs

              And builders say, they help giving thrust to the economy. So RBI should cut rates

              Comment


              • Re : Builders & Real Estate Bulls Theory Proved Wrong

                Originally posted by akash481 View Post
                hahaha ... already some projects in Mumbai are already offering interest waivers on home loans

                Received email for Lodha CasaRioGold Palava in Mumbai which has come up with interest waivers through weekly prizes & crap like that.

                I am unable to attach image here, it appears blank
                This project Lodha CasaRioGold Palava in Mumbai has been delayed already by a year. Interest waivers are just one of the ways to boost sales.

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                • Re : Builders & Real Estate Bulls Theory Proved Wrong

                  Originally posted by herohiralal View Post
                  In markets bulls make money and bears make money but people who sit on the sidelines end up on forums
                  good one.

                  Comment


                  • Re : Builders & Real Estate Bulls Theory Proved Wrong

                    Originally posted by mangopeople View Post
                    This project Lodha CasaRioGold Palava in Mumbai has been delayed already by a year. Interest waivers are just one of the ways to boost sales.
                    True. Palava is delayed.

                    Comment


                    • Re : Builders & Real Estate Bulls Theory Proved Wrong

                      http://www.firstpost.com/economy/pms...e=MC_TOP_WIDGE

                      Sardar speech deriyasi.. on how to manage the economy..
                      He does not open his mouth back home..

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