A new community of millionaires is emerging from India’s booming property space.

Family members of India’s real estate czars are increasingly making it to the list of millionaire shareholders, thanks to their large holdings in respective companies.

Close relatives of key promoters of realty giants like DLF, Unitech, Sobha Developers, Parsvnath Developers, Housing Development and Infrastructure (HDIL) and many others today find themselves being part of these companies, some of which have become most-valuable firms soon after their listing. Sobha Menon, Piya Singh, Kavita Singh, Rajiv Singh, Sanjay Chandra and Nutan Jain are some notable real estate members of the millionaire club.

Sobha Menon, wife of Sobha Developers’ promoter PNC Menon, holds a significant 56.7% stake in the company. At the current price of Rs 755, the value of her personal holding amounts to Rs 3,123 crore. Mr Menon holds a 30.16% stake, which is worth Rs 1,661 crore.

Piya, Kavita and Rajiv — the children of DLF chairman NK Singh — hold 2.3%, 1.2% and 1%, respectively, in the company. The stakes are now worth Rs 2,578 crore, Rs 1,386 crore and Rs 1,240 crore, respectively. Sanjay Chandra, son of Unitech’s Ramesh Chandra owns 4.1% in the company, which is worth Rs 944 crore while Nutan Jain, wife of Parsvnath Developers’ Pradeep Jain, holds 11.9% stake valued at Rs 702 crore. HDIL managing director Sarang Wadhawan holds 5% stake in the company, valued at around Rs 550 crore.

The stakes of these promoters and their wealth are calculated on the basis of shareholding data available as on June 30, 2007, and the share prices as of September 14. It is assumed there is no significant change in their holdings after June. A look at the shareholding pattern of real estate companies showed that a large part of equity capital is held by promoters and their relatives in most of the cases. This could be because they are quite bullish about the industry prospects and want to retain majority control of the respective companies to reap long-term benefits. Promoters hold stakes between 75% and 88% in DLF, Unitech, Sobha Developers and Parsvnath Developers.

Indian real estate sector is still in its infancy. The potential of the sector is yet to be explored fully. More are more market participants are coming and the sector is slowly maturing,according to the director of DTZ — an international property consultant. With a high economic progress and growing success of related sectors like retailing, the number of millionaires from the real estate sector will surely increase significantly in the next few years.
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  • Courtsey: Economic Times, 17 Sep 07

    This news story by Vijay Gurav & Rajesh Unnikrishnan of TNN presents true picture of real estate business as a fortune builder...


    Thanks to such authors who keep watching the sector from different angles !!!
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