Sobha not holding back on Gurgaon launches despite slump

Bangalore-based Sobha Developers has constantly been one of the top picks of brokerage houses. Brokerage firms like Sobha Developers for its execution track record and steady sales. Sobha Developers recently raised the red flag saying that property market in Gurgaon has started showing signs of a slowdown.

It has a high-end project comprising villas and high-rises at a Dwarka Expressway in Gurgaon, beginning at Rs 4 crore a piece. Property prices at Dwarka Expressway have appreciated the most in the country by over 50 percent in the last two years. But despite the slowdown Sobha is not holding back on launches in Gurgaon.

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JC Sharma, MD, Sobha Developers, says: We have got another 10 acres of land from our existing landlord and are rightsizing our product and are going to launch these products in the coming quarter to take advantage of this slowdown by offering a product which is relatively more affordable not on a per square feet basis.

So Sobha is not reducing the per square feet cost, but looking to launch small apartments to attract buyers.

Sharma says Sobha Developers plans to offer the product which is below Rs 4 crore in the Rs 2-3 crore range and take advantage of those customers who are not willing to buy because of its overall ticket size.

Sobha has also observed a slowdown in Pune’s real estate market, but it is a relatively smaller player in Pune versus the others. It has one ongoing project there. This year, we should be doing better than the last year, Sharma says. But still whatever experience we have got in the last 3-4 months, we are also having the same conclusion that Pune market is also having some kind of a pressure as far as volumes are concerned.

Clearly the real estate market across India is under pressure, but Sobha Developers rules out the possibility of any price cuts.

In none of the cities is it contemplating or hearing from fellow developers the reduction of prices because the fear of rise in input costs and the interest costs increase is always there. So, it doesn’t look like there will be any price decrease in the near foreseeable future at all.