See better sales in H2FY18; RERA to benefit organised players: South India realtors

Real estate stocks have been big buzzers in the last few days. Is the RERA and GST related disruption behind the sector?

Sharing their outlook for the real estate market in Southern India JC Sharma, VC & MD, Sobha said H2FY18 would be better for them than H1FY18 because with RERA behind us and GST in place the market understands which developers have the ability to deliver. He said the customers and bankers now know whom to approach. So this is the time when volumes for organized players will start picking up.

MD, Sobha and KP Pradeep, CFO, Brigade Enterprises also said Q3 and Q4 is looking much better in terms of traction in sales post RERA and GST.

When asked if they see land prices falling now, Pradeep said he had no idea in they would come down but said location would determine land pricing. However, they would maintain consistency in land bank, he added.

Meanwhile, Sharma said they have been talking to some small developer/unorganised players for land acquisitions.

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Pradeep said for the real estate sales portfolio is a combination of residential and commercial sale, of which commercial is only 7-8 percent. However, in the last couple of quarters the company has been concentration on commercial leasing business, in which there are two large projects in Bengalurur – Brigade Tech Garden and World Trade Centre. The company is very bullish on these two projects, he added.

Sharma said the government is hell bent on seeing a pickup in affordable housing and they are present in all the segments – houses worth Rs 1 crore, from Rs 1-2 crore and Rs 2 crore and above.

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