Get subscribed to our newsletter
Get interesting updates to your email inbox.
New Delhi, October 4: Though the government’s radical measure of demonetisation has disrupted the economy and has hit the real estate sector — already reeling under prolonged slowdown — it will turn out to be a blessing in disguise in the medium-to-long term.
As an asset class, real estate has been a big source of generating and consuming black money. The cash component in real estate has been there at various levels, beginning with land transactions where it amounts to 30-50 per cent. The cash payout is quite high in luxury housing too. The consumption of cash has been as high as 30 per cent in secondary market transactions.
The primary market transactions, however, are by far bereft of cash component as home purchases are financed through loans from banks and housing finance corporations. It is another matter that even in primary market deals, developers have been encouraging cash payouts by luring property buyers with good discounts on property price.
The speculative buying by investors through offerings like underwriting and pre-launches has also been involving cash payout, leading to artificial price hike and in turn making homes out of the reach of masses.
Demonetisation, coupled with the government’s move to check benami transactions through legislation and curbs on cash transactions, was meant to clean up the system.
This sudden ‘shake up’ was, however, not without its adverse impacts. Demonetisation badly affected the liquidity in the capital-intensive real estate sector, deepening the problem of massive fund shortage/cash crunch faced by developers reeling under delayed deliveries, which deterred buyers from purchasing property.
The impact was more evident in markets like NCR and Mumbai which were largely investor-driven, compared to southern markets of Bengaluru and Chennai and even Pune in the west, which have been end-user driven. The premium/luxury residential segment, in which the cash component was more in transactions, got impacted by demonetisation.
Real estate experts’ belief that the impact of demonetisation is only short-term and will not have long-term impact, stems from the fact that developers who have been following transparent and fair practices have not been affected by demonetisation and instead it worked out to their advantage.
This also turned out to be a positive development for big global real estate consultants like JLL India which doubled its profits in 2016 over 2014-15, with 60 per cent revenue growth.
One key positive impact of demonetisation and RERA (Real Estate Regulation Act) has been that speculative investors deserted real estate and end-users/genuine buyers, who were all these years pushed to the sidelines, came out in large numbers. Now, it is the property consumers who are driving the real estate market, especially residential market, aided by the government’s pro-industry and pro-consumer initiatives.
The step to promote affordable housing and according real estate industry status for the purpose of making easy and cheap funds available to the sector also helps.
Demonetisation has particularly boosted foreign funding. The transparency brought in by demonetisation, aided by RERA, GST reforms and liberalisation of FDI norms, has boosted the confidence of foreign investors, which is clearly evident from the spurt in foreign investments, particularly from pension funds.
This will inject much needed liquidity in the sector starved of funds. Targeting consumers, the government under the Pradhan Mantri Awas Yojana (PMAY), is providing substantial interest subsidy to home buyers. The clampdown on floating cash in the system has contributed significantly to curbing inflation which, in turn, helped RBI in cutting interest rates, thereby boosting home buying.
The proposed measures to liberalise FSI norms and rationalise stamp duty, will give further fillip to the residential sector, particularly affordable housing.
Demonetisation had a salutary impact on property prices by curbing cash transactions and checking speculative pricing, in turn increasing affordability, which is a key to achieve the government’s flagship mission of ‘Housing for All’. RERA & GST are further aiding demonetisation to control prices.
The key provisions in RERA, to speed up project completion, by checking diversion of funds through mandatory escrow account, stringent penalties to check project delays, together with the government’s move to make all building sanctions online, will go a long way in checking time and cost overruns of real estate projects, thereby controlling home prices.
The ban on pre-launching of projects under RERA will also check artificial spurt in pricing. GST has come to tackle the flow of cash in the purchase of building materials by introducing input credit tax. Further, the government’s plans to liberalise FSI norms, especially for affordable homes, and rationalising stamp duty will have a sobering effect on property prices.
But for some little lingering effect, economists and real estate experts believe that the overall downside impact of demonetisation has faded and its impact is not going to be there in the next quarter.
Says Ashwinder Singh, formerly CEO of JLL India & now CEO of leading real estate consultancy, Anarock Consultants: “Other than in terms of the initial confusion-induced decline in sentiment, the trend that is emerging now, points towards a recovery in buying sentiment with serious buyers already returning to primary markets.”
The entire demonetisation exercise undertaken by the government and aided by other reforms, like Benami Property Act, RERA and GST, is to be looked at in the backdrop of the government’s multi-pronged policy to create institutional and regulatory framework for speedy and steady growth of the economy. And at the centre of all these initiatives is real estate, which is a key contributor to GDP. Going forward, these policy initiatives will help make real estate more organised, transparent, credible and affordable, making the sector investor and consumer friendly. (IANS)
One of Indi's leading luxurious Ayurveda skincare brands, Forest Essentials, announces its international foray with the London based Lookfantastic.com, Euroe's premium online beauty retailer. The partnership enables the brand to take significant strides towards its expansion globally starting with the launch in the United Kingdom. "Our focus and USP at Forest Essentials has always been at delivering high quality Ayurvedic products in a sustainable way, with a global appeal.
We firmly believe that the time is right for Forest Essentials to expand to the UK, as our first international footprint with Lookfantastic,' Europe's premium online beauty retailer. "The UK audience is well aware of Ayurveda and we are certain that the demand for our Made in India luxurious Ayurveda products, is going to continue to grow multifold, as consumers are today looking for moments of self-care, to feel better in this stressful period and we are well positioned to support this type of feel-good indulgence that consumers are seeking today," says Samrath Bedi, Executive Director, Forest Essentials. The brand's iconic product ranges, across skincare, body care and haircare will be available for purchase in the UK, including the Soundarya collection, crafted with 24k gold.
The brand's iconic product ranges, across skincare, body care and haircare will be available for purchase in the UK, including the Soundarya collection, crafted with 24k gold. | Wikimedia Commons
The brand's iconic product ranges, across skincare, body care and haircare will be available for purchase in the UK, including the Soundarya collection, crafted with 24k gold. Additional collections offered include the Men's Collection, Madurai Jasmine and Mogra, Green Tea and Oudh, and Nargis, Indian Rose Ab'olute. The brand's vast gifting options are also available via the e-retailer. A portfolio of over 660 premium brands onsite and revenue share grown 40 percent year on year in the last 4 year makes,
Lookfantastic is one of the most successful beauty websites globally. Unrivalled technology, a team of world-class experts, over 30 localized sites in as many languages enables the website to attract millions of visits per month with nearly 71 percent of them being international making it a natural choice as a retail overseas partner for Forest Essentials. Commenting on the announcement, Bedi added, "Ayurveda has gained acceptance globally and there is an increased need to explore authentic products that are not only luxurious but also high on efficacy. Forest Essentials has been a pioneer in every sense and we're confident that our foray into the UK will enable us to represent India and products Made in India successfully in the international market." (IANS/MBI)
Keywords: Ayurveda, Skincare, Forest, Herbal, Body care, Hair care, Beauty Products
Khadi is no longer a dull, drab fabric meant only for politicians' wardrobes. A fashion show organised by the Khadi Gramodyog Board as part of the Azadi Ka Amrit Mahotsav to mark the 75th year of India's Independence showcased the use of Khadi in traditional, as well as, contemporary and festive wear. From lehengas in resplendent Khadi silk to western clothes and casual wear, the models on Thursday night displayed new facts of the fabric.
Several well-known Indian designers including Ritu Beri, Farah Ansari, Rina Dhaka, Asma Husain, Aditi Rastogi and Himmat Singh showcased their designs. Gaurav Gaur directed the fashion show with clothes like lehengas, kurtis, kurta pajamas and partywear.
Lucknow's chikankari and silk artisans also participated in the event. A wedding collection in Khadi was the highlight of the show. "The show was based on the concept 'Khadi for nation, Khadi for fashion' and the fabric for all costumes was provided by Khadi Gramodyog Board," said a spokesman. (IANS/ MBI)
Keywords: lucknow, clothes, lehengas, fashion, fabric
- Khadi fabric originated during the time of Swadeshi Movement in ... ›
- Khadi : The 'Fabric of Empowerment' in India - NewsGram - Lens to ... ›
- Village in Rajasthan Bans 'Fashion Clothes' and Mobiles for Women ... ›
- “I Believe in Repeating Clothes”, Says B-Town Actress Bhumi ... ›
- The Five Quick Wardrobe Maintenance Tips For Fresh Clothes ... ›
Intel saw its stock tumbling by more than 8 percent after the chipmaker said the industry-wide component shortage affected its PC chip business during the third quarter (Q3). Intel CEO Pat Gelsinger told CNBC late on Thursday that he didn't expect the semiconductor shortage to end until 2023. "We're in the worst of it now, every quarter, next year we'll get incrementally better, but they're not going to have supply-demand balance until 2023," Gelsinger was quoted as saying.
The company delivered its Q3 results with revenue up 5 percent (year-over-year) driven by strong demand in its DCG and IoTG businesses, despite the highly constrained industry-wide supply environment. "Q3 revenue was $18.1 billion slightly below our guide due to shipping and supply constraints that impacted our businesses," George S. Davis, Chief Financial Officer, said in a statement. He also announced plans to retire from Intel in May 2022. In the third quarter, the company generated $9.9 billion in cash from operations and paid dividends of $1.4 billion.
| Photo by Slejven Djurakovic on Unsplash
According to the company, the demand remains strong in its PC business with particular strength in commercial, desktop, and higher-end consumer notebooks. In an earnings call, Gelsinger said that the digitization of everything accelerated by the four superpowers of AI, pervasive connectivity, cloud to edge infrastructure, and ubiquitous compute are driving the sustained need for more semiconductors. "The market is expected to double to $1 trillion by 2030. In that timeframe, the market for leading-edge nodes will rise to be over 50 percent of the total, while the market for leading-edge foundry services will grow at twice the rate of the semi-industry overall," he envisioned.
PC demand remains very strong, and "We believe the 2021 TAM (total addressable market) will grow double digits even as ecosystem shortages constrain our customer's ability to ship finished systems," Gelsinger added. "Customers continue to choose Intel for their datacenter needs and our third-gen scalable Xeon processor Ice Lake has shipped over 1 million units since launching in April, and we expect to ship over 1 million units again in Q4 alone," he informed. (IANS/MBI)
Keywords: Intel, Chip, processor, Desktop, AI, Semiconductor, PC, Processor