On May 3rd, the builder lobby will go on a strike. But considering the fact that “over regulation” hasn’t stopped new projects from taking off, it remains to be watched how they present their grievances
Mumbai’s residential property sales have improved by 20% quarter-on-quarter, according to the latest data from Liases Foras. Pankaj Kapoor, MD Liases Foras, says that it is mainly on the back of new projects, some 150 projects were launched during the last quarter. Builders can hardly rejoice, though. Flats now cost Rs10,833 per sq ft, the year-on-year growth stands at 3% while the prices have gone up by 17% and the city would need 40 months to clear its unsold stock. “The market is still inefficient, and things are still looking the same,” said Mr Pankaj Kapoor.
However, what makes the data interesting is the fact that it is the new launches that have propelled sales. It is definitely something that the builders may find difficult to believe, considering they have planned a strike because ‘over-regulation’ is harming their business and slowing down approvals.
On 3rd May, the Maharashtra Chamber of Housing Industry (MCHI) and the Confederation of Real Estate Developers Associations of India (CREDAI) are set to go on a strike. Builders are fed up with “over regulation”. Hence, a grand plan to have as many people possible out in the searing heat, to protest against the “policy paralysis” and the “uncalled for harsh attitude” of the government authorities, that has brought the realty sector to a standstill, particularly in Mumbai.
In several media statements, the MCHI, which accounts for more than 80% of the construction activity in Mumbai, has slammed the civic authorities and the government. There are practically no sales and clearances are getting delayed indefinitely, MCHI’s property fairs had to be postponed and no policy in rental housing has been formulated.
President Paras Gundecha has said that all those who have been affected by “the system” will support MCHI. CREDAI has also said that a demonstration may be held in front of the Parliament in New Delhi.
Inspired as it may be with righteous anger, sources say that the plan was hatched after a heated meeting between the BMC commissioner and the builder lobby a few days ago. The commissioner, rejecting the builders’ suggestion of “acting soft”, had declared that he would continue to deal with them in a strict manner.
“We are planning to gather people for the protest. This is a serious matter. Already we are under too much stress; and the authorities’ attitude is not helping,” remarked a builder who is going to be a part of the protest.
The BMC commissioner, Subodh Kumar, has an upright reputation. Unlike some of his predecessors, who are currently in jail, he is known to have taken a tough stand against errant developers which as made matters extremely difficult for those who have tried to regularise wrong-doings. While that may inspire some hope, overall, the realty situation in Mumbai seems to be bleaker than ever.
“The state government is doing everything in its power to make life difficult for the common man,” said Ramesh S Prabhu, chairman of Maharashtra Societies Welfare Association (MSWA). The MSWA has written to the state chief minister and housing minister, asking them to scrap the Maharashtra Housing (Regulation & Development) Bill 2012, which is set to replace the Maharashtra Ownership of Flat Act (MOFA) that has been in force since 1962.
“The new Bill is unjust, and it is very pro-builder,” said Mr Prabhu. In his letter, he says, “It is unfortunate that the Bill was never published to invite suggestions or objections from any corner. The same was introduced in a hurry in the state cabinet and once it was approved by the cabinet, without giving any opportunities to the public at large to comment on the same, it was introduced in the assembly for passing the same. We are sure, you may not be aware that the same is against the consumers’ interests and gives further scope to the builders to take consumers for a ride.”
Similar thoughts have been echoed by veteran property lawyer Vinod Sampat, who has said that with the new Bill, the government has gone out of its way to help the builders, and the ministry for housing can now be rechristened as ‘ministry for builders.’ Read http://www.moneylife.in/article/flat-owners-urge-maharashtra-government-to-retain-mofa/25091.html
It is indeed strange that while the builders are complaining about “over regulation”, flat owners seem to feel that the government is siding with the builders. Mr Kapoor believes that it is not right to blame only the builders for the sky high prices. “The government hiked stamp duty rates, which it was uncalled for. It is too revenue-centric. The builders will keep prices, and now if the government also adds to the burden, people will have no other option but live in a slum,” he said some time back.
The government’s hike in stamp duty and leave license and the sudden change in DCR have also miffed the builders. Apart from driving away customers, the new DCR has also stopped construction activity in many projects. Many upcoming projects have been stalled, because with the changed FSI norms the builders have to submit fresh plans and redesign.
Referring to the situation, a sector expert commented, “I would love to see the builders go on a strike. What will they do if they are dismissed? Stop construction? That is not happening anyway.”
The builders’ strike is something which has generated much curiosity. But considering the fact that “over regulation” hasn’t stopped new projects from taking off and getting sold, it remains to be watched how they present their grievances.
MediPrime provides a comprehensive set of benefits that every individual looks for in a health insurance policy like cashless hospitalization, domiciliary and 140-day care procedures without any sub-limits
Tata AIG General Insurance Company announced the launch of its first domestic lifetime renewable reimbursement health insurance policy—MediPrime. The introduction of MediPrime adds to the set of general insurance products offered by the company and has been designed specifically to cater to the retail consumer market in India.
Commenting on the launch of MediPrime, Gaurav D Garg, MD and CEO, Tata AIG General Insurance said, “We are proud to announce the launch of MediPrime; a product that has been designed specifically to meet the current requirements of the consumer and ensure that their needs from a health policy are met.”
Under MediPrime, a policyholder can avail the cashless hospitalization benefit; which is currently available through a network of over 3000 hospitals. The policy also provides added benefit of a family discount wherein a discount of 10% is allowed if three or more members of the family are covered under the individual plans.
Having structured and designed the product to suit customer needs, MediPrime comes with a set of unique features that sets it apart from others in the market. Some of them include no sub-limit for inpatient hospitalization; no co-pay; and inpatient and outpatient coverage for accidental dental treatment.
MediPrime provides a comprehensive set of benefits that every individual looks for in a health insurance policy like cashless hospitalization, domiciliary and 140-day care procedures without any sub-limits. It also extends coverage for pre and post hospitalization expenses. Distinct features of the product include its lifetime renewability clause and its zero loading charges on renewal in case of a claim.
The product is available to individuals between the ages of 18 to 65 years and also offers the unique benefit of lifetime renewability for existing customers. The policyholder is entitled to tax benefits under section 80D of the Income Tax Act 1961.
Other benefits of the product include pre and post hospitalization medical expenses - 30 days before hospitalization and 60 days immediately after discharge; health check-up at the end of four continuous renewals for every insured person; and emergency ambulance expenses.
Nifty may be headed for 5,145 and then to 5,080. A close above today’s high may be a first sign of reversal
A rally in IT and technology stocks following better-than-expected results from TCS helped the domestic market brush aside early hiccups and snap its two-day decline. Yesterday we had mentioned that the Nifty would move with a negative bias with some intraday bounce and that the index may find its first support at 5,145 and then at 5,080. Today the benchmark made a small gain but also made a lower low. We continue to maintain yesterday’s support target for the index—at 5,145 and then at 5,080. The National Stock Exchange (NSE) saw a lower volume of 54.23 crore shares.
The market opened with a positive bias on better-than-expected quarterly earnings from India’s largest software exporter TCS after the market closed on Monday. On the other hand, the US markets closed lower overnight on political concerns marred attempts to find a solution to the European crisis. The European imbroglio also weighed on the Asian markets, which were lower in early trade. Back home, the Nifty opened at 5,216, up 15 points, and the Sensex rose by 58 points to resume trade at 17,155.
Intense volatility saw the market fluctuate between gains and losses in early trade with the benchmarks touching the day’s lows in mid-morning trade. At this point, the Nifty fell to 5,180 and the Sensex went back to 17,047.
Value picking at the lows resulted in the market at around 11.00am. Buying support in technology, banking and power stocks enabled the indices stay in the green in subsequent trade. While the benchmarks pared some of their gains, a positive opening of the key European indices kept the domestic gauges in the green.
While the Nifty hit its intraday high at noon with the index scaling 5,232, the Sensex climbed to its high at around 2.40pm at 17,248. Optimism in IT and technology stocks helped the market stay higher today.
The indices settled a tad below the highs with the Nifty gaining 22 points at 5,223 and the Sensex adding 111 points to close at 17,207.
The advance-decline ratio on the NSE was at 726:958.
While the key indices settled higher, the broader indices closed in the red. The BSE Mid-cap index fell by 0.13% and the BSE Mid-cap index lost 0.07%.
BSE IT (up 4.93%) was the biggest sectoral gainer today. It was followed by BSE TECk (up 3.34%); BSE Power (up 0.53%); BSE Metal (up 0.52%) and BSE Fast Moving Consumer Goods (up 0.35%). The losers were BSE Capital Goods (down 1.29%); BSE Healthcare (down 0.35%); BSE Bankex (down 0.26%) and BSE Oil & Gas (down 0.03%).
IT major TCS topped the charts today. The stock jumped 12.84% on the Sensex today. Other Sensex leaders were Wipro (up 4.44%); Tata Power (up 2.54%); Hero MotoCorp (up 2.30%) and Infosys (up 1.58%). The laggards on the index were Larsen & Toubro (down 2.63%); Bharti Airtel (down 2.02%); Bajaj Auto (down 1.63%); DLF (down 1.46%) and GAIL India (down 1.23%).
TCS settled 12.66% higher on the Nifty, followed by Wipro (up 4.44%); SAIL (up 4.40%); Tata Power (up 3.09%) and HCL Technologies (up 3.07%). Ambuja Cements (down 4.88%); Larsen & Toubro (down 2.94%); Kotak Mahindra Bank (down 2.33%); ACC (down 2.30%) and Grasim (down 2.04%) were the key losers.
Markets in Asia, which resumed lower on concerns about Europe, settled mostly higher. However, reports indicated that Chinese state-owned banks may face a financial crunch following aggressive lending, forced by the government. The report further added that borrowers, including local governments, may then default on their interest payments and could fail to pay their loans.
The Shanghai Composite added 0.01%; the Hang Seng gained 0.26%; the Jakarta Composite rose 0.36%; the Straits Times climbed 0.41% and the Taiwan Weighted settled 0.24% higher. On the other hand, the KLSE Composite shed 0.10%; the Nikkei 225 declined 0.78% and the Seoul Composite lost 0.47%. At the time of writing, the key European indices were between 0.46% and 1.19% up and the US stocks futures were in the positive.
Back home, foreign institutional investors were net sellers of equities totalling Rs407.49 crore on Monday whereas domestic institutional investors were net buyers of shares amounting to Rs451.70 crore.
Pharmaceutical major, Lupin, is setting up a new manufacturing plant at the MIHAN special economic zone (SEZ) in Nagpur, entailing an investment of Rs 400 crore over a period of five years. The new formulation facility at the Multi modal International Cargo Hub and Airport (MHIAN) SEZ will take close to a year to be operational, the company said in a statement. The stock declined 1.75% to Rs539.25 on the NSE.
PTC India Financial Services (PFS), part of PTC India, has raised $25-million through external commercial borrowings (ECBs) from International Finance Corporation for financing power projects. The ECBs are repayable in 32 quarterly instalments. PFS closed at Rs16.80 on the NSE, up 2.13% over its previous close.
Sun Pharmaceutical Industries (Sun Pharma) said on Tuesday that it has received approval from the US health regulator to launch the generic version of Eli Lilly’s schizophrenia treatment drug, Zyprexa in the American market. These tablets are indicated for treatment of schizophrenia, bipolar I disorder which are associated with manic or mixed episodes. The stock fell 0.28% to close at Rs594 on the NSE today.