subject: Db Realty Return To Mumbai Real Estate Market [print this page] An aggressive steps has been taken by DB Realty Ltd. to overcome the shadows of the second generation (2G) telecom spectrum scam. The real estate developer is looking to start again its fortunes in Mumbai real estate by launching new projects and rebranding existing ones.
The companys stock has fallen thirty three percent since February 9, 2011, once its managing director, Mr. Shahid Balwa, was arrested the Central Bureau of Investigation. A number of the companys projects conjointly received stop-work notices and have become a matter of intense speculation.
DB Realty is currently trying to launch as many as ten new residential projects in Mumbai in the current fiscal year. The corporate has thirty six prime land plots within the city, that it needs to leverage on. The developer is looking at completing two of its projects this fiscal year.
In cities like Mumbai where the majority of investments/project price is in land, if any developer has prime land and all approvals, they will easily sell the project before the development starts. You sell twenty percent of the project so your entire construction is taken care of.
The company had a debt-to-equity quantitative relation of 0.07. In keeping with the fourth-quarter earnings release, DB Realty had total capital of Rs 213 crore. In the June quarter, the corporate denote a net loss of Rs 2.1 crore due to lower sales.
DB Realty is also in the method of rebranding seven of its Orchid residential property in Mumbai to DB for higher recall. Advertising agency Percept H had urged the corporate rename its projects.
Wherever attainable, They have tried to shift to the DB brand, as it has higher brand recall. They are not shying away from the DB brand. They denied the rebranding exercise had something to do with companys attempt to come out from the negative publicity the 2G scam had generated in the past.
The clouds related with approvals have gone away and it is for the new management team to launch new property in Mumbai and concentrate on execution. Along with Mr. Bansal, the corporate has 5 new executives in senior positions. They have excellent locations. Rebranding helps them in selling projects well.
They aforesaid speedy approvals by the Brihanmumbai Municipal Corporation (BMC), succeeding festival season and clarity on development rules and environment clearances can facilitate developers in execution and monetization of projects. Last year, the companys real estate Mumbai projects featured a series of actions by the government and public bodies.
First, the Maharashtra government cancelled the extra floor space index granted to DB Realtys Pune project. Later, the companys commercial project in Marine Lines in Mumbai, touted collectively of the tallest towers in India, got a stop-work notice from the BMC.
October 2011, the Expert Appraisal Committee directed the state environment department to issue a stop-work notice to the project for concluding work without approval and violating the Environment Protection Act. The project got permission from the state environment impact assessment authority in March this year.
There were media reports that the corporate was searching for joint venture partners for its residential properties in Mumbai and sell of its hotel projects.
Their attempt is to release current inventory in their residential property in phases and make the most of the prevailing market costs. Post-Navratri, plenty of things can amendment in terms of offtake. They are sharply beefing up marketing and advertising budgets to take advantage of that.
Issues raised by the govt. relating to its commercial project are being sorted out and work the Marine Lines project would begin in December. Regarding the companys one million sq ft MIG Redevelopment Project in Bandra, Mumbai, Mr. Bansal aforesaid the corporate had an environment committee meeting recently and was trying to begin work before long.
Experts say developers got to concentrate on the right pricing. Some launches in Mumbai have done well due to right pricing. Mumbai incorporates a vast pent-up demand, as stated by Ms. Jasmeet Chhabra, one of the Mumbai based real estate consultant. The problem is when costs shoot through the roof and patrons have doubts concerning the delivery of the project.
