March 18: The Indian markets shed a part of their gains during the final hour of trade on the back of profit booking. However, they ended the day well above yesterday’s closing level. The BSE-Sensex closed with gains of around 110 points, while the NSE-Nifty closed higher by 40 points. Stocks from the mid-cap and small-cap indices ended the day in the green as well. Buying activity was witnessed in stocks across sectors, with realty and metal leading the pack of gainers. However, the BSE-FMCG Index ended the day in the red.

Most other Asian markets closed on a firm note. The European indices are currently trading mixed. Rupee was trading at 51.34 against the US dollar at the time of writing. Real estate stocks ended the day on a firm note led by Akruti City, Mahindra Lifespace, DLF and HDIL. Stocks from the real estate sector have been amongst the worst performers in the past one year. This is mainly on account of lower demand and liquidity issues. In fact, until last week, the BSE Realty Index had fallen by nearly 46% since the beginning of 2009. However, the index has been amongst the top gainers in the past few trading sessions. The reason behind the same is price cuts in the range of nearly 30% to 40% announced by real estate players. While this move may impact their margins significantly, it will benefit the companies by reducing their inventory, bringing about much needed liquidity. It may be noted that a handful of realty players are sitting on a stock pile of projects that were launched a year back.

Auto stocks ended the day on a firm note led by Bajaj Auto and Ashok Leyland. As per a leading business daily, M&M has recently inaugurated its defence auto facility at Faridabad. This facility has the capability to produce nearly 200 specialised vehicles, which will be used by the armed forces, paramilitary and the police. However, it plans to increase the capacity to 350 units in the next fiscal. This facility will also produce bullet-proof versions of its multi-utility vehicles such as Scorpio and Bolero. With sales of the mainstream auto market drying up, companies such as M&M, which have a certain amount of exposure in the defense area, have been focusing on increasing defence supplies.

As per a report issued by McKinsey & Company, India is likely to face a shortfall of nearly US$ 150 bn to US$ 190 bn in funding its infrastructure projects in the current five-year plan period (FY07 to FY12). The reason behind this view is the global economic slowdown and rising interest rates, which have made project financing expensive and financial closure more difficult. It may be noted that the Planning Commission had earlier envisaged infrastructure investments to the tune of US$ 500 bn. Of this, nearly one-fourth was to be spent by the private sector and the balance by the public sector.
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The Government today allowed Orange Realty to set up a wholly owned subsidiary in India. The company has already received Rs 2,051 crore from IREO Investment Holding III, a Mauritius-based fund focused on setting up SEZ, IT/BPO Parks, and development of real estate projects.
An IREO spokesperson said that Orange Realty’s application to Foreign Investment Promotion Board was for creating a subsidiary. “Orange Realty has a mixed-use project in Gurgaon. The latest approval sought for the step-down subsidiary of Orange Realty, is more of a blanket nod and specifics are yet to be decided,” he said.

The funds injected by IREO Investment Holding III have flowed into Orange Realty since 2005, when the latter started its operations. Orange Realty is a subsidiary of IREO Investment Holding III Ltd. However, not many in the real estate industry seem to have heard about the company in spite of over Rs 2,000 crore of FDI inflow that has already come in. In its application to FIPB, the Delhi-based firm had sought to “acquire the status of foreign owned Indian holding-cum-operating company” and to make downstream investment in companies engaged in real estate activities and development of SEZs.

The change in status from operating company to operating-cum-holding company requires FIPB nod. The FIPB, in its meeting on January 9 recommended that the proposal be placed for consideration of the CCEA, as “the initial investments inflow for making the holding company exceeded Rs 600 crore.”

Briefing the media after the meeting of the Cabinet Committee on Economic Affairs (CCEA) on Wednesday, the Home Minister, Mr P. Chidambaram, said, “The investing company is by the name of IREO-III... That company has a large of number of well-known investors. That company is now investing in Orange Realty.”

Hamptons International is one of the premier international residential agents offering an extensive portfolio of properties across the globe. It has announced a strong focus for the Indian market. Recently, it has established a leadership presence in India through its wholly-owned subsidiary – Hamptons International India. Already, it has established a strong base in markets of Delhi & NCR and Mumbai, and is also expanding marketing of select projects on a Pan-India basis.

Hamptons International in India is headed by Shruti Gupta, who is one of the most reputed professionals in the areas of real estate and investment. Hamptons India is set to provide world-class services such as sales, corporate leasing, residential development consultancy, lettings, global asset management and investments, etc,. Hamptons International is owned and operated as a subsidiary of Emaar Properties, one of the world’s largest real estate companies.

Emaar Properties PJSC is present in India through a joint venture with MGF Developments Ltd. It commenced operations in India in February 2005. Its primary business is development of properties in residential, commercial, retail and hospitality sectors. In addition, it has also identified healthcare, education and infrastructure as business lines for future growth. Its operations span across various aspects of real estate development, such as land identification and acquisition, project planning, designing, marketing and execution.

Some of its projects include Commonwealth Games Village 2010 (Delhi), The Meadows (Gurgaon), Boulder Hills Golf and Country Club (Hyderabad), Garden Terraces at The Palm Drive & Meadows (Gurgaon), Esplanade (Chennai) and others. Hamptons International continues to expand both locally and internationally, positioning it as one of the most valuable residential property groups in the world.