The RBI has denied to extend the deadline for the second list of defaulters. Also there will be no relief for its other stipulations, including the process related to restructuring outside the bankruptcy court. Non-Banking Finance Companies (NBFCs) and banks are finding ways to reduce their mounting of bad loans. They have become extra cautious in lending to the lesser known real estate developers.
A new trend of roping in corporate investigators like Deloitte, EY, PwC and KPMG and other boutique firms such as Kroll, Alvarez and Marshal (A&M) to undertake forensic due diligence before lending money, has picked up amongst the lenders. These lenders include HDFC, Indiabulls, DHFL and Edelweiss. The lenders want to be sure about the status of the project after the completion and any possibility of future litigation, despite getting the confirmation of repayments.
The requests from banks to extend the deadline for restructuring the debt of companies, on a second list of bad loan accounts, has been denied by the Reserve Bank of India (RBI). This will be accelerating the bankruptcy proceedings at the National Company Law Tribunal (NCLT) by December 31, for companies such as Essar Projects, Asian Colour Coated, Jaiprakash Associates, Videocon Industries and Uttam Galva Steel.
RBI is demanding the accounts that were not recast as per rules stipulated, in August, to enter the insolvency process. In its statement from the month of August, RBI issued a deadline of December 13, to those involved in lending to the 28 defaulting companies. These lenders had to find a resolution plan in accordance with a formula prescribed by RBI. The companies were to be referred to the NCLT, in the case of a failure from the banks.
Some of the companies from the list got their resolution plans drawn up by the deadline. Which included Soma Enterprises under the Scheme for Sustainable Structuring of Stressed Assets (S4A) and a one-time settlement in the case of Anrak Aluminium. The Finance Ministry has asked banks to be vigilant to ensure that wilful defaulters are prevented from buying same stressed assets again, as it will ensure the success of bankruptcy process under the Insolvency and Bankruptcy Code (IBC).
As many as 12 accounts, each with more than Rs 5,000 crore of outstanding loans and accounting for 25 per cent of total NPAs of banks are being submitted under the Insolvency and Bankruptcy Code process. A staggering amount of Rs 1.75 lakh crore has been amounted under these accounts, if assumed together. Besides, banks are processing to take other large non-performing assets accounts to the National Company Law Tribunal (NCLT) under the IBC.
Raunak Group Celebrates A Year Of Successes With Digital Agency Insomniacs
Leading Mumbai based real estate developer Raunak Group recently celebrated the first anniversary of their partnership with digital agency Insomniacs, reveling in an occasion that came in after a series of successful campaigns which changed the face of real estate within the city.
Insomniacs was first handed over the digital responsibilities of the real estate developer in December 2016, taking over the reins for their first collaborative campaign, i.e. ‘Darr Ke Aage Ghar Hai’. The campaign targeted the top fears that every potential home buyer faced while on the lookout for a new permanent address, taking away all those ‘Darr’ with a single offer of just 6% interest on their home loans for a period of 4 years, essentially helping every customer save up to Rs. 3 lakhs of their budget. The campaign turned out to be a major hit with Raunak Group delivering 131 homes to happy families.
The brands’ second collaboration, ‘Apna Pehla Ghar’, sparked the interest of many living in Mumbai, inciting within them the feeling of owning their very first home within the city’s limits. ‘Apna Pehla Ghar’ introduced the offer of massive savings in the form of their GST and PMAY benefit, helping each customer save up to a minimum amount of Rs. 6 lakhs on the booking of their home. The campaign struck a chord with Raunak Group’s audiences, guiding 103 families to book their permanent address within the developer’s projects.
Starting in the month of November 2017, Insomniacs and Raunak Group brought back the biggest home buying festival ever seen in Mumbai, i.e. the Raunak Home Buying Fest 2.0. The campaign promised one of the biggest offerings given forth by any real estate developer in Mumbai, giving customers a chance to spin their luck on the Wheel of Fortune which granted them prizes ranging from Gold to an EMI holiday to a massive cash voucher. The campaign turned out to be one of the biggest collaborative successes achieved by both the agency and the brand, leading to over 157 homes delivered to happy families.
Recently, Raunak Group launched their initiative to charge 0 GST on all of their under-construction projects, a first-mover advantage that has worked out in their favour.
Commenting on the development, Shyamal Mody, Director at Raunak Group, states, “When we first partnered up with Insomniacs and their team, we established all the mandates that were required from the agency and knew that they would deliver. Little did we know that they would take an idea and create multiple disruptions over digital media with our campaigns. They’ve taught me never to underestimate the power of a single tweet!”
Adding his insights on the matter, Insomniacs Co-Founder Govind Rai states, “We saw the scope of work that Raunak Group had conducted over the years and we believed in their vision. Hence, we decided to take their brand up another notch and reinvent their identity like never before, thereby bringing them closer to the people who they wished to communicate with. Our strategy along with the right tools is what helped our collaboration worked successfully, thereby resulting in the numbers you see today.’
Another achievement that was recently added to the list of Raunak Group’s accolades came on the occasion of Gudi Padwa, where 47 families booked their permanent addresses with the real estate developer, creating bonds that last a lifetime.
Real Estate Sector To Prosper Due To New Reforms
On Wednesday, a joint report by JLL and Credai mentioned that the country’s real estate sector is estimated to hit $180 billion by 2020 from $126 billion in 2015.
The ‘architects of changes’ through its various reforms and policies has carved a path for a highly beneficial environment for the industry stakeholders, as stated in the report. The latest development has led to a new and improved scope for the domestic real estate sector.
In the residential sector, investment inflows have amounted to Rs 59,000 crore since 2014 which is about 47% of the total invested money in real estate. The total contribution of the housing sector to the GDP is expected to double to 11% by 2020.
JLL, listing the seven trends that will develop the sector, said that the new RERA law is believed to bring together the Indian real estate sector while eliminating unscrupulous developers.
The reports talking about the goods and service tax said that further increases savings by 3-4%. However, within the micro-markets the prices would remain dependent on the demand and supply dynamics.
Nagpur, Chandigarh, Kochi and Patna are the cities in line to be the next growth centres after the right major cities, said JLL. The latest development in the foreign direct investment in the form of relaxation in the real estate sector has also resulted in the upswing of the industry. The report said, “Private equity and debt investments in real estate has increased by 12 % year-on-year across 79 transactions in 2017.”
New Agenda For Co-Working Spaces Is To Support Female Entrepreneurs
India is the third largest hub for all the start-ups in the world. But of this women-only constitute to 9% of the founders of these companies, as mentioned in the report by Grant Thornton and Assocham.
Shared workplaces are the new norm when it comes to work-spaces and with its latest agenda of going the extra mile for women have interesting offerings piled up for the recent future. A Gurgaon-based co-working space is working at starting a special women’s forum, wherein female community members will get a chance to interact, share experiences, brainstorm, and network.
The idea is to also come up with more women-centric events. A 28-year old, said, “As I get my fintech venture off the ground, I can draw from the strengths of other women with similar ambitions.” This initiative has led to getting support groups and mentor-ship sessions and networking events addressed by successful woman co-founders directed at the female community members looking to establish their own start-ups.
Experts opinion on this new development is that by creating such co-working spaces could prove resourceful in the greater female representation in the start-up scenario. 91springboard has come up with ‘Women Entrepreneurs’ League’, a micro-community of women who work together while also inspiring and encouraging each other to march forward into their business ambitions.
The main intention is creating a pool of inspired women sharing tools, knowledge, and network to help each other grow. Pranay Gupta, the co-founder said, “One of the recent programmes organized was a talk by senior woman entrepreneurs on how would-be founders can turn their dreams of starting up into reality”.
In order to take this drive forward the company is organizing a ‘free week’ at its Gurgaon hub in March, which will invite women to come and work in their space for a week without paying while experiencing the benefits of a co-working space and understanding its viability according to their start-up.
Sessions focusing on emotional well-being for female entrepreneurs, bootstrap budgeting for a company, taxation, investment and finances and most importantly social media presence on LinkedIn will be organized for them.
Various online communities for women will be explored and partnered with by 91springboard and Workspace to support their start-up a help them grow it. It will be an effective step for co-working spaces to drive partnership with the industry insiders for the better engagement of women entrepreneurs”, said Sudeep Singh, Co-founder of Gowork.
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