H1 2016, a recap

- A recovery predictedINDIA

REAL ESTATEJULY – DECEMBER 2016

KOLKATA

KOLKATAREAL ESTATE

H1 residential market recap

HAD STEADY LAUNCHES INA RESTRAINED MARKET;

SALES HAD DECLINED BY 10%

We predicted a 4% de-growth YoY in sales for H2 2016,

but Kolkata saw a steeper decline in H2 2016

New launches decline by 15%; Sales observe a fall of 20%

Half yearly trend in launches and sales

H2 2012 H2 2013 H2 2014 H2 2015 H2 2016 -

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

10,

720

8,1

57

15,

653

10,

680

9,0

93

Launches

No. o

f uni

ts

H2 2012 H2 2013 H2 2014 H2 2015 H2 2016 -

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

8,1

63

6,8

74

8,6

07

9,1

70

7,3

08

Sales

No.

of u

nits

15%

20%

Substantial fall in H2 2016 has pulled the annual numbers to

below 2015 performance

New launches witness a relatively controlled decline of 8%; Sales fall by 14%

Yearly trend in launches and sales

2012 2013 2014 2015 20160

5000

10000

15000

20000

25000

30000

35000

2204

7

2044

1 3026

4

2275

3

2098

4.25

Launches

No.

of u

nits

2012 2013 2014 2015 20160

5000

10000

15000

20000

25000

1639

4

1555

3

1875

1

2061

8

1764

6.8

Sales

No. o

f uni

ts

8%14%

While city sees subdued new launches overall, Rajarhat and

South Kolkata lead launches share in H2 2016

Rajarhat continues to lead in launches; South sees considerable growth YoY

in H2 2016Micro-marketwise half yearly trend in share of launches

Central East North Rajarhat South0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

1%

10%

20%

42%

27%

1%

10%

15%

40%

34%

H2 2015 H2 2016

Demand slackens in the city; South follows Rajarhat closely in

share of sales

Host of affordable projects in the Southern peripheral locations and upcoming metro rail

drive the demand Micro-marketwise half yearly trend in share of sales

Central East North Rajarhat South0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

1%

7%

21%

46%

25%

2%

11%

18%

35% 34%

H2 2015 H2 2016

QTS on a gradual decline;2.1 years to offload the unsold inventory

QTS trend

Jun-1

4Ju

l-14

Aug-14

Sep-14

Oct-14

Nov-14

Dec-14

Jan-1

5

Feb-15

Mar-15

Apr-15

May-15

Jun-1

5Ju

l-15

Aug-15

Sep-15

Oct-15

Nov-15

Dec-15

Jan-1

6

Feb-16

Mar-16

Apr-16

May-16

Jun-1

6Ju

l-16

Aug-16

Sep-16

Oct-16

Nov-16

Dec-16

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

8.5

10.411.1

12.012.5 12.1

10.7 10.4 10.09.5

8.3

QTS Unsold inventory

at 37,459 units

Impact of Demonetisation

New launches fall by 25% YoY in Q4 2016; Sales decline by 20%

Quarterly trend of new launches and sales

Q1 2014

Q2 2014

Q3 2014

Q4 2014

Q1 2015

Q2 2015

Q3 2015

Q4 2015

Q1 2016

Q2 2016

Q3 2016

Q4 2016

0

2000

4000

6000

8000

10000

12000

8347

6265

9739

5914 6523

55515562 4675

62135679 5587

3506

52654879

42124395

56645784

4684 42665241

50993895 3413

New Launch Absorption

No. o

f uni

ts

Q4 revenue loss for both State exchequer and industry

Average # units sold in Q4 2014 & Q4 2015 4,331

# Units sold in Q4 2016 3,413

21% fall in sales

Notional REVENUE LOSS to real estate industry

INR 500 cr

State government notional LOSS ON STAMP DUTY

INR 30 cr

Key takeaways

Launches go downhill, sales weaken in H2 2016 on a YoY basis

Garia, Baruipur and Narendrapur in South, Sodepur, BT Road and Madhyamgram in North, as well as Rajarhat

attract buyers due to affordable prices

Uncertainty likely to continue for the next quarter

Reduction in home loan interest rates, RERA, GST and ‘possible’ tax benefits in the upcoming budget likely to bring in a ‘feel good factor’

among buyers

Download the complete report from the link below:bit.ly/IREH216-SS