Real Estate Intellgence Service, Wednesday, September 2, 2009

No need to worry, growth set to pick up by Q4: PM

No need to worry, growth set to pick up by Q4: PM
The Economic Times, September 2, 2009, Page 9

It was a mix of good and bad news for the economy on Tuesday. While Plan panel said India would return to 9%-plus growth levels in two years, exports crashed for 10th straight month

Our Bureau NEW DELHI

THE country’s economic growth will start speeding up in the last quarter of this year to reach 9% levels in two years, a Planning Commission forecast said on Tuesday even as Prime Minister Manmohan Singh allayed fears over drought in large parts of the country.

The economy will grow 6.3% this year and 8% next year before returning to 9% growth in 2011-12, Planning Commission deputy chairman Montek Singh Ahluwalia said after the first meeting of the panel under the new government.

The prime minister, who chaired the meeting that assessed the economic situation, said the effect of the drought in more than 40% of the country is temporary on agricultural output and food price inflation.

“We should not be over-pessimistic. We are in a strong position to manage the consequences of drought. Our food stocks are very high,” Mr Singh said.

He said the government is making all efforts to protect the kharif, or summer crop, and ensure a normal rabi, or winter crop, season. Also, the rural job guarantee scheme will keep the impact of drought on rural poor minimal.

But the drought and the ebbing global recession will impact the economy in the second and third quarters with growth falling below the 6.1% mark recorded in the first quarter, according to Mr Ahluwalia.

India on Monday reported the first acceleration in economic growth in six quarters during April-June. According to policymakers and economists, it signals the worst is over for the economy, which has slowed down over the past one year as recession gripped the world.

The Plan panel’s growth projection factors in a pick-up in overseas demand and normal monsoon rains next year.

The panel also highlighted the need to revive investment, especially in infrastructure, and contain fiscal deficit—government spending over and above its receipts—within the target of 6.8% of the GDP. It called for a bold programme to sell stakes in PSUs to meet the resource gap in the next two fiscal years.

The meeting recommended that prices of petrol, diesel, gas and coal should be freed or linked to the international market. It underlined the need for expanding the scope of publicprivate partnerships to social sectors such as health, education and urban development.

Plan panel sees 6.3% growth

Plan panel sees 6.3% growth
Times of India, September 2, 2009, Page 24

NEW DELHI: Prime Minister Manmohan Singh has cautioned that despite a slight rise in growth, the road to recovery was a long haul, while the Planning Commission felt drought may pull down growth from 6.1% recorded during the first quarter even though 2009-10 may still end with a 6.3% expansion.

Addressing the plan panel on Tuesday, Singh said, ‘‘We have been through a difficult year because of the global economic downturn, which is only now coming to an end with a slow return to normalcy in the months that lie ahead. The country has also seen a poor monsoon.’’

Planning Commission deputy chairman Montek Singh Ahluwalia said, ‘‘The growth rate may turn worse in the current and next quarter because of the impact of drought.’’

UPA dispensation is concerned about the slow pace of economic recovery after the impact of the global downturn. However, anticipating a strong turnaround in the last quarter, Ahluwalia predicted GDP would expand to 6.3% in the current fiscal.

The plan panel’s presentation in the meeting, attended by FM Pranab Mukherjee, agriculture minister Sharad Pawar, power minister Sushilkumar Shinde and other key policymakers, expressed optimism about high growth path from the next fiscal.

The presentation said, ‘‘We project growth of 8% in 2010-11 and 9% in 2011-12. This is optimistic but not impossible. If we have normal monsoon in 2010-11, we can expect a strong rebound in agriculture next year.’’

The economy grew 6.1% in the first quarter, roughly in line with forecasts, but a poor monsoon threatens to erode growth later in the year even as it drives prices higher.

At the meeting which was called to deliberate on state of national economy and integrated energy policy, the PM also pointed out that rational energy policies were critical for rational responses to the threat of climate change.

‘‘This is a new compulsion. We need to assess whether we are on track in critical aspects of our energy policy. Energy is vital to our economic growth. This is an area where we are a deficit economy. We import over 70% of our petroleum energy needs and are also moving to a deficit position in coal,’ Singh said.

After UPA government was voted back, this was the first meeting of the full Planning Commission. It comes against the backdrop of the country facing one of the worst droughts in decades with 278 districts across 11 states declared drought-hit.

Reacting to plan panel’s note on inflation, deputy-chairman Ahluwalia said, ‘‘If drought is managed well and there is good rabi crop as well as fiscal consolidation, inflation may well be contained within the comfort zone.’’

Economy not as bad as it looks, says PM

Economy not as bad as it looks, says PM
The Financial Express, September 2, 2009, Page 10

fe Bureaus, New Delhi

Prime Minister Manmohan Singh on Tuesday said too much pessimism on economic growth is uncalled for the as global financial situation is returning to normal and the country could manage the drought very well.

“We are in a very strong position to manage the consequences of the drought. Our food stocks in particular are very high. The government is giving focused attention to all aspects of drought management, including both relief measures and efforts to protect the kharif crop as much as possible and to ensure a normal rabi season,” Singh said, while chairing the first meeting of the Planning Commission in the second term of the UPA.

Rains have been short of requirement this monsoon season. As on August 26, the overall rainfall was 24.6% lower than normal. But the country has buffer foodgrains of 50 million tonne, enough to meet the requirement of the public distribution system for 13 months.

Singh said, “We have to ensure that the momentum of planned development is maintained in the next two years and that our flagship programmes are fully funded”. The Planning Commission has projected a gap of Rs 1,60,000 crore to fund the government schemes in the remaining years of the 11th Five-year Plan (2007-08 to 2011-2012) in the absence of fiscal consolidation.

The global financial meltdown, which started last September, restricted the mobilisation of funds in developing economies and hit investments and growth. India’s economic growth dropped to 6.7% in 2008-09 from nearly 9% in the previous three years. The plan panel’s projection for economic expansion this year is still lower at 6.3%.

Seeking to calm down the nerves of economists, Singh said the global economic position that originally hit India’s economy is improving. “We have been through a difficult year because of the global economic downturn, which is now coming to an end with a slow return to normalcy in the months that lie ahead,” he noted.

Observing that there are some pending issues in the Integrated Energy Policy, the Prime Minister directed the Planning Commission to coordinate with the various ministries to address them. “There has been some progress in important areas, but the pending policy agenda is very large. Pursuit of these issues is the responsibility of different ministries. I direct the Planning Commission to pursue these issues.” As per the presentation given to Singh during the meeting, certain regulatory and policy changes are yet to be made by the ministries of petroleum, coal, power and new & renewable energy.

Singh said the government is working on streamlining of the Public Partnership Project (PPP) norms for higher private investments in health, education and urban development. “The progress (in implementation of PPP projects) has been less than what we would have wanted. We are taking steps to streamline the process so that PPP projects can move faster,” he added. Besides Planning Commission deputy chairman Montek Singh Ahluwalia, the meeting was attended by finance minister Pranab Mukherjee, home minister P Chidambaram and agriculture minister Sharad Pawar.

PM: raising resources key to growth

PM: raising resources key to growth
The Financial Express, September 2, 2009, Page 1

fe Bureaus, New Delhi

India will end the current financial year with a GDP growth rate of 6.3%, despite a slowdown in the second and third quarters. However, the figure is lower than the 6.7% achieved in 2008-09. The Planning Commission estimate released on Tuesday comes a day after government data showed first-quarter GDP growth at 6.1%.

The meeting of the commission, chaired by Prime Minister Manmohan Singh, said restoring the growth momentum would require filling a resource gap of Rs 1.6 lakh crore to finance public investment until 2012, the terminal year of the 11th Five-Year Plan. Without mentioning disinvestment in public enterprises, Singh said the plan panel has established the challenge of resource mobilisation. “We will have to give careful thought to the various suggestions made for raising additional resources,” he said.

Planning Commission deputy chairman Montek Singh Ahluwalia was more explicit: “A bold and clear disinvestment programme is needed to meet some of these gaps in 2010-11 and 2011-12.” The plan panel noted that robust growth in investment would depend “critically on (the government’s) ability to create a conducive atmosphere for private corporate investment”. This includes pushing for private-public partnership in infrastructure sectors, it noted. Public sector power firm NHPC listed on the exchanges on Tuesday at a 2% premium while Oil India’s IPO will open on September 7.

The plan panel’s figures and analysis not only reflects the UPA administration’s position on how to manage the economy, but will also guide its current term in office. It has projected average growth for the five-year period between April 2007 and March 2012 at 7.8 %, lower than its earlier projection of 9 %.

The estimates rolled out in the paper show overall growth will be supported by a recovery in industrial growth to 7.8% from the 4.1% recorded in 2008-09 as a result of the global economic slowdown. But growth in the services sector is expected to be at 8.2%, down 150 basis points from last year.

Agriculture and allied sectors will contract by 2.5%. The Prime Minister said he anticipated a shortfall in overall foodgrain production at between 18 and 29 million tonne.

This will drive inflation beyond 5%, as measured by the wholesale price index. “The situation could turn worse if agricultural outcomes turn out to be worse than projected,” the commission warned. The worst-case scenario painted by the panel says farm output could decline 6% in the current fiscal, weighing down overall economic growth to 5.5%. But Singh said India was in a strong position to manage the consequences.

Growth rate lowered, targets revised for the Eleventh Plan

Growth rate lowered, targets revised for the Eleventh Plan
Business Standard, September 2, 2009, Page 6

BS Reporter / New Delhi

Plan panel projects 6.3% growth for 2009-10

The Planning Commission today lowered the average growth target over the Eleventh Five-Year Plan period (2007-2012) to 7.8 per cent from an earlier projection of 9 per cent during the five years. It has projected 6.3 per cent growth for the current financial year 2009-10, assuming a contraction of 2.5 per cent in agriculture due to the weak monsoons. Foodgrain output is also expected to fall by 18 million tonnes as a result of drought.

The new projection puts the growth rate almost the same as the Tenth Plan period. Prime Minister Manmohan Singh, however, was optimistic about the economic outlook. “We have been through a difficult year because of the global economic downturn, which is only now coming to an end, with slow return to normalcy in the months ahead,” the prime minister said while addressing the meeting of the full Planning Commission.

The economy had grown by 6.1 per cent in the first quarter of the current fiscal, which is broadly in line with expectations. However, weak monsoons are expected to hamper growth in the coming months. “Growth in the coming two quarters will be lower than that of the first quarter (April to June). However, after that things will pick up in the fourth quarter,” Planning Commission Deputy Chairman Montek Singh Ahluwalia told reporters after the meeting.

Farm sector growth, which is expected to suffer in the current fiscal, is projected to bounce back to 6 per cent in 2010-11. The Plan panel report states that objectives of growth and food security cannot be achieved unless the farm sector achieves an average of 4 per cent growth during the Eleventh Plan period.

Rise in the wholesale price inflation (WPI) is a cause of worry and the panel report said that inflation might easily exceed the RBI projection of 5 per cent by March 2010. “It is evident that if we project underlying movement in WPI in the current year, we will end the fiscal year with inflation above the comfort zone of 4-5 per cent,” the panel said in a background note.

The panel report also expressed concern that drought would consume fiscal resources in an unanticipated fashion due to increased demand for reliefs from states. This is expected to lead to a gap of Rs 1.6 lakh crore of resources to finance the Plan.

US factory, home sales data signal economic recovery

US factory, home sales data signal economic recovery
Business Standard, September 2, 2009, Page 13

NEW YORK (Reuters) - The U.S. manufacturing sector grew in August for the first time in over a year and a half, while pending home sales surged to a two-year high in July, adding to mounting evidence the longest economic slowdown since the Great Depression is ending.

The Institute for Supply Management said its index of national factory activity rose to 52.9 in August from 48.9 in July. The median forecast of 78 economists surveyed by Reuters was for a reading of 50.5.

A reading above 50 indicates expansion in the manufacturing sector. The last time the index showed growth in the sector was in January 2008 with a reading of 50.8. August was the highest since a reading of 52.9 in June 2007.

The manufacturing and housing data pushed U.S. stocks higher and the Nasdaq rose more than 1.0 percent while Treasury debt prices added to losses with the 30-year bond falling more than a full point. The U.S. dollar fell against the euro and rose against the yen.

"Both reports are encouraging readings. I'm particularly encouraged by new orders and spread between new orders and shipments. The manufacturing recession is over. This is not necessarily a one-month event. This suggests manufacturing activity will be picking up," said Jonathan Basile, an economist with Credit Suisse in New York.

Regional U.S. regional surveys have shown business picking up steam in August, though employment remained weak, consistent with fears the United States could be in for a "jobless recovery."

Increased hiring is seen as critical to getting a consumer-led recovery under way. The U.S. unemployment rate was 9.4 percent in July. Economists expect a report on Friday to show it rose to 9.5 percent in August.

However, the employment component of ISM showed some small sign of hope, rising to 46.4 in August to its highest since August 2008 from 45.6 in July.

Many analysts forecast the U.S. economy will return to growth some time in the third quarter helped by the government's fiscal stimulus spending and the Federal Reserve's massive injections of liquidity into the banking system in the past year.

Also on Tuesday, the National Association of Realtors said its pending home sales index, based on contracts signed in July, rose 3.2 percent to 97.6, the highest level since June 2007, from 94.6 in June. Pending home sales contracts have risen for a record six straight months.

Analysts had forecast pending home sales to rise by 2.0 percent.

A nationwide slump in house prices for the first time since the Great Depression of the 1930s contributed to the credit crunch and contraction in economic activity in the past year, but recent housing data suggested home prices may have stopped falling.

Some stabilization in the three-year old housing downturn is seen as essential to any economic recovery.

Last week Standard & Poor's said prices of single-family homes rose for the second consecutive month in June, while the government said sales of newly-build single-family homes rose for a fourth straight month in July and the inventory of unsold new homes fell to the lowest in 16 years.

Earlier this month, the government said existing homes sales rose in July to mark the fastest pace in nearly two years.

Despite some optimism on manufacturing and the housing market on Tuesday, data also showed total U.S. construction spending fell 0.2 percent in July to the lowest rate since February 2004.

Analysts polled by Reuters had expected construction spending to remain unchanged from June. June's rise was revised down to 0.1 percent from the originally reported 0.3 percent.

Proposed IT township project near Rajarhat hits roadblock

Proposed IT township project near Rajarhat hits roadblock
The Hindu Business Line, September 2, 2009, Page 17

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Wipro and Infosys among others were supposed to have their facilities in the township.

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Our Bureau, Kolkata

The prospect of the proposed IT township near Rajarhat, on the fringes of Kolkata, seems to have hit a roadblock due to local disturbances related to land acquisition. Wipro and Infosys, among others, were supposed to have their facilities in the township.

Indicating this on the sidelines of a programme organised by the Bharat Chamber of Commerce here on Tuesday, Mr Debesh Das, West Bengal IT Minister, said, “The process (of land acquisition) seems to have come to halt for the time being and we would like to wait and watch.”

The State Government would not take any illegal land for the project, he said. Akash Nirman, the nodal agency for land acquisition in the project, was expected to hand over land to the State IT Department, which, in turn, was to offer the same to the IT companies.

Mr Das had earlier said that the State Government was ready to give 90 acres each to Infosys and Wipro as the aggregation of a contiguous 200 acres was complete.

The two companies, however, stated recently that they had no immediate plans in the project in view of the economic downturn.

Out of the 1,600 acres earmarked for the project, 600 acre was to be offered to IT companies, Mr Das had said, adding, ITC Infotech and ICICI’s BPO arm were also interested in taking land in the project.

Mr Raj Kishore Modi, one of the Directors of Akash Nirman, was arrested recently following a land-related controversy in the area after part of a nearby resort Vedic Village, of which Mr Modi is also a Director, was torched by locals.

Meanwhile, addressing the interactive session with the delegation from Wuhan province of China, Mr Das said that the State Government discussed with the members of the delegation, the prospects of setting up bases for solar invertors and optical fibre network in Kolkata in partnership with local companies.

STEEL PRICES MAY BE HIKED

STEEL PRICES MAY BE HIKED
The Times of India (Bangalore edition) Mint

Mumbai: Indian steelmakers are considering a price hike in September after global prices rallied in the past month, and a decision would be taken in a couple of days, industry officials said.

“People are sending out feelers in the market, today being the first. There is practicality in price hike but it is not frozen yet,” Ankit Miglani, director-commercial of Uttam Galva Steels, said.

“Internationally, there have been movements in the past two months. We are just trying to see if there is scope for a revision,” Jayant Acharya of JSW Steel said.

INDIA CHANGING ROAD SEC INVESTMENT NORMS: NATH

INDIA CHANGING ROAD SEC INVESTMENT NORMS: NATH
The Economic Times Business Standard

London: The government is changing some of the regulations in the road infrastructure sector to make it more attractive for investors, Minister for Road Transport and Highways Kamal Nath said today.

"We are modifying certain rules to make it much more investment friendly and investment worthy," he said.

Referring to some of the investors, who have sought certain clarifications, Nath said their concerns would be addressed.

The minister also said India plans to change the numbering of the National Highways in the country to make it more scientific, Nath said.

"We are changing the numbers of the National Highways and we are following a scientific pattern of numbering," Nath said after a one-day "Building India: Road Infrastructure Summit" at the St James Crowne Plaza here.

Nath, who was here to attract FDI in the infrastructure development in the country said, "India remains a very attractive destination for foreign investors and the response at the Summit is good." "With the kind of participation at today's Summit, we are quite hopeful."

Nath said he had discussions with some of the major investors and they have assured him that they are looking at India as "one of the best investment friendly countries."

Brahm Dutt, Secretary, Ministry of Road Transport and Highways, said, "the response at the summit has been very encouraging."

Nath said India planned to build 7,000 km roads per annum at the rate of 20km per day. "It will make a visible differences and we expect an investment of USD 10 billion in the next two years," he said.

He said initially there would be 130 mega-projects, which would go up to 320 projects. "Each project will cover 500 km, costing 1 billion dollars."

Answering questions on how the current Road Building projects were different from those that were initiated during the NDA Government under Prime Minister Atal Bihari Vajpayee, Nath said "We are going to build more roads this year than those built during the entire tenure of the Vajpayee government."

RAYMOND READY FOR REALTY

RAYMOND READY FOR REALTY
The Telegraph

Piya Singh, Mumbai

Raymond Ltd, the Gautam Singhania-controlled textiles company, has decided to diversify into real estate. The company’s Thane plant, spread over around 150 acres, could be the first to be developed.

According to sources, the top management has started discussions “internally” on moving out of Thane where it runs a mother plant that makes superfine worsted suiting fabrics and relocating to another company-owned plant in Vapi, Gujarat. However, the management has not yet fixed a deadline for the relocation.

On Monday, the company sent a notice to the Bombay Stock Exchange seeking shareholder approval through a postal ballot to amend the object clause of the company to include “real estate development” as a business.

Deepak Khetrapal, chief operating officer of Raymond, said, “We have sought shareholders’ approval to change the objects clause purely as an enabling resolution at this stage. The resolution will enable the company to examine the opportunities and revert with specific proposals to the board and shareholders.”

Responding to a query on whether the company was making moves to shift production facilities from Thane to Vapi, Khetrapal said, “Currently, all plants of the company, including Thane and Vapi, are operating concurrently.”

An analyst with Mumbai-based brokerage Motilal Oswal said, “Monday’s notice was a positive development for the company and it is logical to assume that the company would first develop its property at Thane.”

“The company has some 140 acres in Thane. The cost of this land would amount to roughly Rs 1,400 crore and after development the net spread (difference between cost of construction and sale price) could yield Rs 2,800 crore in revenues over the next three to four years.”

Another Mumbai-based analyst who tracks the textile sector said the management had indicated in the past that it would consider moving to Vapi as and when they expanded capacity at the Gujarat plant.

So far, Raymond has increased production at Vapi to 14 million metres per annum. A company spokesperson did not disclose how much capacity addition was expected in the future. Labour costs at Vapi would also be lower than that at the Thane plant, which employs 1819 workers, the analyst added. The Vapi plant has high-tech machinery such as warping equipment from Switzerland, weaving machines from Belgium and finishing machines from Italy.

Raymond is not the only textile company that is considering such a move. On Monday, Century Textiles, which shut down Century Mills in mid-town Mumbai a while ago, said the land would be developed for various commercial uses. Century Textiles, which has already demolished the building on this site, expects to spend Rs 625 crore over the next two years in the first phase of developing this land.

RAYMOND READY FOR REALTY

RAYMOND READY FOR REALTY
The Telegraph

Piya Singh, Mumbai

Raymond Ltd, the Gautam Singhania-controlled textiles company, has decided to diversify into real estate. The company’s Thane plant, spread over around 150 acres, could be the first to be developed.

According to sources, the top management has started discussions “internally” on moving out of Thane where it runs a mother plant that makes superfine worsted suiting fabrics and relocating to another company-owned plant in Vapi, Gujarat. However, the management has not yet fixed a deadline for the relocation.

On Monday, the company sent a notice to the Bombay Stock Exchange seeking shareholder approval through a postal ballot to amend the object clause of the company to include “real estate development” as a business.

Deepak Khetrapal, chief operating officer of Raymond, said, “We have sought shareholders’ approval to change the objects clause purely as an enabling resolution at this stage. The resolution will enable the company to examine the opportunities and revert with specific proposals to the board and shareholders.”

Responding to a query on whether the company was making moves to shift production facilities from Thane to Vapi, Khetrapal said, “Currently, all plants of the company, including Thane and Vapi, are operating concurrently.”

An analyst with Mumbai-based brokerage Motilal Oswal said, “Monday’s notice was a positive development for the company and it is logical to assume that the company would first develop its property at Thane.”

“The company has some 140 acres in Thane. The cost of this land would amount to roughly Rs 1,400 crore and after development the net spread (difference between cost of construction and sale price) could yield Rs 2,800 crore in revenues over the next three to four years.”

Another Mumbai-based analyst who tracks the textile sector said the management had indicated in the past that it would consider moving to Vapi as and when they expanded capacity at the Gujarat plant.

So far, Raymond has increased production at Vapi to 14 million metres per annum. A company spokesperson did not disclose how much capacity addition was expected in the future. Labour costs at Vapi would also be lower than that at the Thane plant, which employs 1819 workers, the analyst added. The Vapi plant has high-tech machinery such as warping equipment from Switzerland, weaving machines from Belgium and finishing machines from Italy.

Raymond is not the only textile company that is considering such a move. On Monday, Century Textiles, which shut down Century Mills in mid-town Mumbai a while ago, said the land would be developed for various commercial uses. Century Textiles, which has already demolished the building on this site, expects to spend Rs 625 crore over the next two years in the first phase of developing this land.

PREVAILING TRENDS IN INDIAN REAL ESTATE

PREVAILING TRENDS IN INDIAN REAL ESTATE
The Economic Times

In coming years, India and China are expected to outperform the global markets with a growth rate in the range of 7-10 percent. This will benefit all sectors, particularly the real estate, which is closely linked to high growth in the economy.

A decline in property prices, falling interest rates and stability in the job market has helped the sector gain momentum once again. As developers realised that affordability was the key to lure buyers, they experimented with ‘no frills’ smaller apartment sizes. Projects that were launched in this segment received a good response, which indicated that homebuyers were waiting for a good opportunity to make an entry.

It is not only the listed players but also the unlisted players that have realised that affordable housing is the way to grow. Listed players who have committed huge investments towards low-cost housing projects are Unitech, Puravankara, DLF and Omaxe. Amongst the unlisted ones, Tata Housing is championing the cause of housing for the lower middle class. Following closely are Raheja of Delhi; Mumbai-based Matheran Realty, Lodha Group and others.

Global property consultancy firm Knight Frank has estimated that affordable housing requirement would be in excess of 2 million units across key cities in India and 80 percent of demand is expected to originate from the Rs 3-5 lakh income group. It is seen that real estate sector is realigning its focus towards affordable housing and is estimated to reach a whopping market size of over Rs 3 lakh crore by 2011. With the sixth pay commission being implemented, those government employees who could not participate in the earlier real estate cycle will now be participants in the market. This, along with private sector employees who had postponed purchasing homes due to uncertainty in the market, would also be scouting for good bargains.

The combined effect of increasing sales and restructuring a major portion of debt has improve the liquidity position of most of the developers. An equally important timing of the upturn in the equity market opened another option of fund raising for these cash-starved companies.

Realty stocks had corrected 80-90 percent over January '08-March'09, but rebound back significantly. A number of builders including the likes of Unitech, Indiabulls Real Estate, HDIL, Orbit, DLF and Puravankara took advantage of this and either announced or raised foreign money in the past two-three months. This funding has come at the right time as it boosts the retail investors' confidence in the sector.

As more funds become available, developers will divert all focus towards completing under construction projects. This, coupled with stable commodity prices, will help in faster execution of projects, leading to releasing of piled up inventory and rolling of the cash flow cycle. If the builders continue with a low price regime, then there is tremendous housing demand to be met. However, if developers become too optimistic, as is visible, and start increasing prices, it could turn out to be a big blow to the industry, which is still recovering from its recent fall.

Despite the fact that stocks are still 20–30 percent off their highs, factors like strong balance sheet position, increased liquidity infusion, a stable government, and an improved employment scenario, suggest that there is a fair chance that going ahead, the sector's fundamentals may improve. Though it might be premature to speculate a swift recovery at this point, there are convincing signs that show the sector is moving towards a revival.