pune realestate report

PUNE RESIDENTIAL REAL ESTATE REPORT

ASK group has a heritage dating back to 1983. It is a diversified Financial Services group renowned for its strong research infrastructure and investment advice. Our group is accredited with having launched the Portfolio Management Services (PMS) in India.

Our group, which pioneered the concept of equity research in India, is today a leader in the areas of portfolio management and investment advisory services and manages the portfolios of some of the most affluent families in India. With two and half decades of presence in capital markets, ASK group has been a true believer in the India growth story and over the years has grown hand-in-hand with its clients across the globe. Integrity, Reputation & Relationship with clients are the critical pillars on which the group has based its foundation. These values testify a distinctive corporate culture.

ASK group manages assets of more than US $1 Bn for its clients in Equity PMS, Wealth Advisory and Real Estate PMS.

ASK Property Investment Advisors (ASK PIA) is a venture of the ASK group set up to manage and advise real estate dedicated funds. This initiative of the group rests on the backbone of extensive investment and asset management expertise backed by a strong research focus. The real estate team has over ten decades of cumulative experience and comprises some of the best professionals with risk management, corporate lending, real estate advisory, construction and asset management experience.

ASK Property Investment Advisors

AAbout ASK Group

Funds Under Management:

ASK Group had raised US$ 75 mn (Rs 3260 Million) under tough

market conditions (March 2009-December 2009) and has

committed 90% till date. The capital has been committed in seven

residential projects covering four cities- National Capital Region

(NCR), Pune, Bangalore and Chennai.

ASK Real Estate Special Opportunities Fund has so far raised

Rs. 625 crore ($125 million) for its second real estate fund and is

targeting Rs 1,000 crore by March 2012.

ASKPIA has also announced its first investment in Mumbai from

its second real estate fund.

Pune Residential Real Estate

December, 2011

Key conclusionsŸ

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Pune’s population has seen a gradual shift

towards higher proportion of Service

professionals

Improving income profile driven by IT,ITES, Bio-

Technology & Engineering to improve

affordability

Annual requirement of houses to remain in the

range of 45,000-55,000 per year over next two

years

Real estate prices expected to remain

firm/marginally rise with low vacancy levels and

steady absorption trends

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Indian Real Estate Sector – An Overview

Pune

Demographic and economic profile

Housing demand estimation and outlook

Supply situation and pricing outlook

Micro – market wise analysis

North-East region

North-West region

South-East region

South-West region

Pune Central region

Upcoming Supply trends

IIndex

Indian Real Estate scenario

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Investments in Real Estate led to higher growth rate as compared to overall GDP

FDI in Real estate led to strong inflow providing additional funds to developers; however FDI flows showed signs of slowdown during 2010-11

High GDP growth led to rising incomes during 2002-03 to 2007-08, however recovery post 2008 global financial crisis has been anemic

RReal estate GDP grew at higher pace than overall GDP

Note 1 includes Real estate, ownership of dwellings & business services Real estate GDP growth for 09-10, 10-11 are estimated based on GDP growth QE- Quick Estimates, RE-Revised EstimatesSource: MOSPI (Ministry of statistics and programme implementation)

Note : Annual data is for financial year (Apr-Mar)Source: Department of Industrial Policy & Promotion, RBI

Real estate GDP growth higher than overall GDP

5.8

3.8

8.5

7.5

9.5 9.69.3

6.8

8.0

8.5

5.95.4

8.38.6

10.810.1 10.5

7.1

8.4

8.9

3.0

5.0

7.0

9.0

11.0

2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 (QE)

2010-11 (RE)

per

cen

t

GDP at constant prices Real estate GDP 1

Rising FDI equity investment in Housing and Real Estate

16,000

14,000

12,000

30,000

8,000

6,000

4,000

2,000

Rs. crore

2,121

8,749

12,62113,586

5,149

2006-07 2007-08 2008-09 2009-10 2010-11 2011 (Apr-Sept)

2,043

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Housing loan grew at CAGR of 75% during 2002-03 to 2005-06; Rising real estate prices, interest rates and economic slowdown led to

decline in subsequent years with recovery starting from 2009-10

Growth in residential demand (end user and investment) led to sharp rise in real estate prices

SStrong demand led to high loan disbursal and rise in prices

Trend in Housing loans Trend in Residential Real estate prices

70,000

60,000

50,000

40,000

30,000

20,000

10,000

0

Rs. crore

Note: Data relates to select 47 banks accounting for 95% of total non-food credit given by all scheduled commercial banksSource: RBI annual reports

Note: H1: Jan-Jun; H2: Jul-Dec; Q1: Jan-Mar; Q2: Apr-Jun; Q3: Jul-Sep; Q4: Oct-DecSource: National Housing Bank - Price Index

Mar-03 Mar-04 Mar-05 Mar-06 Mar-07 Mar-08 Mar-09 Mar-10 (Apr-Oct) 2011

Mar-11

0

50

100

150

200

250

300

Index

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Ÿ Draft Real Estate (Regulation and development) Bill 2011 introduced for suggestions

Ÿ The Land Acquisition, Rehabilitation and Resettlment Bill introduced in 2011

Regulatory measures introduced by RBI since November 2010 and National Housing Bank in 2011:

Cap on LTV (Loan to Value) to 80%

Increase in risk weight for loans more that Rs.75 Lacs to 125% : Higher provisioning is likely to lower further loan disbursement

Increased Standard asset provisioning to 2% for teaser loans

Increased provisioning from 1 to 2 percent with respect to Real estate loans

NHB has raised the provisioning requirement for doubtful assets up to 100% & asked to set aside 0.4% of the total outstanding "standard"

loans as a buffer

Public sector banks have been given a strong message from the regulator after the recent exposure of a scam between an intermediary and

public sector housing finance company

Increase in Minimum Capital Adequacy ratio for deposit-taking non-banking financial companies (NBFCs) from 12 per cent to 15 per cent

Focus on monitoring of end-use of funds given to the developers

Home loan for the third house to be treated as commercial property

To attract higher risk weight of 100% compared to 50% for residential real estate

CCurrent Scenario…. Regulatory Changes

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Planning Commission expects India’s GDP growth of 8.5-8.7

per cent during the 12th Five Year Plan period (2012-17)

Domestic demand, Large growing young population,

robust consumption and investment rates

Prospects of rise in salaries and improvement in affordability

Ramp-up in hiring by IT /ITES sector expected in 2012-13

Infosys to hire 23,000 engineers (plans to hire local

overseas staff)

TCS plans to add around 45,000 employees

Incentives for affordable housing projects introduced in

Union Budget 2011-12

Existing scheme of 1% interest subvention has now been

extended to Rs 15 lakh for house costing up to Rs 25 Lakh

CCurrent Scenario…. Positives

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Rise in interest rates by 350 bps since March-09 and

requirement for higher contribution (LTV at 80%) by the home

buyer has resulted in further deferral of demand

Despite rising incomes and jobs, home seekers waiting for

prices to decline

Stringent norms to delay availability of funds to real estate

developers; strict monitoring of end-use of funds by Banks

Higher provisioning requirement to lock up funds and restrict

credit to the Real estate sector

Tightening liquidity forcing developers resorting to high cost

funds; developers with severe liquidity crunch likely to offer

waiver on other charges, stamp duty etc..

Global financial stress may impact job hiring outlook which

may be a cause of concern in the short term

IImpact on the Real Estate Sector

Pune Real Estate

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Population-5.7 mn (Est.) 2011- includes area of PMC, PCMC,

Khadki and Pune cantonment

Leading education hub with 150 plus colleges

IT/ITeS, Engineering, Auto& Auto components and Forging

are the key industries

Pune district has per capita income of Rs 111,637 in 2009-10,

second highest in Maharashtra

PPune Urban Agglomeration

Note: PMC-Pune Municipal Corporation area, PCMC- Pimpri-

Chinchwad Municipal Corporation

Proposed Metro Line

Proposed Metro Stations

PMC Boundary

Cantonment Area

Existing Highways/Expressways

Existing Secondary Roads

Railways Line

River / Canal

Proposed High Capacity Bus Route

Proposed Bus Rapid Transit

City Bus Station

Railway Station

Existing / Proposed AirportSource : Propequity, ASKPIA

PPune City -Demography

Location map of Pune city

Source : Census of India, State economic survey

Key Facts of Pune City

Area

Total Population (2001)

Total Population (2011) (Est.)

Decadal Growth Rate

Density (2011)

Literacy Rate (2001)

Per Capita Income (INR) (2009-10)

Workforce Participation Rate (Census 2001)

Sex Ratio (1000/males)

Major Industries

430 Sq.Km.

25,38,473

40,95,340

61.3%

9,524 Persons/Sq.Km.

71%

1,11,637

34.08%

922 Females

IT/ITeS, Bio-TechnologyAuto, auto ancillary and

Engineering

PPune City – Profile and Connectivity

Ÿ Pune- Cultural capital and leading centre of education in Maharashtra

Ÿ Well established manufacturing base of Auto, Auto-Ancillary , Forging and sugar

industries

Ÿ Leading region in IT/ITeS sector with more than 1,000 units operating in the STPI

Ÿ Pimpri-Chinchwad is a major industrial hub and is one of the biggest industrial zones in

Asia.

Ÿ Major software companies in Pune include Accenture, Infosys, IBM India, Persistent

Systems, Wipro, TCS, Cognizant, Symantec, Tech Mahindra and Syntel

Ÿ Leading companies in the manufacturing sector include Bajaj Auto,Telco, Kinetic

Engineering,Thermax,Bharat Forge, Mercedes-Benz India , Volkswagen, Lupin Labs,

Suzlon

Source : ASKPIA, Propequity

Connectivity

By Air

By Rail

- Pune International Airport- Able to handle an average of 125,000 passengers per month- Well connected to all major Indian airports within two hours flying time

Details

- One of the main stations on the Central railway for trains that travel to Mumbai- Connected to Pimpri-Chinchwad by local trains- Daily express trains connect Pune to all major stations

By Road - National Highway 4 (NH 4) connects it to Mumbai, Bangalore, Sangli and Kolhapur- NH 9 to Solapur and Hyderabad, NH 50 to Nashik

Air Connectivity

International

Pune - Dubai, Frankfurt and Singapore

Pune - Delhi, Mumbai, Chennai, Ahmedabad, Bangalore, Goa, Kolkata

National

PPune City –Key Infrastructure Initiatives

Description

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Construction of 9 railway over bridges, 2 river over bridges,

15 flyovers

The project cost is estimated to be Rs. 260 crore

Flyovers at Hadapsar Saswad, road widening at Baner Road, Flyover at University, Wakad Aundh Road widening

Flyover at Chinchwad- Chaphekar Chowk

Flyover joining Nashik Phata & Chakan

Two metro routes being planned in first phase

The Metro Corridors planned within Pune would reduce road traffic and improve connectivity within various regions, which are currently not easily accessible.

It would benefit both Pune and Pimpri-Chinchwad by reducing the congestion on major arterial roads and improving connectivity within the city

It will be a major link connecting the software parks development in the east and north east of the city

Connectivity to areas like Undri, Pisoli, Katraj,Kondhwa Budhruk

Subway have been planned to avoid congestions at Highway junction

MIDC areas of Talegaon, Chakan (location for proposed international airport)

Projects

Pune city Integrated Road project

Flyovers

Metro Rail

90 feet Ring Road project

Old Mumbai-Pune Highway Widening project

Development Agency

MSRDC

PCMC

PMC

PMC

MSRDC Ÿ All work completed

Ÿ Project approved by Municipal Corporation in March-11

Status

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Work of flyover in progressWork on Nashik Phata & Chakan flyover began in March-10

Ÿ Project approved by State Govt in Feb-11

Source : Propequity, ASKPIA

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road widening nearing completionConstruction of Flyovers completed, Kharadi Bypass

SShift in demographic profile in last 2 decades

Regions (Population)

PMC

PCMC

Pune cantonment

Khadki cantonment

Total

Decadal growth rate

1971

8,56,105

98,572

77,774

65,497

10,97,948

1981

12,03,363

2,51,769

85,986

80,835

16,21,953

48%

1991

16,91,430

5,20,639

82,139

78,323

23,72,531

46%

2001

25,38,473

10,06,417

1,01,723

98,090

37,44,703

Decadal Growth Rate

50%

93%

24%

25%

58%

2011P

40,95,340

14,77,986

1,06,925

1,03,106

57,83,357

Decadal Growth Rate

61%

47%

5%

5%

54%

Source: Pune CDP, Pune Metro Rail report

Ÿ 1991-2001 - An era of manufacturing led population growth in PCMC area due to growth in Auto and Auto ancillary industry

Ÿ 2001-2011 – Ushered IT/ITeS led growth with setting of STPI in Hinjewadi

Ÿ New regions – Kharadi, Baner emerged as IT Hubs

Ÿ PCMC region witnessed relocation of companies for operational efficiencies

The demographic profile of Pune saw a gradual shift towards higher proportion of

Service professionals with higher income range compared to the Working class profile of the 1990’s

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Per capita income much higher than State due to strong economic growth primarily from IT/ITeS industry

Increasing growth of IT /ITeS industry has provided strong growth in job opportunities in past few years

IIT industry growth propelling high rise in incomes

Source: Maharashtra Economic survey Source: Industry , STPI

52,811 59,992

71,073

96,541

1,11,637

36,090 41,144

49,058

64,238

74,027

20,000

40,000

60,000

80,000

1,00,000

1,20,000

2005 -06 2006 -07 2007 -08 2008 -09

Provisional Est.

2009 -10

Preliminary Est.

Rupees

Per capita income at current prices

Pune District Maharashtra

45%

03 -04 04 - 05 05 - 06 06 -07 07 - 08 08 -09 09 - 10 10 - 11E

Pune STPI Maharashtra % share

48% 50%10,000

20,000 52%

55%

55%

55%

59% 58% 60%

55%

60%

65%

70%

30,000

40,000

50,000

60,000 Rs crore

Pune share in IT exports

Demand estimation approach and outlook

SStable growth in population will moderate demand for houses

2001

25,38,473

10,06,417

1,01,723

98,090

37,44,703

8,28,890

4.5

2011P

40,95,340

14,77,986

1,06,925

1,03,106

57,83,357

14,45,839

4

6,16,949

61,695

Note: The average household size is assumed to decline with growth in nuclear families

Source: CENSUS, RITES, PMC and ASKPIA

Ÿ Annual requirement for houses expected to grow annually by 56,000 units based on population estimated as per Pune development plan

Ÿ Growth in population expected to moderate on higher base

(Population)

PMC

PCMC

Pune cantonment

Khadki cantonment

Total

Number of households

Average Household Size(per Household)

Incremental Households in a decade

Annual requirement for Houses - (Assuming equal absorption)

2021P

52,41,758

17,78,293

1,12,394

1,12,182

72,44,627

20,12,396

3.6

5,66,557

56,656

Census data based on growth expected in households and houses

OOffice space absorption indicate sustained hiring

Office space absorption (sq. ft)

2,252,600

612,000

596,950

832,450

1,123,100

1,304,600

1,782,300

984,400

1,120,550

1,356,100

1,448,825

1,994,625

Note: Average office space has been assumed to be 150 sq ft per employee with 2 shifts


Ÿ Existing employment leading to an estimated need of 45,000 houses annually

Ÿ Office space availability of 11 mn sq. ft. during next two years indicate a potential requirement of 47,000 houses leading to sustained

demand for houses (rental or owned houses)

Quarter

Jul-Sep-08

Oct-Dec-08

Jan-Mar-09

Apr-Jun-09

Jul-Sep-09

Oct-Dec-09

Jan-Mar-10

Apr-Jun-10

Jul-Sep-10

Oct-Dec-10

Jan-Mar-11

Apr-Jun-11

Estimated employment based on Office space absorption

Annual addition

46,154 (9 months)

67,233

65,465

Estimated employee addition

30,035

8,160

7,959

11,099

14,975

17,395

23,764

13,125

14,941

18,081

19,318

26,595

TTrend in sales registration in line with demographic growth

Note :Sale agreement data includes – Land sale, commercial sale and residential sale (New homes & Re-sale). Registration of property is with a lag of 3-6 monthsCertain months are considered inauspicious for any new purchases ( 15 day before Dashera ~ Sept-Oct period ) depending on Hindu calendar

Source: Stamp duty Registrar, Maharashtra

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

Apr -08 Jul -08 Oct -08 Jan-09 Apr -09 Jul -09 Oct -09 Jan-10 Apr -10 Jul -10 Oct -10 Jan-11 Apr -11

Units

42,485

Trends in registation of Sale agreement

71,601

78,948

{Ÿ Residential new homes registration agreements estimated to be

45,000 in 2009-10 and 50,000 in 2010-11

Ÿ Sharp recovery in demand in 2009-10 has been sustained in

2010-11

New Home registrations estimated to be

around 63% - of total sale agreements

{

{

SShift in income profile to reflect in demand for houses

Note :1. Gross annual income for manufacturing and services sector have been sourced from primary sources2. Obligation percent has been based on loan norms followed by private sector banks3. Rate of interest has been assumed to be constant across loan slabs4. Floating rate of interest is as of December, 2011

Particulars

Gross annual Income per employee

Person earning per family

Monthy Gross Income of family

Obligations (Tax, monthly exp) %

Income available for EMI (Rs per month)

Term in years

Rate on interest

EMI for Rs 1,00,000

Loan eligibilty (Rs lakh)

Loan to value

Property cost (Rs Lakh)

Income profile and Property cost affordabilty

Manufacturing Sector

Working class

3,00,000

1

25,000

58%

10,500

20

10.75%

Rs. 1,015

10

80%

13

Executive level

6,00,000

1

50,000

58%

21,000

20

21

80%

26

10.75%

Rs. 1,015

Services sector

Entry Level

3,00,000

2

50,000

58%

21,000

20

10.75%

Rs. 1,015

21

80%

26

Middle Level

12,00,000

2

2,00,000

58%

84,000

20

83

80%

103

10.75%

Rs. 1,015

Senior Mangtt. Level

25,00,000

2

4,16,667

58%

1,75,000

20

172

80%

215

10.75%

Rs. 1,015

Shift in income profile with higher proportion of service professionals to result in change

in Pune real estate market in terms of preference for apartment size and facilities

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Based on the two approaches projected demand for houses will be :

Source: ASKPIA

Estimated new home registrations at 50,000 is line with above estimations; we expect demand to grow at an average of

50,000 units annually

Shift in income profile to result in change in demand profile of houses as more service professionals are added to existing

population- the mix of service professional is expected to be 65% of the working population

KKey Conclusions

Demand estimation

Demographic

Commercial space

Houses

56,000

47,000

Pune City Residential supply –Trends and outlook

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Pune has estimated - 468 builders; 296 builders registered with CREDAI, Pune

Builders bound by code of ethics to promote highest standard of promotion, development and construction activities

Integrated township projects like - Magarpatta, Blue-ridge, Nanded city, IVEN township, Megapolis, KUL Ecoloch and

Amanora on outskirts

Applicable FSI in the PMC and PCMC limits is 1.0. In addition a TDR of 0.6 is given for PMC and 0.4 for PCMC area

SSupply – Real Estate Landscape

PPune- Key Regions And Micro-markets

South-West Region BavdhanDhayariErandwaneKarve NagarKothrudSinhagadh RoadSinhagadhVadgaon BudrukWarje

North- East RegionAirport RoadKalyani NagarKharadiKoregaon ParkLohegaonNagar RoadParvatiVadgaon-SheriVimannagarVishrant WadiWagholiYerawada

North-West Region Akurdi Aundh Baner Baner- Pashan Bhosari Chinchwad Hinjewadi Kalewadi Nigdi Pashan Pimple Saudagar Pimpri Rahatani Sus Road Wadgaon Wakad

North -West

South – West

North- East

South-East RegionCampFursungiHadapsarKondhwaManjariMundhwaNIBM RoadSalisbury ParkSholapur RoadUndriWanowrie

South- East

Central PuneBund gardenS.B. RoadShivajinagarUniversity roadDeccanShanivar pethTilak roadPrabhat RoadKarve RoadStation Road

Pune Central

Source : ASKPIA,Propequity

12,667

9,144

4,539

6,724

3,593

8,100

3,510

3,022

1,370

3,589

7,983

10,718

14,586

8,061

1,506

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000Units

Quarterly Trends of New Project Launches

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

0

10000

20000

30000

40000

50000

60000

2008 2009 2010 2011 2012 2013 2014

per centUnitsTrend of Supply - Absorption in Pune

Supply Absorption Cumulative Availability %

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Low cumulative availability of 19% till 2014 indicates healthy absorption trends

Increase in projects launches and low availability indicate healthy demand trend

HHigh absorption of existing stock and new launches indicate sustained demand growth

Q1-20

08

Q2-20

08

Q3-20

08

Q4-20

08

Q1-20

08

Q1-20

09

Q2-20

09

Q3-20

09

Q1-20

10

Q2-20

10

Q3-20

10

Q4-20

10

Q1-20

11

Q2-20

11

Q3-20

11

Note: The analysis is based on year of completion of the projects. Absorption figures are at present levels.



SSupply in tandem with demand……..

Source : Propequity, ASKPIA Note: Absorption includes units launched in previous yearsSource : Propequity, ASKPIA

Fresh Supply 24,159 units in Jan-Jul 2011

1 BHK

2 BHK

3 BHK

4 BHK

5 BHK

4 BKH

2.2%

5 BKH

0.3%

1 BKH

14.0%

2 BKH

49.6%

3 BKH

33.9%

Total Absorption - 27,175 units in Jan-Jul 2011

4 BKH

2.3%

5 BKH

0.3%

1 BKH

13.6%

2 BKH

51.1%

3 BKH

32.7%

1 BHK

2 BHK

3 BHK

4 BHK

5 BHK

Segment-wise supply-absorption has been balanced leading to stable movement in prices;

Higher absorption number has lowered the existing stock levels

Region-wise analysis

NNorth-East Pune

North- East RegionAirport RoadKalyani NagarKharadiKoregaon ParkLohegaonNagar RoadParvatiVadgaon-SheriVimannagarVishrant WadiWagholiYerawada

North - East

Ÿ Location of Airport in the region was

conducive for growth of Commercial

office driven by IT parks

Ÿ Leading IT parks in the region are

Pancshil, Raheja, EON

Ÿ Widening of Nagar Road improved the

connectivity and led to higher office

space demand

Ÿ Premium areas of Pune like Boat club

road, Koregaon park and Kalyani nagar

are located here

Source : Propequity

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

2008 2009 2010 2011 2012 2013 2014

per centUnits

Trend of Supply - Absorption in North East Pune

Supply Absorption Cumulative Availability %

367

2,098

1,031

2,511

773

279

1,416

1,381

236

760

1,2041,295

1,229

2,694

1,953

853

0

500

1,000

1,500

2,000

2,500

3,000 Units

Trend of New launches in North East Pune

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This region accounts for 14% of Pune’s supply with overall vacancy at 18%

These region with elite residential localities has lower quantum of launches, however new regions are witnessing higher launches in past

6 mths

Proximity to airport, SEZ space and connectivity to other parts of city has led to growth of commercial space in this region; Residential

demand growth is thus expected in region like Kharadi which has larger land parcels and comparatively lower rates in the region

SSupply in upcoming areas with high absorption

Note: The analysis is based on year of completion of the projects. Absorption figures are at present levels.Source : Propequity, ASKPIA

Note :Q1-Jan-Mar, Q2-Apr-Jun, Q3- Jul-Sep, Q4- Oct-Dec


Q3

07

Q4

07

Q2

08

Q1

08

Q3

08

Q4

07

Q1

09

Q2

09

Q3

09

Q4

09

Q1

10

Q2

10

Q3

10

Q4

10

Q1

11

Q2

11

Ÿ

Ÿ

Region witnessed steady appreciation in prices except weakness during Q4,2009

Prices are expected to remain stable in premium areas, while they will rise in upcoming areas

SStable to steady price rise scenario expected during 2012


2,000

2,750

3,500

4,250

5,000

5,750

6,500

7,250

Rs per sq ft

kalyani nagar Kharadi Vimannagar

Source : Propequity,ASKPIA

PPrice trends in micro-markets

Quarter

Q3-2007

Q4-2007

Q1-2008

Q2-2008

Q3-2008

Q4-2008

Q1-2009

Q2-2009

Q3-2009

Q4-2009

Q1-2010

Q2-2010

Q3-2010

Q4-2010

Q1-2011

Q2-2011

Q3-2011

Weighted average prices (Rs. per sq. ft)

Kalyani Nagar

5,085

5,182

5,341

5,558

5,802

5,926

5,843

5,830

6,126

6,471

6,741

7,150

6,929

6,400

6,500

6,750

6,750

Kharadi

2,946

3,116

2,972

3,049

3,020

3,001

3,298

3,363

3,135

3,211

3,270

3,073

3,423

3,694

3,857

4,022

4,069

Vimannagar

2,981

3,122

3,685

3,744

3,783

3,660

3,436

3,419

3,464

3,418

3,406

3,655

3,743

3,975

4,745

5,054

5,100

NNorth-West Pune

Ÿ Pimpri-Chinchwad and Hinjewadi are the

two main growth corridors of the region

Ÿ Hinjewadi- started in 1998 has ushered

the IT growth in Pune region

Ÿ Prominent IT players like Infosys, TCS,

Wipro, IBM have set up centres at

HinjewadiNorth -West

Source : Propequity

North-West Region Akurdi Aundh Baner Baner- Pashan Bhosari Chinchwad Hinjewadi Kalewadi Nigdi Pashan Pimple Saudagar Pimpri Rahatani Sus Road Wadgaon Wakad

4,775

9,863

6,558

3,814

2,164

3,142

1,008

2,1292,394

1,645

4,258

3,245

6,937 7,722

4,784

3,054

0

2,000

4,000

6,000

8,000

10,000

12,000 Units

Trend of new launches in North West Pune

Ÿ

Ÿ

Ÿ

North-West region accounts for highest share of supply at 45 % - main region being PCMC and IT hub of Hinjewadi

The region has low vacancy level at 19% due to growth in new residential areas with upcoming IT locations

Saturation of residential area in the existing IT belts will lead to development of areas with better connectivity and proximity to offices -

Residential demand in the region to see strong growth in regions like Baner and Wakad

RRegion with highest supply share at 45%

Note :Q1-Jan-Mar, Q2-Apr-Jun, Q3- Jul-Sep, Q4- Oct-DecSource : Propequity, ASKPIA

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

0

5000

10000

15000

20000

25000

30000

2008 2009 2010 2011 2012 2013 2014

per centUnits

Trend of Supply - Absorption in North West Pune

Total Supply Total Absorption Cumulative Availability %


Q3

07

Q4

07

Q2

08

Q1

08

Q3

08

Q4

08

Q1

09

Q2

09

Q3

09

Q4

09

Q1

10

Q2

10

Q3

10

Q4

10

Q1

11

Q2

11

Ÿ

Ÿ

Prices have been in affordable range for middle income groups

Region is expected have continued demand; prices to remain firm in 2012

SStable to steady price scenario expected during 2012


2,500

3,000

3,500

4,000

4,500

5,000

5,500

6,000

Rs per sq ft

Aundh Baner Hinjewadi Pimple Saudagar

Q3-20

07

Q4-20

07

Q1-20

08

Q2-20

08

Q3-20

08

Q4-20

08

Q1-20

09

Q2-20

09

Q3-20

09

Q4-20

09

Q1-20

10

Q2-20

10

Q3-20

10

Q4-20

10

Q1-20

11

Q2-20

11

Q3-20

11



Quarter

Q3-2007

Q4-2007

Q1-2008

Q2-2008

Q3-2008

Q4-2008

Q1-2009

Q2-2009

Q3-2009

Q4-2009

Q1-2010

Q2-2010

Q3-2010

Q4-2010

Q1-2011

Q2-2011

Q3-2011


Aundh

4,262

4,300

4,405

4,591

4,778

4,667

4,671

4,687

4,680

4,875

4,839

4,857

5,019

5,323

5,539

5,784

5,825

Hinjewadi

3,462

3,465

3,370

3,364

3,454

4,000

3,768

4,049

3,689

3,578

2,661

2,775

3,053

3,126

3,041

3,266

3,301

Baner

3,463

3,466

3,448

3,776

3,934

3,944

3,838

3,222

3,516

3,566

3,613

3,768

3,824

3,974

4,045

4,175

4,443

Pimple Saudagar

2,682

2,787

2,897

3,093

3,182

3,151

2,871

2,868

2,955

3,146

3,304

3,536

3,554

3,664

3,934

4,089

4,169

SaSouth-East Pune

Ÿ Magarpatta- the integrated township

project changed the profile of the region

Ÿ NIBM region has witnessed growth due

to better educational facilties

Ÿ Higher migrant population has led to

demand growth in less preferred

locations

South-East RegionCampFursungiHadapsarKondhwaManjariMundhwaNIBM RoadSalisbury ParkSholapur RoadUndriWanowrie

South- East

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

0

2000

4000

6000

8000

10000

12000

14000

16000

2008 2009 2010 2011 2012 2013 2014

per centUnits

Trend of Supply - Absorption in South East Pune


Ÿ

Ÿ

Ÿ

One of the upcoming regions with the success of integrated township model-Magarpatta, leading to improved profile of the region

Vacancy of 18% for projects launched indicate healthy demand trend

Quantum of new launches has been improving in past three quarters

26% of Pune’s supply expected in the region



2,569

2,632

3,049

3,115

1,896

3,544

1,774

1,747922

384 1,271

1,649

2,571

2,869

2,561

3,197

0

1,000

2,000

3,000

4,000 Units

Trend of new launches in South East Pune

Q3

07

Q4

07

Q2

08

Q1

08

Q3

08

Q4

08

Q1

09

Q2

09

Q3

09

Q4

09

Q1

10

Q2

10

Q3

10

Q4

10

Q1

11

Q2

11

Ÿ High absorption to result in increase in prices as eastern corridor is preferred over other regions

HHigh absorption to drive prices


2,700

2,900

3,100

3,300

3,500

3,700

3,900

4,100

4,300

Rs per sq ft

Hadapsar Kondhwa NIBM Road

Q3-20

07

Q4-20

07

Q1-20

08

Q2-20

08

Q3-20

08

Q4-20

08

Q1-20

09

Q2-20

09

Q3-20

09

Q4-20

09

Q1-20

10

Q2-20

10

Q3-20

10

Q4-20

10

Q1-20

11

Q2-20

11

Q3-20

11



Quarter

Q3-2007

Q4-2007

Q1-2008

Q2-2008

Q3-2008

Q4-2008

Q1-2009

Q2-2009

Q3-2009

Q4-2009

Q1-2010

Q2-2010

Q3-2010

Q4-2010

Q1-2011

Q2-2011

Q3-2011


Hadapsar

3,210

3,360

3,206

3,324

3,210

3,199

3,123

3,016

3,029

2,894

3,078

3,023

3,090

3,261

3,636

3,972

3,963

NIBM Road

3,349

3,460

3,619

3,593

3,459

3,332

3,612

3,420

3,172

3,282

3,498

3,580

3,695

3,686

3,880

4,141

4,020

Kondhwa

3,191

3,256

3,608

3,581

3,752

3,216

3,190

2,915

3,022

2,832

2,938

3,119

3,299

3,371

3,468

3,572

3,630

SSouth-West Pune

Ÿ Region has concentration of Banks, Insurance

and other service sectors offices

Ÿ Nanded city – New township project could

change profile of the area

South-West Region BavdhanDhayariErandwaneKarve NagarKothrudSinhagadh RoadSinhagadhVadgaon BudrukWarje

South – West

Source : Propequity

Ÿ

Ÿ

85% of the expected supply has been absorbed with very low vacancy in near term

New launches have been consistent with the exception in Q2’09 due to launch of Nanded city township project

15% of Pune’s supply expected in the region



1,011

1,980 2,030

1,557

5291,174

1,416

4,352

220

927

1,290 1,270

676

2,274

5,204

951

0

1,000

2,000

3,000

4,000

5,000

6,000Units

Trend of new launches in South West Pune

0%

5%

10%

15%

20%

25%

0

1000

2000

3000

4000

5000

6000

7000

8000

2008 2009 2010 2011 2012 2013 2014

per centUnits

Trend of Supply - Absorption in South - West Pune


Q3

07

Q4

07

Q2

08

Q1

08

Q3

08

Q4

08

Q1

09

Q2

09

Q3

09

Q4

09

Q1

10

Q2

10

Q3

10

Q4

10

Q1

11

Q2

11

Ÿ Upcoming regions of Sinhagad road, Vadgaon budruk, Dhayari to see appreciation in prices in 2012

NNew regions to witness price appreciation in 2012


2,000

2,500

3,000

3,500

4,000

4,500

5,000

5,500

6,000

6,500

7,000

Rs per sq ft

Bavdhan Kothrud Sinhagad Road



Quarter

Q3-2007

Q4-2007

Q1-2008

Q2-2008

Q3-2008

Q4-2008

Q1-2009

Q2-2009

Q3-2009

Q4-2009

Q1-2010

Q2-2010

Q3-2010

Q4-2010

Q1-2011

Q2-2011

Q3-2011


Bavdhan

3,122

3,246

3,306

3,334

3,380

3,389

3,110

3,268

3,284

3,323

3,383

3,588

3,793

3,956

4,095

4,273

4,435

Sinhagad Road

2,915

3,236

3,253

3,293

3,297

3,517

3,606

3,517

3,518

3,420

3,519

3,721

4,221

4,383

4,216

4,383

5,893

Kothrud

3,901

4,105

4,379

4,458

4,417

4,799

3,748

3,874

3,737

3,960

3,953

4,195

4,441

4,852

5,063

6,496

6,436

CCentral Pune

Ÿ The oldest and central most part of Pune

Ÿ Known for Historical monument like

Shaniwar Wada

Central PuneBund gardenS.B. RoadShivajinagarUniversity roadDeccanShanivar pethTilak roadPrabhat RoadKarve RoadStation Road

Pune Central

Source : Propequity

Ÿ

Ÿ

Being the prime region it has almost full absorption ; mostly resale transactions are prevalent in the area

Scarcity of space has led to very less launches; exception has been due to launch of Damodar VI project in Q2,2009

LLess than 1% of Pune’s supply expected in the region



0%

2%

4%

6%

8%

10%

12%

0

200

400

600

800

1000

1200

1400

2009 2010 2011 2012

per centUnits

Trend of Supply-Absorption in Central Pune


0

1,216

0

1,000

2,000

3,000

4,000

5,000

6,000Units

Trend of new launches in Central Pune

Q3

07

Q4

07

Q2

08

Q1

08

Q3

08

Q4

08

Q1

09

Q2

09

Q3

09

Q4

09

Q1

10

Q2

10

Q3

10

Q4

10

Q1

11

Q2

11

0 0 0

540

3016 0 0 00 0 0 00

Ÿ Region to command premium due to its central location and scarcity of supply, hence expect prices

to appreciate

CCentral Pune region will continue to command premium


5,000

7,000

9,000

11,000

13,000

15,000

Rs per sq ft

Shivajinagar Deccan

Q3-20

07

Q4-20

07

Q1-20

08

Q2-20

08

Q3-20

08

Q4-20

08

Q1-20

09

Q2-20

09

Q3-20

09

Q4-20

09

Q1-20

10

Q2-20

10

Q3-20

10

Q4-20

10

Q1-20

11

Q2-20

11

Q3-20

11



Quarter

Q3-2007

Q4-2007

Q1-2008

Q2-2008

Q3-2008

Q4-2008

Q1-2009

Q2-2009

Q3-2009

Q4-2009

Q1-2010

Q2-2010

Q3-2010

Q4-2010

Q1-2011

Q2-2011

Q3-2011


Deccan

8,600

8,600

8,600

8,600

8,600

8,600

8,000

10,666

11,199

11,199

13,000

13,000

13,000

15,000

15,000

15,000

15,000

Shivajinagar

10,000

10,000

10,000

10,000

10,000

7,688

8,520

8,613

9,417

9,125

8,250

8,750

8,750

11,000

11,000

11,000

11,000

SSupply trend in Pune region

Region

North-East

North-West

South-East

South-West

Pune Central

Total Units

Trend in Region-wise supply (% Share)

2008

14%

43%

29%

14%

0%

21,588

2009

12%

44%

25%

19%

1%

30,669

2010

16%

41%

23%

18%

2%

29,605

2011

12%

41%

32%

13%

3%

47,206

2012

16%

48%

25%

10%

0%

52,374

2013

14%

44%

20%

22%

0%

30,279

Ÿ Large share of supply in North-west region is expected to result in saturation of Residential space

Ÿ However regions with connectivity to city could see potential for growth- regions like Balewadi, Wakad and will

continue to see growth and price appreciation

Ÿ – Which includes regions in South and North east are expected to be preferred locations due to proximity to

airport, improved connectivity and competitive real estate rates

Ÿ Regions like Hadapsar, and Airport Road are expected to see residential growth

Baner

Eastern corridor

Kharadi

Note: The analysis is based on year of completion of the projects. Source : Propequity, ASKPIA

R Research Team

MR. RAMAN IYER

MR. DEEPAK RATHI

MR. JITESH KARLEKAR

Director – Asset Management

E-mail ID: [email protected]

Vice President - Asset Management


Senior Research Analyst


DDisclaimerŸ This document is being communicated to you solely for the purposes of providing our views on current market trends. This document is being communicated to

you on a confidential basis and does not carry any right of publication or disclosure to any third party. By accepting delivery of this document each recipient

undertakes not to reproduce or distribute this presentation in whole or in part, nor to disclose any of its contents (except to its professional advisers) without the

prior written consent of ASK Property Investment Advisors, who the recipient agrees has the benefit of this undertaking. The recipient and its professional advisers

will keep permanently confidential information contained herein and not already in the public domain.

Ÿ This document is not an offer, invitation or solicitation of any kind to buy or sell any security and is not intended to create any rights or obligations. Nothing in this

document is intended to constitute legal, tax, securities or investment advice, or opinion regarding the appropriateness of any investment, or a solicitation for any

product or service. The use of any information set out in this document is entirely at the recipient's own risk.

Ÿ ASK Property Investment Advisors does not accept any responsibility for any errors whether caused by negligence or otherwise or for any loss or damage incurred

by anyone in reliance on anything set out in this document. The information in this document reflects prevailing conditions and our views as of this date, all of

which are subject to change. In preparing this document we have relied upon and assumed, without independent verification, the accuracy and completeness of all

information available from public sources or which was provided to us or which was otherwise reviewed by us. Past performance cannot be a guide to future

performance.

Ÿ No reliance may be placed for any purpose whatsoever on the information contained in this document or on its completeness. The information set out herein may

be subject to updating, completion, revision, verification and amendment and such information may change materially.

Ÿ The analysis / interpretation of data is purely the work of ASK Property Investment Advisors Ltd. and does not necessarily reflect PropEquity views as the market.

ASK PROPERTY INVESTMENT ADVISORS PVT. LTD.

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