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West Bengal received zero investment in realty in FY’13: Report

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india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, india news, property news, real estate news, India Property, Delhi NCR real estate, Mumbai Real Estate, Bangalore Real Estate, Pune Real Estate news, real estate stocks, realty stocksTrack2Realty-Agencies: West Bengal did not receive any investment, either foreign or domestic, in the real estate sector in the financial year 2012-13, according to a report by industry body ASSOCHAM.

“The state of West Bengal has absolutely no share in the total value of new investment commitments worth over Rs 42,000 crore made by the domestic and foreign private sources in the real estate sector across India in the last fiscal,” the report which a real estate sector specific analysis and released, said.

“Although total outstanding investments in the real estate sector in West Bengal is worth over Rs 37,000 crore as of March 2013, the state has registered a 100 per cent decline vis-a-vis new investment commitments attracted by the realty sector between 2011-12 and 2012-13,” it said.

In 2011-12, the state attracted new investment commitments in the real estate sector worth over Rs 1,200 crore.

The body said while most of the states have seen a decline in attracting new investment commitments in the realty sector, Gujarat has seen a surge of over 700 per cent as the state has attracted investments worth over Rs 17,000 crore in 2012-13 from just over Rs 2,000 crore a year ago.

Realty stocks still lucrative for serious investors

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2nd of the series

Track2Realty Exclusive

india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, india news, property news, real estate news, India Property, Delhi NCR real estate, Mumbai Real Estate, Bangalore Real Estate, Pune Real Estate news, real estate stocks, realty stocksAs far as IPOs are concerned, out of the 132 IPOs lined up, the largest number -15 -are from the real estate sector. A number of unlisted developers plan to finance projects and repay debt by raising money from the stock market. However, capital market experts are not expecting any real estate IPO this year due to subdued market conditions.

While the primary market option might not be available to those wanting to invest in real estate companies, one should exercise caution while investing in these stocks in the secondary market as well. In the last 12-18 months (since mid 2010) the BSE Realty Index has been underperforming between 36-47 per cent.

However, there are contradictory signals in the market, too. The sector’s gross debt-equity ratio is likely to reduce to half by FY12 from the levels in FY09, according to a report by Standard Chartered Bank. It attributes this reduction to fund raising activities. The report predicts that valuations of these stocks will improve as these companies are on a stronger footing than in 2008, as most ongoing and soon-to-be-launched projects will contribute to their operating cash flows.

In such a scenario, is it a good time to buy stocks of real estate companies? Experts believe valuations of these stocks are lower and look attractive at this point. In 2012, interest rates may start coming down and some issues in the real estate sector are expected to be addressed. Investors should then focus on companies with good governance norms and attractive valuations. One can choose the ones with low debt, debt-to-equity ratio, strong cash flows, no share pledges and high governance standards.