“Our company, which is a pioneer in the affordable housing segment in Gurugram, has now shifted focus to the mid-income housing segment as demand for branded developers in this segment has increased and there are barely any developers in this segment,” says Pradeep Aggarwal.
Real-estate company Signature Global, which is launching its maiden public issue today (September 20), intends to strengthen its foothold in the micro- market as a branded mid-segment housing developer in the next 3-5 years, chairman Pradeep Aggarwal told Moneycontrol.
The company has close to 45 mn sq ft of completed and ongoing projects in Gurugram under its portfolio.
“Our company, which is a pioneer in the affordable housing segment in Gurugram, has now shifted focus to the mid-income housing segment as demand for branded developers in this segment has increased and there are barely any developers in this segment. The main reason behind this shift is to do with the government increasing the basic price for affordable housing from Rs 4,200 per sq ft to Rs 5,000 per sq ft a few weeks back,” he said.
‘Raising of basic prices helped’
“The main reason is that the government has increased the basic price for affordable houses from Rs 4,200 per sq ft to Rs 5,000 per sq ft a few weeks back. You have to plan for the land accordingly – with the increase in price to Rs 5,000 per sq ft, we are hopeful that we should plan these lands in a way such that we can bring in more affordable housing. Of the 21 mn sq ft pie, almost 90 percent is in the mid-segment category. Depending on the location, Rs 1 crore to Rs 2 crore will be the price range,” Aggarwal said.
Of the 45 mn sq ft real estate projects under the company’s belt, almost 6 mn sq ft is completed. Of this, 1.5 mn sq ft is in the mid-income segment and more than 4 mn sq ft is under the affordable category. Of the 17 mn sq ft that is currently under development, 11 mn sq ft is under the mid-income segment and 6 mn sq ft in the affordable category. Also, 21 mn sq ft is planned for the next three to five years. Of this, only 1 mn sq ft is in the affordable category and the rest comprises mid-segment and retail/shops,” he explains.
“Mid income also tends to have better margins in terms of business. Going forward, we will continue to do affordable housing projects but our core will be the mid-income category,” he added.
The company is staying back from moving towards the luxury segment in the near term.
“The Rs 7-8 crore category is not in our range and it is unlikely to form part of our portfolio in the forthcoming future. In the next 3-5 years, our ticket size will be restricted to mid-segment — Rs 1 crore to 2 crore products — depending on the location,” he said.
“The primary focus is clear: we will continue to operate in the mid-segment category,” he said.
‘Focus on Gurugram’
Asked if the company has any plans to foray into other National Capital Regions (NCR) markets such as Noida, he said the focus would primarily be on Gurugram as the city has several advantages in terms of social infrastructure.
The potential of Dwarka Expressway market is getting unlocked. “We do not have any short-term plans for Noida, but if we get the right land parcel, we may look at that opportunity,” he said.
Asked to comment on the scheme to provide relief in interest on home loans for city dwellings that is expected to be announced soon, he said that the company is eagerly awaiting the home loan scheme to be unveiled. “We will be the biggest beneficiary as a bulk of our clientele comprises the middle income, the salaried class.”
Prime Minister Narendra Modi in his Independence Day speech had announced a scheme for middle-class families residing in rented accommodation, chawls or tenements and illegal colonies in cities.
Source : Money Control
