ADVICE for the WISE

Newsletter –April’11

2

Economic Update 4

Equity Outlook 8

Debt Outlook 13

Forex 15

Commodities 16

Index Page No.

Real Estate 19

Dear Investor,

The month of March has seen the return of the positive sentiments tothe Indian Equity markets and to a smaller extent to Indian Debtmarkets. FIIs poured money into Indian equities thus helping the indicesto decisively break out of the range of the earlier months. Part of thisrally is genuine catching up of the valuations in light of expected results.Some other factors that contributed to the sentiment were lack of majornegative news on the 2G scam investigation and relatively containedinflation levels. At the current level, the equity markets seem fairlypriced. Any quick run-up from here would enter the overvaluedterritory. As of now, we continue to recommend investing into Indianequities.The fortunes of different sectors changed quite rapidly in the last fewmonths. Banking which went through a rough patch in December lastyear is back to being a favored sector. Real estate showed some signs ofrevival last year but has lost steam again owing to corporate governanceconcerns. FMCG had performed quite well in the recent months whereasinfrastructure and cyclical sectors like metals lagged behind. Goingforward we believe that equity portfolios can be altered to include moreaggressive sectors such as metals and infrastructure. In the comingmonths defensive sectors like FMCG and Pharma may not deliver verygood returns.The liquidity crunch of last month has now eased partially. The yieldshave stayed steady or come down a little. Fixed deposit rates seem tohave peaked as some banks have started to cut the FD rates. Most ofthis indicates that the debt investment returns have hit their maximumand could well be on their way down. For clients looking to invest intodebt it is advisable to lock in the higher rates/yields available now.

Risk taking investors can evaluate private equity as an interestingand sufficiently diversified investment option. It also has theadditional positive of enforcing a long term outlook which is oftenlacking in public equity investments that allow entry and exit atwill. Private Equity can be thought of as an aggressive play on Indiagrowth story. This is because in a high growth environment, notonly do several small companies do well to deliver supernormalreturns to early investors, the downside risk is also reducedsignificantly for the suboptimal investment choices.When markets show some positive momentum, investors oftenworry that they might buy into an overvalued market. On the otherhand many times investors keep waiting on the sidelines for thecorrection that never happens. Principal protected structuredproducts can provide a way out of this by ensuring that themaximum downside remains at zero while the participation in theupside is maintained and even enhanced. Often some degree ofinnovation in these products can allow an investor to take a morespecific view on the market movement – thus enablingdiversification and enhancement of returns for most outcomes ofmarket levels in future.

3“Advisory services are provided through Karvy Stock Broking Ltd. (PMS) having SEBI Registration No: INP000001512. Investments are subject to market risks. Please read the disclaimer on slide no.23”

Change over last month

As on Mar 31st 2011

Equity markets

Debt markets

Commodity markets

Forex

markets

Change over last year

* Indicates SBI one-year FD

19,4455,8331,3259,755

7.98% 9.25%8.25%

4,27520,760

118.6

44.6582.86

9.1%9.4%

(0.1%)(8.2%)

(2 bps)2.4 bps

0 bps

2.4%(0.2%)

4%

1.2%(1.3%)

10.9%11.1%13.4%

(12.0%)

13 bps4.25 bps225 bps

33.6%27.4%

46%

(0.4%)(11.9%)

BSE SensexS&P NiftyS&P 500 Nikkei 225

10-yr G-Sec YieldCall MarketsFixed Deposit*

RICI IndexGold (`/10gm)Crude Oil ($/bbl)

Rupee/DollarYen/Dollar

4

10 yr Gsec

Gold

70

80

90

100

110

120

130

Ma

r-10

Apr

-10

Ma

y-1

0

Jun

-10

Jul-

10

Aug

-10

Sep

-10

Oct

-10

Nov

-10

Dec

-10

Jan

-11

Sensex NiftyS&P 500 Nikkei 225

6.8

7.3

7.8

8.3

8.8

15000

16000

17000

18000

19000

20000

21000

22000

42

43

44

45

46

47

48

Ma

r-1

0

Ap

r-1

0

Ma

y-…

Jun-

10

Jul-1

0

Aug

-10

Sep

-10

Oct

-10

Nov

-10

Dec

-10

Jan-

11

Feb

-11

Ma

r-1

1

`/$

5

US

Europe

Japan

Emerging economies

• The HSBC China Manufacturing Purchasing Managers Index, a gauge ofnationwide manufacturing activity, remained almost flat at 51.8 in Mar from51.7 in Feb.

• Chinese economy is expected to slow down to grow at 9.6% in 2011.The retailsales rose 15.8% in the first two months of 2011 which was 3.3% lower thanDecember owing to the decline in consumer confidence in recent months.

• The Conference Board Consumer Confidence Index, which had increased inFebruary, declined in March. The Index now stands at 63.4 down from 72 inFebruary. This is due to consumers short term outlook being less favorablethan in February .

• US m-o-m unemployment rate drops to 8.8 per cent in Mar 11.

• Euro-zone PMI declined to 57.6 in March, down from a four-and-a-half yearhigh of 58.2 in Feb 11. All countries saw a slower pace of growth than inFebruary, but France and Germany continued to see strong increase inmanufacturing and services-sector output.

• Unemployment rate in the Euro zone at 9.9% in Feb 11, compared to 10% inJan 11 .

• The Japan Manufacturing Purchasing Managers Index (PMI) fell to a seasonallyadjusted 46.4 in March, the lowest since April 2009, down from February’s52.9, owing to the disrupted supply chains and production operations post themassive earth-quake and Tsunami

• Japan’s unemployment rate decreased to 4.6% in Feb 11 from 4.9% in Jan 11

6

• The GDP growth rate for Q2 FY11 came in at 8.9%backed by a strong growth in services andagricultural output.

• The agriculture sector, which accounts for nearly17% of GDP, rose 4.4% and this offset themoderation manufacturing sector growth, whereproduction went up by 9.8%. The services sectortoo grew at 9.7% during July-September this year,led mainly by finance and real estate as well astrade, hotels, transport and communication

• The Finance ministry is targeting FY11 growth at~8.50% - 8.75% which may be revised upwards. Webelieve the current target is sustainable as weexpect manufacturing and service sectors tocontinue to drive growth in the next few quarters.

IIP monthly data

GDP growth

• Industrial output as measured by the Index ofIndustrial Production (IIP) grew by 3.7% (y-o-y) inJanuary ‘11 as compared to an upward revised 2.7%in December ’10.

• Capital good output contracted 18.6 percentcompared with an expansion of 57.9 percent in theyear ago period.

• We believe that monthly indicators are not a veryefficient way of indicating growth and the lowernumbers could also be attributed to higher baseeffect. But, the growth will eventually moderate out. 4

5

6

7

8

9

10

FY09 (Q3) FY09 (Q4) FY10 (Q1) FY10(Q2) FY10(Q3) FY10(Q4) FY11(Q1) FY11(Q2)

0.0%2.0%4.0%6.0%8.0%

10.0%12.0%14.0%16.0%18.0%20.0%

• Bank credit growth remained stable at 23.2% in themonth of February while Deposits grew by 16.4%compared to 15.9% in January 2011.

• Growth of credit demand and tight liquidity had putpressure on the banks to raise their deposit rates,.Though we see liquidity concerns easing, highinflationary pressure may lead the RBI to increaserates further.

• We expect credit growth to settle at ~20% levels inthe coming quarters on the back of improvingbusiness confidence and decline in risk aversion onthe part of banks.

• Inflation as measured by WPI increasedmarginally and stood at 8.31% (y-o-y) for themonth of February -11 as compared to 8.23%during January 11. Rising oil prices and highfood prices have led to high inflation in themonth. These figures are based on the newbase year and WPI list.

• We expect WPI inflation numbers to moderatein m-o-m inflation numbers due to the expecteddecrease in food inflation and the monetarytightening stance by RBI, but increasing fuelprices may be a cause of worry.

Growth in credit & deposits of SCBs

7

Wholesale Price Index

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

Feb-10 Mar-10 Apr-10 May-10 Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11

Bank Credit Aggregate Deposits

-2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

Feb

-10

Mar

-10

Ap

r-1

0

May

-10

Jun

-10

Jul-

10

Au

g-10

Sep

-10

Oct

-10

No

v-1

0

Dec

-10

Jan

-11

Feb

-11

8

March turned out to be a good month for Indian equity markets. In the first two months of CY11, Nifty ended on a negative note with an

outflow of 9000 crores by FII. This changed in the month of March with a gain 9.4%. FIIs returned in the last week of March with almost

9000 cr invested in 7 days. The FII buying was seen across quality large cap names and a few mid-cap ideas.

On the macro economic front, consumer demand continues to hold up quite well across both rural and urban India. March witnessed

strong auto sales numbers growth. All manufacturers’ sales surpassed expectations as retail demand continues to remain buoyant with

two wheeler and four wheeler sales numbers well ahead of expectations.

The sector which has seen the most difficult times last year was infrastructure. There were various issues in terms of environmental

clearances, lack of new orders, land acquisition and commodity prices. There seems to be some movement on the first two issues. Last

month saw several coal mine development plans being cleared by the environment ministry. A few commodity green field projects also

got clearances. There was a revival in order announcements by key infrastructure vendors like PGCIL which announced its largest ever

Transmission & Distribution order of 5000 crores. NHAI is also expected to announce highway development orders to the tune of 2000

crores in this quarter. This momentum, if continued, will provide a much needed fillip to infrastructure development of the country and

would be a big positive for the infrastructure stocks. Concerns related to commodity prices and interest rates have already been priced

in by the market. The government also seems keen to press ahead with key reforms and introduced GST and Pension Reform bill in

parliament.

Crude continues to be a cause of concern with Nymex crude touching 109$/barrel driven by continued unrest in Middle East and North

Africa. Fighting continues in Libya with no side emerging as a clear winner. It would be prudent to assume that Libyan supplies would be

disrupted for some time. Saudi Arabia has increased supplies to make up for that. However, concerns remain on the unrest in Yemen

and Bahrain spreading to Saudi Arabia which is the world’s largest crude producer.

9

• After pulling out ` 9,400 Cr. in this year (Jan & Feb) FIIsinvested `6898 Cr. in the Indian markets in the month ofMarch’11. High growth prospects in the Indian market are adriver for these investments.

• Mutual Funds invested around ` 459 Cr. in the month ofFebruary.

FII & MF data

Food price inflation in mid-March again touched the double digit levels due to firm price trend seen in protein rich items like milk,

cereals and fish. We now expect WPI inflation in March to cross 8%. We would expect inflation to stay at elevated levels led by firm

food price trends and high commodity prices and average around 7% in Fy12. RBI is expected to announce its forecast for full year

inflation in the May review. We would expect a further hike of 25bps when RBI next meets with a total hike of 50 to 100 bps for FY12.

This view would change if there is any big spike in retail fuel prices led by continued upside to global crude prices.

The market seems to be trading at reasonable valuations of around 16 times based on FY12 earnings. Further clarity on valuations will

emerge once the Q4 results start coming in from second week on April. We believe that in Q4 FY11, we would witness steady earnings

growth of 17-18% for Nifty companies. Similar to the scenario in Q3FY11, manufacturing sector might face some earnings

disappointments due to high commodity prices and interest rates, but that should get compensated by the increase in earnings of

Metal companies. We would continue to maintain a strict vigil on crude prices and inflationary expectations in the economy. We like

sectors with earnings visibility, growth, superior capital efficiency of the businesses & good corporate governance and have maintained

overweight position on Financials, Metals, Healthcare & Capital Goods.

-15000.0

-10000.0

-5000.0

0.0

5000.0

10000.0

15000.0

20000.0

25000.0FII MF

10

Sector Stance Remarks

Healthcare Overweight

We believe in a large sized opportunity presented by Pharma sector in India. India’s strength in generics

is difficult to replicate due to quality and quantity of available skilled manpower. With the developed

world keen to cut healthcare costs, and a vast pipeline of drugs going off-patent, Indian pharma players

are at the cusp of rapid growth. Here, we have taken exposure to medium-sized, non-index ideas while

trying to play on the opportunity in Generics and CRAMS.

E&C Equalweight

The USD 1 trillion Infra opportunity is hard to ignore. Here, we have carefully taken Power sector as our

dominant bet over other sub sectors such as ports, roads and telecom infrastructure, because of

favorable economics under PPP model. Within power, we focus on the engineering companies over

utilities, T&D and other infrastructure owners because of their superior profitability and better

competitive dynamics.

BFSI Overweight

Financial sector is undeniably the lubricant for economic growth. Whether the growth comes from

consumption or investments, credit growth is inevitable. Being a well regulated sector, BFSI in India has

good asset quality and capital adequacy ratios. This, when juxtaposed to the growth opportunity

available makes an attractive long term opportunity.

FMCG Neutral

The exposure is in “discretionary consumption” beneficiaries such as Paints and branded food, as the

growth in this segment will disproportionately higher vis-à-vis the increase in disposable incomes. This

also provides a defensive posture to the portfolio.

Telecom Underweight

The regulatory hurdles, competitive pressures and leverage prevent any return to high rofitability levels

in the short to medium term. The huge capex incurred in the rollout of 3G services will put further

stress on the already stretched balance sheets. Remain cautious on Sector’s prospects.

11

Sector Stance Remarks

IT/ITES Equalweight

Robust volume growth led by some uptick in pricing makes IT an attractive investment. Market

share gains led by deeper and wider expansion of global delivery model will drive earnings

growth. Best played through Tier I stocks.

Automobiles Overweight

Demand outlook remains very robust with strong earnings growth despite raw material price hikes

and raging competition. We are more bullish on commercial vehicle and agricultural vehicles

segment due to lesser competition and higher pricing power.

Energy Underweight

Through a single company, we have taken a large-sized exposure to refinery and natural gas

exploration sector. The regulatory cap on RoE does not allow a vast value creation opportunity in

the infrastructure owning companies. We have also purposely tried to stay away from PSUs, due

to issues of cross subsidization distorting the underlying economics of oil exploration and refinery

businesses.

Metals Equal weight

Indian metal companies will benefit from global upturn in demand. Commodity prices have

moved up significantly as recovery takes place in US and Europe. Positive on the producers of

Steel, Copper and Aluminium.

Cement UnderweightCement demand will certainly grow over the next three years. But the issue is on the supply side.

We do see an oversupply situation for the next 3-4 quarters.

Power Utilities Underweight

We like the growth prospects of power sector but believe that value will be created by

engineering services providers. Merchant power rates have been sliding downwards and coal

prices have been on the way up putting pressure on return ratios.

Basic Theme

A diversified portfolio of stocks that seeks Alpha through superior stock selection. The Portfolio Management adopts a comprehensiveapproach and invests across sectors, investment themes and market capitalization categories.

Portfolio Details

Placement fee 2%Exit Load Nil (Full management fee to be levied if redeemed before 1 yr)

Management Fee2.5% for investments below Rs. 1 Cr.

2% for investments above Rs. 1 Cr.

NIL

Profit Share NIL NIL 15% of all gains

Top 10 Holdings

Comparatives 3 Month Since Inception

Alpha Portfolio -6.4% 17.0%

S&P CNX Nifty -4.9% 11.7%

Sector Allocation Performance (as on 31st Mar 2011)

Absolute Returns (%)

-6.4%

17.0%

-4.9%

11.7%

-10%

-5%

0%

5%

10%

15%

20%

3M Since Inception (30/11/09)

Alpha Portfolio Nifty

12

Reliance Industries Ltd. 8.5

Infosys Technologies Ltd. 6.8

HDFC 6.4

Punjab National Bank 5.9

State Bank of India 5.8

Titan Industries Ltd. 5.3

Nestle India Ltd. 5.1

Larsen & Toubro Ltd. 5.1

Bharat Heavy Electricals Ltd. 4.9

Page Industries 4.5

Top 10 Stock Concentration 58.3

BFSI26.5%

IT6.8%

Capital Goods13.0%Pharma

7.9%

FMCG18.3%

Others11.0%

Energy8.5%

Metals7.9%

13

• The benchmark 10 yr G-sec yield decreasedmarginally from 8.0% in the month of February‘11 to close at around 7.98% in February ‘11.

• With no respite from the high inflation in spiteof monetary tightening, it is possible that RBImay take a stand that the monetary tightening isunlikely to bring down food inflation in a directmanner.

10-yr G-sec yield

Yield curve

• We expect yields at the longer end of the yieldcurve to remain stable. High inflation, monetarytightening and rising credit growth will keep theyields at the longer end range bound.

• After the rate hike by RBI in Mar, the 10 year GSec yields are trading around 8.0% from 8.15levels in Jan 2011. If the inflation continues to behigh, there may be another increase in theinterest rates by RBI.

(%)

6.8

7

7.2

7.4

7.6

7.8

8

8.2

8.4

6.5

7.0

7.5

8.0

8.5

9.0

0.0

1.0

2.1

3.1

4.1

5.1

6.1

7.1

8.2

9.2

10.2

11.2

12.2

13.2

14.2

15.3

16.3

17.3

18.3

19.3

OutlookCategory Details

Long Tenure Debt

With tight liquidity and inflationary pressure being high, weexpect more rate hikes in the current year. As the inflationarypressure begins to settle down, these may be attractiveinvestments but currently, we would recommend staying out ofthe longer term investments.

Some AA and select A rated securities are very attractive atthe current yields. A similar trend can be seen in the FixedDeposits also. Tight liquidity in the system has alsocontributed to widening of the spreads making entry atcurrent levels attractive.

14

We recommend short term bond funds with a 6-12 monthinvestment horizon as we expect them to deliver superiorreturns due to high YTM. We have seen the short term yieldsharden due to reduced liquidity in the market andconsecutive rate hikes prompted by inflationary pressures.Hence, Short term bond funds and FMPs provide aninteresting investment option.

Short Tenure Debt

Credit

15

•The rupee appreciated against all the currencies except the euro.

•The appreciation was on the back of improved performance of the Indian equity markets and inflow of funds in to the domestic markets

•Going forward, the rupee will be helped by the narrowing of the current account deficit and the inflow of funds into the domestic markets. However rising oil prices remains a concern.

Rupee movement vis-à-vis other currencies (M-o-M) Trade balance and export-import data

• Exports for the month of February increased by 49.7%(y-o-y) while imports increased by 21.2% over last year.The trade deficit increased to USD 8.1 bn.

• Capital account balance continues to be positive throughFY11 and stands at `241293 Cr. for the Q1 – Q3.

• We expect the capital account balance to remain positiveas higher interest rates would make investment in theIndian markets attractive hence drawing investments intothe market.

-15000

-10000

-5000

0

-20

0

20

40

60

80Export Import Trade Balance (mn $)

0

20000

40000

60000

80000

100000

120000

140000

FY 09 (Q4) FY 10 (Q1) FY 10 (Q2) FY 10 (Q3) FY 10 (Q4) FY 11 (Q1) FY 11 (Q2) FY 11 (Q3)

Capital Account Balance

16

Precious

Metals

Oil & Gas

Gold prices continue to remain stable amid demand from

emerging economies including China, where the investment

demand growth was strongest last year. The global political

uncertainty and growing Middle East tensions shall continue to

support prices. Further, the seasonal demand during Akshaya

Tritiya in India is likely to support prices. Nevertheless, we do

not expect any sharp spikes in the yellow metal in the near

term; however the falling dollar is a concern and shall push the

metal prices higher.

Although the Middle East status quo remains, crude oil prices

found support from the renewed demand for conventional

energy after the Japanese Nuclear fiasco. The difference

between WTI and Brent continues to wide. Crude is expected

to remain stable in the near term amid declining dollar aiding

its rise.

Crude

Gold

15000

16000

17000

18000

19000

20000

21000

22000

Mar

-10

Ap

r-1

0

May

-10

Jun

-10

Jul-

10

Au

g-1

0

Sep

-10

Oct

-10

No

v-1

0

Dec

-10

Jan

-11

Feb

-11

Mar

-11

60

70

80

90

100

110

120

Mar

10

Ap

r 1

0

May

10

Jun

10

Jul 1

0

Au

g 1

0

Sep

10

Oct

10

No

v 1

0

Dec

10

Jan

11

Feb

11

Mar

11

17

Tenor 36/40 months

Issuer Karvy Financial Services Limited

Reference Index S&P CNX Nifty Index

Principal Protection 100%

Initial Fixing Level Official Closing level of S&P CNX Nifty Index as on DDA

Final Fixing Level Average of Official Closing Level of S&P CNX Nifty Index as on 34M, 35M and 36M

Exit Nifty Level Official Closing level of S&P CNX Nifty Index as on DDA +36M

Participation Rate 200%

Knockout Level 150% of Initial Fixing Level

Knockout Rebate 30%

Payoff2 * Max {0, (Final Fixing Level / Initial Fixing Level) -1}, if Knockout event is nottriggered

Overview

• Aditya Birla has launched a private equity fund targeting

innovation themed growth capital investments within sunrise

sectors – Lifestyle, Lifeskills and Education, Lifecare and

Applied Technologies.

Attractiveness

• We believe that the sectors that they have selected are

attractive growing annually at 20% plus supported by benefits

of higher disposable income and improving infrastructure in

the country.

• The managers have had a successful track record in similar

sectors and have delivered consistent returns. Operational

value addition and domain knowledge would be the drivers of

IRR.

• Based on the Investment team’s extensive business network in

overweight sectors 60 high quality early stage proposals have

been received over the last 12 months

Product Features

• Fund size: Rs. 350 Cr. + green shoe option of Rs. 150 Cr.

• Sponsor Commitment: 10%

• Fund tenure: 6 years with an option of a 1 year extension

• Commitment Period: 30 Months from date of initial closing

• Minimum Commitment: 1,000,000

• Indicative Draw-down:

INR 10 lakh 100%

INR 15 lakh–45 lakh Higher of 20% of commitment or

INR 7.5 lakh

> INR 45 lakh 10% of commitment

• Expected IRR: 25% gross p.a.

• Upside Sharing: 20% of net profits of the fund with catch up

• Management fee: 2% p.a. of the total commitment amount

• Setup fee : 2.25% upfront

18

19

Asset Classes Tier-1* Tier-II**

Residential This sector is the only one to be left out of the correction

wrath. Heavy media reporting’s on probable correction, 40%

down-trend in sales and unavailability of finance to

developers are the major factors putting pressure on this

segment to correct. The investor community also varies on

the assumptions on account of bad sales and gives their “no

confidence motion” towards any visible appreciation. Markets

like NCR, Pune, Hyderabad and Chennai would set the course

of correction on the forthcoming over-supply.

These cities still manage to sell from the attractive entry point

(Avg. Rs.2800-3600 per sqft) but are getting over-supplied in

pockets. A recent report from Knight Frank suggests that these

cities have seen lot of investor confidence between 2007-2009

which for some reasons have seen 30% down-trend. Typically

the investor’s early buy-in and upfront payment of the total

consideration for best discount gives the developer strong hold

time for local demand. Ironically, across markets Investors

contribute not more than 15% of sales.

Commercial/IT Still in the shadows of over-supply and cautious expansion

approach by corporate, this segment has gone through

correction. Rates per sqft have seen almost 30% down-trend

and will be stagnant for the coming 2-3 quarters. Surely, the

segment is at the down-tip of the cycle, and is the best

opportunity for companies looking for long term holding of

real estate office space. Since most of the commercial growth

had happened in 05-06, many lease agreements are getting

expired giving way for companies to shift base, re-negotiate,

etc. IT/ITEs would remain the main driver for consumption.

Commercial segment not that significant, but unlike Tier-I the

price differentiation is double favoring commercial since most

of them are in CBD areas.

Retail Sales have definitely recovered but distress in the over-

supplied market is evident. Many deals have been done on

Revenue Share, giving more control to the Lessee to hold

price per sqft for a longer time-frame

Unlike the Tier 1 markets the retails is unable to cope with sales

and thus the sales to rent ratio is becoming bigger pulling down

the rent paying capacity. Important point also is that, unlike the

Tier 1 markets more than 40% of any mall in these cities are

operated by local franchisees making cash-flows not regulated

Land Land is highest in demand and still a maintaining a steady

growth of 15-20% per annum

Very similar to the trend in Tier 1 cities. Opportunistic

investment can really give great returns since N.A land is still

available cheap (between 200-300 per sqft)

20

Markets Major Locations/Zones Total Sqft (In Mn), Expected in

2011-2013

Established Builders

Bangalore Hebbal, Whitefiled, Hosur Road, Jayanagar, MG Road,

Malleshwaram

74Mn Sqft, out of which 60% supply is

in Hosur & Whitefiled followed by 18%

in Hebbal

Shobha, Prestige, Salarapuria,

Purvankara, Brigade Group, Nitesh

Estate, Mantri, Confident group, Pride

Group

NCR Gurgaon - DLF city, Sohna Rd, Manesar

Noida – Sec 14,15,92,93,128 and Greater Noida

Ghaziabad – Indirapuram, Vaishali

Faridabad – prime chandanwood village, Sec 78,89

436 Mn sqft, out of which Noida-32%,

Ghaziabad-21%, Gurgaon-24% &

Faridabad-12%.

Parsavnath, Emaar MGF, DLF, Unitech,

Ansal properties, M2K, Uppal, Cosmos,

Suncity, Vipul

Mumbai Prime Residential Among Zones

Napean Sea Road, Tardeo, Worli, Lower Parel, Bandra,

Andheri West, Juhu and Powai

Mid Segment Among Zones

Prabhadevi, Ghatkopar, Goregaon, Malad, Gorbunder,

Kalyan, Dombivili, Belapur and Panvel

183 Mn Sqft, out of which 69% is

accounted from Prabhadevi, Ghatkopar,

Goregaon, Malad, Gorbunder, kalyan,

Dombivili, Belapur and Panvel.

Malad/Goregaon accounts for more

than 23mn sqft and other btw 10-12Mn

sqft

Hiranandani Developers Pvt Ltd,

Marathon Realty Pvt Ltd, Akruti City

Ltd, Kalpataru Ltd, K Raheja Universal

Pvt Ltd, K Raheja Corp, Lokhandwala

Group of Companies, Sheth,

Rustomjee, DB Realty, Godrej

properties, Oberoi to name a few.

Hyderabad Banjara hills, Shameerpet, Securabad Contonment,

Ghatkesar, Old Hyderabad and Shamshabad

58 Mn sqft, out of which 58% supply is

expected in and around Hi-Tech city

DLF, Jayabheri, Manjeera, Mantri,

Saisree, SMR Holdings, Aliens Group

Residential Market Snapshot (Supply and Developers)

As you would find out from the below mentioned table, most cities have supply concentrated in a particular zone and investment in these zones would belucrative (entry point being low) with a long term view, since the supply would always keep the capital value appreciating to 5-7% per annum. Rest zoneswould be always speculative and demand led behavior. The only differentiator would be quality development which could command premium.

Pune Pimpri Chichwad and Chakan,

Hinjewadi, Baner, Audh, Wakad and Balewadi

Kothrud, Kondwa, Hadapsar, Central Pune

Kalyani Nagar, Viman Nagar, Kharadi

93 Mn Sqft, out of which over 70% is

accounted by Pimpri Chinchwad,

Hinjewadi and Kalyani Nagar zones

Kumar Builders, Gera, Lunkad,

Konark, Goel Ganga, Marvel,

Magarpatta, Rohan

Kolkata CBD Areas-Ballygaunge, Carmac street and Park street

Salt Lake & EM Bypass

North 24 Parganas-Rajarhat, Barasat, madhyamgram

South 24 Parganas – narendrapur, Sonarpur

Batanagar & Mahestala

55Mn Sqft, out of which North 24

Parganas accounts for more than 50%

of supply

Ekta Developers, Eden group, Fort,

Mayfair, Merlin, Srijan group,

Swastic, Somani, Godrej, GM Group,

nangalia, Orbit, Bengal Sharachi, Sriji

Developers

Chennai North Chennai – Ayanavaram, Kilpauk, Korathur, madhavaram, Perambur, Villivakam

South Chennai – Adambakam, Chromepet, madipakkam, Medavakkum, Sholinganur, OMR, Selaiyur, tamabaram, Urapakam, Velachery

West – Ambattur, Annanagar, Avadi, KK Nagar, manapakam, Nolambur, Porur, salingramam, Sriperumpudur, Vadapalani

Central – Adayar, Alwarpet, Egmore, mataliyapuram, Nungampakkam, Parry’s, Tnagar

68 Mn Sqft, of which South Chennai

accounts for 64% of supply

Emmar, Ozone, Chaintanya, Mantri,

Doshi, Sabari, Hiranandani, L&T,

Unitech

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Please Note:1.Tier I* markets include Mumbai, Delhi & NCR, Bangalore, Pune, Chennai, Hyderabad and Kolkata2.Tier II* markets includes all state capitals other than the Tier I markets3.The IC note is proposed to be presented every quarter

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The information and views presented here are prepared by Karvy Private Wealth or other Karvy Group companies. Theinformation contained herein is based on our analysis and upon sources that we consider reliable. We, however, do not vouchfor the accuracy or the completeness thereof. This material is for personal information and we are not responsible for any lossincurred based upon it.

The investments discussed or recommended here may not be suitable for all investors. Investors must make their owninvestment decisions based on their specific investment objectives and financial position and using such independent advice,as they believe necessary. While acting upon any information or analysis mentioned here, investors may please note thatneither Karvy nor any person connected with any associated companies of Karvy accepts any liability arising from the use ofthis information and views mentioned here.

The author, directors and other employees of Karvy and its affiliates may hold long or short positions in the above-mentionedcompanies from time to time. Every employee of Karvy and its associated companies are required to disclose their individualstock holdings and details of trades, if any, that they undertake. The team rendering corporate analysis and investmentrecommendations are restricted in purchasing/selling of shares or other securities till such a time this recommendation haseither been displayed or has been forwarded to clients of Karvy. All employees are further restricted to place orders onlythrough Karvy Stock Broking Ltd.

The information given in this document on tax are for guidance only, and should not be construed as tax advice. Investors areadvised to consult their respective tax advisers to understand the specific tax incidence applicable to them. We also expectsignificant changes in the tax laws once the new Direct Tax Code is in force – this could change the applicability and incidenceof tax on investments

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