Monday, October 11, 2010
Wednesday, August 4, 2010
Tips On The Stock Market- Free Interrelated Tip For Stock Market Advice Tip by sudarsan chhetri
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Retail Industry in India by Jajati Patro
The retail industry in India is emerging to attract new investments in the retail sector in the country.
Bharti Retail Ltd operates about 80 stores and owns a chain of grocery outlets and easyday market hypermarkets to cater to the retail market in India . Owned by billionaire Sunil Mittal's Bharti Group, the company plans to open 140 retail stores in India in 2010, said Raj Jain, managing director of the group's venture with Wal-Mart Stores Inc.
He added that Wal-Mart can open a large number of retail stores in India if the government allows foreign direct investment in the South Asian country's retail industry.
The company awaits policy changes in the retail market in India. The Bharti-Walmart JV runs the BestPrice Modern Wholesale stores to cater to the retail sector in North India. This is a 50:50 cash and carry joint venture between Bharti Enterprises and WalMart. The company will require additional manpower as it plans to open more cash-and-carry stores in the retail sector in the country. At present, it has two stores in India (in Punjab) and employs 450 workers.
The government has been in talks to open the multi-brand retail sector for FDI. At present, up to 51 per cent foreign investment is allowed in single brand retail and 100 per cent FDI in wholesale, but none in multi-brand.
The company has recently launched the second Bharti-Walmart Training Centre in New Delhi by entering into a public-private partnership with the Delhi Government. The centre would enroll up to 2,000 students a year to impart free of cost training in sectors, such as retail, BPOs and hospitality. The centre was inaugurated by Sheila Dikshit, Chief Minister of Delhi and would work to fill up the shortage in skilled workers for organised retail and cash-and-carry stores.
At a recent function, the Daniele Smadja, Head of the Delegation of the EU to India, said "We would like India to further open its economy to EU investments.
Furthermore, Nokia India is focussing on the retail distribution model. It is for the first time the world's largest mobile phone company has initiated a retail distribution model for its services venture.
In yet, another format of the retail market in India, the major retail players proved to be a boon to the small food processing vendors as they helped the latter put in a system which in turn attracted FMCG companies to hire the same vendors on account of quality.
Similarly the retail market in India is foraying into various sectors. Retail in healthcare sector is witnessing an immense interest from private equity investors. The upturn in the retail industry in India is attracting PE investors, gearing them to maximise their profits with the highest deal volumes being in various sectors including retail. According to V Jayasankar, Head, Private Equity, Kotak Investment Banking, "There is high level of interest in the retail sector as it directly feeds on consumption.
Additionally, the airport retail market in India is witnessing a renaissance with the fast pace of development in the expanding airport facilities in the country and the increasing number of passengers. With people on a constant move the target audience is easily available and the round the clock mode of retail sector available on airport gives that strategic advantage to the retail players.
Bharti Retail Ltd operates about 80 stores and owns a chain of grocery outlets and easyday market hypermarkets to cater to the retail market in India . Owned by billionaire Sunil Mittal's Bharti Group, the company plans to open 140 retail stores in India in 2010, said Raj Jain, managing director of the group's venture with Wal-Mart Stores Inc.
He added that Wal-Mart can open a large number of retail stores in India if the government allows foreign direct investment in the South Asian country's retail industry.
The company awaits policy changes in the retail market in India. The Bharti-Walmart JV runs the BestPrice Modern Wholesale stores to cater to the retail sector in North India. This is a 50:50 cash and carry joint venture between Bharti Enterprises and WalMart. The company will require additional manpower as it plans to open more cash-and-carry stores in the retail sector in the country. At present, it has two stores in India (in Punjab) and employs 450 workers.
The government has been in talks to open the multi-brand retail sector for FDI. At present, up to 51 per cent foreign investment is allowed in single brand retail and 100 per cent FDI in wholesale, but none in multi-brand.
The company has recently launched the second Bharti-Walmart Training Centre in New Delhi by entering into a public-private partnership with the Delhi Government. The centre would enroll up to 2,000 students a year to impart free of cost training in sectors, such as retail, BPOs and hospitality. The centre was inaugurated by Sheila Dikshit, Chief Minister of Delhi and would work to fill up the shortage in skilled workers for organised retail and cash-and-carry stores.
At a recent function, the Daniele Smadja, Head of the Delegation of the EU to India, said "We would like India to further open its economy to EU investments.
Furthermore, Nokia India is focussing on the retail distribution model. It is for the first time the world's largest mobile phone company has initiated a retail distribution model for its services venture.
In yet, another format of the retail market in India, the major retail players proved to be a boon to the small food processing vendors as they helped the latter put in a system which in turn attracted FMCG companies to hire the same vendors on account of quality.
Similarly the retail market in India is foraying into various sectors. Retail in healthcare sector is witnessing an immense interest from private equity investors. The upturn in the retail industry in India is attracting PE investors, gearing them to maximise their profits with the highest deal volumes being in various sectors including retail. According to V Jayasankar, Head, Private Equity, Kotak Investment Banking, "There is high level of interest in the retail sector as it directly feeds on consumption.
Additionally, the airport retail market in India is witnessing a renaissance with the fast pace of development in the expanding airport facilities in the country and the increasing number of passengers. With people on a constant move the target audience is easily available and the round the clock mode of retail sector available on airport gives that strategic advantage to the retail players.
Importance of automotive components Industry in India by vineet i
India is one of the most competitive auto parts manufacturers in the world and Indian automotive components are most sought after by international auto majors; since India is the best auto parts supplier who promise to give genuine, hardy and economically priced automotive parts.
The Indian automotive components industry has fast emerged from a supplier of the domestic market only, to one of the central and best auto parts supplier of Asia. Apart from being a significant player in the global automotive supply chain, auto component companies India also supply high-value and sophisticated auto components to renowned auto makers such as General Motors, Toyota, Ford, Volkswagen to name a few.
Most global auto makers purchase Indian auto components to meet the growing demands for hardy and genuine spare parts. According to statistics revealed by the Automotive Component Manufacturers Association of India (ACMA), the estimated turnover of the auto component industry will be around US $19.2 billion, in the year 2009-10. Whereas exports from the auto component companies India will be around US $3.2 billion. The maximum percentage of Indian automotive components is dominated by engine parts that accounts to almost 31%, 19% by drive transmission and steering parts and 12% each by suspension and braking parts and body and chassis respectively. The best auto parts supplier from India covers three main clusters mainly, commercial vehicle suppliers Delhi and NCR regions, Pune and Chennai.
Initiatives of the UNIDO-SPX further helped the Indian Auto component manufacturers to reach out to the global auto majors by organizing noteworthy and useful events such as the Auto Expo 2010 held from 5-11 January 2010 in New Delhi. The UNIDO-SPX India is a technical information and match making centre for industrial subcontracting and supply chain management that helps small and medium sized companies to reach out to the global audience and make a foothold in the international market. Various auto component companies India, especially from the small and medium sectors were immensely benefited from this Auto Expo fair that strengthened their chance of creating tie-ups with big international as well Indian players in the automobile industry. The various delegations from all around the world who were participating in this Auto Expo also got a chance to get into contract with commercial vehicle supplier Delhi & NCR, Pune and Chennai to purchase Indian auto components.
According to the Investment Commission of India, India is among the most competitive manufacturers and best auto parts supplier in the world. More and more international auto component makers including big names like Delphi, Visteon, Bosch and Meritor are interested to purchase Indian auto components and have set up operations in India. Apart from this India is also becoming the main hub for research and development of automotive components with companies like Bosch, Suzuki, Johnson Control etc setting up research and development centers in this country.
ACMA is the main agency for the Indian automotive components industry that helps the auto parts manufacturers to participate in international trade and technology fairs, send delegates abroad, bringing out publications on various automotive industry issues etc. ACMA also helps the auto component companies India to maintain their standard and quality of products and keep themselves upgraded according to international standards.
India is the second largest producer of motorcycles in the world after China. The vast range of vehicles made in India includes;
* Light passenger vehicles including passenger cars, MUV's, SUV's, Commercial vehicles including light commercial vehicles, medium and heavy commercial vehicles and buses,
* Tractors that include earth moving, and construction equipments,
* Two wheelers including motorcycles, scooters, mopeds and
* Three wheelers including passenger carriers and goods carriers.
* Light passenger vehicles including passenger cars, MUV's, SUV's, Commercial vehicles including light commercial vehicles, medium and heavy commercial vehicles and buses,
* Tractors that include earth moving, and construction equipments,
* Two wheelers including motorcycles, scooters, mopeds and
* Three wheelers including passenger carriers and goods carriers.
Monday, May 31, 2010
Tuesday, April 6, 2010
Acquisition/Investment in Indian Companies by Foreign & Domestic Investors - Six Steps Mantra By Seema Jhingan
Acquisition/Investment in Indian Companies by Foreign & Domestic Investors - Six Steps Mantra
Joint ventures, strategic alliances and acquisitions are the flavor of the day that enable fast growth focused companies to have rapid inorganic growth and expansion in new sectors. However, prior to engaging in a joint venture relationship or acquisition of an operating Indian company ("Investee company"), either by way of private placement, or secondary market, or subscription of substantial equity share capital, it is advisable for the Investor to carefully and stringently undertake the following six step mantra to avoid future surprises and heartburns:
(i) Due Diligence/Operations Audit: Extensive legal and financial due diligence of the Investee company is advisable to assess Investee company's track record in compliance with Indian laws, statutory obligations and regulations applicable to it. The due diligence exercise (which usually takes between three (3) to four (4) weeks depending on availability of documents) not only enables the Investor to assess potential liabilities, evaluate unknown and potential, disclosed or undisclosed liabilities but also enables the Investor to assess the feasibility and viability of the proposed acquisition and rationalize enterprise valuation. If required, Investor can demand creation of an escrow account for safe deposit of a part of the acquisition cost, parked for an agreed period to mitigate against any future liabilities of the Investee company.
(ii) Resolution of Preliminary Issues: Preliminary issues, if any, arising pursuant to the conduct of the Due Diligence exercise would need to be resolved and a decision taken whether or not to proceed with the acquisition. For example, whether a change of control would affect the ability of the Investee company to carry on its business operations under the current regulatory framework and the approvals and licenses required. Unresolved issues that are not fatal to the acquisition may be identified and negotiated.
(iii) Regulatory/Pricing/Tax Issues: Identification of regulatory and tax issues that may impact the transaction is critical. In case the Investor is a non-resident, foreign direct investment ("FDI") guidelines will also need to be assessed.
FDI either by way of acquisition/transfer of issued equity capital or fresh subscription to the equity capital of Investee company in most sectors is presently unregulated and most sectors barring a few do not require the FDI approval from the Foreign Investment Promotion Board. However, the price at which the transfer takes place will need to conform to the pricing guidelines prescribed by the Reserve Bank of India ("RBI"), i.e., the fair valuation of shares have been done by a chartered accountant as per the prescribed guidelines; and the price per share arrived at has been certified by a chartered accountant. The share consideration in respect of the shares purchased by Investor will need to be remitted to India through the banks authorized to deal in foreign exchange.
In case of transfer of shares to the Investor the transaction would be subject to levy of stamp duty ranging from 0.25% to 0.75% of the value of the shares transferred and payable in accordance with the applicable rates prescribed by the respective State where is the Investee company is registered. The transferor usually bears the stamp duty for the transfer of shares in the absence of a contract to the contrary. Alternatively, Investor can consider to subscribe to the equity share capital of the Investee Company by way of preferential allotment and avoid the stamp duty payable on transfer of shares.
Capital gains arising from transfer of shares (in the event of an acquisition instead of an issue of fresh equity) would attract tax in the hands of the seller, i.e., the existing shareholder of the Investee Company.
(iv) Contract Documentation Preparation: Upon successful resolution of preliminary issues and an affirmative decision to proceed with the acquisition, parties would need to identify and prepare commercial documentation to record their understanding of the transaction and the manner in which such transactions would be closed.
(v) Closing: A reasonable time frame is agreed within which the share acquisition would be consummated. If Closing is delayed, parties may consider to put documents/consideration money in an escrow pending resolution and satisfaction of the closing conditions.
(vi) Post Acquisition Compliances: This would usually include corporate compliances such registration of the share transfer in the statutory books of Investee Company and intimation of change of control that may be required pursuant to any regulatory approvals and licenses already obtained. For instance, Investee Company will need to inform Registrar of Companies and the RBI about the change in the equity structure of the company.
The risk of acquiring an existing operating company with its past baggage of liabilities versus setting up a new company is a critical question that most Investors face. Needless to say, the cumbersome process of setting up a new company, obtaining necessary authorizations from regulatory authorities for establishing an Indian company and growing a new business is always challenging. It is for this reason that mergers and acquisitions are not only common but the preferred way for expansion and growth in the today's fast growing economies.
Joint ventures, strategic alliances and acquisitions are the flavor of the day that enable fast growth focused companies to have rapid inorganic growth and expansion in new sectors. However, prior to engaging in a joint venture relationship or acquisition of an operating Indian company ("Investee company"), either by way of private placement, or secondary market, or subscription of substantial equity share capital, it is advisable for the Investor to carefully and stringently undertake the following six step mantra to avoid future surprises and heartburns:
(i) Due Diligence/Operations Audit: Extensive legal and financial due diligence of the Investee company is advisable to assess Investee company's track record in compliance with Indian laws, statutory obligations and regulations applicable to it. The due diligence exercise (which usually takes between three (3) to four (4) weeks depending on availability of documents) not only enables the Investor to assess potential liabilities, evaluate unknown and potential, disclosed or undisclosed liabilities but also enables the Investor to assess the feasibility and viability of the proposed acquisition and rationalize enterprise valuation. If required, Investor can demand creation of an escrow account for safe deposit of a part of the acquisition cost, parked for an agreed period to mitigate against any future liabilities of the Investee company.
(ii) Resolution of Preliminary Issues: Preliminary issues, if any, arising pursuant to the conduct of the Due Diligence exercise would need to be resolved and a decision taken whether or not to proceed with the acquisition. For example, whether a change of control would affect the ability of the Investee company to carry on its business operations under the current regulatory framework and the approvals and licenses required. Unresolved issues that are not fatal to the acquisition may be identified and negotiated.
(iii) Regulatory/Pricing/Tax Issues: Identification of regulatory and tax issues that may impact the transaction is critical. In case the Investor is a non-resident, foreign direct investment ("FDI") guidelines will also need to be assessed.
FDI either by way of acquisition/transfer of issued equity capital or fresh subscription to the equity capital of Investee company in most sectors is presently unregulated and most sectors barring a few do not require the FDI approval from the Foreign Investment Promotion Board. However, the price at which the transfer takes place will need to conform to the pricing guidelines prescribed by the Reserve Bank of India ("RBI"), i.e., the fair valuation of shares have been done by a chartered accountant as per the prescribed guidelines; and the price per share arrived at has been certified by a chartered accountant. The share consideration in respect of the shares purchased by Investor will need to be remitted to India through the banks authorized to deal in foreign exchange.
In case of transfer of shares to the Investor the transaction would be subject to levy of stamp duty ranging from 0.25% to 0.75% of the value of the shares transferred and payable in accordance with the applicable rates prescribed by the respective State where is the Investee company is registered. The transferor usually bears the stamp duty for the transfer of shares in the absence of a contract to the contrary. Alternatively, Investor can consider to subscribe to the equity share capital of the Investee Company by way of preferential allotment and avoid the stamp duty payable on transfer of shares.
Capital gains arising from transfer of shares (in the event of an acquisition instead of an issue of fresh equity) would attract tax in the hands of the seller, i.e., the existing shareholder of the Investee Company.
(iv) Contract Documentation Preparation: Upon successful resolution of preliminary issues and an affirmative decision to proceed with the acquisition, parties would need to identify and prepare commercial documentation to record their understanding of the transaction and the manner in which such transactions would be closed.
(v) Closing: A reasonable time frame is agreed within which the share acquisition would be consummated. If Closing is delayed, parties may consider to put documents/consideration money in an escrow pending resolution and satisfaction of the closing conditions.
(vi) Post Acquisition Compliances: This would usually include corporate compliances such registration of the share transfer in the statutory books of Investee Company and intimation of change of control that may be required pursuant to any regulatory approvals and licenses already obtained. For instance, Investee Company will need to inform Registrar of Companies and the RBI about the change in the equity structure of the company.
The risk of acquiring an existing operating company with its past baggage of liabilities versus setting up a new company is a critical question that most Investors face. Needless to say, the cumbersome process of setting up a new company, obtaining necessary authorizations from regulatory authorities for establishing an Indian company and growing a new business is always challenging. It is for this reason that mergers and acquisitions are not only common but the preferred way for expansion and growth in the today's fast growing economies.
| Areas of Practice: Infrastructure, Telecommunications, Power, Mergers/Acquisition, Software/Information Technology, Business Process Outsourcing, Media & Entertainment, Private Equity and Venture Capital, General Corporate and Commercial, International Arbitration. Professional Summary: Seema Jhingan's practice spans over fourteen years during which she has acquired substantial expertise in representing developers, sponsors/lenders, venture capital investors, international corporations, financial institutions, and other strategic investors involved in the establishment, development and financing of major infrastructure and IT projects in India. |  |
Indian Real Estate - Right Place For Your Investment By Amjad Islam Khan
There is a huge rush for investment in real estate in India. The reason behind the huge demand and inflation in real estate price is that India has become a hub for investment for real estate investors throughout the world. In recent years, Indian economy has really boomed and the outside world has appreciated the growth the country has made in every sector. Real estate sector is also one of those important sectors, which has seen growth by leaps and bounds.
It is difficult to determine the correct value of property because there is not a proper procedure that has been put in place in India to assess the value of properties. The price of a property usually depends on its location and the properties that are situated near popular market areas command higher prices as compared to the properties that are not situated near such places. Before purchasing a property in India, one should try to ensure that it is located in the vicinity of important facilities like schools, hospitals and markets, and is also endowed with the basic amenities of water, electricity and excellent roads around the property. Excellent accessibility with the railways, airports and the inter-state bus depots is also a very important condition that should be seen before investing in a residential property.
Before purchasing apartments or flats, you should also see that builders who are registered and have a good reputation building the properties. An investor who invests in a property in India can expect a huge amount of windfall gains if the property prices soar up due to reasons like construction of Metro near the property, inclusion of the property in a Special Economic zone or airport construction near the property. Sometimes, there can be an expected increase in the price of a property when a shopping complex is constructed near it.
The prices of Real Estate are booming in India and the property is available for all kinds of residential investors, right from condomiums and one-bedroom lodgings to lavish 3 bedroom apartments in Gurgaon. There has been a tremendous change in the real estate scenario in India especially in the metropolitan cities with large-scale commercial construction companies coming into the construction business, which are giving a very tough competition to the small-scale local construction agents. The government has also facilitated setting up of (SEZs) Special Economic Zones, IT parks and townships which has led to large scale urbanisation and availability of amazing real estate properties equipped with all the requisite modern facilities.
It is difficult to determine the correct value of property because there is not a proper procedure that has been put in place in India to assess the value of properties. The price of a property usually depends on its location and the properties that are situated near popular market areas command higher prices as compared to the properties that are not situated near such places. Before purchasing a property in India, one should try to ensure that it is located in the vicinity of important facilities like schools, hospitals and markets, and is also endowed with the basic amenities of water, electricity and excellent roads around the property. Excellent accessibility with the railways, airports and the inter-state bus depots is also a very important condition that should be seen before investing in a residential property.
Before purchasing apartments or flats, you should also see that builders who are registered and have a good reputation building the properties. An investor who invests in a property in India can expect a huge amount of windfall gains if the property prices soar up due to reasons like construction of Metro near the property, inclusion of the property in a Special Economic zone or airport construction near the property. Sometimes, there can be an expected increase in the price of a property when a shopping complex is constructed near it.
The prices of Real Estate are booming in India and the property is available for all kinds of residential investors, right from condomiums and one-bedroom lodgings to lavish 3 bedroom apartments in Gurgaon. There has been a tremendous change in the real estate scenario in India especially in the metropolitan cities with large-scale commercial construction companies coming into the construction business, which are giving a very tough competition to the small-scale local construction agents. The government has also facilitated setting up of (SEZs) Special Economic Zones, IT parks and townships which has led to large scale urbanisation and availability of amazing real estate properties equipped with all the requisite modern facilities.
Current Realty Trends in India By Deepika B
Indian Real Estate has revived after a year long period of stagnation and declining transactional activity. Over the last three months, the real estate scenario of the country has taken a positive turn as a lot of development is seen on this front. The sentiments in the realty market are echoing signs of revival as both property investors and property developers are turning active.
India is developing at a fast pace and the rapid industrial expansion has bolstered the demand for housing and commercial space. Real estate builders are constantly working on meeting the growing consumer demands from both individuals and corporate companies. These developers aim at catering to the needs of all the classes by creating global standards of living along with affordable pricing.
Large scale developments are taking place all over the country among residential, commercial and retail sectors. From apartments, flats, independent houses, villas, deluxe houses, etc. in residential sector to commercial complexes, offices, plazas, SEZs, etc. in industrial sector to shops, retail outlets, food chains, entertainment zones, etc. in retail sector, every segment of real estate is being developed rapidly. Both the factors, increase in demand and varied investment options are leading to such immense growth of the realty industry.
Various property dealers are promising quality housing at affordable prices to catch attention of the property investors. This has resulted in generating afresh wave among property buyers who have been inactive and deferring their purchases. Property prices and rental values are also stabilizing in almost all the cities but are expected to spiral up soon. A huge boom in Indian real estate is due and according to leading property consultants will arrive soon. Not only metros would reap the benefits of this favorable position, tier-II cities will gain benefits too. In fact, tier-III and tier-IV cities are the ones seeing massive construction of property across all sectors and industries.
'Affordable housing' has become the new buzzword in the real estate industry today. It is interesting to know that a significant reason for the large-scale development in smaller cities is the upcoming trend of affordable housing. In the horde of providing high standard housing and value for money, the real estate developers are coming up with various projects in small towns. All these cities are going through a facelift as these builders are giving the realty scenario a makeover.
There are several other reasons for heating up of the real estate in India after the prolonged global slowdown. To know a little more, read on.
- Foreign and NRI investments in Indian realty.
FDI (Foreign Direct Investment) in India's property market has increased substantially since the time policy changes were introduced by the Government in 2005. The new alterations allowed 100% foreign investments in construction projects with fast-track approvals. But the major attraction for foreign investors is potential investment returns of more than 25 % in Indian projects which is way higher when compared to US and European markets.
-Investments from NRIs and PIOs
Non-Resident Indians (NRIs) and Persons of Indian Origin (PIOs) have been increasingly investing in Indian real estate. This is chiefly because it is both monetarily rewarding in terms of higher returns and emotionally gratifying as it helps maintain bonds with the home country.
-Smaller investors brought into real estate
Affordable housing gives an opportunity to smaller investors to widen their investment horizons, ultimately expanding the Indian property market. Realty developers are targeting the low income groups by creating this new section of high quality, cost effective living. The focus on financial security by these investors is also attributed as one of the reasons of growing property developments.
India is developing at a fast pace and the rapid industrial expansion has bolstered the demand for housing and commercial space. Real estate builders are constantly working on meeting the growing consumer demands from both individuals and corporate companies. These developers aim at catering to the needs of all the classes by creating global standards of living along with affordable pricing.
Large scale developments are taking place all over the country among residential, commercial and retail sectors. From apartments, flats, independent houses, villas, deluxe houses, etc. in residential sector to commercial complexes, offices, plazas, SEZs, etc. in industrial sector to shops, retail outlets, food chains, entertainment zones, etc. in retail sector, every segment of real estate is being developed rapidly. Both the factors, increase in demand and varied investment options are leading to such immense growth of the realty industry.
Various property dealers are promising quality housing at affordable prices to catch attention of the property investors. This has resulted in generating afresh wave among property buyers who have been inactive and deferring their purchases. Property prices and rental values are also stabilizing in almost all the cities but are expected to spiral up soon. A huge boom in Indian real estate is due and according to leading property consultants will arrive soon. Not only metros would reap the benefits of this favorable position, tier-II cities will gain benefits too. In fact, tier-III and tier-IV cities are the ones seeing massive construction of property across all sectors and industries.
'Affordable housing' has become the new buzzword in the real estate industry today. It is interesting to know that a significant reason for the large-scale development in smaller cities is the upcoming trend of affordable housing. In the horde of providing high standard housing and value for money, the real estate developers are coming up with various projects in small towns. All these cities are going through a facelift as these builders are giving the realty scenario a makeover.
There are several other reasons for heating up of the real estate in India after the prolonged global slowdown. To know a little more, read on.
- Foreign and NRI investments in Indian realty.
FDI (Foreign Direct Investment) in India's property market has increased substantially since the time policy changes were introduced by the Government in 2005. The new alterations allowed 100% foreign investments in construction projects with fast-track approvals. But the major attraction for foreign investors is potential investment returns of more than 25 % in Indian projects which is way higher when compared to US and European markets.
-Investments from NRIs and PIOs
Non-Resident Indians (NRIs) and Persons of Indian Origin (PIOs) have been increasingly investing in Indian real estate. This is chiefly because it is both monetarily rewarding in terms of higher returns and emotionally gratifying as it helps maintain bonds with the home country.
-Smaller investors brought into real estate
Affordable housing gives an opportunity to smaller investors to widen their investment horizons, ultimately expanding the Indian property market. Realty developers are targeting the low income groups by creating this new section of high quality, cost effective living. The focus on financial security by these investors is also attributed as one of the reasons of growing property developments.
Investing in the Indian Money Market By Sourav Sharma
The global economic scenario is no longer same as it was few months ago. The panic that the market created amongst investors turning many bankrupt, jobless, and also leading to the closing down of a number of companies is all gone. Markets are fast recuperating and the Indian market almost tops the list in the recovery race. Stock market news are flooded with information related to rise of assorted sectors with the fall rate hardly holding grounds. The scenario has invited overseas investors to invest in crores in the Indian money market besides domestic investors already investing in bulks.
Investors as well as stock trading agencies are at the moment making big money from brisk trading. The Indian stock market, as a result, has in no time almost reached its normalcy with the sensex figures crossing the 17,000 mark exhibiting an upward graph. It is stock market news that updates the investor about the current market situation. Which companies in the Indian market are gaining and which companies are losing, sectors that are gaining grounds, sectors that are likely to exhibit profits in the long run, and more information can be accessed via stock market news.
If you are a beginner in the Indian money market, you can yet make a mark by investing wisely. Expert tips can be sought from brokerage platforms and online stock trading agencies to get the maximum profit out of your investment. At these platforms, stock specialists vigilantly analyze and scrutinize the present market trends and then compare the same with the past market conditions. As risks are always involved, you cannot get a guarantee on profits but you can be guided through the trading sessions for successful transaction and generation of the highest return on investment. Market analysts have rightly said that long term investment does bring good returns in the long run. With high inflation rates dominating the Indian stock market scenario, investors who bought stocks and waited for long are now earning handsome profits. Investors now can experience new rays of hope and the countdown has already begun!
Investors as well as stock trading agencies are at the moment making big money from brisk trading. The Indian stock market, as a result, has in no time almost reached its normalcy with the sensex figures crossing the 17,000 mark exhibiting an upward graph. It is stock market news that updates the investor about the current market situation. Which companies in the Indian market are gaining and which companies are losing, sectors that are gaining grounds, sectors that are likely to exhibit profits in the long run, and more information can be accessed via stock market news.
If you are a beginner in the Indian money market, you can yet make a mark by investing wisely. Expert tips can be sought from brokerage platforms and online stock trading agencies to get the maximum profit out of your investment. At these platforms, stock specialists vigilantly analyze and scrutinize the present market trends and then compare the same with the past market conditions. As risks are always involved, you cannot get a guarantee on profits but you can be guided through the trading sessions for successful transaction and generation of the highest return on investment. Market analysts have rightly said that long term investment does bring good returns in the long run. With high inflation rates dominating the Indian stock market scenario, investors who bought stocks and waited for long are now earning handsome profits. Investors now can experience new rays of hope and the countdown has already begun!
Get Attractive Property Investment Opportunities in Real Estate in India By Joseph Golu Smith
Undoubtedly, real estate in India offers very attractive property investment opportunities for anyone interested in making real good money. This is due to the consistent appreciation of real estate properties in India for several years now, barring the recent slump in the wake of the global economic meltdown. But the recession has had only a temporary effect in the Indian economy. The real estate industry was in fact affected by the resultant slump, however. And, reportedly the doldrums in the market is tapering off and the industry is again becoming vibrant with talks and deals. As such, individual and institutional investors have begun to evince keen interest in real estate properties in India. As the slump has caused stagnation in the market, many prime properties are available at much less price than they would be available after a year.
From another angle also investment-wise properties offers attractive opportunities in India. Among other investment options, stock and shares do not seem promising in the context of fluctuating sensex and volatile market conditions. Bank deposits and related investment options will not yield any lucrative returns in the context of inflation and declining currency value. There is yet another aspect which can inspire confidence in the mind of the property investors in India. Currently, the real estate scenario in India is undergoing a metamorphosis. In the new scenario new market equations are emerging due to the influence of sector-specific and macro-economic factors. Also, industry experts aver that the Indian property sector is going to be in an upswing in the coming years. The renowned property investment analyst, Jones Lang LaSalle opines: "economic recovery during CY 2010-11 is likely to reinvigorate the interest of foreign investors in Indian Property market. We expect enhanced capital inflow in the property sector in the medium-to-long-term".
There is yet another dimension to the fact that Property India offers very attractive investment opportunities. In resonance with the foregone forecast as to the prospects of real estate investment in India, it would be logical to anticipate a quantum leap in the property sector in India in the coming future. The projected growth in the national income in the coming years will be directly linked to a resultant up-thrust in the property market. Further, owing to the increase in the pay-scale of Government employees, better paying corporate sector, foreign exchange through NRI manpower, an estimated 10 million residential units in the middle-income-level will be in need in India in the coming years. This aspect is very relevant when we analyze the scope of property investment in India.
From another angle also investment-wise properties offers attractive opportunities in India. Among other investment options, stock and shares do not seem promising in the context of fluctuating sensex and volatile market conditions. Bank deposits and related investment options will not yield any lucrative returns in the context of inflation and declining currency value. There is yet another aspect which can inspire confidence in the mind of the property investors in India. Currently, the real estate scenario in India is undergoing a metamorphosis. In the new scenario new market equations are emerging due to the influence of sector-specific and macro-economic factors. Also, industry experts aver that the Indian property sector is going to be in an upswing in the coming years. The renowned property investment analyst, Jones Lang LaSalle opines: "economic recovery during CY 2010-11 is likely to reinvigorate the interest of foreign investors in Indian Property market. We expect enhanced capital inflow in the property sector in the medium-to-long-term".
There is yet another dimension to the fact that Property India offers very attractive investment opportunities. In resonance with the foregone forecast as to the prospects of real estate investment in India, it would be logical to anticipate a quantum leap in the property sector in India in the coming future. The projected growth in the national income in the coming years will be directly linked to a resultant up-thrust in the property market. Further, owing to the increase in the pay-scale of Government employees, better paying corporate sector, foreign exchange through NRI manpower, an estimated 10 million residential units in the middle-income-level will be in need in India in the coming years. This aspect is very relevant when we analyze the scope of property investment in India.
Indian Property Investment - Some Reasons to Rejoice By Joseph Golu Smith
Indian Property Investment - Some Reasons to Rejoice
For those who are interested in properties in india to buy, Indian property investment have some reasons to rejoice. After the general economic slump that has affected the property sector, now there is a new fillip in the real estate market in India. Along with the micro and macro economic factors, the government policies also have contributed to the new growth in the industry. Among the gamut of government policy decisions, the foreign direct investment (FDI) has been instrumental in overseas participation in the real estate sector in India. As a result, investors from across the continents have evinced interest in investing Indian properties. This foreign direct investment is expected to increase in the coming years.
There are some reasons to rejoice for property Investment in India because the real estate sector in India is attracting huge investments and the market is once again active after the slump. Apart form the FDI, national financing sector also makes commendable contributions to real estate finance in India now. Banks and other financial institutions of the country have advanced various borrowing schemes to builders and property investors. Overseas investors have evinced keen interest in the Indian property market. US-based Warburg Pincus, Blackstone Group, Broadstreet and Morgan Stanley Real Estate Fund (MSREF) have shown interest in investing in India. Among foreign investors who have started consultations for new projects in India include: Columbia Endowment Fund, California Public Employees' Retirement System (CalPERS), Hines, Tishman Speyer, Sam Zell's Equity International, JP Morgan Partners and Amaranth Advisors. Also Barren Buffet's Berkshire Hathway is keen to invest in India. With these foreign direct investments, the property market will be very vibrant and it will be a reason for the investors to rejoice.
There are some genuine reasons to rejoice for investment at property in India. Apart from this huge foreign direct investment, both the central and state governments have formulated several new policies for the congenial growth of the property market in India. Governmental decisions include: the repealing of Urban Land (Ceiling and Regulation) Act, 1976 (ULCRA) by increasingly larger number of states; the minimum area to be developed for integrated townships has been brought down to 25 acres from 100 acres; in single-brand retail outlets 51% FDI allowed and 100 per cent in cash-and-carry through the automatic route; after three years original investment can be repatriated fully. Another reason to rejoice for the investors is that international experts have estimated a sustained growth in Indian national income in the coming years.
There are some reasons to rejoice for property Investment in India because the real estate sector in India is attracting huge investments and the market is once again active after the slump. Apart form the FDI, national financing sector also makes commendable contributions to real estate finance in India now. Banks and other financial institutions of the country have advanced various borrowing schemes to builders and property investors. Overseas investors have evinced keen interest in the Indian property market. US-based Warburg Pincus, Blackstone Group, Broadstreet and Morgan Stanley Real Estate Fund (MSREF) have shown interest in investing in India. Among foreign investors who have started consultations for new projects in India include: Columbia Endowment Fund, California Public Employees' Retirement System (CalPERS), Hines, Tishman Speyer, Sam Zell's Equity International, JP Morgan Partners and Amaranth Advisors. Also Barren Buffet's Berkshire Hathway is keen to invest in India. With these foreign direct investments, the property market will be very vibrant and it will be a reason for the investors to rejoice.
There are some genuine reasons to rejoice for investment at property in India. Apart from this huge foreign direct investment, both the central and state governments have formulated several new policies for the congenial growth of the property market in India. Governmental decisions include: the repealing of Urban Land (Ceiling and Regulation) Act, 1976 (ULCRA) by increasingly larger number of states; the minimum area to be developed for integrated townships has been brought down to 25 acres from 100 acres; in single-brand retail outlets 51% FDI allowed and 100 per cent in cash-and-carry through the automatic route; after three years original investment can be repatriated fully. Another reason to rejoice for the investors is that international experts have estimated a sustained growth in Indian national income in the coming years.
Foreign Investment in India Under Automatic Route By Rakesh Parik
The various formalities involved in the Intimation to Reserve Bank of India in respect of the equity brought in 100% subsidiary to an Indian Company by a foreign company has always remain a matter of clarification for many people. I am writing this article from my practical experience as in one of our clients case there was delay in filling the same. I hope you will gain good understanding of the matter from the write-up.
The Requirement and the flow of events is as follows in simple terms and have been explained point-wise later:
1. Share Application money is brought by the foreign company in its Indian Subsidiary.
2. Within 30 days of introducing the money the company should intimate to RBI about the receipt of funds.
3. Once the Intimation is send to the AD i.e Authorized dealer through whom the funds were received in India and the AD Intimates to RBI after verification of certain details.
4. AD forwards the application to RBI and Gets the Unique Identification Number which shall be quoted in the future correspondence with the RBI and Authorized dealers.
5. The Allotment of shares shall be done for share application money and Filling of FCGPR shall be filled within 180 days of the receipt of the funds.
6. In case the allotment is not done and intimated to RBI the funds shall be send back to the Holding company immediately.
7. The for FC-GPR Shall be filled with RBI within 30 days of allotment of shares to RBI through AD.
8. The FCGPR shall be filled along with a valuation certificate from a CA and a compliance certificate from the Company Secretary.
9. Once the FCGPR is filled all the formalities are completed and RBI will approach for any discrepancies or doubts if they have any.
Elaborating the above points in Details and various situations
1. Share application money should be brought in the account of the subsidiary company or it may be brought into the account of the agent of the foreign company and than transferred to the account of the subsidiary company. But every thing should be done through proper banking channels.
2. The Intimation shall be done in 30 days, In case it is not done still the same shall be filled with the AD as delay and the reason for the delay shall be mentioned in the covering letter.
3. The Intimation shall be filled with the Authorized dealer i.e if the funds have come to the subsidiary companies account that with the same authorized dealer. If the funds have come to the account of agent of the holding company than with the banker of the agent i.e authorized dealer of the agent. Some times this might happen that the funds have comes in an account which is no more operative or closed by closed by the company even is such cased the intimation shall be filled the authorized dealer with whom the funds have come and it's the responsibility of the authorized dealer to accepts the intimations.
After receipt of this intimation the internal procedure of the AD is that they have to send a swift massage to the remitting bank in order to confirm the remittance once it is confirmed form the foreign remitting bank that the funds were remitted by the same bank the intimation will be forwarded to RBI for allotment.
4. Once the application is forwarded to RBI , After processing it RBI issued a Unique Identification Number. Generally allotment of UIN number may take long time in such case further document and forms can be filled with the RBI based on the acknowledgment of the Intimation filled previously.
5. The allotment of share shall be done immediately; In case delay is made and the period is expired the same shall be filled along with a letter for condemnation of delay and giving the reason for the delay.
6. In the absence of completing the formalities within 180 days the requirement is to remit back the money. The companies can remit back the whole funds and again ask for the share application money for its holding company. But this procedure is very tedious. Hence as a alternation an effort can be made by filling the further FCGPR forms and awaiting from RBI for any show cause notice and Filling a genuine reply for the delay.
7.The FCGPR shall be filled within 30 days of allotment of share , there may be delay in filling the same as the client may wait for the allotment to get approved from ROC which sometimes takes higher time. Still the FCGPR shall be filled with the reason for delay.
8. FCGPR shall be filled along with the valuation certificate from CA, the valuation shall be less than the value of issue of share. In case the issue price is less than the actual valuation as per CA certificate it is treated as loss of foreign exchange by the government of India. Further compliance certificate shall also be taken from the company secretary that all the legal formalities for allotment of shares have been done properly.
9. Filling of FCGPR along with the above details completes the procedure and the assignment is over. If we receive any clarification from RBI same shall be answered accordingly.
Rakesh Parik, Chartered Accountant by profession and a Business setup Consultant for India. Looking at the complex legal framework in India Rakesh decided to start a business setup advisory company in order to provide a relief to the foreign investors in setting up there business in India. Primarily focusing on the SMEs. With his consultancy company he has tried to provide a phenomenal environment to the foreign investors and made an effort to make their Indian setup an easy process.
The Requirement and the flow of events is as follows in simple terms and have been explained point-wise later:
1. Share Application money is brought by the foreign company in its Indian Subsidiary.
2. Within 30 days of introducing the money the company should intimate to RBI about the receipt of funds.
3. Once the Intimation is send to the AD i.e Authorized dealer through whom the funds were received in India and the AD Intimates to RBI after verification of certain details.
4. AD forwards the application to RBI and Gets the Unique Identification Number which shall be quoted in the future correspondence with the RBI and Authorized dealers.
5. The Allotment of shares shall be done for share application money and Filling of FCGPR shall be filled within 180 days of the receipt of the funds.
6. In case the allotment is not done and intimated to RBI the funds shall be send back to the Holding company immediately.
7. The for FC-GPR Shall be filled with RBI within 30 days of allotment of shares to RBI through AD.
8. The FCGPR shall be filled along with a valuation certificate from a CA and a compliance certificate from the Company Secretary.
9. Once the FCGPR is filled all the formalities are completed and RBI will approach for any discrepancies or doubts if they have any.
Elaborating the above points in Details and various situations
1. Share application money should be brought in the account of the subsidiary company or it may be brought into the account of the agent of the foreign company and than transferred to the account of the subsidiary company. But every thing should be done through proper banking channels.
2. The Intimation shall be done in 30 days, In case it is not done still the same shall be filled with the AD as delay and the reason for the delay shall be mentioned in the covering letter.
3. The Intimation shall be filled with the Authorized dealer i.e if the funds have come to the subsidiary companies account that with the same authorized dealer. If the funds have come to the account of agent of the holding company than with the banker of the agent i.e authorized dealer of the agent. Some times this might happen that the funds have comes in an account which is no more operative or closed by closed by the company even is such cased the intimation shall be filled the authorized dealer with whom the funds have come and it's the responsibility of the authorized dealer to accepts the intimations.
After receipt of this intimation the internal procedure of the AD is that they have to send a swift massage to the remitting bank in order to confirm the remittance once it is confirmed form the foreign remitting bank that the funds were remitted by the same bank the intimation will be forwarded to RBI for allotment.
4. Once the application is forwarded to RBI , After processing it RBI issued a Unique Identification Number. Generally allotment of UIN number may take long time in such case further document and forms can be filled with the RBI based on the acknowledgment of the Intimation filled previously.
5. The allotment of share shall be done immediately; In case delay is made and the period is expired the same shall be filled along with a letter for condemnation of delay and giving the reason for the delay.
6. In the absence of completing the formalities within 180 days the requirement is to remit back the money. The companies can remit back the whole funds and again ask for the share application money for its holding company. But this procedure is very tedious. Hence as a alternation an effort can be made by filling the further FCGPR forms and awaiting from RBI for any show cause notice and Filling a genuine reply for the delay.
7.The FCGPR shall be filled within 30 days of allotment of share , there may be delay in filling the same as the client may wait for the allotment to get approved from ROC which sometimes takes higher time. Still the FCGPR shall be filled with the reason for delay.
8. FCGPR shall be filled along with the valuation certificate from CA, the valuation shall be less than the value of issue of share. In case the issue price is less than the actual valuation as per CA certificate it is treated as loss of foreign exchange by the government of India. Further compliance certificate shall also be taken from the company secretary that all the legal formalities for allotment of shares have been done properly.
9. Filling of FCGPR along with the above details completes the procedure and the assignment is over. If we receive any clarification from RBI same shall be answered accordingly.
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