Real estate growth strongest in greater Mumbai region, says Mahantesh Sabarad
June 26th, 2024
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“You would find that among the largest or strongest growing markets for real
estate in the past two years have been the greater MMR region,
the Mumbai metropolitan region, particularly Thane. In the past, we used to
see that real estate markets of Delhi, Bangalore would grow fast but
particularly, we are seeing in the last two years Thane has been a very large
growing market. Raymond has a direct presence in the Thane market in terms
of real estate projects and even from a comparative perspective, Thane has
been one of the fast-growing real estate markets. So, would not be surprised
with the kind of development we are seeing on the Raymond stock,”
says Mahantesh Sabarad, Independent Market Expert.
Mahantesh Sabarad: Looking at the banking space and looking at the way
HDFC Bank is moving up, it does appear that these false starts that we had
seen for the past two years is now not the case. The entire banking space is
likely to do better going ahead, simply because you are emerging out of a
situation where you will have better credit growth ahead; you do not have asset
quality issues anymore and all the consolidation that you had seen in the past
is done with.
And we are going to enter a cycle, an interest rate cycle, which will signal
perhaps easing instead of tightening ahead. All these augurs really well for the
banking sector as a whole. And therefore, I would say HDFC participating in
that rally is something that is also coming out of their own situation, the past
legacy issues of HDFC Bank are no more there to handle. So, they are riding
the banking wave that we are likely to see ahead.
Mahantesh Sabarad: So, I think the real estate sector is doing quite well,
particularly those which are linked to Mumbai city. You would find that among
the largest or strongest growing markets for real estate in the past two years
have been the greater MMR region, the Mumbai metropolitan region,
particularly Thane.
In the past, we used to see that real estate markets of Delhi, Bangalore would
grow fast but particularly, we are seeing in the last two years Thane has been a
very large growing market. Raymond has a direct presence in the Thane
market in terms of real estate projects and even from a comparative
perspective, Thane has been one of the fast-growing real estate markets. So,
would not be surprised with the kind of development we are seeing on the
Raymond stock.
Having said that, even the other Mumbai-based real estate companies have
been doing really well. Oberoi Realty is another one. Godrej is another. So, I
believe that some of these companies exposed to the Mumbai real estate
market or MMR real estate market will start tending to do better and let us not
forget that we have new metro projects upcoming now who are just about to
start which would lend a better kind of real estate growth to the greater MMR
region.
Mahantesh Sabarad: So, when you look at the auto ancillary space — and I
do agree it is a vast space to really cover. But if you spot the trends that are
happening, whereas which is coming out of how the overall automobile industry
is developing, there is premiumisation that is happening, that means more and
more people are buying higher end kind of cars, which calls for greater,
therefore, content per car that is coming in, which obviously augurs well for
some of the auto ancillaries.
Point number two, in terms of trends that is coming up is that we are seeing
some kind of policy consensus coming towards junking of cars. So basically,
doing away with old cars. And therefore, that should start a very healthy trend
in terms of overall automobile growth.
The third trend that we are witnessing is that the overall driving — the
experience of vehicles is technology driven, getting technology driven. There is
a lot of integration that is happening; tech integration that is happening within
the automobile space. And therefore, some ancillaries stand to benefit out of
that.
So, if one were to pick out of all these trends that are happening within the auto
ancillary space, the trend that seems to be the strongest is the trend number
three that I identified which is linked to the increased automation and increased
technology usage within the automobile space. So, you actually start looking
therefore not really in the auto ancillary space, but at engineering services kind
of companies who are in the auto space, that should start doing really well
going forward and not necessarily just the pure auto ancillary space alone. But
the auto ancillary space that can do potentially well are the ones who have
large replacement markets to look forward to. Tyres is one of them. Batteries is
another segment which are not really OE dependent, but on a lot of
replacement demand dependent, and therefore fits well with the overall growth
theme that happens, which is linked to the junking of old cars, etc. So, would
look at these spaces, engineering services space and the replacement market
driven kind of space.
Source: economictimes.indiatimes.com
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