>HDIL (ICICI Securities)

● Healthy demand at lower price point. The visit to HDIL’s residential site in Kurla has surprised us positively on the demand front – HDIL sold 390 apartments within three days of the launch. And our interaction with the buyers suggests that the demand for the project at the offered price points is genuine. HDIL has launched the project at Rs5,250/sqft with a ticket size of Rs4mn, at more than 25% discount to the ongoing projects in the vicinity. Sales have been booked on advance payment of 5- 10% of the ticket size. The project is located in Kurla, within 5kms from the Mumbai airport and 20mins from Bandra-Kurla Complex. The 756-apartment project has a
total saleable area of 0.6mn sqft. With a total saleable area of ~5mn sqft at the site, HDIL has the potential to increase the scope of the project 8x over a period of time.

● Construction at a rapid clip. The Kurla residential project site is nearing completion as regards ground excavation and delivery is expected in April ’11. Work in Kurla SRS is going strong with ~3,000 workers and eight contractors working on ~28 buildings – The pace has picked up since Q3FY09.

● Other developers too getting better response at lower price points. Post the favourable response received by DLF on its below-market priced projects in Chennai, Bangalore and Hyderabad, other developers are following suit. Purvankara recently launched Cosmocity near Siruseri in South Chennai under its mid-income housing banner Provident. The 2,174-apartment project is priced at ~Rs1,600/sqft with ticket size below Rs2mn – Our discussion with the Purvankara management suggests that the initial response has been good.

To see full report: HDIL