Below is the Views On series of measures over the last 3 months to address the issues that are impacting the economy By Siddharth Mehta, Founder and CIO of Bay Capital Partners.
“The most recent announcement relating to the real estate sector is another positive announcement in a series of measures over the last 3 months to address the issues that are impacting the economy. Bay Capital believes that while the effects of the measures will take some time to fully play out, the announcements will boost sentiment and provide relief to the beleaguered real estate sector that has been hit by the multiple head winds of demonetization, GST and RERA in quick succession.
Among the notable highlights of the policy announcements are: positive net worth projects would get a respite, the stage of project completion would not be a factor in availing the financing and perhaps most importantly, even NPA and NCLT projects can be funded. The beneficial impact to the sector beyond the affordable housing segment is certainly positive although with the cap of INR 20 million in Mumbai, the super-premium projects in Mumbai would be out of the ambit of the arrangement and would continue to experience their own pain points.
All in all, Siddharth Mehta believes that policy makers are aware of the issues at hand and are working on all fronts to mitigate the effects of the slowdown. The recent round of corporate results from some of the consumer staples companies and the auto companies have been encouraging and could signal a bottoming out of the cycle. Bay Capital continues to be positive about the long term structural opportunity for investing in India..”