Over 62 per cent or approximately USD 58 billion of the total loan advances (USD 93 bn) to Indian real estate by banks and NBFCs/HFCs is currently completely stress-free, reveals a study by ANAROCK Capital. Another 22 per cent (approximately USD 21 billion) is under some pressure but can potentially be resolved. In fact, the stress on this segment is largely on recovery of interest and not on principal amount.
With demand finally outpacing supply, the Indian hospitality industry is on an upswing. The 'India Hospitality Industry Review 2018' report by HVS ANAROCK predicts RevPAR to grow by 9.5 per cent in 2019.
It may be true that ‘when the going gets tough, the tough gets going,’ but this doesn’t hold true for the Indian real estate sector currently. The ongoing NBFC crisis post IL&FS default has made things even more difficult for developers.
DeMo, RERA and GST struck at the very heart of the previously unregulated practices prevalent in the Indian real estate. RERA, in particular, has been responsible for smaller and often unscrupulous developers taking a major hit not only in terms of existing business but future business viability.