Message From MD, July – 2024

Dear Friends,

June was a fruitful month in all aspects of our business. Congratulations to all the top performers! It was thrilling to hear Dr Sajeev from KFRI deliver the inspiring speech on World Environment Day during the 28th edition of the Beyond Square Feet (BSF) Lecture series.

The monsoon began simultaneously across Kerala and Northeast India on June 1st, marking the start of the four-month rainy season. This rare phenomenon made June especially significant. Additionally, the National Election results were announced, with Prime Minister Narendra Modi and the NDA coalition securing a majority, albeit narrower than predicted. Modi’s victory and the continuation of his government’s reform agenda should further strengthen the trajectory towards an ‘Emerging New India.’

From a management perspective, PM Modi’s strategy of balancing welfare policies with fiscal conservatism and promoting infrastructure, manufacturing, and technology growth resonates with voters. Traditional influences like cash handouts, religion, and caste are becoming less significant. Modi’s first two terms as Prime Minister have been marked by sustained economic growth, fiscal conservatism, and structural reforms to increase India’s competitiveness.

Key reforms include:

1. Real Estate and Banking Sector Reforms: Initiatives like the Real Estate (Regulation and Development) Act (RERA) have improved transparency and accountability in our business. Banking sector reforms have stabilised financial markets and expanded financial inclusion.

2. GST and Tax Reforms: The Goods and Services Tax (GST) simplified a complex tax structure, enhancing compliance and increasing revenue. Further tax incentives for new facilities have bolstered investment.

3. Digital Expansion: India added approximately 500 million internet subscribers over seven years, dramatically enhancing productivity across government, corporate, and consumer sectors.

4. Production-Linked Incentives: Aimed at boosting domestic manufacturing through import substitution, these incentives have encouraged significant investment in local production capacities.

Economically, India’s growth trajectory is expected to remain robust, making it the fastest-growing emerging market democratic economy for at least the next five years. The election results may have a minor impact on administrative and legislative changes. While constitutional amendments will be harder, legislative changes are possible, especially with victories in Odisha and Andhra Pradesh bolstering the NDA’s position in the Rajya Sabha.

Fiscal consolidation is expected to continue, with the fiscal deficit projected to fall to around 4.9% for FY25 and lower again in FY26. Recently, international agencies have given India’s credit rating positive assessments, and the latest quarterly GDP data showing 7.8% growth has significantly exceeded expectations. Combined with ongoing reforms, this sets the stage for further meaningful progress in the years ahead.

India continues to offer attractive investment opportunities, driven by gains from digitisation, ongoing reforms, and a recovery in traditional sectors. The fundamentals remain strong, fueled by productivity gains, a revival in the real estate sector, and supportive capital flows, driving economic growth and market stability. Modi Government 3.0 is poised to build on past successes, driving India’s economic and real estate growth to new heights as we look ahead.

Friends, it’s time for us to gear up and join this success story. Asset Homes also has a lead role to play. Together, we can!

Regards,

Sunil Kumar V
Founder & Managing Director