Story of Bennett, Coleman & Co (TOI Group) and Real Estate Companies

This is about how one media group can manipulate the "news" and its content to make money and control the public opinion for its profitability. This is about Bennett, Coleman & Co (TOI Group) which owns media assets like ToI,ET(across all cities),regional newspapaers and TimesNow TV.They have something called "Times Private Treaty" which invests in emerging enterprises and small & midcap companies just like a VC. But its slightly different with Times Private Treaty(TPT) where in TPT will get equity for its media coverage (whatever TPT pays, gets back for media treatment).Investee companies will get special coverage,increased exposure and mouth piece service. We dont know much about the very details of the agreement between TPT and investee companies.

Details:

India’s largest new company, Bennet, Coleman & Co. Ltd., (BCCL) has signed Times Private Treaties with over 200 companies in the past 3 years.

What is TPT?

TPT identifies growth rich but Advertisement shy comapnies (???!!) and gives them media space in BCCL platforms. In return, they get a share in Equity. Expected value of these TPT’s - Rs.1,700 Cr- Rs.3,000 Cr.

http://www.timesprivatetreaties.com/portfolio/list-as-per-industry.html

Why TPT?
BCCL believes that Indian market is commodity driven, not Brand driven. Only 14,000 brands are actively advertising in India. But in US there are 8 lakh active brands. Hence there is a future for brands.

Who is following?
HT Media, NDTV, Dainik Bhaskar, Dainik Jagran, Mid Day.

Conflict: Editorial lenience to TPT companies.


We could see the list (portfolio) of compnaies earlier in their website( which has been removed. I list the companies later from my memory. I noticed about these investments in 2003 and impressed by the idea(didn't know details) of Jain family but what happened latter is big let down for the indian public. There are no goverment controls at present but we expect a little ethics, social values, moral control and culture for media group with such long tradition.

List of companies from Mint
http://www.livemint.com/2008/01/14234923/F7C03521-A4FD-40D1-B769-A38A8D7DE369ArtVPF.pdf

I remember the list of companies as Sobha Builders, Rajesh Exports,Pyramid Saimira, JetKing, Peninsula and many more realty players.I guess we should stop reading newspapers like these which actually doesn't add any knowledge but only noise.

Here are the links for more understanding;

http://ajayshahblog.blogspot.com/2008/01/murky-ethics-on-part-of-media-and-firms.html

You can find many more links in Ajay's Blog.

http://www.business-standard.com/india/news/bennett-colemans-private-treaties-business-sees-sharp-value-erosion/357692/

http://www.dnaindia.com/money/report_private-treaties-a-public-and-investor-menace_1254804

http://www.livemint.com/2008/01/14234923/Should-private-treaties-be-mad.html

http://www.suchetadalal.com/?id=cc8c67c4-6674-207a-4947b1bb96dc&base=sections&f&t=CURRENT+ACCOUNT+(MoneyLIFE+Issue%2C+1st+Jan+09)

http://www.suchetadalal.com/?id=ee33e5a1-2d4b-8231-4a24f507414e&base=sections&f&t=Pyramid+Saimira%3A+Weak+Follow+Up

http://www.suchetadalal.com/?id=2f109f06-d1bf-afca-4a0176e5b38e&base=sections&f&t=Ring+of+Thieves

http://www.vccircle.com/500/content/bccl-picks-up-652-per-cent-in-sujana-industries-hats-off-to-times-private-treaty


I would like to get the views of our readers. I am sure many of you already knew but its good for those who still believe whatever newspapers say is truth and newspapers are run by the people who care very much about this poor country and its people.

Read More

Prices correcting in Hyderabad - Maytas

Here is something I received in the mail.The slowdown is coming. The combined offer translates to over 15% drop in the cost of the house. Not bad for a start. Last year this property was quoted at 3200 which means there is no appreciation over the past year, Actually people who have bought have lost 10% of the down payment. Also such big projects get delayed by atleast 1 year.

For the long term resident, 2800 seems a good entry price. still 15% lower then what is quoted.

Fabulous offer for top tier corporates employeesMaytas Properties has developed 400 acres of land at Bachupally, which is located just 10 km from Hi-tech city. The name of the venture is Maytas Hill County. In this spectacular venture we have a world-class township spread over 85 acres which has a decent mix of Villas, Independent Bungalows & Semi-furnished Apartments. Government has approved to develop an IT Special Economic Zone in 75 acres adjacent to the Residential Township, this helps the residents can ‘Walk to Work’ in the IT SEZ. As the bookings are going berserk we have come up with a COMBO offer for top tier corporates.

Here is COMBO offer which comes in with:
PRE-EMI offer & Corporate offer

PRE-EMIis a fantastic mode of payment where the EMI need not be paid till the property possession is taken ovev, the Interest to the banker during this period will be borne by Maytas. Infact the interest component will be paid on behalf of the customer. (This is applicable for applicants who avail Bank Loan for purchasing the property with us).

Corporate offercomes with Rs.200/- less than the regular price (per square feet). This is offered to the Employees of Corporate companies which have been listed by us.

Regular Price : Rs. 3699 per sft

Corporate offer : Rs. 3499 per sft

Read More

Some sense returning to the real estate market

Mint reporting on the slowdown in PE deals.

New Delhi: India’s real estate party may be cooling down rapidly. Global private equity firms say that they would rather invest in the US realty market than in the Indian one because US property prices have fallen so sharply that yields on investments there will be more attractive—without the hassle.


Private equity firms made a beeline for India after the government allowed foreign direct investment in real estate in 2005. They were attracted by returns of 25-30%, but with home prices falling in the US, global private equity firms now believe it makes more sense to park their investments in that country.
See:Realty deals
“Last year, Japan was a more attractive market to put money in. If you look at the US, we can now get an internal rate of return of 25% there, so why would anyone want to come to India?” asked a senior executive at an international financial services group, who did not wish to be named.
Four out of six private equity funds Mint spoke to said they are no longer investing in India. They didn’t want to be identified.
The US, reeling from a subprime lending crisis, is seeing the worst housing slump since the 1930s. The median price for a single-family home has dropped 7.7% in the first quarter of the year, the biggest decline in at least 29 years, as values tumbled in two out of every three US cities, according to the National Association of Realtors.
Sales of single-family houses and condominiums also fell 22% to 4.95 million at an annualized pace, the slowest in a decade.
“It is true that there are certain transactions in the US where you can get similar returns (as in India) of 25%, such as buying a condominium project or a commercial project,” said Subhash Bedi, director at Red Fort Capital Advisors Ltd, a private equity firm. “When you can get similar returns in India and in the US, global private equity firms which have a mandate to invest anywhere in the world, will prefer the US market because there are lesser risks associated with investments there.”
The Indian market is riskier to invest in because government approvals for projects here take a long time and there is also an execution risk because Indian developers do not have a history of completing projects on time, Bedi said.
Project delays can sometimes run to two to three years and there aren’t enough laws in place to effectively protect investors. There is also no central registry of land titles in India, because land is a state subject and the system of record-keeping and rules vary from state to state, making investing compelling only if the returns are high. In the US, there is a central registry of titles and title insurance can be purchased to protect investors.
India, where property values doubled in a year and, in some cases, tripled in less than two years, is now starting to see some cooling off after values shot up so high that they bordered on the unaffordable, eroding returns and turning away investors. Realty values in Mumbai rival that in Manhattan, New York.
To be sure, while global private equity firms might choose to move their investments to the US, nothing changes for funds dedicated to India as they can only invest in Indian real estate.
There are around 125 private equity funds for real estate in the country, out of which 60% are global funds, according to Venture Intelligence, an agency that tracks private equity.
“It can become increasingly difficult for the local team of a global fund to justify investment in India when you can get the same return for lesser risks elsewhere,” Bedi said. “So, for the short term, say a year, global funds might decide to invest in the US real estate market instead of India.”
“There is a big liquidity crunch in the US,” Bedi said. “It is much less in India when compared with the US because banks here are at least not turning away all borrowers.”
While private equity investment will continue to come into Indian realty, the number of firms chasing developers will be fewer, another senior official at one of the world’s leading financial management and advisory companies said.
“We will see fewer private equity firms, say two or three, chasing a developer unlike last year, when 8-10 private equity players were chasing the same set of companies,” he said requesting anonymity.

Read More

It's Raining Freebies As Builders Try To Beat Recession

* Buy a premium apartment from Kumar Builders and go on an all paid week-long trip for a family of four to Switzerland .
* Despite the hike announced by the city builders DSK has offered 55 of its apartments in the current schemes at old rates.
* Mont Vert has offer for incentive customers who bring in another buyer.
* Many builders are offering free white goods - air-conditioners, refrigerators, washing machines, modular kitchens.

Pune's developers and builders may not be willing to admit that the real estate market is in a slowdown mode. But check out some of their recent initiatives to woo customers and it becomes clear that the city builders are selling at discounted rates. Thus even as there is no dent in the price line which they continue to hold on diligently, potential clients are surely being wooed with a whole lot of freebies that have flooded the market of late.

These can be as extravagant as a trip for four to Switzerland and as unassuming as lining up the housing loans. There is an array of freebies that can be pegged somewhere in between these two instances, ranging from free white goods and stamp duty waiver to even offers to pay the first couple of EMIs on behalf of the buyer.

Naresh Malkani, CEO indiaproperties.com describes the scenario of the last few months as a "no-deals time". Cushman and Wakefield in their latest report on Pune residential scene have also noted that sale transactions are expected to see a further slowdown which "may force certain developers to offer better deals or free amenities to incentivise purchaser and ensure cash flow for their projects." The point seems to have been well taken by the builders.

"We are offering a trip to Switzerland for seven days and six nights for two adults and two children for those buying a flat in our premium projects where the cost is over Rs one crore. In projects that are lesser in price we have the same offer with Malaysia being the destination instead," says Prabha Shankar, vice president, Sales, Kumar Properties.

Click on "Full Story" for more...

Mont Vert Homes that had offered a discount of Rs 50-100 on Gudi Padwa day are now extending this scheme. " Whenever the price is needed to be hiked because of increase in prices of input materials, we offer small incentives so that the customers do not feel disheartened," says Manish Kaneria, director of Mont Vert Homes.

"We also have a scheme called `Mont Vert Customer Appreciation' in which if one of our customers gets along another potential buyer then he is offered incentives," he adds.

DSK has been advertising that it's thrown open 55 of their apartments at rates prevalent before the Promoters and Builders of Pune (PBAP) announced a price hike. Says Sudesh Kosumbkar, manager at DSK, "Rates in our projects are slated to go up significantly after the hike. We decided to keep 55 flats open at old rates for the benefit of customers."

According to S Motwani, a city real estate broker, goodies and early bird discounts are fast becoming the rule rather than the exception: "The objective is to of course pump up sales and motivate the customer to buy."

Read More