"But theres a big difference between impossible and hardto imagine The first is about it; the second is about YOU!" - Marvin Minsky
It is my honour and privilege to interact with you as the Chairman of HousingDevelopment and Infrastructure Limited and great pleasure to share with you the keyhighlights of the Companys performance during the Financial Year 2016-17.
Your Company delivered a steady performance during the year in the backdrop of apersistently sluggish demand environment continuing pressure on the Real Estate andInfrastructure Industry due to higher cost of funding cumulative impact of sharp hike ininput costs and gestation costs relating to approvals for new projects the operatingenvironment was rendered particularly challenging in the second half of the year with thecurrency crunch impacting the incipient recovery in demand.
F.Y. 2016-17 has been fairly satisfactory and encouraging in terms of Companyperformance despite the uncertainties caused during the year which marked a big effect onEconomy. The impact that left its mark on each and every sector of the domestic economywas sudden announcement of demonetisation in November 2016 and the implementation of theGoods and Services Tax (GST) in July this year. Introduction of both these measures willhave long term impact on the economy and only time will prove its real value to theeconomy. As we all were aware of the fact that Indian economy was largely cash drivenwith substantial transactions taking place in cash and very marginal percentile in digitaltransactions. With the decision of demonetization Investment power of consumers has beennegatively affected due to cash not being readily available. Consequential to thiscash-sensitive sectors like Small Scale Industries and real estate sector suffered heavilyduring the second half of the year. Bank changed main focus on the single task i.e depositand withdrawals; with the result that their core function of lending was adverselyaffected which again added adversity to Real estate as all stakeholders in this sectorare financed by them. Now looking at the GST prospectus the Real Estate Sector hasbrought to some relief on the implementation of GST. Supply chain mechanism in real estatesector has revamped as cascading effect in the tax was reaped off. Currently the sale ofland and buildings have been kept out of the ambit of GST and hopefully expected to becontinued in future too. Construction of land and building will benefit from the ratesdeclared for cement bricks and iron under GST but looking at the rate specified realestate sector is expected to be neutral. In the phase of major challenges we made asignificant progress.
The Company has successfully Registered its ongoing Projects under The Real Estate(Regulation and Development) Act 2016 which came into force with effect from May 1 2017.Looking ahead to 2018 we will need to work harder to execute the strategies in the faceof uncertain economic conditions confronting our business and by the upcoming years yourCompany will launch many affordable housing projects which will strengthen Companysfinancial Position and flourish its arena of operations. Presently Your Company is one ofthe largest developer and land bank owner in Mumbai Metropolitan Region. Mumbai haswitnessed many changes in urban infrastructure landscape and effective measures are neededto adapt to such changes.
Company follows project completion method and financial performance comparison will notbe appropriate. However for the record Company recorded:-
The Turnover of ` 74617.74 Lacs as against ` 119239.50 Lacs in the previousyear.
The Companys Profit from operations for the year ended March 31 2017 is `20856.28 Lacs as against ` 28642.35 Lacs in the previous year.
The Net Profit for the year is ` 17524.58 Lacs as against ` 34035.15 Lacs inprevious year.
"BUDGET HOMES"- A MILESTONE ADDED TO AFFORDABLE HOUSING SEGMENT:-
We would like to take this opportunity to address you that in line with the vision& mission of "Housing for All" by 2022 for "MAKE IN INDIA"concept the Company launched "Budget Homes" in affordable housing segment inMulund - Mumbai which provide 1BHK at ` 45 Lacs and the same has been receiving very goodresponse. So far the company has received booking for 239 flats as compared to 243 flatsin total of Budget Homes which itself is a overwhelming vibes. In rapidly growing countrylike India with a large young population needs more homes at affordable price points whichin turn would enable more households to become homeowners. "Budget Homes" is awish to conquer their dream of homeowner.
The thrust given to affordable housing has been extremely encouraging. Developersspecially your Company can now avail a 100% tax deduction on profits and gains if theyconstruct affordable housing units. No other major sector of the economy has been givensuch attractive incentives. Further infrastructure status for affordable housing has openup more avenues of lower Cost longer tenor funding in the Real Estate Sector.
Last but not the Least I wish to express sincere thanks to all my shareholders Boardof Directors bankers business partners Government agencies contractors and customersfor their continued support and faith reposed in the Company. I also place on record mydeep appreciation to all employees for their hard-work and dedication.
I would also take this opportunity to acknowledge that your Company is upholdingresponsibility for the environment and promoting well-being of all stakeholders includingemployees customers and society at large.
Rakesh Kumar Wadhawan