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India's Leading Infrastructur Companies 2013

 
 

 

Q. Kindly provide a brief profile of the company

A. Canopy Estates Private Limited, the flagship company of the Canopy group, is a leading real estate developer with inhouse talent and a combined experience pool of more than 80 years. The company is actively engaged in providing integrated solutions in property development to an eclectic clientele spanning across reputed corporates, multinational, and government bodies.

Canopy is a pioneer in introducing the innovative approach of customized home design and in providing semi furnished apartments. The company brings real value for investment based on its association with top-notch architects and consultants/professionals as well as conceptualising the company’s projects in areas with high growth potential.

Since 1996, Canopy has built various projects including villas, row houses, budget and luxury apartments, fabulous duplex penthouses, and catering to more than 2000 clients. The Canopy, Canopy Cologne, Canopy Classic and Canopy Crest IRS are some of its major projects.

Canopy has participated in several CSR activities, which supported many social causes. The following are some of major ones:

  • Supporting women’s Shelter/orphanage
  • Home for the aged
  • Various awards/sponsorships for young college students
  • Other similar philanthropic activities

Q. What are the major challenges faced by the sector?

A. The following are some of the major challenges faced by the sector:

  • The Indian real estate sector is highly fragmented comprising many small builders and contractors who account for a majority of the sector. Consequently, there is less transparency in dealings or sharing of data among the real estate companies.
  • Real estate developers face many challenges in generating adequate demand for the projects. The factors that influence a customer’s choice in property selection are not only restricted to quality alone. In fact, customers also give equal importance to external factors such as proximity to urban areas and facilities, infrastructure such as schools, roads and water supply, each of which is often beyond the developer’s control. Moreover, policy decisions relating to housing incentives do influence demand for housing units.
  • Clients often fund construction activities by forwarding cash advances at different stages of construction. In other words, the final revenue of a project is pre-determined and realised over the construction period. Increasing costs of raw materials is a prominent issue that real estate developers face. The cost of a real estate project depends on a number of factors such as cost of cement, steel, bricks, wood, sand, gravel, and paints. As the revenue from sale of units is predetermined, adverse changes in the price of any raw material directly affects margins of developers.

Q. Are there many regulations related to the construction industry in India? Do you anticipate any regulatory change in the near future?

A. As our company’s business involves acquiring land and land development rights, a number of central and state legislations, which regulate the substantive and procedural aspects of acquisition and transfer of land, govern our business. For executing projects, we may have to obtain licenses and approvals depending upon the prevailing laws and regulations applicable in the relevant state and/or local governing bodies such as the Municipal Corporation of Bengaluru, the Fire Department, the Environmental Department, the City Survey Department, the Collector, and MSD.

Further, our projects at various stages require sanctions from concerned authorities under the relevant central and state legislations and local byelaws. Our company is subject to land acquisition, town planning, and social security laws.