Red-hot Indian property market spurs Danube Building Materials to open outlet in Bombay

Dubai-based Danube Building Materials recently opened an outlet in Bombay, its second in Asia after Shanghai in China, as a young and upwardly mobile population in a city of over 18 million has begun investing frantically in housing.

"India is unbelievably vibrant and Bombay being the commercial capital is the real barometer of where the real estate market is heading," said Anis Sajan, Managing Director, Danube Building Materials FZCO, after attending the inauguration of the new outlet in Santacruz (W), an upmarket suburb of Bombay. "The demand is huge, though our pricing is much higher than in Dubai because of customs duties and taxes in India."

"Property prices zoomed by nearly 50 per cent in Bombay last year, as a result of foreign direct investment and increasing affluence among the younger segment of population," added Mr. Sajan. "A decade ago, the average age of a homeowner was 45, today it is 32, or even less. Home-owners have also become choosy about lifestyle products, triggering a demand for upscale fittings and high-end sanitary products."

Danube made its Indian foray following a tremendous response to its products at Build India Exhibition at Bandra Kurla Complex, Bombay, last year. The company will be participating in an even bigger event this year, the Inside Outside exhibition, in October 2006.

Danube, which expects sales worth AED 15 million (INR 190 million approximately) in the first year from its Bombay outlet, is sourcing high quality products from China and Italy, including massage bath-tubs with built-in DVD and shower rooms, to cater to the Indian market,.

"As suppliers of stylish and innovative sanitary ware and other items, Danube is in a strong position to provide the very latest to Indian property developers and consumers because of our close contacts with top suppliers," said Rizwan Sajan, Chairman of Danube Building Materials. "Many Indians used to come to Dubai to shop for new products. Now Danube can service them at their doorstep."

Danube has announced plans to open outlets in other India cities shortly, including Bangalore, Delhi, Chennai and Calcutta.

According to industry sources, the Indian real estate is being fuelled by market deregulation and a rapidly expanding middle class. The property market saw more development during the last three years than in the preceding 50 years, experts say. According to a report in The Economic Times, average returns in the sector stood at 50 per cent in the past four years.

The Government of India now allows 100 % FDI (Foreign Direct Investment) in real estate. According to global consultancy firm CB Richard Ellis, more than US$ 15 billion of foreign funds are awaiting investments into India. Among the new players entering the Indian property market are Emaar, Jakarta-based Salim Group, Canada-based Royal Indian Raj International Corporation, Singapore-based Lee Kim Tah Holdings and several others.