Voltas, Dow Chemical plan JV to tap water and waste water treatment market

Tata Group company, Voltas Ltd and Dow Chemical Pacific (Singapore) Pte Ltd, a member of the Dow Group Companies, are joining hands and forming an equal joint venture company in India. The proposed entity christened Voltas Water Solutions Pvt Ltd will tap the growing Water and waste water treatment market in the Indian subcontinent.

According to company officials, the JV will market and distribute standard packaged water treatment systems and waste water treatment systems of capacity up to 20 m3/hour. These systems will be primarily targeted at the residential and commercial complexes and, light industrial markets in the Indian subcontinent. The JV’s operations would include designing, procuring, testing, marketing, selling and servicing of such standard water treatment systems and waste water treatment systems.

Commenting on the development, Snehal Desai, Global Business Leader for the water and process solutions division of Dow Group, said, "Water treatment has significant business potential in India, and Voltas is an ideal partner with a strong brand reputation, and a wide-spread sales and service network. As part of our long-term strategy, we intend to establish the joint venture, to fully exploit the untapped potential of the Indian market."

Having identified water as a key focus area for the Tata group, Voltas officials said that Dow Group's unrivalled know-how and technological leadership in the water treatment space will help Voltas Water Solutions cater to the growing water treatment requirements of the Indian subcontinent. 

"The partnership will simultaneously leverage the brand and distribution strength of Voltas, along with the technology prowess of the water and process solutions division of the Dow Group. We will work towards establishing the joint venture as a leading provider of water treatment solutions," said Sanjay Johri, managing director, Voltas Ltd.

The water and waste water treatment market targeted by the new company is largely catered by unorganised players currently. The new joint venture, company officials said, will provide a branded and differentiated product line, with a focus on quality and service delivery.

Matrix Partners invests in MSME lender Five Star Business Credits

Matrix Partners India has led the first institutional round of funding in Five Star Business Credits (Five Star), a leading small business finance company that provides secured loans to micro and small enterprise customers (MSME). Five Star with its proprietary secured lending model has catered to more than 5,000 MSME customers over the last 5 years.

India has 29.8 million MSMEs and a further 30 million MSMEs in the unorganised sector. Formal banking and financial channels find it challenging to address the needs of MSME customers primarily due to the challenges in assessing credit quality of such customers. 

According to D Lakshmipathy, Managing Director, Five Star, MSME lending is a significantly underserved market in India not addressed by formal financial channels. "We have built a unique credit assessment model for deserving customers that run small but healthy businesses and all our loans are collateral backed. This round of funding from Matrix should help us further expand our branch footprint and enhance our funding base for long term expansion,” said Lakshmipathy.

Operators of small shop owners (provision stores, small restaurants, textile stores, bakery outlets, medical stores etc), small and medium machine shop operators, self employed people etc are key customers of Five Star that also provides loans for the purpose of home improvement to MSME customers. The company is present across 30 branches in Tamil Nadu and is planning to further expand its footprint across different states in India.

“Five Star has a highly differentiated, secured and sustainable lending model to address the large, underserved MSME financing opportunity. Financial services is an important focus area for the firm. We share Lakshmipathy’s vision and passion for this sector and look forward to being his partners in this journey,” said Rishi Navani, Managing Director, Matrix India.

A private investment firm Matrix Partners has Rs 3,000 crore under management and invests in companies targeting the Indian consumer market at the seed, early and early growth stages. It has a global network of funds investing in the US, China and India with $3 billion under management.

So far, Matrix Partners has invested in several market leading companies including Muthoot Finance (gold loan NBFC), TreeHouse Education (preschools), Cloudnine (maternity and infant care chain), Mswipe (mobile POS), Verse/NewsHunt (vernacular mobile platform) and Quikr (online classifieds).

Why should one invest in a residential property in Mumbai?

At the age of 23 when she had just started working, Shirin Gadbade acquired a ready-to-move, two-bedroom, hall, kitchen (BHK) flat in Pancham Apartments at Link Road, Borivali (West) for an all inclusive cost of around Rs 22 lakh.

Having fully paid back the bank loan taken to fund this acquisition in 2010, she decided to invest around Rs 80 lakh in another two-and-half BHK apartment at the Rustomjee Urbania development on the Eastern Express Highway in Thane (suburban Mumbai) in 2011.

“My mother coaxed me into buying the first flat. I figured investing in property was significantly rewarding when valuation of my apartment increased significantly by the time I'd paid off the home loan. Motivated, I decided on investing in another one for investment purpose and am hoping to replicate the success in the years to come,” she said.

A perfect example of creating wealth through investing in real estate, Shirin took possession of the second residential apartment sometime in 2012. While a large a large part of the total unrealised gains of around Rs 1 crore (majority from the first apartment bought 8-9 years ago) Shirin's real estate portfolio (of two apartments) is currently worth an estimated Rs 2.5 crore odd – all this at the age of 33.

Shirin is among the thousands of other like-minded people who took the plunge investing in real estate at various stages in the last decade or so and are reaping the benefits of this timely decision that helped create wealth.

Elaborating on the approach, Om Ahuja, chief executive officer – residential services, Jones Lang LaSalle India, said it is definitely possible to create wealth through real estate investment as long as one keeps the fundamentals in mind. “Effective investment in residential property requires a location to meet certain parameters. Fundamentally, the area should have good social infrastructure, availability of adequate public transport and sufficient economic activity to sustain development and growth. In order to mitigate most of the investment risk, one should restrict one’s residential property investment to Tier 1 and select Tier 2 cities.

“The investor should keep an eye on the market and sell the residential property at the right time in order to multiply wealth. If all the above precautions have been taken, the property should have appreciated at a consistent rate of 15% per annum for three years,” sid Ahuja adding that it is important to remember that one can almost never sell at the peak, just as it is impossible to always catch the lowest price.

Going by prices compiled by real estate rating and research firm, Liases Foras, different pockets in the Mumbai Metropolitan Region (MMR) and extended suburbs delivered a compound annual growth rate (CAGR) of 20% or more for investments made in 2005. Simply put people who bought real estate assets have seen their money multiply anywhere between 3.7 to 4.9 times depending on the market they invested then.

Lets now look at how prices have behaved in the years between 2005 and 2013. The Liases Foras data for the said duration shows, on an average, real estate prices in the island city rose from Rs 6,637 per square foot (psf) in January 2005 to Rs 30,344 psf in December 2013. In the central and western suburbs prices increased from Rs 3,005 psf and Rs 3,290 psf to Rs 12,418 psf and Rs 14,344 psf respectively in the same period.

In Thane and Navi Mumbai area, average prices grew from Rs 1,934 psf and Rs 1,730 psf in January 2005 to Rs 9,190 psf and Rs 6,475 psf in December 2013 respectively. The strong growth trend in real estate prices was also visible beyond the MMR region i.e. suburbs beyond Thane and Borivali, which saw per square foot rates shoot from Rs 1,055 and Rs 1,063 in January 2005 to Rs 4,571 and 5,237 in December 2013 respectively.

While realty market over the years has shown a lot of potential for investments, the overall economic environment in the recent past has changed thus raising questions as to whether wealth creation still holds true in the current scenario. Industry experts feel it does. “Intelligent investment into residential property still holds the potential of significant wealth creation. However, the market keeps changing and one needs to understand these changes,” said Ahuja.

So if you are keen on taking the plunge and investing your surplus in the residential property segment, following are some of the options in the MMR, according to Jones Lang LaSalle India that can be looked into for potential investments currently.

Bandra Kurla Complex (BKC): Currently quoting at Rs 27,500 psf to Rs 50,000 psf can double in 4-5 years time. Budget range from Rs 6 crore to Rs 25 crore. Walk to work concept, lesser supply and Central Business District are the key drivers .

Chembur / Tilak Nagar: Currently quoting at Rs 12,500 psf to Rs 20,000 psf can double in 3-5 years time. Budget range from Rs 2 crore to Rs 6 crore. Monorail, lesser supply and Santacruz Link Road are the key triggers.

Mahalaxmi / Jacob Circle: Currently quoting at Rs 20,500 psf to Rs 55,000 psf can double in 4-5 years time. Budget range from Rs 9 crore to Rs 25 crore. Monorail, gated community, lesser supply, south Mumbai profile like this area for race course view, eastern freeway are key triggers.

Ghatkopar / Chandivali: Currently quoting at Rs 12,500 psf to Rs 16,000 psf can double in 5-6 years time. Budget range from Rs 2 crore to Rs 5 crore. Closer to Powai where multi-national companies have offices, closer to metro, eastern freeway to get terminated at Ghatkopar junction, value for money at current price points.

Mulund / Bhandup / Ghodbunder: Currently quoting at Rs 10,000 psf to Rs 15,000 psf can double in 5-6 years time. Budget range from Rs 1 crore to Rs 3 crore. Better social infrastructure, better road connectivity and environmentally best in Mumbai.

“As for areas like Wadala, Lower Parel, Dombivli, Malad, Goregaon etc. there is enough supply that will hit the market where percentage appreciation will become a big challenge. Infrastructure is collapsing currently and don't see visibility of any major developments in terms of public transport and social infrastructure,” cautions Ahuja.

HCL Corp forays into healthcare, launches India's first nation-wide networked multi-specialty clinics under HCL Avitas

HCL Corporation, the parent company of HCL Technologies and HCL Infosystems, has forayed into the healthcare sector with plans to be one of India's largest healthcare service providers. The new business entity, HCL Healthcare will address the entire spectrum of healthcare needs including providing healthcare delivery, innovative medical services, products and training to meet the growing need for quality healthcare.

Accordingv to Shiv Nadar, founder & chairman, HCL and Shiv Nadar Foundation, education, healthcare and technology will be the key enablers of India's future progress and growth. “Over the last 38 years, HCL has been at the forefront of technology and innovation. I have personally been committed to the cause of education through the Foundation for 20 years,” said Nadar adding that the company's entry into healthcare is an area of paramount national importance.

Kickstarting the venture, the company has launched a subsidiary called HCL Avitas in affiliation with Johns Hopkins Medicine International. Offering a of healthcare delivery offerings, HCL Avitas is positioned as India's first nation-wide networked multi-specialty clinics. The clinics will adopt global best practices for medical quality and training using evidence-based systems and integrating advanced technology to provide unmatched patient experience and outcomes.

Steven J Thompson, CEO, Johns Hopkins Medicine International, said, that HCL was a strong and trusted brand with a steadfast commitment to transform healthcare in India. “Together with HCL Avitas, we hope to establish a new paradigm in patient-centered care in India,” said Thompson.

HCL Healthcare observed that India has a shifting disease burden that is influenced by changing lifestyles and that this need is grossly underserved. “Our technology expertise and the ability to create scalable institutions will help us institute new benchmarks in healthcare delivery in India. Creating an organised technology-led health system that will be the long-term care partner is our immediate goal. HCL Healthcare intends to be that partner and provide patient-centered care for over 20 million people by 2020,” said Shikhar Malhotra, vice chairman, HCL Healthcare.

In the launch phase, HCL Avitas will establish a network of multi-specialty clinics across the country starting with the National Capital Region. Harish Natarajan, chief executive officer, HCL Avitas, said, “Technology is our strength – our clinics will all be networked giving patients access to their medical history and to the best specialists available in our system. Through our association with Johns Hopkins, we will bring in global best practices and the best evidence-based systems. In the next 5 years, we expect to have over 1500 doctors in our network across various cities in the country,” said Natarajan.