E-Paper
Gautam Singhania on luxury real estate: ‘If Raymond can make ₹16 lakh jackets, why not ₹100 crore apartments someday?’
Gautam Singhania, chairman of Raymond Group, said the company will focus on the ‘belly of the market’, ‘affordable luxury segment’ with primary focus on Mumbai
Gautam Singhania, chairman of Raymond Group, has said that while Raymond Realty aspires to one day sell ₹100 crore luxury apartments, the focus for now remains on the ‘belly of the market’ which is ‘affordable luxury.’
"Today, we make a ₹16 lakh jacket, we do 0.00001% of that," he remarked, highlighting the brand’s high-end potential but measured approach.
Singhania said the real estate arm wants to be in the ‘belly of the market, which is affordable luxury.’ The company plans to focus on the Mumbai real estate market right now and look at Pune in the future.
"Out of 20 million sq ft, we might make 200,000 sq ft (of luxury apartments). I'm not saying we're doing it today," he clarified.
Real estate companies are often viewed through the same lens
Singhania said real estate companies are often viewed through the same lens, though not all operate in the same segment.
Everyone looks at real estate companies with the same eyes. With due respect, when you talk about the big players who’ve done phenomenally well, this isn’t a criticism, but we’re not in the same business, he said.
Singhania explained that Raymond Realty operates in a different market segment than many large developers.
“Just because we’re all in real estate doesn’t mean we’re the same. It’s like comparing Armani and Raymond - yes, both make clothes, but they’re not in the same business. Similarly, the market we operate in is very different from theirs.”
Also Read: Raymond Realty plans to foray into Pune real estate market: CEO Harmohan Sahni
Raymond Realty has a 30% market share in the Thane real estate market
According to Singhania, Raymond Realty currently holds a 30% market share in the segment it operates in within Thane.
When asked about the company’s target for the Mumbai real estate market, Singhania clarified that Mumbai isn't a single market but a collection of micro-markets.
"Well, in Mumbai, I don't look at Mumbai as a market. Firstly, there are thousands of micro markets, and you have to see which market you are going to play," he said.
“We have two projects in Mahim, two in Bandra, and one in Wadala. So, our presence will depend on the specific market as we take on new projects.”
He said that in Thane, Raymond Realty commands a 30% share in its category. “There’s a different market above us and a different one below us. If you look at the Mumbai real estate market as a whole, our share might be 0.0001%. That’s how the Mumbai market is,” he explained.
‘Not in the redevelopment mad race’
According to Harmohan Sahni, CEO of Raymond Realty, the company targets projects that ensure a minimum profit margin of 20%.
Echoing this disciplined approach, Singhania said, “We have very strict financial discipline. I’m willing to walk away from a deal if it doesn’t meet our financial parameters. I will only pursue a deal if it meets my financial return criteria.”
Commenting on the current market environment, he told reporters, “I’m seeing deals that are so heated that, if I were a betting man, there’s no way people can make money out of them.”
“I am seeing deals that are so heated that if I were a betting man, there is no way people can make money out of them," Singhania said while speaking with reporters on June 30.
