Shivshankar K.R. talks to Neeta about the health of flooring industry amidst RERA, GST and Budget 2018
Inovar Floors India Pvt. Ltd. is a leading flooring company headquartered in Malaysia. The company has a strong presence in India for more than a decade now. Inovar runs its Indian operations from Mumbai but it has a strong presence in other parts of the country through dealer network. It offers a range of flooring options and decking solutions.
What is your take on the impact of RERA and GST on the business?
GST has managed to bring down the prices for developers due to the input credit system, a benefit which should ideally be passed on to the customer. The idea is to counterbalance the GST that the end customer pays. However, the customer has to pay GST on a lower cost, therefore the impact is relatively low.
When we talk of RERA, it is a very good regulatory guideline for the
industry. Up to May 2017 the industry to a large extent was unregulated. RERA has helped professionalize the whole business. But whenever anything new is introduced, there is some amount of disruption and little bit of uncertainties that slows down the pace economic activity. Although this is a very short term phenomenon. Things have moved to a great extent and I think that in the next couple of months they should pick-up even further, pushing the real estate industry back in its original gear. The industry is definitely experiencing a temporary slowdown due of RERA.
What impact of Budget 2018 would be felt by the flooring industry?
This budget has not made any significant direct change to the industry. Although we expect some benefits through the affordable housing schemes. As in, we are expecting that the owners of the houses constructed and allotted under the Pradhan Mantri Awas Yojna – Urban and Rural, could divert the money saved in house purchase, to their home interiors.
Another important aspect of this scheme is the attractive rates of getting loans. Once again, there is a strong possibility of the money that these buyers will save through interest subsidy, to get diverted to home interiors.