BIG TECH’S BIG THEFT

THE WORLD IS GOING GAGA OVER CHATGPT, THE ARTIFICIAL INTELLIGENCE BASED CHATBOT DEVELOPED BY OPENAI, FOR ITS STUNNING CAPABILITIES. BUT WHAT IS THE REALITY?

here is a word that is almost used as a synonym for ‘innovation’, ever since the startup culture caught on. Yes, it is ‘disruption’ itself, and how it came to be a positive word despite its quite negative meaning is a feat that only Big Tech could manage on this planet.

It is said that angel investors and venture capitalists have made disruption an important yardstick while assessing the ‘innovative potential’ and ‘scalability’ of startups. For a startup idea to click bigtime it should ideally disrupt the lives of the incumbent players and the people they employ. But of course, all for the common good.

Maximum the disruptive potential, maximum will be the scalability. The logic? It is quite simple to understand, and can be explained with two real world examples. Uber has to first disrupt the lives of millions of cab drivers across the world, so that this huge segment will have no option but to enrol for Uber. Or Oyo has to disrupt the lives of lakhs of hotels and lodges, so that they will have no option but to enlist themselves for Oyo. But all for the common good.

hat sets apart a leader in any sector is how it performs during downturns rather than in good times. The first three quarters of this fiscal delivered serious headwinds for the entire real estate sector, as it witnessed unprecedented rate hikes by Reserve Bank of India (RBI) in its bid to contain the inflation contagion that hit Indian shores too due to the Russian invasion of Ukraine. But a sector leader like Prestige Estates Projects faced these headwinds with considerable strength, which is readily seen from its H1 (Q1+Q2) results as well as the ongoing sales momentum in Q3 & Q4. The Bengaluru headquartered developer which had guided for Rs. 12,000 crore of pre-sales for this current fiscal, could surpass more than halfway of this - Rs. 6500 crore - by the end of H1 itself. The listed developer has done extremely well in both its residential and office / commercial segments. This helped the developer report an 80% surge in its consolidated net profit at Rs 140.7 crore in Q2 of this fiscal year, on a year-on-year basis. Total income rose to Rs 1,474.7 crore in the second quarter of this fiscal year from Rs 1,345.2 crore in the corresponding period of the previous year. Sales bookings during Q2 rose 66% year-on-year to Rs 3,511 crore on higher demand despite a rise in home loan interest rates. For the full half year of this fiscal or H1, Prestige Estates’ sales bookings more than doubled to Rs 6,523.1 crore from Rs 2,845.9 crore in the corresponding period of the previous year. The developer sold 3,210 units during the second quarter, translating to 36 Prestige homes sold every day on an average basis. Total sales during H1 was 8.18 million square feet with an average realization of Rs 7,976 per square feet. In its core and traditional market of Bengaluru, its pre-sales was largely led by the sprawling Prestige City project so far, and going forward, Prestige has a pipeline of 25 million sq ft of upcoming launches to keep the residential momentum in high gear, of which around half is from non-Bengaluru markets like Mumbai, NCR-Delhi, Hyderabad, Chennai, Pune and smaller markets like Kochi and Calicut. It also has Rs 6,500 crore of inventory in ongoing projects to rely upon in Q4 and beyond. Earlier, in FY’22, Prestige had reported sales bookings of Rs 10,400 crore, thereby becoming the first real estate company to breach Rs 10,000 crore pre-sales mark in the country. Despite its entry into the Mumbai market only a couple of years back, Prestige was among the top sellers in the central suburb of Mulund with sales worth Rs 883 crore in 2022. Prestige Estate’s commercial portfolio is also doing extremely well, and it is most bullish on Mumbai from where it expects around 50% of its overall rentals to come from by the next few years. Prestige has three office towers, spread over 10 million square feet coming up in the core Mumbai business district of Bandra Kurla Complex, as well as upcoming office towers in Pune, Hyderabad, and Kochi too. But the bigger story from Prestige is that the company has performed well during the recent headwinds, and that these headwinds are now all set to subside with inflation easing and rate hikes getting paused or even reversed soon. This will deliver significant tailwinds for the company in Q4 and beyond.