A sound Paranjape Schemes is a golden goose whose time has come
Once a sleepy city, better known for its retiree population, Pune has now found its mojo in IT. That said, apart from the city’s growing significance as an IT hub, Chakan’s growth as an automobile hub in the neighbourhood, and the growth of food-processing industries in the surrounding areas has also bolstered the demand for residential, commercial and office space in the city in the last decade.
Cashing in on this trend, several developers have grown in size and acquired a reputation as quality builders. One of the leading developers in this pack has been Paranjape Schemes (Construction) Ltd (PSCL), which-was set up in 1987, by the two brothers, Shrikant and Shashank Paranjpe, chairman and MD of the company, respectively.
PSCL has come a long way since inception. With the filing of a Draft Red Herring Prospectus with the SEBI on 9 July, its shares are destined for listing on the NSE and BSE sometime in the near future. The company will be raising ?600 crore through an IPO. Though the date has not been announced so far, it can’t be too distant.
Traditionally, Paranjapes have been a business family. Grandfather Vishnu Paranjape was a manufacturer of silverware in the 1920s. To his credit, he foresaw the potential for development of real estate in Mumbai and invested profits from this business in large tracts of land in Vile Parle (East). This laid the foundation for the next generation to enter real estate development.
Interestingly, one of Vishnu Paran- jape’s first acts in developing his property was to establish Parle Tilak Vidyalaya in 1921. This is now a leading educational institution in the metro. After inheriting the property,
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the promoters’ uncle Moreshwar Paranjape and their father Purshot- tam Paranjape targeted the housing needs of the middle classes in the western suburb of the metro.
Thus, they subsequently developed the entire estate into, what in today’s parlance can be called ‘an integrated township’. It gave them the reputation as reliable builders. However, Shrikant – who had just completed CA in 1983, and his younger brother Shashank – who was still doing his articles, decided to launch their own venture, separate from the family’s real estate business. They instead went into manufacturing adhesives for wood in 1983.
With intense competition and small operating margins, adhesives turned out to be a challenging task. Nevertheless, they stuck it out for several years, expanding successfully from a small manufacturing unit in 1983 to three units in 1987. “It taught us to value customers,” reminisces Shrikant.
However, they decided to look for better opportunities; and, what else could have been better than the real estate business? By virtue of being in a family of developers, they already had some familiarity with the field. They sold their adhesives business and invested the capital raised from this sale into a realty venture, calling it Paranjape Schemes (Construction) Pvt Ltd. “We may have sold adhesives,” says Shashank, “but it
Responding to the Central Government’s National Policy for elders in the country, Paranjapes have formed a non-profit charitable organisation, Athashri Foundation, under Section 25 of the Companies Act, 1956. The foundation has been pursuing a two-pronged approach in meeting the needs of its senior citizens. One of these has been to assist them whenever needed. The other has been to make their lives happy and comfortable, by paying attention to their age-specific physical and psychological needs. All Athashri schemes have been developed on this theme, in association
gave us the confidence to face challenges in the rapidly changing realty market after the opening up of the Indian economy”.
So, where does PSCL stand in India’s real estate scenario after nearly 28 years in business? From being principally a Maharashtra- based developer, it has expanded to Bangalore and Baroda and has now begun exploring opportunities elsewhere as well.
An amazing aspect of Paranjapes’
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approach, unlike other developers of Pune or, for that matter, even Mumbai, has been their boldness in exploring opportunities even in smaller cities like Kholapur, Nashik, Chiplun and Ratnagiri. This open- mindedness in tapping opportunities is what has distinguished them from others in the field.
Paranjapes began with a focus on mass housing in 1987, which was
with Paranjape Schemes and Athashri Homes Pvt. Ltd.
Beginning with Pune, the company has now expanded its footprint to Bangalore and Vadodara, in Gujarat. In Pune alone the Athashri Foundation has been taking care of 1095 senior citizens. Having set this benchmark in these cities, Paranjapes’ ultimate aim is to have Athashri projects in all major cities of India in the coming years.
“The average age of residents at this complex is 78,” says Hari Sundaresh, 71, a former World Bank Employee, who met this correspondent at one of the
the sole segment of opportunity then. Today, they have diversified into various segments of real estate development, including mass-housing projects, residential schemes for the elderly and lifestyle projects for those who can afford this.
As for the scale, they have large projects like the integrated townships and relatively smaller ones like the redevelopment schemes. On the commercial side, they are at present setting up a special economic zone, an IT park, malls and hospitality projects like hotels. In fact, they already have a management tie-up with the Taj in the city.
Over 28 years, PSCL has completed 160 projects, covering about 15.33 million sq ft of developed area – comprising 12.99 million sq ft of residential and 2.34 million sq ft of commercial space. Besides, it has several ongoing projects, while several more are at the development stage and some in the pipeline. These will form the bulk of the revenue in next few years.
As far as Pune is concerned, the developer’s focus was on Kothrud, Deccan Gymkhana and Pashan Sus road, in 1988. But, with the passage of time, as these areas were saturated, it shifted its focus to Western and Southern Pune, where all the action is now.
To its credit, PSCL has been instrumental in developing Hingewadi, where it has an iconic township project, Blue Ridge. This is now one of
Paranjape’s Pune Athashri complexes. “There are three to four interesting events every month besides several other programs, which keep us engaged.”