Sell inventories now instead of waiting for market conditions to improve, Union Commerce and Industry Minister Piyush Goyal has told real estate developers in a video conference organised by NAREDCO.
Goyal suggested that while the government is considering ready reckoner rates as concession, it would be better if developers move ahead in case it does not go through, as per a report by The Economic Times.
Goyal said: “If any of you here feels that government will be able to finance in such a way that you can hold longer and wait for the market to improve, market is not improving in a hurry. Things are seriously stressed and your best bet is to sell.”
He further pointed out that holding on to inventories even as bank loans pile up would be erroneous, as precedent has shown that those who leveraged losses and sold at lower prices were better off than those who wait. He said they would have to chance default in case of inability to repay loans and have banks seize inventory, or sell at present levels.
Among measures announced by Finance Minister Nirmala Sitharaman for the sector in the Rs 20 lakh crore package last month, a six-month extension for construction projects’ timeline and a year-long extension of credit linked subsidy scheme (CLSS) for middle-income group till March 2021 were some of the highlights.
Further, states and union territories (UTs) were also allowed to extend construction permissions by nine months from original date. Besides this, the Reserve Bank of India (RBI) has enabled a six-month moratorium on payment of term loan instalments.