Thursday, September 17, 2009

Sobha Developers - One among cheats in Bangalore

That’s really BAD. Actually when you see all the prominent builders of bangalore are non professionals and lack basic knowledge of multi-storeyed building. This is even the case with puravankara, who take ages to complete their project. I saw many ppl staying in still under construction site (only 40% completed). This is ridiculous, high time these builders learn some professionalism and don’t cheat customers

Sobha Moonstone - Biggest Blunder and no compensation to customers

I have booked apartment in moonstone in 2006 and till date they have hardly constructed it. After fighting for 6 months they have cancelled it and taken away 80,000 Rs of my money citing service tax and cancellation fees. I am yet to understand how a cancelled apt have service tax.

Sobha Developers - biggest crooks on Earth

I was stupid enough to fall for the Sobha brandname and book a flat in one of their HSR properties. This is what I got in return:

1. It’s 16 months past their committed delivery date and still no signs of handover.

2. There is no access road to the property. The 40 ft road that was marketed as access turns out to be pieces of land owned by different individuals who have filed cases of encroachment against SDL. One of them filed a case 4 yrs back and won it recently and has now fenced off his land thereby rendering the apts almost inaccessible. SDL knew about this for at least 4 yrs but still went on with the sale of apts hiding this litigation from customers. When some customers found about this through RTI, SDL flatly denied at first. When pressed further, they lied saying it is about some "other" stretch of land, whoch is NOT part of the access road. It has been 3 months since this road was fenced off and SDL has not been able to arrive at any solution.

3. As per CDP 2015 which was released in 2005, a 30-m road is supposed to run through the property cutting it into 2 pieces. SDL kept customers completely in the dark about this. It was only when some local villagers put up some banners in protest that we, the customers came to know about it. Even then, SDL first lied saying it was the act of some local miscreants trying to extract money. Now, the entire issue has come in the open. SDL, not only refuses to come to any solution - they are trying to pass the buck onto customers saying it is our problem. Strangely, even today if you call their marketing posing as a prospective customer, they will say that there is "no issue" with any CDP road.

4. Charges have been hiked by 150% for BWSSB and KEB. SDL says they are not liable to show receipts to customers as it is not "standard industry practice". They have levied an additional 20k for solar lighting to all customers citing a 2006 govt order while most customers purchased the flats well after that. An independent evaluation shows that they are making 6x profit on cost/watt. Service tax refunds are not paid back to customers - instead we are being told to take this up with the govt directly.

5. A major architectural blunder renders 3 blocks inaccessible from the ground floor level. Residents are expected to go to the basement and enter the blocks. Now, they are trying to make up by putting some iron staircase (remember factories) at the back side.

6. They have not paid compensation for the delay to any customer who have made even the slightest modification like changing a tile, fitting a bathtub or a switch (for which Sobha charged exorbitantly). To those, who did not make any changes (probably only 10% of the owners), they held back compenstation for 69 days citing reasons like Rajkumar’s death, rains in Oct 2005, sand strike of 2006 - events that took place well before most people booked their flats. Wonder why they left out Indira Gandhi’s murder, 1993 blasts, Godhra riots, .... And the list goes on.... Last but not the least, they shout at customers, misbehave with them and have no shame or decency. Their customer service folks never pick up the phones, seldom respond to emails.......
So friends, this is the true picture of the city’s premier builder - arrogant, unethical and full of fraudulent practices. I made the worst decision of my life by going with them. Please don’t go down the same path. If my post dissuades even one person from investing with SDL, I would consider to have done some service to mankind!!

Horrible Experience Dealing with Sobha Developers

I own a Sobha flat. Sobha flats look beautiful and they haven’t fallen down - yet. That’s why I went with them. That’s the good part. The bad part is:

1. They use horrible plumbing and electrical material. They leave wide gaps between the tiles. Anything that can be replaced with cheap material without changing the looks from outside - they will.

2. They cheat and mislead their customers on the sales agreements with fine prints and levy false charges.

3. For customer service they employ people who occasionally take your phone call - and try to be your shrimp instead of taking down your complaint.

4. They will not be there when you need them. They will leave one soul to maintain 150 odd apartments in the name of "maintenance agreement". And you will never hear back from that one bloke unless you chase him down like a maniac.

5. They are way too expensive.

For the amount of money they charge - its just not worth it. The process of handing over was stressful and the realization was sharp that I had paid a premium price to buy a lot of pain. It was a mistake to buy from Sobha.

Thursday, August 6, 2009

Lenders agree to Sobha debt recast

Bangalore: Banks and financial institutions, which lent close to Rs 1,900 crore to Sobha Developers Ltd, have agreed to reschedule part of the debt.

Sobha Developers' managing director J C Shama said, "The company has managed to reschedule a substantial part of its loan portfolio." However, he did not elaborate. "Almost all the financial institutions have realigned our loans and our target is to bring down the debt to equity ratio of 0.5 by this fiscal from the current 0.85," he added. Of the total debt of Rs 1,900 crore, the Bangalore-based real estate developer will be able to repay Rs 1,130 crore on easier timelines.

Sobha has also refinanced/ rescheduled its near-term debt to match expected cash flows. The realty major is currently paying an average rate of interest of around 13% and has an annual interest outgo of Rs 240 crore and fixed overheads of Rs 60 crore. Sharma said, "We are looking at operational improvement and plans to bring down the debt through land monetisation, QIP and private equity deals."

Instead of paying Rs 960 crore and Rs 460 crore in FY10 and FY11, respectively, as per the rescheduled timeline, Sobha will pay an easier Rs 450 crore and Rs 690 crore in the period, the analyst said.

The company is looking to mop up between Rs 1,200 - Rs 1,400 crore by selling its land parcels at a premium. These parcels, totalling up to 475 acres, were valued at between Rs 600 and Rs 800 crore sometime back, according to market sources. However, Sharma refused to give any details .

Sobha recently raised around Rs 530 crore by diluting close to 22.5% equity through a qualified institutional placement (QIP). It intends to use Rs 410 crore of the QIP proceeds to reduce part of the debt.

Sobha profit dips to Rs 13 cr in Q1

BANGALORE: Realty major Sobha Developers has seen its net profit nosedive for the first quarter ended June 30, 2009, at Rs 12.7 crore, against Rs. 50.5 crore for the same period in FY09. Income from operations stood at Rs 177.1 crore (Rs 346.8 crore).

Sobha, which bore the aftershocks of the global economic slowdown, has seen a revival in fortunes in the first quarter compared with the fourth quarter ended March 31, 2009. Net profit in the first quarter increased 76.4% to Rs 12.7 crore from the fourth quarter, while total income was sequentially up 15.6% at Rs 178.6 crore.

“The real estate industry has seen clear signals of revival in demand during the first quarter. With the Indian economy growing at 6-7% and expected to achieve a higher growth rate in the next couple of years, real estate infrastructure industries are poised to play a more significant role. It will be a domestic-driven industry, growing at a much faster pace,” a company filing made with the bourses added.

On its part, Sobha Developers has realigned debt, brought on board a private equity partner, besides successfully completing a qualified institutional placement (QIP) raising Rs 500 crore.

These steps, the filing goes on to say, have added the much-needed comfort in operations and have helped the company focus on progress in various projects across key cities, including Bangalore. The company intends to focus on debt reduction and cost optimisation and believes it is well-equipped to capitalise on the early revival in the Indian economy.

As of June 30, 2009, Sobha Developers has completed 50 residential / commercial in-house projects and 146 contractual projects covering 31.9 million sq ft of built-up space.

Sobha Developers has currently 31 residential / commercial ongoing projects totalling 9.2 million sq ft. The company has contractual projects in several states like Karnataka, Kerala, Andhra Pradesh, Orissa, Tamil Nadu, Punjab, Haryana, the NCR, besides Maharashtra.

On the bourses, the Sobha scrip was down 1.2% at Rs 219, with 3.5 lakh shares changing hands on BSE.

Tuesday, May 26, 2009

Sobha best at only disappointing and cheating its customers

I had booked a flat with Sobha for their reputation. I already own a flat built by a lesser known builder. I know the pain of dealing with builders and getting the job done. But I must say my experience with Sobha has been very very bad.I feel like having made a big mistake by entrusting them with my hard earned money!

They have all the bad things that you may encounter while dealing with builders. And they charge a hefty PREMIUM for it. They have delayed my project by 1.5 yrs as everyone including the lesser known builder is struggling with the liquidity (And I thought Sobha was big). OF course they are smart enough not to pay any money to the customers for the delay. On the contrary they are prompt in charging interest if your payments are delayed by a single day.

Simple stuff like keeping track of changes requested by the customer is made a mess of by the staff. And they want you to accept the poor quality work. They have hidden facts and manipulated the terms.

Stay away from paying premium for poor quality , unprofessional work!