5 Sectors on a Hiring Spree

India's journey on the path of economic reforms has transformed it to one of the world's fastest growing economies. Its large and growing population is its best asset and can quadruple GDP and catapult India to the league of developed economies over the next decade. All this if a billion could be transformed into a productive workforce.

For over half a decade now, India has been chanting the demographic mantra with little real progress. Because, with opportunities come challenges. The services sector needs many million knowledge workers. Lack of employability is endemic. India's large labour force has been stubborn in transition. Over 90% of the labour force is inadequately trained.

Jobs continue to be created, needing an educated workforce and many in sunrise sub-sectors. We need to recognise new opportunities and prepare the supply side. Let us take a quick look at five existing sectors that are likely to hold us in good stead in the future in terms of employment generation and business growth.

1. INFORMATION TECHNOLOGY
The IT sector has been India's sunshine sector for quite some time now. The industry has contributed considerably to changing India's image from a slow developing economy to a global player in providing world class technology solutions. According to the IBEF (India Brand Equity Foundation) figures, the Indian IT industry is set to touch $225 billion by 2020. 

Global firms line up jobs at IIM-Bangalore 

Industry experts and NASSCOM say the Indian IT workforce will touch 30 million by 2020, becoming the highest sector employer. This will be coupled with steady increase in pay in a sector already offering a high base. The outsourcing industry too is looking towards India and is expected to be a $2.5 billion industry in the next 24 months.

2. TELECOM
India's telecom story is only getting better. According to Zinnov estimates, India already has nearly 850 million mobile phone subscribers, with a 15% smart phone penetration. All this points to a penetration that is fuelling the growth of enterprise mobility in India, which will lead to significant employment growth. 

EXPERT TIP: How to adjust to your new workplace 

The Telecom Regulatory Authority of India (TRAI) too is targeting a 10-fold increase in broadband subscribers to100 million by 2014. Outsourcing revenues from the telecom sector, as per E&Y, are set to grow at a CAGR of 31% to nearly $2 billion in 2012. India today is at a stage in telecom growth that probably America was 30 years ago. Our mobile and Internet penetration has to increase further, resulting in a new era in enterprise mobility.

3. HEALTHCARE
There are clear indications that healthcare is going to be a major sector that stimulates economic growth and contribute to employment. 

Over 40 million new jobs are expected to be generated by 2020, as per a report titled 'India's New Opportunities-2020' by the All India Management Association, Boston Consulting Group and the Confederation of Indian Industries (CII). The Indian healthcare industry also has advantages over other developing countries in becoming a global hub for medical tourism. The medical treatment and educational services in India are a fraction of the cost in developed countries. 

While we may lag in molecule development and drug patents, an increasing disposable income has led to a strong domestic market potential in India. This will result in significant employment generation across various functions, such as sales, marketing, HR, IT and operations, within the industry.

4. INFRASTRUCTURE
India's infrastructure growth has been exponential over the past decade. Today, we are the fourth largest and probably the second-fastest growing economy, with infrastructure being one of the cornerstones. The infrastructure industry in India is highly fragmented and hence difficult to gunge its exact size and the jobs it generates each year in absolute terms. 

However, be it roads and highways, railways, aviation, shipping, energy, power or oil & gas, the Indian government and the various state governments seem to making rapid progress. This has led to significant employment generation, though a majority of it is still in the unorganised sector. Over the next 10 years, the infrastructure sector in India will need to continue its growth momentum and is likely to maintain a growth rate anywhere between 7-10%, a very healthy sign.

5. RETAIL
Over the past few months, the retail sector has grabbed headlines with talks of 100% FDI in single brand retail, which is currently capped at 51%. While the outcome is still undecided, the opening up of India's retail will create a stronger, organised industry that will help in generating employment. 

Today, only a small part of retail in India is organised. Despite this, it is estimated that the sector in India is worth more than $400 billion, with domestic and international players planning to expand across the country. Industry leaders predict that the next phase of growth will emerge from rural markets. There are projections of the workforce doubling by 2015, from the current five lakhs in both organised and unorganised sector.

Buying Gold versus Real Estate - Which Is Better?

From times immemorial, Indians are known for their love for the yellow metal, especially as India is the second largest consumer of gold in the world. However, the recent times have witnessed a huge surge in the realty sector in India, and many Indians are not hesitating to pledge or sell their gold (ornaments as well) to invest in the booming real estate sector. In such a scenario, would it be safe to say that investment in real estate is better than buying gold? Is real estate a conclusive investment alternative to gold? Let us discuss the reasons behind such changing trend.

Fluctuations in gold rate and drop in ornament rates

More often than not, investors consider gold as an insurance in their portfolio; however, the recent fluctuations in gold rates have led many investors to think otherwise and to look for investment avenues that can generate guaranteed profits. Needless to mention that most of the investors consider real estate investment as a safer bet than investment in gold.

Possibility of income from real estate investment

Believe it or not, older generation invested in gold partially because they were very fond of wearing gold ornaments. But the same cannot be said about the newer generation that is vary of flaunting their gold jewelry. Moreover, people now understand that gold is unproductive in nature unless you are mentally prepared to dispose it off for profits at a later date. Investment in real estate opens up the possibility of a regular monthly rental income and that is the reason why many smart investors are preferring real estate over gold.

Warren Buffett Reveals His Secrets for Investing in Real Estate

 Here are five takeaways from the letter and Buffett's words supporting each.

1. Invest in Undervalued Real Estate

From 1973 to 1981, the Midwest experienced an explosion in farm prices, caused by a widespread belief that runaway inflation was coming and fueled by the lending policies of small rural banks. Then the bubble burst, bringing price declines of 50% or more that devastated both leveraged farmers and their lenders.

In 1986, I purchased a 400-acre farm, located 50 miles north of Omaha, from the FDIC. It cost me $280,000, considerably less than what a failed bank had lent against the farm a few years earlier.

And....

In 1993, I made another small investment. Larry Silverstein, Salomon's landlord when I was the company's CEO, told me about a New York retail property adjacent to NYU that the Resolution Trust Corp. was selling. Again, a bubble had popped –- this one involving commercial real estate –- and the RTC had been created to dispose of the assets of failed savings institutions whose optimistic lending practices had fueled the folly.

2. Think in Terms of Income, Not Appreciation

With my two small investments, I thought only of what the properties would produce and cared not at all about their daily valuations. Games are won by players who focus on the playing field –- not by those whose eyes are glued to the scoreboard.

If you instead focus on the prospective price change of a contemplated purchase, you are speculating. There is nothing improper about that. I know, however, that I am unable to speculate successfully, and I am skeptical of those who claim sustained success at doing so.

3. Focus on Underutilized Properties

I calculated the normalized return from the farm to then be about 10%. I also thought it was likely that productivity would improve over time and that crop prices would move higher as well. Both expectations proved out.

And regarding the New York property ...

Here, too, the analysis was simple. As had been the case with the farm, the unleveraged current yield from the property was about 10%. But the property had been undermanaged by the RTC, and its income would increase when several vacant stores were leased. Even more important, the largest tenant – who occupied around 20% of the project's space – was paying rent of about $5 per foot, whereas other tenants averaged $70. The expiration of this bargain lease in nine years was certain to provide a major boost to earnings.

4. Use Partnerships to Fill In Gaps in Your Expertise

I knew nothing about operating a farm. But I have a son who loves farming and I learned from him both how many bushels of corn and soybeans the farm would produce and what the operating expenses would be. 

And ...

I joined a small group, including Larry and my friend Fred Rose that purchased the parcel. Fred was an experienced, high-grade real estate investor who, with his family, would manage the property. And manage it they did. As old leases expired, earnings tripled. Annual distributions now exceed 35% of our original equity investment. Moreover, our original mortgage was refinanced in 1996 and again in 1999, moves that allowed several special distributions totaling more than 150% of what we had invested. I've yet to view the property.

5. The Macro View Is More Important Than the Micro

My two purchases were made in 1986 and 1993. What the economy, interest rates, or the stock market might do in the years immediately following –- 1987 and 1994 -– was of no importance to me in making those investments. I can't remember what the headlines or pundits were saying at the time. Whatever the chatter, corn would keep growing in Nebraska and students would flock to NYU.

There is one major difference between my two small investments and an investment in stocks. Stocks provide you minute-to-minute valuations for your holdings whereas I have yet to see a quotation for either my farm or the New York real estate.

Conclusion

Perhaps unsurprisingly, Buffett's philosophy on investing in individual companies is similar to the one he applies to investing in real estate. Find investments that produce income, have long-term value prospects not currently being recognized by the market, and, once you buy them, increase their operational and managerial efficiencies to maximize recurring revenue.

రియల్ ఎస్టేట్ రహస్యాలు..

1. ముందు మీ దగ్గర ఎంత డబ్బు ఉందో చూసుకోండి.

అంటే, మీరు ఎంత బడ్జెట్ తో సిద్దంగా వున్నరో స్పష్టంగా  ఉండండి.

2. స్థిరాస్థి అమ్మే వారికి హక్కు ఉందొ, లేదో నిశితంగా పరిశీలించండి...

అంటే, స్థిరాస్థి కి సబంధించిన డాకుమెంట్స్ ని వివరంగా చదివి అర్ధం చేసుకోండి. అవసరం అయితే, మీ లాయర్ ని, రిజిస్ట్రార్ ని సంప్రదించండి.. ఈ డాకుమెంట్స్ లో మీకు అనుమానం వుంటే, ఇంక ఆ ప్రాపర్టీ వైపు అసలు చూడకండి.  కనీసం 14 ఇయర్స్ లింక్ డాకుమెంట్స్ చూడటం అలవాటు చేసుకోండి. ఇక్కడ మీరు మొహమాట పడ్డారో, ఇంక అంతే. జాగ్రత్త.. జాగ్రత్త.. జాగ్రత్త..

3. మీరు కొనబోయే స్థిరాస్తి కి అన్ని అనుమతులు ఊన్నయో, లేవో చూసుకోండి.

అంటే, ప్లాన్ అప్ప్రూవల్స్, లేఅవుట్ అప్ప్రూవల్స్, ల్యాండ్ కన్వర్షన్, ఇతరత్రా.. అన్ని... 

4. మనసు పడి ఇల్లు కొనకండి... మనసు పెట్టి అలోచించి కొనండి.

అంటే, అందంగా ఉంటే కొనాలని అనుకోకండి.. అన్ని విధాల ఏ లోపం లేని ప్రాపర్టీ ని మాత్రమే కొనండి..

5. మిగతా ఖర్చులు ఏమిటో ముందే లెక్క వేసుకోండి

అంటే, రిజిస్ట్రేషన్ చార్జీస్, డాక్యుమెంట్ ఖర్చులు, చలానాలు, మీ ఏజెంట్ కి ఇవ్వాల్సిన కమిషన్.. అన్ని ఒకసారి లెక్క వేసుకోండి..

6. భవిష్యత్ లో బాగా - త్వరగా కాదు - రేట్ పెరిగే ప్రాంతం ఎంచుకోండి

అంటే, ఇప్పుడు తక్కువ రేట్ కి ఎక్కడ లభిస్తుందో చూసుకోండి.. తక్కువ లో కొంటెనే కదా.. పెరిగేది.. ఇప్పుడే ఎక్కువ పెట్టి కొంటె భవిష్యత్ లో ఎక్కువ గా పెరగక పోవచ్చు కదా..

7. మీకు భవిష్యత్ లో ఈ డబ్బు తో ఏమ్ చెయ్యలో ముందుగానే నిర్ణయించుకోండి

అంటే, ముందుగా.. మనసులో ముడుపు కట్టండి. అమ్మాయి పెళ్లి, అబ్బాయి చదువు, లేదా ఇంత పెరిగాక మళ్ళి అమ్మాలి. అని

8. మీరు కొనబోయే ప్రాంతం, చుట్టూ పక్కల ఏమేమి వున్నయో సరిగ్గా పరిశీలనా చూడండి.

అంటే, ముందుగా అక్కడి చుట్టూ పక్కల నివాస యోగ్యం గా వున్నా ఇతర భూములు ఉన్నాయా.. లేవా అని గమనించండి. పర్యావరణాన్ని కలుషితం చేసే పరిశ్రమలు, హై వొల్టజ్ కరెంట్ తీగలు, దగ్గర్లో స్మశానాలు లాంటివి లేకుండా చూసుకోండి.   


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