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India's Urbanization - Initial read through from census
data
Results of census 2011 are being gradually released. Preliminary trends
indicate that urbanization trend is intact and population growth rate in cities
is happening at a rate higher than average population growth. Within cities,
growth seems to be higher (as expected) in upcoming suburbs around cities.
This then is supportive of long-term hypothesis of rising real estate demand
around major economic centers. However, on the flip side, as cities look to be
hitting their long-term population targets faster than expected, the census then
seems to have sparked off a sharp debate amongst various activists/ planners
on government spend (or lack of it) in ensuring adequate infrastructure in
fast growing metros.
• In terms of key cities:
o Gurgaon registered the highest decadal population growth at 74%
(1.5MM), followed by Noida (GB Nagar) at 51%. These two areas
instead of being suburbs to Delhi are now transitioning to becoming full
fledged cities in themselves. Interestingly Delhi’s population growth rate
moderated (21% vs. 47% last decade), implying that new opportunities
are more in upcoming geographies around the main city.
o In Mumbai, a similar pattern was repeated. While the main city just
registered a population growth of 4%, MMR region registered a far
higher growth. Thane (+43% growth, 1.8MM ppl) is now one of the
largest districts in India. New satellite townships i.e Navi Mumbai
(+48%). Vasai Virar (+ 221%), Kalyan Dombivili (+50%), New Panvel
(+113%) were some of the fastest growing suburbs around the
metropolis.
o Bangalore’s decadal population growth increased to 47% (vs. 35%) to
9.6MM people or close to what Mumbai had in 2001. Interestingly, the
city has already achieved its population target, which was expected by
2030 (10.1MM) (as per Mckinsey).
o In other key cities, growth was more modest—Hyderabad (4MM, 4.5%),
Chennai (4.7MM, 7.5%). Kolkata was one of the only metros to register
a population decline (4.5M, -1.7%). Although suburban data for these
metros are not out yet, it may be possible that population growth rate
there again will likely be higher.
• Urbanization is widely understood as the main driver of RE demand. As per
a study by McKinsey, by 2030 almost 590MM people will be living in cities
(2x current population), which will account for 70% of new employment
generation. Mumbai and NCR will be the largest cities in Delhi with
population of 33MM/26MM respectively.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Realty check
India's Urbanization - Initial read through from census
data
Results of census 2011 are being gradually released. Preliminary trends
indicate that urbanization trend is intact and population growth rate in cities
is happening at a rate higher than average population growth. Within cities,
growth seems to be higher (as expected) in upcoming suburbs around cities.
This then is supportive of long-term hypothesis of rising real estate demand
around major economic centers. However, on the flip side, as cities look to be
hitting their long-term population targets faster than expected, the census then
seems to have sparked off a sharp debate amongst various activists/ planners
on government spend (or lack of it) in ensuring adequate infrastructure in
fast growing metros.
• In terms of key cities:
o Gurgaon registered the highest decadal population growth at 74%
(1.5MM), followed by Noida (GB Nagar) at 51%. These two areas
instead of being suburbs to Delhi are now transitioning to becoming full
fledged cities in themselves. Interestingly Delhi’s population growth rate
moderated (21% vs. 47% last decade), implying that new opportunities
are more in upcoming geographies around the main city.
o In Mumbai, a similar pattern was repeated. While the main city just
registered a population growth of 4%, MMR region registered a far
higher growth. Thane (+43% growth, 1.8MM ppl) is now one of the
largest districts in India. New satellite townships i.e Navi Mumbai
(+48%). Vasai Virar (+ 221%), Kalyan Dombivili (+50%), New Panvel
(+113%) were some of the fastest growing suburbs around the
metropolis.
o Bangalore’s decadal population growth increased to 47% (vs. 35%) to
9.6MM people or close to what Mumbai had in 2001. Interestingly, the
city has already achieved its population target, which was expected by
2030 (10.1MM) (as per Mckinsey).
o In other key cities, growth was more modest—Hyderabad (4MM, 4.5%),
Chennai (4.7MM, 7.5%). Kolkata was one of the only metros to register
a population decline (4.5M, -1.7%). Although suburban data for these
metros are not out yet, it may be possible that population growth rate
there again will likely be higher.
• Urbanization is widely understood as the main driver of RE demand. As per
a study by McKinsey, by 2030 almost 590MM people will be living in cities
(2x current population), which will account for 70% of new employment
generation. Mumbai and NCR will be the largest cities in Delhi with
population of 33MM/26MM respectively.
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