In an exclusive interaction with FE Online, Ravi Kumar, Founder & CEO, udChalo, talks about the new segment and his plans for the future.
udChalo, a company that exclusively caters to the defence community, is all set to set foot in the real estate sector. Founded by Ravi Kumar, udChalo has grown at a CAGR of 495% since it began operations in 2015. Having introduced around 3 million virgin flyers from the defence community to air travel over the last 6 years, udChalo is now geared up to foray into the real estate segment to address the next need they have identified.
In an exclusive interaction with Sanjeev Sinha, Ravi Kumar, Founder & CEO, udChalo, talks about the new segment and his plans for the future. Excerpts:
What made udChalo foray into real estate for this consumer base?
Compared to all the customer bases, defence forces have very different and special needs. Due to their unique lifestyle, they have little to no access to numerable products available in the market. Hence they face a lot of challenges outside their camps and cantonments.
A defence personnel retires at an average age of 35, with hardly any time left to plan about their retirement. Post retirement, they refrain from returning back to their small towns and are burdened with finding alternative careers, education of their children and an investment in the right property. Housing is their first priority post retirement. So, when their tenure ends, they struggle to find a home of their preference to settle down. Last moment home-buying exposes them to skyrocketing prices or leads to desperate purchases that eventually result in poor decisions. Recognizing these problems, we initiated the housing project to address the typical challenges the armed forces face which are not known to others.
udChalo would like to make this journey easy for the armed forces and the veterans by identifying the best properties that they can invest in that are offering concessions due to bulk buying.
For a long time the defence forces have relied upon AWHO and Air Force Naval Housing Board for their housing needs. udChalo would like to provide them with one more option as choices and concessions are limited.
What are the pressing challenges that defence forces face while buying a property?
Many a times, the decision to buy a home is taken hurriedly. Defence forces do not have the time to cross check on papers, authenticity of developers, understand the market value, check on quality, right locality of the projects and fall prey to fraudulent deals.
Their occupation comes with various challenges and they rarely have the time to do background checks which often results in endless delays in possession. Additionally, there is the rigmarole of paper work, applying for loans, claiming tax benefits on property they purchase and right investments that they should get into.
There are consumer sites that do address the various concerns of regular consumers but our armed forces are stationed at remote geographical locations throwing a new set of challenges to this segment.
We wish to address these issues by doing thorough research for them and ensuring that they get the best that the market has to offer.
Why should a defence buyer prefer udChalo over AWHO?
udChalo’s housing initiative is broadly inspired by AWHO. The Army Welfare Housing Organization was a much-awaited welcome within the community when it started in 1978. But for a segment as big as 30 million, only one entity serving the segment does not fulfil the market demand.
10% of India’s middle class is made up of the defence community and around 98% of fraternity is comprised of non-officers who rely on affordable housing. So, the demand for quality homes at a low price exceeds its supply.
udChalo strives to fill this gap by ensuring that there is enough for everybody without any compromise. We will deliver homes with legal end-to-end assistance for all documentation purposes and act as an additional regulatory authority for auditing the builder’s financial state so that the quality is at par with industry standards and the hand-over is always on time. The rates we offer are affordable as compared to AWO. We also hope to expand to all cities where the defence community likes to settle.
What are the special needs this consumer segment have, that developers do not understand?
Since defence personnel live away from civil life for so long, when they come back to settle, they seek familiarity. Hence, you will notice that people from the fraternity are usually placed together in various pockets of the country. Since, many jawans retire at an early age, their children are often still at school. So they also prefer to stay closer to schools.
Retirement at the average age of around 35 also generates the need to work post their service years. Keeping in mind all these aspects, we choose locations that are closer to schools and provide ample professional opportunities to the ex-servicemen.
We will address not only the distinct needs of the community but will also provide more than necessary amenities to them for a wholesome living experience.
Is property investment a new concept for defence forces in the low ranking officers?
Making investment in a piece of property is the first priority for the armed forces. In fact, it is the most common mode of investment for this community. When the personnel and their families seek to invest, they always look for a property or land over stocks, mutual funds, and the like. Real estate is not only a need within the fraternity but also a definite want. Therefore, when we started ideating what next to do for the forces, real estate was the next segment we wanted to venture into and now we are in the process of materializing the vision.
What is your current tie-up and how will it benefit the new home buyers?
We are commencing our journey into real estate from Pune. Here we have collaborated with the Nyati Group where we will be providing the armed personnel homes at a price point of Rs 3999/- per square feet, which ensures them a cost advantage of 10% on the day of purchase and an expected appreciation of 20% approximately. We will be selling units of 1BHK and 2 BHK with a saleable area of 706 – 709 sq.ft. and 713 – 885 sq.ft., respectively.
Armed forces are also entitled to multiple tax benefits under various provisions meant for them. So, the resultant housing through udChalo is significantly of low price and high quality.
The Nyati Group is a reputed real estate developer in the city who have secured the trust of many home-buyers. Nyati was naturally our preference also because 40% of their sales since inception have been to the armed forces’ community. The group is working diligently towards the construction of the property in Wagholi – in an area that lies amidst greenery, is surrounded by IT Parks and is in close proximity to the upcoming Pune Metro.
What are your future plans and how do you plan to cater to the large segment?
We want to be able to reach out and help as many servicemen, families and veterans from the community as we can. In the next 12 months, we are planning to enter six new cities in the order of preference and concentration of armed personnel in those areas. Some of the cities we are eyeing at the moment are Chandigarh, Delhi, Delhi-NCR, Patna, Lucknow, and Bangalore. We plan to collaborate with the most reputed developers in each city and create housing and locales that become central to the city and the lives of the forces. For the farther future, we hope to build the kind of trust that will make home-buyers come to us with the demand to build a house for them.
