Scribd
Upload
133 views4 pages

Oberoi

Oberoi Realty, a Mumbai-based real estate developer, has faced several corporate governance issues, including tax authorities carrying out searches for suspicious transactions and price manipulation. One resident also filed an FIR accusing Oberoi Realty of fraud worth Rs. 142.56 crore for delivering smaller flats than promised and not providing all amenities. Additionally, a report found Oberoi Realty had one of the lowest paid leadership teams at 0.5% of net profit on average for three years and received poor ratings on management compensation, trading practices, and financial stability.

Uploaded by

Mainali Gautam
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
133 views4 pages

Oberoi

Oberoi Realty, a Mumbai-based real estate developer, has faced several corporate governance issues, including tax authorities carrying out searches for suspicious transactions and price manipulation. One resident also filed an FIR accusing Oberoi Realty of fraud worth Rs. 142.56 crore for delivering smaller flats than promised and not providing all amenities. Additionally, a report found Oberoi Realty had one of the lowest paid leadership teams at 0.5% of net profit on average for three years and received poor ratings on management compensation, trading practices, and financial stability.

Uploaded by

Mainali Gautam
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 4

INTRODUCTION:

 Oberoi Realty is a real estate development company operating in Mumbai,


focused on premium developments.
 The company has established a strong brand and a successful track record in
the real estate industry by developing innovative projects through its emphasis
on contemporary architecture, strong project execution and quality construction.
 While its focus is on residential projects, it has a diversified portfolio of projects
covering key segments of the real estate market, which target the upper end of
the respective income or market segment.
 It develops residential, office space, retail, hospitality and social infrastructure
projects in mixed–use and single–segment developments.
 Oberoi Realty currently follows a sale model for its residential projects and a
lease model for a portion of its office space and retail projects as it believes this
provides the company with stable cash flows.
 In hospitality projects, it currently follows an operating agreement model,
whereby the hotel is owned by the company and operated by a hotel chain.

CORPORATE GOVERNANCE ISSUES:

1. Suspicion transactions and price manipulations:

 The Income Tax (I-T) Department on Tuesday carried out searches at Oberoi
Realty group and its biggest vendor Capacit’e Infraprojects for suspicious
transactions, including alleged purchase from dubious entities, receipt of ‘on-
money’ and price manipulation and cash deposits during demonetisation period.
 Searches were carried out at over 30 locations in Mumbai, Delhi and Hyderabad
by I-T sleuths.
 Oberoi, which has developed over 40 projects in Mumbai, is also being probed
on allegations of receipt of ‘on-money’ and price manipulation.
 There is information that at least eight prime projects of the realtor in Mumbai
and its suburbs in which there is suspicion of difference between sale prices
shown in books and those of registered prices vis-a-vis payment received.

2. Oberoi Realty accused of fraud worth Rs 142.56 crore

 One of the residents of the project had lodged an FIR against Vikas Oberoi.
 Accused the head of the Oberoi Realty of duping flat owners by delivering
smaller flats than what was promised.
 Filed by Mohit Bhardwaj, a resident of Oberoi Splendour, a luxury project on
Jogeshwari-Vikhroli Link Road.
 He claimed to represent several other flat owners, who have been fighting
against the developer for the last couple of years.
 Not only the size of the flats was smaller, but the height of the ceiling was also
lesser than what was promised, among other things.
 Amenities such as club house, swimming pool squash court, spa, party hall,
jogging park, tennis court, amphitheatre, camping site, plaza, landscaped
garden, etc were promised which were not given.
Buyers found out that the number of flats on each floor was much higher.

Reaction by Vivek Oberoi

 Allegations are factually incorrect.


 All legal obligations have been fulfilled.
 Complainant has got no relief till date from any of the legal forums that he has
approached.
 Oberoi Realty is a law-abiding corporate and adheres to the highest principles of
corporate governance and ethical business practices.

3. Lowest paid leadership teams

 Oberoi Realty’s management emerged as one of the lowest-paid leadership


teams—the total compensation on average for the last three years was 0.5% of
net profit
 Oberoi Realty poorly on compensation paid to management, trading in own stock
and financial stability, respectively according to the report by BNP Paribas.

Shareholder’s value:
Share prices

You might also like