The Series of disruptions seen in the past 2-3 years (demonetisation, RERA, GST, NBFC liquidity crisis, accounting changes) have led to rapid consolidation in the sector. Reputed developers, which have been gaining market share, have aligned their businesses to comply with RERA, GST. The operations of unorganised developers have been impacted and they have slowed down their new launches (down 22% y-o-y in Q3FY19), finding it difficult to monetise ongoing inventory. Hence, top listed developers have reported 20-30% volume growth in 9MFY19 vs. tepid volume growth for the industry. Consequently, the market share of category A & B developers has increased sharply in a very short span of time. NBFC liquidity issue to play out over next 1-2 years NCR and MMR remain the most stressed markets in terms of liquidity (interest coverage of ~1.5x each vs. 3.7x for Bangalore). Thus, consolidation in NCR and MMR will be far more significant relative to Bangalore and other key cities. Reputed developers in NCR (DLF, Ashiana) and MMR (Oberoi, Godrej) can gain disproportionate market share over the next 1-2 years. While Bangalore will also see consolidation, market share gains are likely to be moderate. Political outlook is conducive Recent polls suggest a second term for NDA, which will be positive for the real estate industry. NDA is more focused on housing than UPA \u2014 funding and execution on Urban and Rural housing by NDA is higher than that of UPA. The NDA government has given multiple sops to private developers and consumers to revive demand in housing. BJP-ruled states have implemented strong housing reforms in the last 5 years. Housing has a 10-12 year cycle peak-to-peak Down cycles last about 6 years, while up cycles last 5-6 years. We are already 6 years into the current downturn, which is similar to the duration of the previous two downturns. This suggests we are on the cusp awaiting an upturn. After registering a steady decline over the past 5 years, residential cycle in the top 6 cities has bottomed out with volume trajectory now clearly moving upwards. Bangalore continues to be the preferred market, driven by (i) continued strong commercial demand (10-12 msf p.a.), (ii) low inventory levels (36 months to sell) and (iii) better balance sheets of developers (interest coverage of 3.7x vs. 1.5x for NCR and MMR).