The latest auction of 7.67 acres of land at Rayadurgam in the heart of Hyderabad fetching a staggering Rs 177 crore an acre to the Telangana government has broken all records, making one wonder whether it was a real boom in the real estate sector in Hyderabad or an artificial inflation of prices.
Pharma major MSN Laboratories bought the piece of land at Rs 177 crore, which comes to roughly Rs 4 lakh per square yard.
Analysts say if the buyer really has the will to develop it and make profits, he would have to sell the space for at least Rs 40,000 per square feet.
The Telangana industrial and infrastructure corporation (TGIIC) which conducted the e-auction for 18.67 acres of prime government land in the upscale Rayadurgam area, located near Gachibowli and Hi-Tech City, a zone dominated by high-rise towers, tech parks and major corporate hubs.
The TGIIC itself has put the upset price of the land at Rs 101 crore per acre and the MSN Laboratories secured 7.67 acres at Rs 177 crore per acre, attracting Rs 1,357.59 crore to the state exchequer.
In the second e-auction for 11 acres, Prestige acquired the land at Rs 141.5 crore per acre, contributing another Rs 1,556.50 crore.
Taking into account the stamp duty and registration fees, the total revenue from the 18.67 acres stands at Rs 3,135 crore, marking the highest price ever recorded in a government land auction in Telangana.
Experts say Rayadurgam’s strategic location between Hi-Tech City and Gachibowli has made it one of Hyderabad’s most sought-after investment zones.
The area enjoys excellent connectivity to the Miyapur Metro, Outer Ring Road and the Rajiv Gandhi International Airport.
With a strong potential for IT, ITES, commercial, life sciences, healthcare, education, residential, hospitality, retail, and entertainment sectors, investors were willing to pay a premium price.
However, after watching a similar land auction at Kokapet during the Bharat Rashtra Samithi regime, one wonders whether the latest auction is also an attempt to create an artificial hype in the market or generate buzz in the market that the Hyderabad real estate has been growing and not witnessing a slump.
The land auction at Kokapet – the Neopolis venture – set off shockwaves when land fetched an astronomical Rs 100 crore per acre.
A few key players took part in the auction by bidding high prices, but when it came to actual buying, they backed out and even forfeited their initial amounts.
At Shankarpally, bids began at Rs 1 lakh per square yard — nearly five times the prevailing rate of Rs 30,000. By the end, speculative bidding drove land to over Rs 50 crore an acre.
Of the hundred bidders, 95 forfeited their deposits after failing to pay up, leaving HMDA richer by several crores in non-refundable deposits.
Apparently, they used the auction to artificially inflate the prices in select parcels — one or two acres at most — and used those rates to push valuations 50 kilometres around the city sky-high. It was a manipulative strategy of the real estate cartel.
The “Rs 100 crore Kokapet song,” it turned out, was a market stunt — a bait where a handful of big landholders auctioned off an acre or two to create an illusion of sky-high value for their adjoining lands.
For ordinary buyers, Kokapet soon became a mirage — a market where half-acre plots inspired “hundred-crore dreams,” but no real transactions materialized. The ruling party celebrated these astronomical prices as evidence of Hyderabad’s global rise.
Now, after watching the unprecedented Rs 177 crore per acre bid for Rayadurgam land, people wonder whether the hype has returned.
Analysts note that as long as land auctions become the main source of government revenue, they will continue to generate such a hype.
