Parsvnath plans sale of shares, project stake

Parsvnath plans sale of shares, project stake
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First Published: Thu, Sep 03 2009. 10 20 PM IST
Updated: Thu, Sep 03 2009. 10 20 PM IST
Mumbai: Parsvnath Developers Ltd plans to sell as much as $100 million (Rs489 crore) of shares and stake in a real estate project as it seeks to trim its debt to one-third by March, chairman Pradeep Jain said in an interview.
“The New Delhi-based developer aims to sell shares to institutional investors by the end of October, and the stake in a housing project this month to a private equity fund,”Jain said. In June, the firm got Rs90 crore from private equity firm Red Fort Capital for a stake in a New Delhi housing project.
Indian developers including Unitech Ltd and Indiabulls Real Estate Ltd have raised more than $2.6 billion since April as the Bombay Stock Exchange (BSE) Realty Index more than tripled from a 9 March low. Investors are speculating a decline in borrowing costs and property prices will revive housing demand in a nation with an estimated shortage of 24.7 million homes. “The quarter for the sector has been good, but the sustainability will have to be checked,” said Nitin Idnani, an analyst with Enam Securities Pvt. Ltd in Mumbai. “Any increase in prices may dampen demand.”
Shares of the developer rose 2.73% to Rs120 on Thursday in BSE trading. The stock has more than doubled this year, after plunging 90% in 2008. “The worst for the real estate sector is behind us,” Jain said. There’s a renewed interest by overseas investors, depending on the quality of the projects.
Parsvnath, which expects to get about Rs5,000 crore from sale of homes over 24-30 months, aims to trim its debt to Rs500 crore by March, Jain said
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First Published: Thu, Sep 03 2009. 10 20 PM IST