Parsvnath raises Rs225 cr through stake sale at project level

Parsvnath raises Rs225 cr through stake sale at project level

New Delhi: Realty major Parsvnath Developers is understood to have raised Rs225 crore through equity sale of two of its projects to private equity investors and plans to utilise the funds to reduce its Rs1,600 crore debt and meet construction cost.

According to market sources, the company has closed two transactions — one of Rs150 crore and another Rs75 crore — with private equity firms. The company has sold stakes in its two projects located in the national capital region (NCR). When contacted the company’s spokesperson declined to comment.

With these two deals, Parsvnath has raised over Rs500 crore in the last four months through private placement of shares and stake sales at project level. The fund raising exercise is meant to cut its debt amounting to Rs1,600 crore by at least half by the end of this fiscal.

The company also intends to strengthen its balance sheet by improving cash flow, which has taken a hit due to slowdown in the property market and global financial crisis.

During this week, Parsvnath raised $35 million (nearly Rs170 crore) through the QIP (qualified institutional placements) route by issuing shares at Rs121.25 a share.

The company yesterday announced selling additional 4% stake in a North-Delhi project to Red Fort Capital for Rs25 crore. In June, it had sold 18% stake in the same project to Red Fort Capital for Rs90 crore.

The company might raise more funds as it has obtained approval from its board to raise up to Rs2,500 crore through QIP and other instruments.

Post the QIP, the company’s share prices have gone up by 17%. Its share prices have risen to Rs147.55 as on Thursday on the Bombay Stock Exchange (BSE) from Rs126.25 on 25 September — the day its QIP was launched.

Parsvnath, which has a pan-India presence spread over 47 cities and 16 states, has a developable area of over 193 million sq ft. It is aggressively working on 42 million sq ft, of which 35 million sq ft is already sold.

The company plans to deliver 30 million sq ft within the next two years.

Parsvnath has presence in all verticals of real estate, including residential, offices and shopping complexes, metro projects, hotels, special economic zones (SEZs) and IT Parks.

It is currently developing 31 residential projects, 21 commercial projects, 16 integrated townships, 14 hotels, 11 SEZs/IT parks and five metro projects.