Realty major Parsvnath Developers is understood to have raised Rs 225 crore through equity sale of two of its projects to private equity investors and plans to utilise the funds to reduce its Rs 1,600-crore debt and meet construction costs.

Sources said the company had closed two transactions - one worth Rs 150 crore and another Rs 75 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 Rs 500 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 Rs 1,600 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 the global financial crisis. During this week, Parsvnath raised $35 million (nearly Rs 170 crore) through the qualified institutional placements (QIP) route by issuing shares at Rs 121.25 a share.

The company announced selling an additional 4 per cent stake in a North Delhi project to Red Fort Capital for Rs 25 crore. In June, it had sold an 18 per cent stake in the same project to Red Fort Capital for Rs 90 crore. The company might raise more funds as it has obtained approval from its board to raise up to Rs 2,500 crore through QIP and other instruments.

After the QIP, the company’s share prices have gone up by 17 per cent. Its share prices have risen to Rs 147.55, as of yesterday, on the Bombay Stock Exchange, from Rs 126.25 on September 25—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 are 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 rojects, hotels, special eco­nomic zones (SEZs) and IT parks. It is developing 31 residential projects, 21 commercial projects, 16 integrated townships, 14 hotels, 11 SEZs/IT parks and five metro projects.

Source: Business Standard

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