At least some real estate developers are now breathing easy, having secured debt funds at a lower cost than before. This augurs well for the real estate sector as a whole which has long been complaining that funds are simply not available to carry on with or start new projects.
On Wednesday, HCC Ltd, India largest engineering contracting company, announced that its subsidiary, Lavasa Corporation, which is setting up a large real estate project near Pune, had just raised Rs 50 crore from Allahabad Bank in the form of convertible debentures.
A few days ago, Puravankara Projects, a Bangalore-based real estate company, raised debt from the Life Insurance Corporation at a rate lower than the prevalent 16 to 17 per cent, according to an investment banker. This debt was raised for its subsidiary, Provident Housing and Infrastructure, which focuses on affordable housing.
The New Delhi-based Assotech has raised around Rs 80 crore in debt from a consortium of banks. “We raised money from Andhra Bank (around Rs 33 crore) and Punjab National Bank (Rs 50 crore),” said Sajeev Srivastava, its managing director, who declined to reveal the interest rates at which the debt was contracted.
Unitech, India’ssecond biggest realtor, recently raised Rs 200 crore from Bank of Rajasthan to pay back some of its debtors. Reportedly, Unitech raised the money at a very high interest rate.
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